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Speech at the 2005 HKIHRM Annual Conference and Exhibition

Speech by Mrs Fanny Law, GBS, JP

Permanent Secretary for Education and Manpower

at the 2005 HKIHRM Annual Conference and Exhibition

                      on Tuesday, 8 November 2005                       


“Back to Basics”


Mr Lai, Mr Mok, distinguished guests, ladies and gentlemen,


                     Thank you for inviting me to join you at this Jubilee Conference.  I value this opportunity to address a distinguished audience of human resource management professionals, as we share common goals in nurturing human capital for Hong Kong.  The theme of this Conference – Back to Basics (反璞歸真、以人為本) – strikes a common chord with the education reform that the Government launched in 2000.  Going back to the basics, the two pillars of the education reform are to “motivate students to learn” and help them “learn how to learn” for  self-motivated learning is the key to success for the individual and the basis for continuing improvement and sustainable development of an organization. 


                      “People” is indisputably the most valuable asset of any society.  This is particularly true for Hong Kong where people are the only natural resource.  Good people management is crucial for the success of any organisation, especially in a knowledge economy where competition is based on innovations and brain-power.  Central to people management is human resource development.  In a rapidly changing world, lifelong learning matters because knowledge and skill requirements easily become outdated, and aging societies depend more on older workers as a source of new skills and know-how. 


Human resource development

                     I am pleased to share with you that over the past two decades, the educational attainment of our workforce has improved significantly.  The proportion of workers with lower secondary education or below has reduced from 58.2% in 1985 to 33% in 2004.  On the other hand, those with tertiary education increased from 10% to 27.3% over the same period, with more pronounced improvements since 1997.  This is the result of increased government investment in education over the years, and enhanced awareness of the need for lifelong learning to cope with the changing demands in the workplace. 


                      However, jobs for workers with low educational attainment are disappearing more rapidly than the rate of enhancement in educational attainment, hence the higher unemployment rate for this group of workers.  On the contrary, the demand for workers with tertiary education continues to increase even in the economic downturn.  How to motivate workers to upgrade their competitiveness and employability; how to provide for appropriate and effective training that serves the purpose; and how to finance such training are questions that the community will have to address collectively.  The Government cannot do it alone.


                     According to a survey by the American Society for Training and Development in 2004, the average percentage of payroll invested in staff learning was 2.5% in the United States .   The survey covers 344 organizations representing about 2.4 million workers and includes the broadest range of US organizations in terms of size and industry.  It therefore represents the US norm.


                     A similar survey conducted by the HK Institute of Human Resource Management in May this year shows that, on average, 2.4% of the total annual basic salary was set aside for staff training.  The survey covers 102 firms, over 60% of which are medium to large companies which employ more than 100 staff.  This shows that the level of investment in staff development among the larger companies in Hong Kong is comparable to that in the United States . 


                     However, over 98% of business operations in Hong Kong are small and medium enterprises which are less inclined to invest in staff training and development.  A survey conducted by the University in Hong Kong in 2000 shows that, taken all businesses into account, only 8% of the companies had provided employees with formal training in the previous year, which is far from satisfactory.


Government initiatives

                     What is encouraging is to see that people of Hong Kong , in general, are keen to learn.  Many are willing to invest in their own continuing education.  The HKU SPACE estimated in 2003 that about one in five persons were engaged in continuing education and the annual expenditure amounted to $16.3 billion.   The demand for education is strong as shown in the rapid expansion of post-secondary education since 2000, facilitated by the Government through the provision of land and loans for the providers and financial assistance for needy students.  The establishment of a $5 billion Fund in 2002 also adds impetus to the demand for continuing education.


                     The proliferation of education opportunities also creates concerns.  The learner gets lost in the maze of training programmes and qualifications, not knowing which course to choose and which qualification would be recognized by employers.  Employers, presented with an assortment of certificates, are unsure about what they mean, in terms of the competency of the certificate holders. 


                     To provide better clarity of programmes and qualifications, and to facilitate learners in mapping their own progression pathways, last year the Government decided to introduce a Qualifications Framework (QF) in Hong Kong, building on the strengths and avoiding the pitfalls, of similar systems in countries like Australia, New Zealand and the United Kingdom. 


The Qualifications Framework (QF)

                     The QF is a seven-level hierarchy that orders and supports academic as well as vocational qualifications.  Each level is characterized by a set of generic descriptors that are outcome-based and cover four domains, namely, knowledge and intellectual skills; processes; autonomy and accountability; and generic skills such as communication, IT and numeracy.   The outcome standards state, in broad terms, what a person should know, understand and be able to do in each of the domains at a particular level.  In the academic field, outcome standards at lower levels are tied to the school curriculum, and at the tertiary levels are set by scholars.  In the vocational field, outcome standards are determined by members of the respective industries through a consensual process.


                      By developing a clear structure to recognize learning and qualifications, we aim to promote lifelong learning by increasing the transparency of and access to learning opportunities, facilitate the articulation of qualifications, and set clear expectations to guide training providers in the design of programmes.


                     The QF is underpinned by industry-specific competency standards.  They represent the industry benchmarks for the skills, knowledge and attitude required for good performance at different levels.  The specifications are practical, and at the same time sufficiently broad and flexible, encompassing not only the needs of today, but also projected requirements in the foreseeable future.


                     Work has begun on developing the competency standards for eight industries, namely Watch & Clock, Chinese Catering, Printing & Publishing, Hairdressing, Property Management, Electrical & Mechanical Services, Jewellery, and Information & Communications Technology.  It is encouraging to see representatives of employers, workers, and professional bodies, with the support of the HK Council for Academic Accreditation (HKCAA) and the Government, working together to develop the competency standards based on which training providers will develop the curricula.  The process has helped to clarify employers’ expectations and develop better understanding between employers’ associations and labour unions. 


                     For workers who wish to pursue further learning, but are unsure where they stand in the QF, a mechanism for “Recognition of Prior Learning” will be set up to give recognition to past experiences and on-the-job learning which may not lead to a formal qualification.  I must emphasise that the QF is a voluntary system established to promote lifelong learning.  It is not, I repeat not, intended for employment.  In other words, possession of a qualification recognized under the QF should not become the pre-requisite for employment but, where available, may serve as an additional reference for employers.


Quality assurance

                     The Hong Kong Council for Academic Accreditation will institute a system of accreditation and periodic re-validation to assure the quality and credibility of the qualifications awarded by a wide range of education and training providers.  Only programmes and qualifications that have been quality assured will be included in a web-based ‘Qualifications Register’ that is open to scrutiny and monitoring by the local and international community.  The HKCAA will be vested with the authority to de-register a programme that fails to deliver to the expected standards. We expect to establish the Qualifications Register soon after the legislative framework is approved by the Legislative Council hopefully within the current legislative session. 


The QF and secondary education

                     The QF also has relevance to secondary education.  You may have been aware that every year, over 10,000 secondary students leave school without proper certification as they fail to obtain five passes in the Hong Kong Certificate of Education Examination.  These young people are not intellectually impaired.  Most of them are unmotivated to learn because they are not academically oriented by nature and may find the highly structured school environment uninspiring. 


                     Many of them become unemployed for lack of a recognized minimum qualification which employers look for.  Unemployment is a distress to the individual, a source of conflict in the family, and a burden to the society.  Youth unemployment is particularly traumatic, and Hong Kong cannot afford to squander human resources in this way. 


                     In 2000, the Government launched the Project Yi Jin to provide an alternative progression pathway for secondary school leavers who are not qualified to continue education in mainstream schools.  For the first four years, about 7,000 students, representing 57% of the total enrolment, have successfully obtained a Yi Jin certificate that is rated as comparable to five passes in HKCEE.  54% of these students then pursue further studies through the continuing education route.  I am pleased to say over 50 students have moved on to the university level.  Imagine where they would have landed had there not been an alternative progression ladder.


                     These success stories send an important message that most of the time students fail not because of a lack of ability but a lack of options in our education system that enable them to demonstrate and develop their potentials.  This brings me back to the fundamental aim of the education reform, i.e. to motivate students to learn, and in order to achieve this aim, we must provide choice and diversity in the curriculum and mode of assessment to cater for individual differences.


                      The experience from Project Yi Jin has prompted EMB to pilot career-oriented courses (COC) in secondary schools since 2003.  They provide an alternative to students who are inclined towards practical subjects and see the HKCEE as a dead alley.  The number of students enrolled in the COC increased significantly from below 400 in 2003 to over 2,400 in 2005.  Built on the successful experience of the pilot, we decided to include career-oriented studies as elective subjects in the new three-year senior secondary curriculum to be introduced from the 2009/10 school year. 


                     The career-oriented studies will be quality assured in three stages.  First, the Curriculum Development Institute and Hong Kong Examinations and Assessment Authority will assess the curriculum, input of resources and the assessment scheme to ensure that they are comparable to the standards expected at the level of the new Hong Kong Diploma of Secondary Education (HKDSE).  Second, the HKCAA will monitor the delivery of the courses.  Third, the HKEAA will supervise the assessment process and ensure consistency of standards between course providers which will certify and award an appropriate qualification under the QF. 


The QF and HR professionals

                     By now, you may ask, as a human resource professional, what has the QF to do with me.  It has relevance in at least three respects.  First, we are aware that there is no direct causal relationship between early education achievements and work performance, although the correlation may be high.  The workplace provides continuing learning that is contextualized and more meaningful.  The QF, and the industry- specific competency standards which will be developed progressively, provide a useful reference for HR professionals in designing their own in-house human resource development plans. 


                     Second, many of the existing training activities organized by the HR department are not formally recognized.  The industry-specific competency standards, coupled with a credit unit system that is being developed in parallel, will add value and portability to the training.  Employees will be better motivated to participate in the training, and your investment will add value and is more worthwhile. 


                     Third, the industry-specific competency standards, suitably adapted to suit individual companies, can serve a range of HR functions ranging from recruitment, staff development, performance management, promotion, salary administration and manpower planning.  They become the linchpin that connects the HR functions.



                     The pace at which competency standards are developed is determined by the enthusiasm of stakeholders in respective industries.  Overseas experience suggests that it will take considerable time to develop a comprehensive QF that covers all economic sectors.  I appeal to HR professionals to assist in the development of industry-specific competency standards to expedite the process.  Our initial priority is to focus on occupations that appeal to young people, so as to support the development of career-oriented studies in the new senior secondary curriculum.  By the time the new senior secondary curriculum is introduced in 2009, we expect to have developed training specifications for 20 industries. 


                   We also give priority to industries which employ a large number of workers with relatively lower academic attainment who will need re-training to catch up with changes in the skill requirements.  Following extensive consultations, we expect the first three sets of competency standards for the Watch & Clock, Printing & Publishing, and Hairdressing industries to be finalized and published early next year.  We shall review and refine the standards in the light of experience. 


                     The value of any qualification hinges on employers’ attitude in recruitment.  The government has taken the lead in recognizing sub-degrees and the Project Yi Jin in civil service recruitment.  I appeal to you to follow suit.


Concluding Remarks

                     The QF is a new endeavour that will have significant long-term implications for Hong Kong .  We see HR professionals as our ally and look to you for advice, support and participation in building the infrastructure for a lifelong learning society.  We need a flexible, transparent and accessible qualifications system that provides inherent incentives to motivate people to seek self-actualisation through continuing learning and improvement.  I very much look forward to working with the HKIHRM and your member organizations to upgrade our human capital. 


                    Over the past 28 years, the HKIHRM has established an illustrious track record in enhancing the professional standards in human resource management in Hong Kong, and has assumed a leadership position in the Asia Pacific region.  I congratulate you on your past achievements and wish you continued success in the years to come.  I also wish all participants a fruitful Conference and meaningful learning over the next two years.  Thank you. 


Last revision date: 08 November 2005
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