2014 Policy Address and 2014-2015 Budget

Mr. John Tsang

Financial Secretary

HKSAR Government

December 20, 2013.

Dear Mr. Tsang,

Re: 2014 Policy Address and 2014-2015 Budget

Please find attached the suggestion input from the Hong Kong Information Technology Joint Council (HKITJC), our suggestions mainly focus on the following area:

  1. Developing IT as an Economy Driver
  2. Nurturing Talents and Manpower Development
  3. Entrepreneurial Development
  4. IT for the Society
  5. Getting Ready for the Digital Future

I hope our suggestions are useful to you for preparing the captioned documents.

Yours truly,

Professor Kam-Fai Wong

President

Attachments:

(1) “Suggestions for HKSAR’s 2014 Policy Address and 2014-15 Budget”

(2) About HKITJC

Attachment 1:

Suggestions for HKSAR’s 2014 Policy Address and 2014-15 Budget

By Hong Kong Information Technology Joint Council (“HKITJC”)

December 20, 2013.

(A) Developing IT as an Economy Driver

  1. Hong Kong society now has the general consensus that developing Information Technology (“IT”) should be moved forward quickly so as to maintain the long-term competitiveness of Hong Kong economy. However, the progress in this development direction has been slow, in comparison with our neighbour countries/economies and major cities in Mainland. Such unfavourable situation is due to the lack of sufficient knowledge and understanding in the Government of how innovation and technology as well as their applications could be developed to become a key economy driver for Hong Kong.

SUGGESTION: To tackle the aforesaid fundamental difficulty, HKITJC suggests the 2014 Policy Address and 2014-15 Budget to initiate and set aside budget for the following developments at a high priority:

  1. a) Establish the Bureau of Innovation and Technology with qualified leadership having strong innovative technology background and extensive industrial experience to develop and implement an overarching plan for Hong Kong to move forward the SAR’s economic transformation with the strategic development and use of Innovation and Technology.
  2. b) Set up a high-level Commission on Technology reported directly to CE with the similar composition like the Commission on Innovation Technology, which was established by the Chief Executive Tung Chee Hwa and and chaired by late Professor Tien Chang-Lin, in the late 1990s, to review the progress of its proposed developments 15 years ago and to formulate new strategies for Hong Kong’s economic transformation by capitalizing our world-class university talents in high-technology and scientific researches and reaping the benefits of our inherent advantages of being close to the vast markets and abundance of skilled manpower resources in China.

(B) Nurturing Talents and Manpower Development

  1. The world is entering into a new era in which IT is tightly interwoven into nearly all elements of our society activities and individuals’ daily life. In order to maintain Hong Kong’s competitive advantages, our people must be able to master IT, not only as users or consumers for IT products and services, but also as creators of high economy values through innovation and invention of products/services that would be highly demanded in modern society. In this regard, we have to support our schools adequately by providing them with the needed IT facility and staff resource for educating our young generation.

SUGGESTION: HKITJC suggests the 2014 Policy Address and 2014-15 Budget to support school based IT in education and IT education developments and set aside budget at a level of HK$5B for financing a 5-year school-based IT enabling program for all schools in Hong Kong. This program should include

  1. a) upgrading IT facilities, such as Internet connectivity, WiFi, e-learning and e-book systems, information security measures, etc.,
  2. b) providing IT staff in school to support the operation and effective use of the increasingly sophisticated school-based facilities, and
  3. c) training teachers in mastering the needed IT skills and knowing new pedagogies for nurturing talents in an IT-rich school environment.
  4. The total R&D expenditure of Hong Kong is still quite low in comparison with many other places, including many of our neighboring countries/economies. Such weakness will hinder our development, attracting and retaining talents and manpower for Hong Kong to compete in the innovation technology and modern services markets that will certainly be major parts of the global economy in next two decades. SUGGESTION: HKITJC suggests the 2014 Policy Address and 2014-15 Budget to have a plan to increase the Gross Expenditure on R&D (GERD) with the aim of closing the gap between us and our major competitors in 5 years’ time. A reasonable starting point would be 0.8% as proposed by the CE in his election statements and gradually increase to 1.3% in 5 years. (Note that 0.5% increase is in par with the GERD growth rate forecasted by the Central Government in the National 12th Five Strategy Plan, which would increase from 1.7% in 2011 to 2.2% by 2015.)
  5. Hong Kong is at a stage of requiring to transform a huge workforce to adopt the use of innovation and technology in traditional businesses and industries. For instance, it is envisaged that continued success in future of Hong Kong’s construction industries would heavily involve the use of Building Information Modelling (BIM) technologies, and that the ability of adopting apps/cloud computing wisely by our services industry workforce would determine our future success in market competition. Continuing education for enabling existing workforce to acquire and master new skills should therefore be needed so as to position Hong Kong as an innovation centre in the region. Such effort for raising the caliber of our existing workforce should be of equal importance to raising the education standard for young generation and increasing investment in R&D activities.

SUGGESTION: HKITJC suggests the 2014 Policy Address and 2014-15 Budget to increase the maximum subsidies of the Continuing Education Fund for eligible courses to $20,000 so as to encourage more high quality training programs in the use of IT and innovation technology for transforming our traditional businesses/industries be offered by course providers and taken by our working people.

(C) Entrepreneurial Development

  1. Entrepreneurship had been the prime mover in the 1960’s and 1970’s for Hong Kong’s economy to take off. Noting that Hong Kong is now better developed and more people are under less pressure to survive on their own, the sense of entrepreneurship is apparently get less and less attention.

SUGGESTION: HKITJC suggests the 2014 Policy Address and 2104-15 Budget to include initiatives to foster entrepreneurship in Hong Kong at all levels of school/college educations by promoting the concept, spirit and successful cases and at society level through providing training grants, mentorship programs and assistance support to entrepreneurs for acquisition of business skills and investment capitals in their start-up endeavors.

  1. Small and Medium Enterprises (“SME”) form a major constituency of Hong Kong’s economy. It is characterized by the many trades covering a wide spectrum of long established businesses as well as relative new creative/IT industries. Such unique composition of Hong Kong’s SME has a high potential of further development if the traditional SMEs and the creative/IT SMEs are connected to interact with each other. Such interactions would bring in opportunities to rejuvenate trades of traditional goods/services in reaching a much wider market in the cyber-world, and at the same times creative/IT SMEs would have access to the vast market of traditional good/service consumers in the aspects of providing IT services and/or IP rights trading.

SUGGESTION: HKITJC suggests the 2014 Policy Address and 2014-15 Budget to initiate SME interaction programs to be operated by industry federations/organizations for fostering more interaction opportunities among the traditional and creative/IT SMEs with the aim of rejuvenating Hong Kong’s many SMEs in traditional trades and creating bigger market place for our SMEs in the creative/IT businesses. Establishing community centres for SMEs to gather together and explore new business opportunities under a friendly and trusted atmosphere can be an example of SME interaction programs.

(D) IT for the Society

  1. IT for the Community, Health Care and Services to Elderly. Improvement of livelihood of Hong Kong society at large has been one of the key endeavors of the SAR Government. While Hong Kong has been quick in adopting IT for businesses and personal lifestyle, there exists a big room of improvements for the Government to adopt IT for improving its services to society, including those for the growing population of elderly.

SUGGESTION: In the welfare and health care areas, HKITJC suggests the 2014 Policy Address and 2014-15 Budget to allocate budget for the indicated purposes of driving wide adoption of IT by Government Organizations (“GO”) and Non-Government Organizations (“NGO”) for improving the quality and efficacy of their services in the health and elderly care areas. For instance, the Government can set up programs to build more intelligent homes to cater for the needs of the growing population of “digital elderly”, and set up workable free WiFi in all public hospitals, out-patient clinics as well as major public service locations operated by GOs and NGOs.

  1. Tax Relief and Housing Supply. Most Hong Kong people in IT related work are within the middle class income group. It is well understood that while this is a group of key contributors to sustaining Hong Kong’s stability and economy development, they are not rich and for long living under tremendous pressure. They are required to work diligently in trying to maintain their living standard not to be eroded by the continuous increase in cost of living and the exorbitantly high home cost. They genuinely need Government’s help.

SUGGESTION: HKITJC suggests the 2014 Policy Address and 2014-15 Budget to

  1. a) keep the tax rebate scheme, increase the tax allowance for individuals and married persons by 10% and increase the tax allowance for children from HK$7,000 to HK$8,000; and
  2. b) speed up the housing supply plan so as to maintain the home price at a stable level afforded by the middle class income group.

(E) Getting Ready for the Digital Future

  1. Preparing for the Next Generation Internet Era. Hong Kong is far lacking behind in preparing for the Next Generation Internet era in comparison with our neighboring countries/economies, like China, Japan, Korea, Taiwan, Singapore, Malaysia, etc. The Government should do its best to avoid the risk of missing the ability to compete early when Next Generation Internet enters the mature stage of wide deployment for practical applications.

SUGGESTION: HKITJC suggests the 2014 Policy Address and 2014-15 Budget to start supporting the industry to set up Hong Kong’s Next Generation Internet Test-bed with connections to similar test-beds of other countries/economies so that potential applications on the next generation Internet can be explored early in Hong Kong, like the other places mentioned above.

Attachment 2:

HKITJC香港資訊科技聯會

Hong Kong Information Technology Joint Council ( Since 1996)

Vision宗旨

To unite professionals of the Hong Kong IT industry in promoting and fostering support for Hong Kong as the I.T. hub in the region.

團結資訊科技界內專才,以其專業知識和經驗,爲香港成爲區內資訊科技樞紐作出貢獻。

Mission使命

Through the professional knowledge and experience of our members, we

ž Contribute towards the formulation and sustaining of the professional standard and practice of the HK IT Industry;

ž Co-ordinate and provide objective and constructive advisory input from the HK IT industry and professionals in relation to the IT policies and infrastructural strategies of the HKSAR Government and make recommendations to the HKSAR Government on IT related issues;

ž Strengthen the communications and develop synergetic co-operation among professional/industrial groups and individuals of the IT Sector in Hong Kong;

ž Provide the effective and mutually beneficial bridge and liaison between the HKSAR and China and other international IT professionals at all levels, i.e. Government, corporate, professional bodies and individual professionals.

  1. 就資訊科技界事項和政策,向政府及社會各界人士提供專業意見;
  2. 促進及加强香港及與內地資訊科技界的溝通和合作;
  3. 建立資訊科技人員的專業地位…等。

Achievements成就

We successfully gained the support and accomplished the establishment of the I.T. functional constituency of the HKSAR Legislative Council.

本會成功地爭取到香港特區立法會內的資訊科技界功能組別。

We are the executive arm of the Hong Kong IT Sector Celebration of the National Day Ltd. and have up to now brought together a cumulative number of more than 80,000 Hong Kong IT professionals in our series of annual National Day Celebration events since 1996.

自1996年,超過八萬人次參與過本會的週年資訊科技界慶祝國慶活動。這為業界提供了一個有效的溝通平台。

We are the first sector-wide organization of professionals in the HK IT industry having close partnership with the industry counterparts in China.

本會是眾多香港資訊科技團體中率先與內地同行建立緊密合作關係的先駒。

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