After the handover of Hong Kong, the Hong Kong Special Administrative Region (HKSAR) Government is established and it promoted some programs, such as (1) Target-based Management Process in 1997, (2) Enhanced Productivity Program in 1998, and (3) Civil service reform in 1999 (Lee, 2000), in order to reform the public sector of Hong Kong. Those reforms aim at (1) reducing the size of public sector, (2) Making the public sector more cost-effective, (3) improving the responsiveness of public sector and (4) enhancing the performance of public sector (Vranic, 2008).
Privatization, contracting out and public private partnership are the three main tools that widely used by different countries and regions, namely USA, UK and Hong Kong, in achieving…show more content… Then, I will analyze the merits & demerits of these three tools respectively. After that, the comparison of the merits & demerits mentioned and a brief analysis of context of Hong Kong will be provided so as to elaborate the reasons why I recommend contracting out for the HKSAR Government to adopt to the public sector reform of Hong Kong.
Privatization refers to the permanent transferring of the ownerships and public sector activities to the private organizations or non-profit organization. Once a service/ an asset of the government is privatized, the private sector will have full control of over it. Government will have no control over the service / asset and it is also hard for the government to reverse the decision of privatization. Airport Authority Hong Kong and Link REIT are the typical examples of government assets that had been privatized by the HKSAR…show more content… This relation is formed if there is a common goal for them to reach. A contractual agreement is followed, the skills, resources, risks and rewards they possessed will be shared under this agreement (Norment). Then, they can make full use of their advantages so as to achieve the common goal efficiently.
Western Harbor Crossing and Hong Kong Disneyland are the typical examples of achievements that constructed under public private partnerships of HKSAR Government and private companies.
After briefly introducing these three tools and the implementation of them in Hong Kong, I would like to analyze the merits and demerits of each of these tools so as to gain a better understanding of the nature of them before making recommendation of which tool should the HKSAR Government adopts to the public sector reform.
By using privatization, the following merits can be faced by the