We experienced the Asian financial turmoil at the turn of the millennium and the attack of Severe Acute Respiratory Syndrome in 2003. Yet Hong Kong recovered speedily from these crises, thanks to our solid economic foundation. We have remained an international financial, trading and business centre, one of the top container ports in the world and a popular tourist destination.

Today, we have a population of nearly 7 million and a workforce of about 3.6 million. In 2005, our GDP was $1.382 trillion - or US$177.2 billion- or $199,282 per capita.

Hong Kong has no natural resources. A hardworking, adaptable and well-educated workforce is the bedrock of our productivity and creativity. Clearly, manpower is Hong Kong's most treasured asset. The Hong Kong Government is firmly committed to improving safety and health at work and will continue to take all possible proactive measures to achieve this policy objective.

Protecting and enhancing the safety and health at work of our workforce is one of the primary tasks of the Labour Department. Before I share with you our work in this area, I wish to give you an overview of our occupational safety and health performance.

In 1998, we recorded the highest number of occupational injuries. We had 63,526 cases, of which 43,034 were industrial accidents. The annual industrial accident rate per thousand workers was 64.7 then.

In the construction industry, there were 19,588 industrial accidents, which accounted for 45.5% of all industrial accidents. The accident rate per thousand workers in the construction industry was 247.9. The catering industry also recorded 13,011 industrial accidents with an accident rate of 73.9. Accidents in these two accident-prone industries already made up over 75% of all industrial accidents.

It is encouraging to note that, with the collaborative efforts of the Government and all other stakeholders, our occupational safety and health performance has improved markedly since 1998. In 2005, the number of occupational injuries stood at 44,267, representing a drop of 30.3% from 1998.

The total number of industrial accidents was 16,917, down 60.7%. In particular, the number of industrial accidents in the construction industry dropped significantly by 81.9% to 3,548, while the accident rate also fell by a hefty 75.9% to 59.9. The number of industrial accidents in the catering industry was 8,902, down by 31.6%. Its accident rate also declined by 36% to 47.3. However, despite these improvements, the two accident-prone industries still accounted for 73.6% of all industrial accidents.

As for occupational diseases, there were 256 confirmed cases in 2005. The incidence rate was 10.3 cases per 100,000 employed workers. The most common occupational diseases were:

* tenosynovitis, or inflammation of the tendon and tendon sheath;

* silicosis, a group of lung diseases that develop following the inhalation of crystalline silica dust; and

* occupational deafness.

Compared to the corresponding figures of 948 and 39.7 in 1998, there had been a cumulative fall of 73% and 74% respectively in the number of cases and incidence rate.

The Hong Kong Government is well aware that safety is a shared responsibility and that it is not enough just to count on our own efforts. Employers must shoulder the primary responsibility of managing the risks that they create, and workers should co-operate fully with their employers and not put their own lives and those of others at risk.

The amendment of the Factories & Industrial Undertakings Ordinance in 1989 to introduce provisions on general duties with regard to safety and health at work was an important move. It laid down a broad legal framework for enterprises to practise self-regulation which is the long-term goal of our work in occupational safety and health.

In 1995, the Government conducted a comprehensive review of industrial safety in Hong Kong. This review took the self-regulation concept further with profound implications for the subsequent development of Hong Kong's safety strategy.

Following the review, we have moved gradually from an enforcement approach to a safety management approach in tackling workplace safety and health. Our strategy is to foster self-regulation and inculcate a safety culture through legislation and enforcement; training and education; as well as promotion and publicity.

We believe that long-term and sustainable improvements in safety and health at work can only be achieved through collective commitment and the joint efforts of all stakeholders, including the Government, employers, employees, trade associations, workers' unions, training providers, professional bodies and other related organisations.

It is only through working together genuinely and not paying lip service that we can make a real improvement in our safety performance. Let me now elaborate on the multi-pronged strategy underpinning our work in enhancing safety and health at work in Hong Kong.

Before 1997, the efforts to improve workplace safety and health were largely focused on the industrial sector. In accordance with the recommendations of the 1995 review report, we enacted the Occupational Safety & Health Ordinance in 1997, setting a milestone in the development of occupational safety and health in Hong Kong. It extended occupational safety and health protection from industrial sectors to nearly all branches of economic activities.

The ordinance also empowers the Commissioner for Labour to serve improvement notices and suspension notices requiring duty holders to take prompt action to rectify irregularities and dangerous situations.

We believe that the practise of safety management in enterprises is the key to achieving the objective of self-regulation in occupational safety and health. We decided to go down the legislative route because we considered safety management too important a subject to be left to individual initiatives.

We, therefore, enacted the Factories & Industrial Undertakings (Safety Management) Regulation in 1999. The regulation provides a legal framework for the implementation of a safety-management system. It requires certain high-risk industrial undertakings, including construction sites, to implement safety management. The regulation also requires these industrial undertakings to conduct safety audits or reviews at regular intervals for the purpose of achieving continuous improvement.

The Construction Sites (Safety) Regulations is the major piece of legislation to regulate the safety and health at work on construction sites. Before 2003, compliance with the regulations was largely a matter for the principal contractor. We adopted this approach because we believed that the principal contractor should bear the primary responsibility for the co-ordination of all construction activities and all safety matters on site.

In the light of enforcement experience, we were convinced that this approach might, in some circumstances, unreasonably absolve the offending sub-contractors from their legal responsibilities, and was not conducive to improving site safety. We, therefore, amended the Construction Sites (Safety) Regulations in 2003, extending the duties imposed on the principal contractors to other contractors and sub-contractors having direct control over the work activities. We have since been enforcing the provisions vigorously to drive home the message that subcontractors, too, have to fulfill their safety obligations.

As regards law enforcement, our work programme focuses on high-risk or accident-prone industries. In particular, we target enterprises with poor safety records. Prosecution will be taken out against those found in breach of occupational safety and health legislation.

Improvement notices or suspension notices are also issued when necessary to secure a speedy rectification of irregularities, or to remove imminent risks to lives and limbs. In 2005, a total of 1,568 suspension notices and improvement notices was issued.

Our normal inspection programme is re-inforced by special blitz operations. From time to time, the Labour Department mounts special enforcement campaigns targeting high-risk processes, including working-at-height, scaffolding work, operation of lifting appliances, cargo handling and work in confined spaces. Recently, we have also stepped up the inspection of offices to tackle the ergonomic hazards associated with the prolonged use of display screen equipment. Vigorous enforcement action will continue to be taken against violation of occupational safety and health legislation.

In view of the outbreak of SARS in Hong Kong in 2003 and the threat of avian influenza, we have also conducted focused inspections to high-risk workplaces including hospitals, clinics and elderly homes to ensure that adequate infection control measures, such as proper ventilation and use of personal protective equipment, are in place.

In 2005, the Occupational Safety & Health Ordinance was amended to include SARS and avian influenza A as notifiable occupational diseases. The move aims to facilitate the Labour Department in collecting information about work-related cases of these two diseases, conducting investigations and advising on the necessary preventive measures.

It has long been recognised that inadequate safety awareness is one of the main causes of occupational accidents. We believe that basic induction safety training can help to inculcate a strong safety culture. It was on this premise that we enacted the Factories & Industrial Undertakings (Amendment) Ordinance in 1999 to provide for mandatory safety training for all workers in the construction and container handling industries.

These workers are required to attend a one-day safety course organised by training providers approved by the Labour Department. Upon satisfactory completion of the training, they will be issued with a certificate. Only with such a certificate can they be allowed to work on a construction site or in a container-handling establishment.

The certificate is valid for three years. To re-validate the certificate, the worker has to attend a half-day refresher course every three years. So far, more than 771,000 people have obtained the certificate for working on construction sites and more than 389,000 workers have completed the half-day refresher course and obtained their re-validation for another three years.

For the container-handling industry, over 21,400 workers have obtained their training certificate and over 7,700 of them have also attended the refresher course. You may be interested to know that I have personally gone through both the initial and the refresher training in construction safety as an ordinary trainee, rubbing shoulders with genuine construction workers, and obtained my passport to working on construction sites.

We are also concerned about the adequacy of safety training for workers engaged in operating high-risk plant and machinery as well as in hazardous work processes. There are provisions in our occupational safety and health legislation requiring safety training for these workers.

Notable examples are people operating cranes, working on suspended working platforms and working in confined spaces. These workers are required to undergo recognised training and obtain relevant certificates from training providers approved by the Labour Department.

To enhance the legislative control of hazardous plant and processes, we have extended this certification regime to the operation of loadshifting machinery as well as gas-welding and flame-cutting work by introducing the Factories & Industrial Undertakings (Loadshifting Machinery) Regulation and the Factories & Industrial Undertakings (Gas Welding & Flame Cutting) Regulation.

Occupational safety and health education

The Occupational Safety & Health Training Centre of the Labour Department offers training courses and tailor-made talks to help duty holders understand the requirements of our occupational safety and health legislation. In 2005, the training centre organised 469 training courses and 355 talks for 13,800 participants.

Occupational health education is also an important strategy for controlling occupational health hazards and preventing occupational diseases. Apart from organising health talks on our own premises, we have also delivered talks at individual companies. In 2005, 1,700 such health talks were delivered to more than 59,000 participants.

Raising safety awareness and initiating attitude change at the shop-floor level are key aspects of a successful occupational safety and health programme. Our promotion strategy is to enlist the participation of key players and stakeholders in our safety-promotion campaigns and publicity drives. Through this partnering approach, we can make the best use of our resources and maximise the effects of our promotional efforts.

Over the years, we have launched a variety of occupational safety and health promotion and publicity programmes. These activities include seminars, thematic talks, roving exhibitions, TV and radio programmes and advertisements. We have also launched the Occupational Safety Charter and two major safety award schemes.

To nurture a positive safety culture in the community, the Labour Department launched the Occupational Safety Charter in 1996. The Charter highlights safety as a "shared responsibility" among employers, employees and the Government.

It also provides a safety management framework for employers and employees to work together to improve occupational safety and health in their workplaces. The charter is not a legal document, but signing it signifies the commitment by employers and employees to work together to improve safety and health at work. So far, 859 companies and organisations have subscribed to it.

As I have said earlier, construction and catering are the two most accident-prone industries in Hong Kong. In line with our strategy of targeting industries with high safety and health risks, we have been organising the Construction Industry Safety Award Scheme and the Catering Industry Safety Award Scheme every year since 1999 with a view to promoting safety awareness and inculcating a strong safety culture in the industries.

These territory-wide, large-scale promotional campaigns are jointly organised with key stakeholders of the two industries. Through an open competition, construction sites, catering establishments, supervisors and employees identified to have good OSH performance will be awarded. These two schemes have been well received by the industries.

The Hong Kong Government, as the client of public works and housing projects, is determined to ensure that its contractors maintain a high standard of work safety. To prevent site safety from being compromised due to competitive tendering, the Government has introduced the "Pay for Safety Scheme".

Contractors are required to include in the tender the necessary safety-related items. These items will be separately paid for by the Government if the contractors have carried them out satisfactorily. Failure to do so will result in no payment. The scheme has been well received by contractors. In view of the success of the scheme, private sector developers have also launched a similar scheme to improve construction safety in private projects.

The Government has also put in place the mechanism to take regulatory actions against contractors with poor safety performance. A contractor who has accumulated five or more convictions for safety-related offences in a six-month rolling period will be debarred from tendering for public and housing projects for a certain period of time. The disciplinary regulatory actions have proved to be an effective tool for deterring contractors from committing safety-related offences.

The Labour Department has been operating an Occupational Health Clinic to provide clinical consultations and medical treatment as well as occupational health education and counselling services for workers suffering from work-related diseases. A total of 9,395 such clinical consultations were offered in 2005.

With heightened public awareness of occupational health, the demand for our clinical service has continued to grow over the years. We have just opened a new occupational health clinic in Fanling in the New Territories yesterday to provide 4,800 more consultations a year.

According to the estimate by the International Labour Organisation, the economic losses arising from work-related injuries and diseases amount roughly to 4% of the global GDP. Needless to say, any work accident inevitably results in an all-lose situation. For the injured employees and their families, it means human suffering, loss of earning capacity or even loss of lives. For employers, work accidents incur huge costs, including compensation payments for work-related injuries and deaths.

In Hong Kong, we adopt the no-fault principle in our employees' compensation system. Compensation is payable for injuries or deaths caused by accidents arising out of and in the course of employment. To ensure that employers are able to meet their compensation liabilities, they are compulsorily required to take out employees' compensation insurance in the private market.

As a further protection, we have set up a scheme which is funded by a levy on the insurance premium paid by employers to assist injured workers whose employers have failed to purchase the required insurance and are, therefore, unable to pay compensation.

In 2005, 46,620 employees' compensation cases - including 208 fatal cases - were settled. More than $1.02 billion (US$130.8 million) was payable as compensation to injured employees or dependants of deceased employees.

The number of workdays lost amounted to well over 1.7 million. On average, each work accident resulted in a compensation payout of $21,918 (US$2,810) and productivity loss of about 37 workdays.

While the total cost of work accidents would certainly be far greater than the amount of statutory compensation, the dollar value of these payments is alarming enough to remind us of the huge economic losses that work injuries are capable of incurring.

All along, we have kept improving our employees' compensation legislation in the light of the changes in social needs and in ways that are commensurate with our socio-economic development. The Legislative Council will vote on a bill tomorrow to recognise the treatment, examination and certification by Chinese medicine practitioners under our employees' compensation legislation. Passage of the bill will mark an important milestone in enhancing the labour rights of our workforce.

In recognition of the importance of rehabilitation and early return to work, the Labour Department launched a pilot voluntary rehabilitation programme for injured workers in the construction industry in 2003. Under the programme, participating insurers would closely manage the rehabilitation process and provide timely rehabilitation service to workers in appropriate cases at no charge.

In view of the initial success, we extended the pilot programme to the manufacturing, transport and catering industries in 2004. The number of injured workers who participated in the second year of the programme more than tripled.

Over 86% of those who completed the rehabilitation programme considered it helpful in achieving faster and better recovery. By regaining their earning capacity as soon and as much as possible, employees' economic and non-economic losses due to injury could be considerably reduced.

We have also noted that the programme has strengthened employees' sense of belonging in the company, fostered better employer-employee relationships and helped cut down the number of litigations. It raises the prospect that, in the long run, the overall costs of claims could be lowered and, as a result, the insurance premium borne by employers would be reduced. With such positive outcome, the programme is increasingly accepted by employees, insurers, rehabilitation professionals and the community.

It is encouraging to note that, through the collective efforts of all parties concerned, Hong Kong's safety performance has improved significantly over the years. That said, we should not and will not be complacent. We will continue to do our best to improve our safety and health performance. Working in partnership with our stakeholders, the Government will continue to put in our best efforts to further enhance the standards of occupational safety and health in Hong Kong.

Permanent Secretary for Economic Development & Labour Matthew Cheung gave this address at the 7th International Congress on Work Injuries Prevention, Rehabilitation & Compensation.