Hong Kong’s top decision-making body has proposed a flat 2 per cent pay rise for civil servants across all salary bands this year, lower than the suggested rates for middle-tier and senior government staff.

Secretary for Civil Service Ingrid Yeung said on Tuesday that the chief executive and the Executive Council (ExCo) made the offer, which would take effect retrospectively from April 1 this year, based on a “prudent” approach to public finance.

Yeung said she would meet with staff representatives of the civil service on Wednesday to listen to their feedback regarding the proposed pay rise and report to the ExCo for a final decision.

The proposed pay rise, if finalised, will incur additional government spending of HK$6 billion, Yeung said.

“The government’s finances have improved in the 2025-26 fiscal year, but there are still huge financial undertakings for Hong Kong’s future development,” Yeung said in Cantonese during a press conference.

“Geopolitical changes can also affect residents’ livelihoods within a short period of time, warranting timely government intervention,” she said. “Due to the continued uncertainty in geopolitics, the government must be extra prudent in its approach to public finance.”

The 2026 Pay Trend Survey recommended a 4.12 per cent pay rise for senior staff and 2.64 per cent for mid-level government employees. It suggested a 1.17 per cent pay rise for junior civil servants.

Yeung said the ExCo had given “balanced” consideration to the matter when making the offer, and that the Pay Trend Survey was only one of the factors taken into account.

When asked whether the deadly Tai Po fire in November had affected the proposed pay rise, Yeung said it was difficult to isolate the impact of an individual incident on the ExCo’s decision, which she described as “holistic.”

The government resumed pay rises for civil servants this year following a salary freeze in 2025 amid a three-year fiscal deficit that strained public finances.

Financial Secretary Paul Chan estimated in his annual budget speech in February that the government could see a HK$2.9 billion surplus in the 2025-26 fiscal year.

The civil service last received an across-the-board pay rise, of 3 per cent, in the 2024-25 fiscal year.

The Hong Kong government could raise civil servants’ salaries by up to 4.12 per cent this year and plans to introduce a revamped appraisal system for its employees in October, a minister has said.

Secretary for Civil Service Ingrid Yeung said on Thursday that the tentative results of the 2026 Pay Trend Survey suggested a 4.12 per cent pay rise for senior civil servants, 2.64 per cent for middle-tier employees, and 1.17 per cent for junior staff.

The suggestions are based on findings from a survey of around 155,000 employees from 104 private companies conducted between April 2025 and April 2026. The survey’s results will be one of six factors considered by the Executive Council, the city’s top decision-making body, for a pay adjustment, Yeung said.

The other factors include “civil servants’ demand for salary adjustment and their morale,” Yeung said, adding: “I will meet with their representatives next week on these matters.”

The government resumed the pay trend survey this year following a salary freeze in 2025 amid a three-year fiscal deficit that strained public finances.

Financial Secretary Paul Chan estimated in his annual budget speech in February that the government could see a HK$2.9 billion surplus in the 2025-26 fiscal year.

Asked on Thursday whether a pay rise for civil servants would lead to a backlash in the wake of the deadly Tai Po fire, Yeung said the “vast majority” of government employees “are professional, efficient, and committed.”

“For the few underperforming civil servants, I believe the best way is to handle them through established mechanisms,” she said.

Yeung also said that under the revised appraisal system, civil servants’ performance assessments would be curved, and the bottom five to 10 per cent of staff may not receive a pay rise.

Department heads, especially those leading smaller teams or highly professional workers, may make a case to the Civil Service Bureau if they find the performance of all their staff members to be satisfactory, she added.

She promised that authorities would review the new mechanism to ensure fairness in the appraisal.