How Hong Kong Emerged From the Swamp

In 1960s British Hong Kong, bribery was a seemingly settled way of life. Getting adequate care from a nurse while in hospital required a payment of a small gift, “tea money,” as did getting service from government officials when trying to obtain a driver’s license or a passport. Firemen famously received two payments: one to start the water, and a second, after the fire was extinguished, to turn it off and stop flooding one’s home or business.

Few were more vulnerable than informal street vendors, or hawkers. Their itinerant businesses were illegal — in some cases they were seen as direct competition with stores that had the commercial disadvantage of having to pay rent — but in a rapidly growing population, tolerating their presence was essential both in order to absorb the jobless and to bring cheap goods, including food, to the city’s poorer citizens. In exchange for not sanctioning these illegal businesses, police officers on a beat would demand tea money, in effect charging them rent; the alternative was a loss of their livelihood. These police, in turn, operated in syndicates or franchises, with higher officials selling to subordinates the right to extort in specific districts. The latter, in turn, collected payments from their own subordinates, who collected from the hawkers.

Yet within a few short years, by the late 1970s, the problem of corruption had been drastically curtailed, and Hong Kong became recognized as a model of probity. How did the government achieve this? And are there lessons for other jurisdictions?

Colonial Hong Kong’s attack on public corruption offers a few potential lessons for other cities. First, the city’s top leadership demonstrated a firm commitment to eradicating the problem. Second, while responding to a clear demand from the public, it also worked hard to shape an anti-corruption culture. Third, it empowered an independent anti-corruption agency that could and did prosecute cases of bribery. Fourth, it demonstrated that even high officials were expected to follow the rules. And finally, in the process of implementing the new system, it demonstrated flexibility in order to bring potential dissenters along.

Popular Complaints and Colonial Government

Prior to the late 1960s, sociologist Henry Lethbridge has argued, corruption was not perceived as a significant social problem in Hong Kong. Colonial authorities and other Europeans regarded such “gifts” in exchange for services, whether from officials or to grease the wheels of commerce, as being simply a long-standing part of Chinese culture. British colonial officials in Hong Kong and elsewhere generally took a noninterventionist approach to their subjects’ cultures, outlawing only those cultural practices they found most abhorrent (foot-binding met the threshold; eating dogs did not). Even if officials had been inclined to address corruption, it would have been a low priority in a rapidly growing colony in which housing and basic law and order were more pressing concerns.

Not only was corruption a low priority, but addressing it among the police, in particular, seemed risky. (The upper levels of the police were British, the lower levels were majority Chinese.) As a result, despite occasionally passing new anti-corruption legislation, the government before the late 1960s did not pursue corruption vigorously. Crucially, enforcement of anti-corruption legislation was left to the Hong Kong Police Force.

Colonial officials took their cue from their Chinese subjects. Before the 1960s, complaints about corruption were rare. In a largely transient population — Hong Kong then was made up primarily of people temporarily escaping disorder in mainland China, or stopping off en route to settling in Southeast Asia or North America — little was expected of the colonial government. In addition, although some demands for payment were resented, others were “payments of convenience” or “satisfied customer” transactions: Both parties got what they wanted. There was little reason for the colonial government to act.

That changed in the late 1960s. Hong Kong’s youth population exploded, many the children of migrants who had arrived as the Chinese Civil War resumed after World War II, or after the Communist victory in 1949.

For these young people, Hong Kong was the only home they had known. Rapid economic growth brought high inflation, and Hong Kong remained overcrowded with adequate housing in scarce supply. Major riots in April 1966 and, more extensively, between May and December 1967, revealed the extent of popular dissatisfaction over inflation and general living conditions, even as the latter showed the ability of the Communist Party to exploit people’s grievances.

The colonial government became convinced that a communication “gap” between itself and its subjects had grown too large; the government’s legitimacy was at stake. Simultaneously, concepts of public service were evolving: It was no longer seen as acceptable for public officials to receive private payments for providing services that their posts entailed.

In this context, public complaints about demands for bribery grew, many of them delivered to activist and Urban Council member Elsie Elliott, who had emerged as a champion of Hong Kong’s poor. While Elliott pestered senior government officials, she and former police inspector Alan Ellis, who had been hounded out of the Force when he had refused to participate in bribery schemes, regularly appealed over the colonial government’s head to the British parliament, bringing unusual outside attention to Hong Kong.

Taking on the Police

Despite his general laissez-faire orientation, Gov. David Trench knew it was time to act, but he faced a difficult problem. For many who complained, the face of corruption was the neighborhood police officer. Any reforms that took away an accustomed perk of the police, let alone threatened them with prison, could lead to blowback, making Hong Kong ungovernable. In addition, as the 1967 riots dragged on, most Hong Kong people rallied to the government. The police, bribery notwithstanding, were broadly popular in Hong Kong, and in 1969 the Hong Kong Police Force’s role in subduing the riots was rewarded by being rechristened the Royal Hong Kong Police Force. Tackling corruption would have to start with the police, whose demands for graft were most ubiquitous. Addressing it elsewhere, including kickbacks in the private sector, would come later and would be less straightforwardly successful — yet taking on the police would be a challenge.

How did the colonial government proceed and largely achieve its goals? Three components stand out. First, it passed draconian legislation that would not have been acceptable in Britain itself. Second, it created a dedicated, independent agency that had subpoena powers as well as a publicity arm to communicate the new anti-corruption rules. And third, in order to secure most of what it wanted, it exhibited a degree of tactical compromise that government officials thought very distasteful. Behind these actions lay another crucial factor: growing pressure from civil society, including the press and student protesters.

The key legislation was the Prevention of Bribery Ordinance, proposed in 1970 and enacted the following year. Since 1959, a civil servant could be dismissed for failing to provide a satisfactory explanation for possessing wealth or enjoying a living standard beyond what could be supported by their official remuneration. The 1971 law made such unexplained wealth a criminal offense. 

Although deemed necessary to root out corruption in Hong Kong, such a law not only did not exist in Britain, but would have been seen as a direct violation of traditional British liberties, just as it would have in the United States. For one thing, it violated the basic principle of presumption of innocence, requiring the accused in effect to prove that they were not a criminal. For another, it required the accused potentially to provide self-incriminating evidence. Despite the stringency of this legislation, though, its enforcement remained under control of the Police Force. In the government’s view, appointing an independent outside body to investigate police corruption would have risked harming police morale, possibly even provoking strikes and leaving the colony ungovernable.

Less than three years later, in February 1974, a powerful independent body, the Independent Commission Against Corruption (ICAC) was established, taking over the enforcement function. In November 1971, a new governor, Murray MacLehose, had replaced Trench. A diplomat by training, unlike previous governors who had come up through the Colonial Office, MacLehose launched a broad program of social reform and publicity campaigns meant to repair the postriot communication “gap” between rulers and ruled. Reforms included expanding education and housing access. MacLehose was hit with a crisis in June 1973. A high-ranking British-born member of the Police Force, Chief Superintendent Peter Godber, was asked to explain his outsize wealth, which was several times greater than his cumulative salary over more than two decades. It emerged that Godber had been at the top of a Kowloon-based corruption franchise; skim from thousands of petty bribes made their way up the chain to Godber. Taking advantage of his police privileges, Godber left the colony without passing through passport control, arriving safely in England. 

This presented Gov. MacLehose with a problem. To Hong Kong public opinion, manifested in student-led “Get Godber Back” rallies, Godber’s escape confirmed the worst of assumptions. Despite lower-ranking Chinese officers being the public face of corruption, a member of the foreign ruling class was the ultimate benefactor. And worse, when discovered, he was protected from prosecution through what looked like technicalities.

The British governing class stood together. In the post-1967 atmosphere in Hong Kong, with the Great Proletarian Cultural Revolution in full swing across the border and anticolonial sentiment growing, this was not a message the governor wanted to send. Yet British authorities, though sympathetic to the governor’s difficulties, were unwilling to extradite Godber, for a simple reason: The charge against him was not a crime in Britain. He was not charged with accepting bribes. No evidence could be found for that. He was charged with inability to explain his wealth.

This standoff dragged on for several months until ultimately a cooperating witness, former Superintendent Ernest “Taffy” Hunt — in order to mitigate his own criminal sentence — swore that he had seen Godber directly take a bribe. Although many observers thought that unlikely, this was good enough to secure Godber’s extradition, and in 1975, following what Lethbridge called a “show trial,” he was sentenced to an “exemplary” four years in prison.

The Necessity of Compromise

Well before the Godber case was resolved, the public outcry helped provide an environment in which Gov. MacLehose succeeded in establishing the ICAC, directly reporting to the governor (and after 1997, the chief executive). Indeed, the anti-Godber protests had included demands that the enforcement of anti-corruption legislation be moved beyond police control. Key posts were staffed from outside Hong Kong, often police on secondment from a U.K. police force. Such recruits lacked any ties to the community they were investigating. With extensive powers of surveillance and investigation, the ICAC largely succeeded in rooting out the most blatant official corruption, above all the franchising system.

The method of securing Godber’s extradition required compromising on long-standing British legal traditions. But an even bigger compromise was ahead. The early spate of ICAC prosecutions provoked an outcry from the police, leading by October 1977 to a police “mutiny” following mass arrests of police the previous month. In addition, large sections of the public, though having wanted the corruption problem to be addressed, thought the ICAC too powerful and too intrusive. Some 2,000 off-duty police marched on Police Headquarters at the end of October, while around 40 followed that up by storming the ICAC offices. Although these ringleaders were punished, the governor decided, pragmatically, that the only way out was a partial amnesty for those guilty of corruption. Essentially, the first of January, 1977, was the cutoff date, with corrupt police behavior prior to that date exempted from charge.

How transferable are Hong Kong’s lessons? Govs. Trench and MacLehose, despite needing to build legitimacy among public opinion following the 1960s riots, were ultimately appointed foreign governors, responsible to the British Queen and state. Although they would not have pursued an aggressive solution had it not been for changes in local public opinion, once they decided it was necessary to act, they did not face the same types of legislative pushback that a more democratic jurisdiction would have faced. Hong Kong’s Legislative Council was not directly elected, and, as a matter of course, the executive could count on a substantial number of dependable votes.

Although an independent anti-corruption body could function elsewhere — no less than an independent central bank — some of the key tools the ICAC enjoyed under the Prevention of Bribery Ordinance would surely face constitutional challenges if tried in New York, for example. Finally, it is worth remembering that the Hong Kong Government’s greatest success in the 1970s came when vigorously enforcing norms that had become widely held over the previous decade. This suggests that while the five lessons outlined at the beginning of the essay are valuable for study, their practical effectiveness may ultimately hinge on the city’s political culture and governmental framework.