Legislative Council Question 4 : "Urban Renewal Strategy" by the Hon Fernando Cheung and a reply by the Secretary for Housing, Planning and Lands, Mr Michael Suen, in the Legislative Council
Following is a question by the Hon Fernando Cheung and a reply by the Secretary for Housing, Planning and Lands, Mr Michael Suen, in the Legislative Council today (February 7):
It is learnt that the Urban Renewal Authority ("URA") is currently launching redevelopment projects in various old districts and has applied to Court to invoke the Lands Resumption Ordinance to mandatorily resume the land concerned of those owners and tenants who do not accept its compensation packages. Many people have related to me that the present urban renewal strategy, URA and the Hong Kong Housing Society ("HKHS") with which URA cooperates, and the compensation packages cannot address the needs of the public. They have also pointed out that while URA receives financial support from the Government, it adopts commercial practices in its operation, and its management is being given huge bonuses every year. In this connection, will the Government inform this Council:
(a) given that the Government has not reviewed the urban renewal strategy since 2001, when the Government will conduct consultation and review on the strategy;
(b) whether it knows the amounts of bonuses received by URA staff each year since 2001, the method for determining such bonuses and the percentages such amounts represent in the monthly total staff salaries, broken down by the ranks of the staff; whether the bonus system is applicable to HKHS staff, and whether the relevant authorities will consider abolishing the bonus system; and
(c) given that many owners, shop operators and residents in the old districts have indicated their wish to continue living and conducting business in the same districts, whether the Government will consider drawing up a mechanism or measures to assist URA and HKHS in offering in-situ rehousing (including "flat-for-flat" and "shop-for-shop" exchange arrangements) to residents, shop operators and owners affected by the urban redevelopment projects?
My reply to the three-part question is as follows:
(a) The Urban Renewal Authority ("URA") is a statutory body established under the Urban Renewal Authority Ordinance. The Ordinance provides a legal framework for the URA to undertake urban renewal in a comprehensive and holistic manner, covering redevelopment, rehabilitation, revitalisation and preservation with buildings of architectural and historical values within its urban renewal projects. The Urban Renewal Strategy (URS) formulated after extensive public consultation provides broad guidelines to steer the URA's urban renewal work. Similar to other policies, we agree that the URS should be reviewed at an appropriate time in order to improve the relevant work continuously. Nevertheless, we have to seriously consider some important issues, so as to ensure that the review of the URS can be conducted effectively.
Over the past few years, the URA has been giving priority to implement the former Land Development Corporation projects not yet completed. In general, these projects were implemented in accordance with the Land Development Corporation Ordinance. As a result, there are so far only a few new projects commenced under the Urban Renewal Authority Ordinance. Considering that it usually takes years to complete the procedures of implementing a redevelopment project, including consultation, planning and design, property acquisition, rehousing and land resumption, and that the URA has not accumulated sufficient experience in the other aspects of its "4R" initiatives including rehabilitation and revitalisation, we consider it necessary to allow more time for the URA to accumulate practical experience, in order to provide a solid basis for a comprehensive and effective review of the URS.
Upon that time, we will widely consult the public and ensure that the views of the stakeholders concerned will be fully taken into account in the URS review.
(b) Neither the URA nor the Hong Kong Housing Society ("HKHS") has adopted any bonus pay system predicated upon the organisation's business achievement and profitability. To provide incentive for better performance, the URA adopts a variable pay system, under which the whole remuneration package of its staff comprises two components, i.e., a fixed pay and a variable pay linked to the staff performance. In gist, a variable pay is set for the URA staff of different ranks. In determining the variable pay level, the URA will take into account staff performance, including their performance in handling their duties, organisational ability, staff management, and team work. In this connection, the pay level of URA staff, including the variable pay, is not related to the acquisition cost nor the profitability of any individual project.
The HKHS also introduced a variable pay system in 2002-03 in order to improve its staff performance. Likewise, there is no connection between the acquisition costs as well as the profitability of any redevelopment project undertaken by the HKHS, and the pay level of its staff.
(c) As we understand, the URA Board considers that property acquisition by way of an "flat-for-flat" and "shop-for-shop" option has some merits conceptually. In practice, there are however a number of difficulties that cannot be resolved easily within a short time. Taking the "flat-for-flat" option as an example, the URA needs to consider the supply and demand of the affected residential flats, as well as the cost-effectiveness and operational difficulties of the proposal.
Concerning the "shop-for-shop" option, the URA considers that the operational problems involved are even more complicated. Given the varying nature of the business, the shop owners will have different requirements on the reprovisioning of a shop in respect of size, location, orientation, useable floor space, road facilities in the vicinity, headroom and loading capacity of the floors, and as a result of the related industrial and business regulations under the law.
In view of the above, the URA Board considers that at this stage, the Authority is not equipped, nor has the ability to implement these two options.
Nevertheless, the URA staff and its social service teams are willing to provide flat or shop owners with relevant market information and assist them, as far as practicable, in looking for suitable replacement flats or shops.
We will continue to encourage the URA to adopt an open attitude and listen to the views of different sectors of our society. We will also ask the URA to explore other rehousing and compensation options including the option to allow priority for the affected owners to buy back flats after redevelopment, in order to address the different needs and aspirations of the residents or shop operators affected by redevelopment.
Ends/Wednesday, February 7, 2007
Issued at HKT 13:36