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LCQ1: Mandatory Building Inspection Scheme

Following is a question by the Hon Ronny Tong and a reply by the Secretary for Development, Mr Paul Chan, in the Legislative Council today (December 4):

Question:

Since mid-2012, the Buildings Department (BD) has fully implemented the Mandatory Building Inspection Scheme (MBIS), which is applicable to buildings 30 years old or more. Upon receipt of a statutory notice from BD, owners' corporations (OCs) of the selected buildings are required to arrange qualified persons to carry out building inspection and conduct the prescribed repair as required. I have recently received quite a number of requests for assistance from owners of housing estates which are 20-odd years old only. They said that although the OCs of their buildings had not yet received any statutory notice from BD, the OCs and the property management companies had already arranged to conduct investigation works in the estates and invited tenders for maintenance programmes which involved huge costs. Those owners pointed out that they were unable to verify if the repair works under the maintenance programmes were necessary and they had to vote on the maintenance programmes at the general meetings of the OCs without knowing the relevant details. As most owners were indifferent to the maintenance programmes, many controversial maintenance programmes were passed by a slight majority of ownership shares at the meetings. In this connection, will the Government inform this Council:

(a) of the numbers and names of housing estates and buildings between 25 to 30 years old in various District Council districts, and whether it knows if the OCs concerned have recently planned to carry out any large-scale building maintenance programme; of the number of applications received by the Government for funding of such programmes under various assistance schemes or interest-free loan schemes, the percentage of the number of those housing estates in the total number of eligible housing estates in Hong Kong since the implementation of MBIS, as well as the success rate of those applications and the total sum granted; apart from financial assistance, whether the Government has rendered any other support to owners carrying out such programmes; if it has not, of the reasons for that;

(b) as quite a number of owners of housing estates have pointed out that the passage at an OC general meeting of a proposal to implement a large-scale building maintenance programme, no matter how high its cost is, requires only a majority vote (which means that more votes are in favour of the proposal than against it), whether the Government has assessed if there is a loophole in the law regarding the adoption of such a voting method for large-scale building maintenance programmes; if the assessment result is in the affirmative, whether the Government will consider amending the legislation, e.g. by requiring that the support of owners holding a majority of the ownership shares of a housing estate must be obtained before a large-scale building maintenance programme may be implemented, in the same manner as the requirement for terminating the appointment of the Deeds of Mutual Covenant managers, in order to enhance protection of owners' interests; if it will, of the time to amend the legislation; if not, the reasons for that; and

(c) as quite a number of owners of housing estates have indicated that they have little knowledge of the maintenance works required under MBIS and are unable to distinguish them from the general maintenance and repair works, resulting in frequent disputes with OC members, whether the Government has made any publicity effort to educate the public on common knowledge of the general repair works of buildings; if it has, of the details; if not, the reasons for that; whether BD has appointed representatives to attend the OC general meetings of various housing estates in order to provide technical advisory service and explain the legal requirements; if it has, of the housing estates whose OC general meetings were attended by BD's representatives in the past three years, as well as the effectiveness of such practice; if not, whether it has planned to implement the aforesaid measure and when to do so?

Reply:

President,

The Mandatory Building Inspection Scheme (MBIS) and the Mandatory Window Inspection Scheme (MWIS) were fully implemented on June 30, 2012 to tackle the problem of building neglect at source. The former scheme  covers all private buildings aged 30 years or above while the latter one covers all private buildings aged 10 years or above, except domestic buildings not exceeding three storeys in height. Under the Buildings Ordinance, the MBIS is not applicable to buildings aged below 30 years and, as such, the Buildings Department (BD) cannot issue statutory notices to these buildings. Nevertheless, we encourage owners to properly maintain their buildings on their own initiative. Building owners/owners' corporations (OCs) may take the initiative to carry out the required inspection and repair under the MBIS and MWIS. Where the process follows the standards and procedural requirements under the two schemes, even though the building has reached the age requirement of the two schemes, BD will not select it to carry out mandatory building and window inspection within the respective inspection cycles.

Having consulted the Home Affairs Bureau, my reply to the three-part question is as follows:

(a) At present, there are approximately 15 000 and 25 000 private buildings in the territory eligible for selection as target buildings under the MBIS and the MWIS respectively. According to the records of BD, there are approximately 3 240 buildings aged between 25 and 30 years in Hong Kong. The breakdown on the number by District Council districts is at the Annex. In general, other than buildings that carry out investigation and repair in compliance with a statutory order issued by BD, BD does not know if the owners or OCs of individual buildings have planned to carry out repair works.

The Hong Kong Housing Society (HKHS) and the Urban Renewal Authority (URA) jointly launched the Mandatory Building Inspection Subsidy Scheme (MBISS) in August 2012 to subsidise eligible owners the full cost of the first building inspection under the MBIS (subject to a cap) (Footnote 1). As at end October 2013, HKHS and URA had received a total of 179 applications, among which 149 applications had been granted "approval-in-principle", six applications were rejected owing to the failure to meet the eligibility criteria of the scheme and the rest were under processing. We do not have information on the percentage of the number of buildings having applied for the MBISS over the total number of buildings eligible for applying under the subsidy scheme. Reason for that is listed at Footnote 2.

Apart from financial assistance, HKHS and URA will also provide technical assistance to owners participating in the subsidy scheme, including assisting them to organise themselves and offering support on tendering matters. As for the repair works found necessary according to the inspection, the Government, together with HKHS and URA, will continue to provide financial assistance under the various existing schemes. Details of the schemes can be found at Footnote 3. The amount of subsidy will be determined when the actual cost is available upon completion of the inspection and repair. As there are currently no cases where the inspection has been completed, we are unable to provide the amount involved in the approved applications.

(b) According to the Home Affairs Bureau, section 3 of Schedule 3 to the Building Management Ordinance (BMO) stipulates that subject to provisions otherwise provided in the BMO, all matters (including maintenance works) arising at a meeting of the OC at which a quorum is present (i.e. 10% of the owners) shall be decided by a majority of the votes of the owners voting either personally or by proxy. This requirement aims to ensure that the passing of a resolution at an OC meeting is subject to the consent of a certain number of owners, while avoiding the difficulty in commencing maintenance works due to too high the required percentage of owners for the passing of the resolution.

Moreover, the BMO has provided for measures to ensure the transparency of any maintenance works carried out by an OC and the OC's effective supervision of the tendering and the maintenance works concerned. Under the BMO, an OC shall invite tender for any projects with a total value over $200 000, and a general meeting shall be convened to endorse the relevant tender if the total value of the project exceeds 20% of the annual budget of the OC. Furthermore, during the tendering process, an OC has to observe relevant codes of practice under the BMO (Footnote 4).

To ensure that the BMO keeps pace with changing circumstances, the Review Committee on the Building Management Ordinance (Review Committee), comprising members from relevant sectors with extensive knowledge in property management, is conducting a comprehensive review of the BMO. The review will, inter alia, examine ways to resolve common problems in building management, such as improving the resolution procedures relating to maintenance works. Upon receipt of the Review Committee's recommendations, the Government will study how to follow up on and implement the recommendations.

(c) The scope of the MBIS covers the common parts, external walls, projections and signboards of a building. BD has issued a code of practice, setting out the building elements required to be inspected under the MBIS and specifying that there are building elements and services that do not fall within the scope of the MBIS. Details are listed at Footnote 5. While under the MBIS owners are required to carry out basic repair works only to render the building safe, owners of individual buildings may wish to carry out other improvement works concurrently and such decisions are made by the building owners after discussion among themselves. The code of practice requires a registered inspector to clearly state in the repair proposal the repair works required under the MBIS, which should be distinguished from any additional works.

Since the implementation of the MBIS and the MWIS, BD has taken various measures to enhance publicity. As part of the publicity efforts, BD has organised or attended upon invitation over 200 briefing sessions, including district briefing sessions that it organised for owners of target buildings on a quarterly basis as well as those that were organised by individual organisations or estates and attended by BD upon invitation. BD has not maintained a list of estates that have participated in or organised the briefing sessions. In all of the briefing sessions, BD staff will explain the scope of the MBIS and the MWIS to residents. Residents can also contact BD if they have any enquiries.

Footnote 1: The Mandatory Building Inspection Subsidy Scheme covers buildings that are aged 30 years or above and that have received pre-notification letters or statutory notices under the MBIS issued by BD. Buildings applying for the subsidy scheme should also meet the eligibility criteria on rateable value.

Footnote 2: As mentioned in footnote 1, a building is eligible for applying for the MBISS only if it has received a pre-notification letter under the MBIS issued by BD and meets the eligibility criteria on rateable value. As at September 2013, BD had issued pre-notification letters under the MBIS to 2 484 buildings. As BD does not have information on the rateable value of these buildings, BD is unable to provide the required percentage.

Footnote 3: The schemes include the Integrated Building Maintenance Grant Scheme jointly administered by HKHS and URA, the Building Safety Loan Scheme administered by BD, and the Building Maintenance Grant Scheme for Elderly Owners administered by HKHS.

Footnote 4: The Code of Practice on Procurement of Supplies, Goods and Services and the Code of Practice on Building Management and Maintenance.

Footnote 5: Under paragraph 3.1 of the Code of Practice for the MBIS and the MWIS, an inspection under the MBIS shall cover external elements and other physical elements, structural elements, fire safety elements, drainage systems and unauthorised building works. The paragraph also specifies that building elements and services that do not fall within the scope of the MBIS include foundations, buried or embedded elements such as pile caps and ground beams, freestanding earth retaining structures, slopes and buried water services in slopes, lifts, escalators, fire services installations, electric wiring, ventilation and air conditioning systems, and gas and water supplies installations.


Ends/Wednesday, December 4, 2013
Issued at HKT 18:33

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