LCQ20: Compensation and rehousing matters in relation to land resumption

Following is a question by the Hon Holden Chow and a written reply by the Secretary for Development, Mr Michael Wong, in the Legislative Council today (June 8):

To take forward the public housing development project at Kam Tin South, Yuen Long, the Government posted, in March last year, notices of land resumption in accordance with the Lands Resumption Ordinance (Cap. 124), and indicated that it would properly handle the related compensation and rehousing matters. Regarding the compensation and rehousing matters in relation to land resumption, will the Government inform this Council:
(1) of the timetable and other details in respect of the Government's disbursement of compensations to the residents affected by the land resumption for the project;
(2) of the number of affected households registered in the pre-clearance survey for the project; among them, the numbers of those households and residents of squatter structures who are eligible for being rehoused to public rental housing (PRH) and have already been allocated a PRH flat; among these residents of squatter structures who have been allocated a PRH flat, (a) the number of households who have obtained the key to the PRH flat and moved into it seamlessly prior to the departure deadline, and (b) the respective numbers of households who have only obtained the key to the PRH flat (i) within one month, (ii) more than one month to two months, (iii) more than two months to three months, and (iv) more than three months, after the departure deadline (set out in a table);
(3) among the (a) landowners, (b) non-owner residents of squatter structures and (c) business operators who have been affected by the land resumption for the project, of the respective current numbers of such persons (i) who have already been disbursed and (ii) who have not yet been disbursed, with the compensations (set out in a table);
(4) in respect of the three types of persons mentioned in (3) who were affected by the Government's resumption of land in the New Territories, of their respective average waiting time for the Government's disbursement of their compensations in the past five years, and set out in a table the respective numbers of cases in which the waiting time was (i) six months to less than one year, (ii) one year to less than two years, and (iii) two years or more; and
(5) of the reasons for the delay in the past five years in disbursing compensations to those persons who had accepted the Government's terms of compensation for land resumption, and other details?
To increase the supply of public housing, the Government is taking forward the public housing development project at Kam Tin South, Yuen Long, providing a total of around 8 100 housing units and various community facilities. The funding for the site formation and infrastructure works of the Project was approved in January 2021 by the Finance Committee (FC) of the Legislative Council. The Project area is around 21 hectares, including 12.3 hectares of private land. On March 4 of the same year, the Lands Department (LandsD) posted land resumption notices according to the Lands Resumption Ordinance (Cap. 124) and Roads (Works, Use and Compensation) Ordinance (Cap. 370) to the 108 private lots involved in the Project, and the ownership of the affected private lots reverted to the Government on June 5 of the same year. According to existing practice, the LandsD will start arranging rehousing or issuing compensation to eligible persons upon the approval of the works funding, and will notify land occupiers of their departure dates according to the works programme of the works department, and clear and hand over the required land parcels according to the relevant schedule. The LandsD has already handed over parts of the land under the Project to the Civil Engineering and Development Department to commence works, and the remaining land is expected to be handed over gradually later this year.
The reply to questions raised by the Hon Holden Chow is as follows:

(1) Compensation and rehousing arrangements are provided to affected households of the Project according to the relevant policy enhanced by the Government in mid-2018. If the squatter households fulfil the relevant eligibility criteria, they may opt for the established means-tested rehousing arrangement to be rehoused at public rental housing (PRH) units of the Hong Kong Housing Authority (HKHA), or the newly introduced non-means-tested rehousing arrangement to be rehoused at the dedicated rehousing estates (DREs) developed and managed by the Hong Kong Housing Society (HKHS) (Note 1). For households who do not opt for / accept rehousing but meeting the relevant eligibility criteria, they may claim for Ex-gratia Allowance (EGA) for Permitted Occupiers of Licenced Structures and Surveyed Squatters affected by Clearance (EGAPO), where the eligibility criteria and amount of allowance were also relaxed in mid-2018. Further, affected households registered under the pre-clearance survey (PCS)(also known as freezing survey), regardless of whether they are eligible for rehousing arrangements or EGAPO, will also be disbursed with the Domestic Removal Allowance (DRA).
In end-2019, the LandsD commenced the eligibility screening for compensation and rehousing of the affected households of the Project. Upon the FC's approval for the works funding in January 2021, the LandsD immediately referred the eligible rehousing applications to the HKHA and the HKHS for allocation of rehousing flats. Upon a household's acceptance of the rehousing offer, the HKHS or the HKHA will proceed with the intake procedures (the clearees would obtain keys of the unit upon completion of the procedures). The eligible households of the Project started to receive rehousing offers and were arranged for intake starting from August 2021. In addition, the LandsD has also made EGA offers to eligible households who have opted to claim EGAPO and/or the DRA, both of which will be issued when the households depart (starting from the middle of this year).

(2) According to currently available information, as of end-May 2022, there were 227 affected households under the Project. The status of compensation and rehousing is tabulated as follows:

Households affected by the Project are required to depart gradually starting from the middle of this year. The LandsD and the relevant units will process the outstanding cases with best endeavours, with an aim to properly rehouse the eligible households or disburse the EGAs before their departure, and provide practicable assistance to other households in need.

(3) and (4) When the Government invokes the legislation(s) to resume private land, the Government is required under the legislation(s) to provide statutory compensation to landowners and business operators. The Government has also put in place ex-gratia compensation arrangements, which serve as an easier and more convenient compensation alternative to statutory compensation.
On May 3, 2022, the Government announced the enhancement measures to the ex-gratia compensation arrangement for landowners and business operators, and the package was approved by the FC on May 27. Under the enhancement measures, the Ex-gratia Zonal Compensation System (Zonal System) for landowners will be merged from four zones to two zones. Upon merging, land resumed for public housing projects located outside New Development Areas (NDAs) (such as the Project) together with NDA projects and other development uses will be classified under "Tier One", and its compensation rate is pitched at that of Zone A under the former system, representing a 60 per cent increase in the ex-gratia compensation compared to that normally receivable under Zone B prior to merging. As for the EGA for Open-air/Outdoor Business Undertakings applicable to outdoor business operators, the eligibility criteria concerning the operation duration will be relaxed (adjusted from seven years preceding PCS to two years preceding PCS), while the ceiling on the size for open areas qualified for calculation of allowance will be removed (which was no more than 5 000 square metres per business undertaking in the past). The effective date of the enhancement measures would be backdated to the day of announcement (i.e. May 3, 2022), covering resumption and clearance projects commencing after the effective date, and those ongoing on the effective date, including the Project. As a one-off sympathetic arrangement, despite the fact that some landowners affected by the Project may have already received compensation, they would still be entitled to receiving topped up compensation under the enhanced arrangement with compensation calculated based on the prevailing Zone A rate at the time of land resumption.
In end-March 2021, the LandsD made ex-gratia compensation offers to affected landowners according to the then prevailing Zonal System (which was calculated based on the then prevailing Zone B compensation rate). Since October of the same year, the LandsD gradually disbursed compensation to landowners who accepted the ex-gratia compensation offer and with title-checking completed. As of end-May 2022, the processing situation is as follows:

As mentioned above, the Project will also benefit from the enhanced Zonal System arrangement which took effect on May 3 this year, such that the applicable ex-gratia compensation zone will be enhanced from the former Zone B to "Tier One". The LandsD is now contacting relevant landowners to make offers for topped up ex-gratia compensation (irrespective of whether the relevant person has already accepted compensation).
As for the situation and statistics for squatter households, please see part (1) and (2) of the reply.
Regarding business operators, they may be provided with the relevant EGA according to their eligibility, including EGA for Shops, Workshops, Godowns, Slipways, Schools, Churches and Ornamental Fish Breeding Undertakings (applicable to business undertakings operating from surveyed/licensed structure(s)) and EGA for Open-air/Outdoor Business Undertakings (applicable to outdoor business undertakings). In general, the LandsD will assess the eligibility of affected business operators for each project in a timely manner in order to issue the EGA as soon as the works funding of a project has been approved. The time required for assessment will depend on the circumstances of each case and the information submitted by the business operator. The LandsD does not compile the statistics on the processing time. In general, it has been the usual practice to disburse the EGA on the day the business operators hand over the land and depart. Nonetheless, considering that the affected persons may need capital in advance to prepare for relocation, the LandsD will introduce a new arrangement shortly to allow business operators to apply for the early collection of allowance within three months prior to departure (this arrangement will also apply to squatter households).

     As of end-May 2022, the processing status in respect of business operators of the Project is as follows:

(5) The Government understands that persons affected by land resumption and clearance hope to obtain rehousing or compensation as soon as possible. To this end, the LandsD has been striving to conduct the assessment and vetting work as soon as practicable in order to relieve the concerns and distress of relevant persons. For landowners, in respect of agricultural land which is the more common type of land resumed in land resumption projects in the New Territories, the LandsD will make ex-gratia compensation offers to the affected landowners of New Territories agricultural land within four weeks after the land resumption notices have been posted. Upon receiving the landowners' acceptance letter indicating their acceptance of the ex-gratia compensation offer, the LandsD will issue the ex-gratia compensation to the relevant landowners after confirming the land title. The time required for title checking for each lot will be different depending on the circumstances of the case. In general, the checking can be completed within a few months for straightforward cases and compensation can be issued thereafter. According to past experience, for landowners who have accepted the Government's offer but yet to receive the compensation for land resumption within a few months, the major reasons include the longer time required to verify or clarify issues concerning incomplete title to land or probate matters, and landowners not being able to return to Hong Kong to collect the compensation for land resumption due to the COVID-19 pandemic in recent years. For land users such as households and business operators, the LandsD in general will ensure proper rehousing and compensation issued before the eligible persons depart.
The LandsD will continue to maintain close communication with affected persons, and adhere to the "people-oriented" philosophy in explaining and carrying out the processing work for rehousing and compensation.

Note 1: Pending the completion and intake of DREs in 2024 the earliest, the HKHS and the HKHA will make use of the vacant units in their rental estates to provide transitional accommodation arrangements for eligible households. When the DREs are about ready for intake, the households concerned may opt to, instead of being mandated to, relocate to the DREs.
Note 2: All affected households registered under the PCS, regardless of whether they are eligible for rehousing arrangements or EGAPO, will be disbursed with the DRA. Among the 227 households, 97 have been verified to be eligible for the DRA, while the eligibility of the remaining households are being assessed or are considered not eligible. The DRA will be disbursed at the time of departure.
Note 3: Major reasons include: ownership of domestic property in Hong Kong, existing PRH tenants or beneficiaries of subsidised housing benefits, the structures concerned are unauthorised such that they are either not surveyed or erected without relevant land instruments.
Note 4: Due to the nature of the business, certain business operators opted for other EGAs, such as EGAs applicable to agricultural operators.
Ends/Wednesday, June 8, 2022
Issued at HKT 15:45