Privatisation should never be seen as the panacea for all ills

PUBLISHED : Saturday, 12 September, 2009, 12:00am
UPDATED : Saturday, 12 September, 2009, 12:00am

I refer to the article by Nicole Alpert of The Lion Rock Institute ('When privatisation offers the best value', September 5).

Taking the shopping centres and car parks previously managed by the Housing Authority as an example, Ms Alpert said that due to the lack of incentive for 'profits', the authority's use of resources and facilities was inefficient.

She said the operating efficiency in the malls and car parks improved after privatisation when 'The Link Management took control'.

This was thanks to the business philosophy of profit-maximisation.

I agree that under the authority there was a lack of incentive and public resources were wasted. This problem should have been resolved. However, the philosophy of 'profit-maximisation' is not the best cure available.

We must remember the basic difference between the purposes of public services and those of private business.

The concept that people's self-interest will promote public welfare is valid as long as all parties involved are equal. But often those in need lose out. That is why we have social welfare policies and these policies include the provision of public housing.

Profit-maximisation should not become the underlying mission of services provided in public housing estates.

Public housing is provided at below-market rents to help improve the living conditions of those in need, rather than for the purpose of making a profit. I am not suggesting a communist society where personal effort and talent are not rewarded, but social welfare and subsidies are necessary.

There is no such thing as a pure capitalist society in the modern world.

The problem of inefficiency can be tackled by closer monitoring and the participation of the public's elected representatives, such as district councillors. This could better reflect local residents' preferences.

The key to success is to have better administrative measures and active public participation.

Tony Chan, Kwun Tong




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