Hong Kong officials' billion-dollar favours

PUBLISHED : Sunday, 10 October, 2010, 12:00am
UPDATED : Sunday, 10 October, 2010, 12:00am

The belief that government officials are, for whatever reasons, hand in glove with developers runs so deep that at times it scarcely seems worth noting. But some departmental decisions on apparently minor matters are so remarkable that they deserve more airing. Take for instance the rearguard actions of residents of Hong Kong's oldest and biggest private housing development, Mei Foo Sun Chuen, to stop development of a new block in what has been an empty space between several blocks. It would be several storeys higher and built to within 70cm of neighbouring blocks, restricting light and air flow to the estate's 99 blocks.

This is said to be legal because the land is classed as a 'remaining portion' not attached to the ownership of the existing blocks. This land was used for a low building housing a communal LPG plant, which was later removed. By then, the land had been quietly rezoned as residential, one of those apparently small changes in regulations which officials like to sneak through without the concerned owners realising. It is now the basis for the scheme to insert a new block in the cracks in the regulations kindly opened up by the Lands Department.

'Rights' to development were ultimately acquired in 2008 by Cheung Tat, which in 2009 acquired adjacent open spaces from Broadway-Nassau Investments, New World's Mei Foo management company. Mei Foo residents and district councillor Joe Wong Tak-chuen have repeatedly claimed Cheung Tat (Billion Star Development in English) remains connected to New World via a law firm.

The government process which led to a situation where homeowners now threaten a blockade of construction is murky. But it is not too late for the government to prevent this becoming a grime-encrusted monument to failure, to protect individual and public rights from developers.

This case is not isolated. Other developments have 'remaining portions' which flat owners believe to be open space but could become valuable if officials can be persuaded to change zoning or reinterpret other regulations. At least judging by Independent Commission Against Corruption prosecutions, corruption is never involved.

Another developer-vs-public-interest issue concerns the Ebenezer School and Home for the Visually Impaired, a Christian charity established in 1897. This does invaluable work for the visually impaired, but now has a deal with Hang Lung Properties to build a residential property on the Pok Fu Lam land it owns. This can only go ahead if the Town Planning Board changes the land's zoning from institutional to residential use, and the government provides new land for Ebenezer. The board is reported to be close to agreeing - in effect to hand profits to a developer at the expense of the public.

If the school, which receives government subsidies and had a large Jockey Club grant for buildings completed in 1995, wants a bigger site in the New Territories, it should simply swap its more valuable Pok Fu Lam land and, if justified, get a building grant. If the government then wants to change the Pok Fu Lam land zoning and sell it at auction, that is fine. But, as a charity supported by public money and private donations, Ebenezer has no business enabling a developer to profit at public expense. Will the board protect the public interest or hand another gift to a well-connected developer?

The power of officials to provide billion-dollar favours at public expense is not confined to the property sector. The public, forced to contribute to the MPF, has had to pay outrageous fees to the cartel of fund managers. It has also suffered from MPF rules which enable employers to do deals with the managers at the expense of employees. Responsibility for this situation rests heavily with Rafael Hui Si-yan, a former managing director of the MPF Schemes Authority and later chief secretary. His new post? Director of AIA, an MPF trustee.

Philip Bowring is a Hong Kong-based journalist and commentator