Colonial-era leasehold system to blame for URA’s woes
The managing director of the Urban Renewal Authority revealed in an email to staff yesterday that she left because of “fundamental differences” with its chairman over its direction …
City, April 1
The easy thing to do on reading this story is sigh and say, “Well, there you go, just another example of a cold-hearted bureaucrat stopping his public-spirited subordinate from carrying out her social mission.”
But that would be to read it the wrong way.
I entirely understand the frustrations of Iris Tam Siu-ying in leaving her job as managing director. The URA is tasked with redeveloping moribund old parts of the city but is also expected to balance its books on these projects. This can be a difficult balancing act.
It is our leasehold system ... which makes so much of the older parts of the city moribund
It must pay the owners of the properties it assumes a fair price or they will sue for breach of property rights that are protected by the Basic Law. But if it pays them this price it can only balance its books by construction of relatively costly flats. There is no role left to it for true low-cost housing. The most it can do is help owners of older blocks put a lick of new paint on their flats.
This has to be frustrating for people who join the URA thinking that their lives will now have meaning because they can change the world. All that URA really has is a limited role in helping property owners come together for redevelopment. This doesn’t do much for the angels.
But I think it is the way things have to be. To consider only the URA is to have much too narrow a focus.
How well equipped is any URA staffer to evaluate whether any particular housing project is worth more to society than greater operating funds for hospitals or the hiring of additional policemen or the proper regulation of telecommunications? How does he or she know when taking more money from the public to provide such services might actually impose a burden that outweighs the benefits?
No-one really has the answers to these questions but government is still compelled to provide its guesses and it does so every year in the financial secretary’s budget. He may get it wrong, I think he often does, but I do not dispute that it is his role to have the final say in these choices, including how much should go to the URA.
Iris Tam is unhappy with his strictures on the URA and feels they prevented her from her doing her job properly. She has therefore resigned. This is entirely proper.
If she wishes to complain about it, however, she should take the matter up with the financial secretary, not the chairman of the URA.
And she should then join the queue of all the others who think the financial secretary has it wrong. She has no better grounds than they have to decide whether hospitals, policemen or regulators should have a larger or smaller piece of the pie when their needs are weighed against the URA’s.
There is another way of looking at this, however. We live under a peculiar colonial system of land tenure in which all land is under leasehold from government and lease payment is determined by the land uses that the lease permits.
Redevelop a crumbling old block into a modern high-rise and most of the reward goes to the government in payment of a lease conversion premium. Why bother doing it at all then?
This is a reason that it can sometimes be very difficult to find all the owners of an old block. They see no reason to come out of the woodwork and show themselves when all this might do is have them slapped with an order for costly repairs on the utilities or on slope stabilisation.
But wave some money in their faces and we would need no URA to induce them to redevelop. They will emerge from where they hide and do it themselves.
It is our leasehold system, a hangover from British colonial practice, which makes so much of the older parts of the city moribund. The fundamental answer is leasehold reform, not more money or big deficits for the URA.
Think more closely about where you direct your ire, Iris.
