CY Leung policy address 2013
Hong Kong Chief Executive Leung Chun-ying delivered his maiden policy address on January 16, 2013, in which he unveiled a blueprint that will set policy direction in the next five years. Acknowledging soaring property prices and cramped living conditions, he said his top priority is housing.
Pressure on CY Leung to deliver on clean air
In the second part of our look forward to Leung Chun-ying's first policy address, reporter Cheung Chi-fai assesses the challenges he faces
A big carrot is likely to be accompanied by a heavy stick when Chief Executive Leung Chun-ying announces plans to phase out old and polluting commercial diesel vehicles as he attempts to address roadside air quality in his maiden policy address next week.
Of the many environmental problems Hong Kong faces, air quality is undoubtedly the top priority for Leung. In his election platform he made only vague pledges of new measures to achieve air quality targets and encourage the use of low-emission vehicles and public transport.
All eyes are now on how Leung will translate his pledges into policy and how far he will go in introducing measures to clean up the polluted air that not only tarnishes the city's image as an international financial centre but puts public health in jeopardy.
The problems Leung inherited are long-standing and taking thousands of dirty vehicles off the streets is expected to cost billions of dollars.Of the city's 120,000 diesel commercial vehicles, some 50,000 were registered before Euro II emissions standards came into effect in 2001. Some 17,000 vehicles date back more than 20 years.
With the government's strong fiscal position and growing awareness of the problem, the pressure is on Leung to deliver more than his predecessors did.
His big carrot is expected to take the form of a significant increase in the subsidy offered to owners of older vehicles to buy cleaner replacements.
At the same time, he is likely to wield the heavy stick, perhaps by placing a cap on the maximum working life of a diesel vehicle or even by reviving the idea of higher licence fees for older vehicles - an idea previously rejected by lawmakers.
Officials are hopeful that new measures will boost the disappointing take-up for vehicle replacement schemes.
Since 2007, such schemes have cost the Environmental Protection Department some HK$1 billion, but the process has had a limited effect - just 29 per cent of vehicles registered before 1997 and 11 per cent of vehicles dating back to before 2001 being scrapped, according to the Audit Commission.
The transport industry has long decried the replacement schemes as unattractive, especially to operators already struggling to make a profit from a business hit hard by rising oil prices.
Earlier consultation with industry groups by environment officials found that a subsidy of 30 per cent of the cost of a new vehicle would be the minimum incentive they would require to scrap their old trucks.
Some wanted more - 50 per cent, or even the full cost.
But Leung Kun-kuen, chairman of the Kowloon Truck Merchants Association, said a full subsidy sounded unrealistic, but the 30 per cent mark was acceptable.
"The government has been using double standards. The taxis got a 25 per cent subsidy when they switched from diesel to LPG. Even private cars have generous tax concessions. But for heavy trucks, the subsidy only amounts to 10 per cent of its cost," he said.
Leung said the group would oppose any mandatory measures to limit the service life of polluting vehicles - a cap of 15 years has been floated by officials in the past - unless they were given an acceptable subsidy for replacements.
Environmental officials have argued that such limits are not uncommon in other jurisdictions.
New York caps taxis to six years' service, while London taxis can run for no more than 15 years. On the mainland, goods vehicles in use must be less than 15 years old. Singapore also sets a maximum lifespan for coaches and goods vehicles at 20 years.
Hahn Chu Hon-keung , an environmental affairs manger at Friends of the Earth, said the government needed to be flexible in designing effective schemes to target polluting diesel vehicles.
"One needs to set out clearly the objective first, whether it is phasing out the polluting vehicles or replacing them with new ones," he said.
Chu said officials should also pay attention to the livelihoods of vehicle owners who could not afford to buy a new vehicle, even with higher subsidies.
Chu believes that the option of higher licence fees is not desirable since it is not certain it would lead to vehicles being taken off the roads.
Leung, of the truck association, agreed that owners should be compensated sufficiently for winding up their businesses if they were asked to scrap their vehicles.
But the idea of subsidies for closing down transport companies has previously been rejected by environmental officials.
Meanwhile, Angus Ho Hon-wai, executive director of environmental group Greeners Action, said he did not expect the chief executive to make significant moves to target the problem of food waste, even though the chief executive had pledged to eliminate it.
The waste accounts for about a third of the municipal solid waste being dumped in the city's rapidly filling landfill sites.
"A ban on kitchen waste in landfills is out of question at this stage, but he could consider setting aside sites for large-scale food-waste treatment plants and help find markets for the compost such plants generate," he said.
Earlier, Wong Kam-sing, the Secretary for the Environment, formed the Food Wise steering committee to launch a citywide campaign to cut food waste at source. Ho, a member of the committee, said he expected the body to initially focus on education and publicity work.
The chief executive is also expected to repeat the government stance that a waste incinerator might still be required if recycling efforts prove insufficient to tackle the landfill crisis.
The previous government withdrew its request for HK$23 billion in funding for an incinerator and landfill expansion last year after failing to win the support of lawmakers.