Government officials yesterday reiterated the administration would not deliberately cut land prices and would allow them to be set according to market forces. Secretary for Planning, Environment and Lands Bowen Leung Po-wing said a report yesterday suggesting the Government would deliberately suppress land prices was incorrect. 'I have to stress that this is not our policy,' he said. He said it was Government policy to set land premium according to market forces. 'Recently, there have been signs of downward adjustment in the market, we would certainly take this into account when setting the upset price [minimum price] for the next land auction.' Mr Leung said the Government had never worried whether the revenue generated from land sales would be to the administration's satisfaction. 'There is no policy that we must get back a certain amount of money. We set the upset price of the land in accordance with the market situation.' The comments were made in response to a report which quoted director of lands Bob Pope as saying the Government would sell land to developers at lower prices and charge lower premium on residential developments on agriculture land. Mr Pope said in a statement yesterday: 'We always follow market prices and there has been no change in this policy, no matter whether in setting prices for lots put up for auction or in calculating premium for agricultural lots to be converted to building land.' Commenting on the issue, Cheung Kong (Holdings) chairman Li Ka-shing said the opening price fixed by the Government for sites on auctions was not that important, it was the final sale price that counted. New World Development chairman Cheng Yu-tung agreed: 'It is insignificant to us whether the Government marks down or up the opening bid. The final price depends on the bidding and we have to compete anyway.' Asked whether the company would be more cautious in bidding at public auctions, Mr Cheng said developers would acquire land and would closely monitor conditions. But he said New World would negotiate for a lower land premium for approved residential developments on agricultural land it owned. Mr Pope said: 'Property prices are a determining factor for land prices and, naturally, at a time when property prices come down, land prices will follow the trend.' 'The Government will not withhold the sale of a lot only because it fails to fetch a certain price, unless the offers are ridiculous. 'But, on the other hand, this certainly does not mean that the Government will deliberately reduce the prices of land; market prices will always prevail.' Since the handover, the Government has sold seven residential-related sites at public auctions for a total of $14.32 billion. The next public auction will be held on November 19 with two residential sites on offer. In addition, nine residential sites, two car-park sites, a commercial lot and a hotel site are scheduled for sale at four other auctions between December and March.