Many lawmakers had their fingers burned by the Link Reit controversy. They thought that taught them a lesson in how to safeguard public assets but, in truth, they've got it wrong - again.
Most legislators rushed to endorse the initial public offering of the real estate investment trust: it floated part of the Housing Authority's most valuable shopping malls and car parks on the stock exchange.
But it backfired when The Link Management, which runs the properties, sought to impose drastic rent rises on commercial tenants, triggering a public outcry.
Once bitten, Legislative Council members are proving twice shy. They have now adopted an unduly sceptical attitude towards another official initiative involving substantial government assets. They are dragging their feet in scrutinising the proposed merger of the rail operations of the city's two rail companies. Some lawmakers have even threatened to veto the deal unless lower ticket prices are guaranteed.
But the suggested rail merger is completely unlike the Link Reit experience. Instead of protecting the public interest, the suspicious councillors are in fact doing the community a disservice.
The MTR Corporation is a listed company, while the Kowloon-Canton Railway Corporation is wholly owned by the government. Officials reached an understanding with MTR Corp, in April, on the terms for the merger of the MTR and KCR systems. On that basis, the government signed a non-binding memorandum of understanding with MTR Corp.
A draft law to pave the way for the union was gazetted in June. The Legco committee on the bill held its first meeting in July, but little progress has been achieved.
