I AM pleased to see that the Government is responding to the recent land auction 'fiasco' by commissioning a task force to consider ways of combating collusion.
However, I seriously wonder about the appropriateness and effectiveness of some of the measures proposed by the task force.
I understand that for some land auctions it is proposed to replace the current open auction method with closed bidding (ie sealed bidding), especially in instances where the market is considered to be sluggish.
Although this measure should help in the fight against collusion it seems to me that the Government may end up with a lower market price since sealed bidding is a 'one shot' bidding method whereas the open auction is 'progressive' (ie. the bidder gets more than one chance to submit a bid).
Also the idea of the Government not disclosing bid prices to the public if it is dissatisfied with the prices received appears to me to be a step in the wrong direction.
It is my belief that such a move will not only fuel counter-productive speculation but will also encourage developers to contact each other after the bid submission deadline and swap bid prices.
Surely to combat collusion the bidding system should be made as transparent as possible. Perhaps a solution to the problem is to simply modify the current open system in such a way that at the time of bidding all communication between developers is prohibited.