Hong Kong must stand up to the Link Reit for the sake of grass-roots families in public housing
Albert Cheng says vulnerable public housing residents are paying the price for the listing of the Link Reit. Concerned politicians should seek a judicial review over possible land lease violations and the government could offer ancillary amenities to those most affected
When Carrie Lam Cheng-yuet ngor was chief secretary of Hong Kong, she spoke of “three mountains”, or knotty problems, that the government aimed to overcome. The three, all major social issues closely linked to people’s livelihood, were the management of public housing malls by the Link Reit, repeated MTR fare increases, and the offsetting mechanism of the Mandatory Provident Fund.
Lam is now chief executive, but these problems have yet to be resolved. Progress is seen in handling the issues relating to the MTR and MPF; though barely satisfactory, on these Lam has realised her promise to a certain extent. However, with the Link Reit, she chickened out and admitted that her hands were tied.
Lam has firmly stated that the government would not buy back the Link Reit, as that would be a “very foolish” act. However, she would demand that the Lands Department uphold its role in ensuring lease enforcement. She said all the government could do was regulate the Link Reit through the conditions stated in the land leases. Clearly, Lam is surrendering to the investment giant without a fight.
The government’s approval of the listing of Link Reit was a mistake. Now that the company has turned into an uncontrollable monster, the politicians and media who supported that decision should be held accountable.
The situation, though undesirable, is irreversible. It would indeed be a stupid move to buy back the Link Reit, as it would only benefit its resourceful investors. The Link Reit has switched its mode of operation from running as a trust to real-estate speculation.
If the government buys back the Link Reit now, the key shareholders will put a hard bargain on the table, offering an exorbitant premium. Buying back the shares at an unreasonably high price would only enrich Link Reit stakeholders with public money.
The focus of the drama, however, should have been on the egotistical act of the Link Reit, with no regard for the government of Hong Kong or its lawmakers.
Link Reit is a privately owned and listed company, and the government is not allowed to interfere in the operation of private companies due to the free-market policy.
The situation has worsened since the Link Reit started to invest in malls in the mainland. When red capital gains benefits from the Link Reit, it would become even more challenging for Carrie Lam to tackle this “mountain”.
The recent media headlines on the issue have not sparked much of a public outcry, as society has been polarised in a way. Some of the malls owned by the Link Reit have been nicely renovated and are providing a more convenient living environment for the upper-middle class. The company’s actions have become an issue that affects only the grass roots, who have the least or no bargaining power.
If the politicians, especially the pan-democratic parties, have concerns over the Link Reit issue, this should be proven by real actions. They should seek a judicial review on whether it is violating its land leases, so that justice can be upheld and done to the people whose livelihood has been affected.
Meanwhile, Lam should uphold Section 4 of the Housing Ordinance, to secure the provision of the ancillary amenities needed by public housing tenants. This may include providing rental discounts to welfare groups, launching free shuttle bus services, and operating markets and other facilities for people’s benefit.
Albert Cheng King-hon is a political commentator. [email protected]