Consumer protection in Hong Kong

Management of the city’s public markets must be improved

An investigation by the Ombudsman has highlighted a series of issues with the management of public markets. From questionable rental leases to slack enforcement against abuses, the Food and Environmental Hygiene Department has a lot to answer for

PUBLISHED : Sunday, 02 September, 2018, 12:09am
UPDATED : Sunday, 02 September, 2018, 12:09am

Maladministration and misspending are not unheard of in Hong Kong. But the latest investigations by the Ombudsman into the management of public markets have left many wondering what officials are paid for. From questionable rental leases to slack enforcement against abuses, the Food and Environmental Hygiene Department has a lot to answer for.

The Ombudsman is to be commended for turning the spotlight on an important yet under-reported aspect of public life. With 99 public markets – 45 per cent of all local markets – under its management, the department risks dereliction of its duties if it cannot run the outlets in the best public interest. According to the watchdog’s report, there exists an array of jaw-dropping irregularities in the management and operation of our markets.

Despite an occupancy rate of 90 per cent, it was found that many stalls were not operating or used for storage only. This is not helped when 76 per cent of the stalls were paying below market rent and that the levels had been frozen for 19 years until an inflation adjustment method was put in place last year. This is why the deficits incurred by public markets hit HK$1.6 billion over the past five years.

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It can be argued that low rent is a form of government subsidy to benefit consumers. But historical differences mean there is an unlevel playing field for tenants. The Ombudsman found that monthly rents in 24 markets range from below HK$200 to more than HK$9,000, even though some sell the same commodities. The department’s study found that a catty of choi sum would cost the same at different vendors even when their rents per square foot could be as different as HK$62 and HK$9,400.

Given the circumstances, an immediate jump to market rate for all would seem unrealistic. But better efforts must be made to narrow the gap. One tenant was renting 23 stalls just for storage. Some tenants had altered their food stalls into offices, cold storage or workshops, raising questions whether officers were turning a blind eye during daily inspections. Even when breaches were identified, tenants were often only warned verbally. There were only eight cases of tenancy termination between January 2015 and June 2018.

The damning report reflects prolonged bureaucratic inertia by the department, which was also criticised by the Audit Commission for similar mishaps in 2008. It would be meaningless if policies and rules are not regularly updated and enforced seriously. Not only does it make a mockery of the mechanism, it also nurtures abuses and makes enforcement even more difficult. The department said it accepted the watchdog’s criticisms and pledged to improve. It may well be difficult, but the problems must be rectified.