Legislative Council

LC Paper No. CB(1) 1796/98-99
(These minutes have been seen
by the Administration)

Ref: CB1/PL/HG/1

Panel on Housing

Minutes of meeting
held on Monday, 3 May 1999, at 4:30 pm
in the Chamber of the Legislative Council Building

Members present :

Hon LEE Wing-tat (Chairman)
Hon Gary CHENG Kai-nam (Deputy Chairman)
Hon David CHU Yu-lin
Hon HO Sai-chu, JP
Hon Edward HO Sing-tin, JP
Hon Albert HO Chun-yan
Hon LEE Cheuk-yan
Hon Fred LI Wah-ming
Hon NG Leung-sing
Hon Ronald ARCULLI, JP
Hon James TO Kun-sun
Hon CHAN Yuen-han
Hon CHAN Kam-lam
Hon LEUNG Yiu-chung
Hon Andrew WONG Wang-fat, JP
Hon LAU Kong-wah

Members attending :

Hon LEE Kai-ming
Hon SIN Chung-kai

Members absent :

Hon Mrs Selina CHOW LIANG Shuk-yee, JP
Dr Hon YEUNG Sum
Hon Andrew CHENG Kar-foo
Hon Timothy FOK Tsun-ting, JP
Hon TAM Yiu-chung, JP

Public officers attending :

For item IV

Housing Bureau

Principal Assistant Secretary (Project Management)

Housing Department

Ms Jennifer MAK,
Director Corporate Services

Mr HO Chi-sing,
Chief Manager/Management (Support Services 3)

For item V

Housing Bureau

Ms Eva TO,
Principal Assistant Secretary (1)

For item VI

Housing Bureau

Ms Sandy CHAN,
Principal Assistant Secretary (2)

Housing Department

Mr Andrew LAI, Head,
Corporate Strategy Unit

Mr WONG Kuen-hang,
Acting Chief Manager/Management (Support Services 2)

For item VII

Housing Bureau

Ms Sandy CHAN,
Principal Assistant Secretary (2)

Housing Department

Mr Andrew LAI, Head,
Corporate Strategy Unit

Mr HO Chi-sing,
Chief Manager/Management (Support Services 3)

For item VIII

Housing Bureau

Principal Assistant Secretary (Project Management)

Mr Enoch T S LAM,
Chief Assistant Secretary (Project Management)2

Housing Department

Mr D Ellis,
Senior Planning Officer 3

Environmental Protection Department

Mrs Shirley LEE,
Principal Environmental Protection Officer

Planning Department

District Planning Officer/Kowloon

Transport Department

Mr YAU Ka-tai,
Senior Engineer/Housing and Planning/Kowloon

Civil Engineering Department

Government Civil Engineer/Project Management

Attendance by invitation :

For item IV

Hong Kong Housing Society

Mr Victor SO, Executive Director

Mr Peter MIAO, Computer Services Manager

For item V

Hong Kong Housing Society

Mr Victor SO, Executive Director

Mr Francis LAW, Director (Planning and Development)

Clerk in attendance :

Ms LEUNG Siu-kum,
Chief Assistant Secretary (1)2

Staff in attendance :

Miss Becky YU,
Senior Assistant Secretary (1)3

I Confirmation of minutes of previous meeting
(LC Paper No. CB(1) 1231/98-99)

The minutes of the joint meeting with the Panel on Planning, Lands and Works held on 30 March 1999 were confirmed.

II Information paper issued since last meeting

2. Members noted that the following information papers had been issued since last meeting:

LC Paper No. CB(1) 1128/98-99- Submission from the Concern Group on Redevelopment of Lei Muk Shue Estate and the Administration's response regarding the overall medium rent to income ratio of households living in new public rental housing estates; and

LC Paper No. CB(1) 1232/98-99- Information paper provided by the Administration on the Housing Managers Registration Bill.

III Date of next meeting and items for discussion

3. The Panel agreed that the next meeting would be held on Monday, 7 June 1999, at 4:30 pm to discuss the following:

- Housing Managers Registration Bill; and

- Study on bedspace apartments and related issues.

IV Year 2000 compliance in Government and non-government organizations funded or regulated by Government under the purview of the Housing Bureau
(LC Paper No. CB(1) 1235/98-99 (01) and (02))

4. At the invitation of the Chairman, the Principal Assistant Secretary for Housing (Project Management) (PAS for H(PM)) briefed members on the information paper. He pointed out that the Estate Agents Authority had already achieved Year 2000 (Y2K) compliance since its computer systems had taken into account Y2K issues when they were installed. As regards the latest position of Y2K compliance within the Housing Authority (HA) and the Housing Department (HD), the Director Corporate Services (DCS) advised that as at 15鼦pril 1999, HA/HD had checked and rectified 52 or 81% of the mission-critical computer systems; 992 or 99.4% of the mission-critical embedded systems; and all except one line communication systems. Rectification work for the remaining systems would be completed by June 1999. She supplemented that the aim was to have the framework of a contingency plan to mitigate the effects of and enable recovery from Y2K induced incidents developed by 30 June 1999.

5. On Y2K compliance procedures, DCS explained that HA/HD had to first identify the mission-critical systems under their purview in accordance with the guidelines issued by the Information Technology and Broadcasting Bureau. After the mission-critical systems had been identified, rectification work would begin. Service contractors had been engaged to assist in part of the rectification programme. Mr鼦ndrewONG asked if an independent organization would be employed to verify the compliance status of the rectification work. DCS confirmed that the contractors engaged to assist in the rectification of the critical systems had asked the Hong Kong Productivity Council to undertake quality assurance, and consideration was being given to invite the Y2K Task Force comprising representatives from the Electrical and Mechanical Services Department (EMSD) and the Information Technology Services Department to conduct a third party check on the compliance status of HA/HD.

6. Noting that business partners of HA/HD were required to provide written confirmation on compliance status of their systems, Mr NG Leung-sing enquired about the information to be included in the confirmation and whether HA/HD would impose additional legal responsibility in respect of Y2K compliance on their business partners, such as on those banks which acted as the rent-collecting agents for HA/HD, in the event of undesirable consequences arising from non-compliance. DCS replied that all business partners of HA/HD had been asked to confirm their Y2K compliance status to HA/HD. Detailed information would be required from critical service providers. She added HA/HD might consider terminating the contracts of the service providers in the event of Y2K non-compliance where appropriate.

7. The Chairman expressed concern that service failures due to Y2K non-compliant systems in public housing estates such as suspension of water supply and lift service would cause undue disruptions to the daily lives of tenants. The Chief Manager/Management (Support Services 3) (CM/M(SS3)) replied that water supply should not be a problem since all the mission-critical systems in the Water Supplies Department would be Y2K compliant by June 1999. He supplemented that although the logging system of elevators, in particular those of new designs, was vulnerable to Y2K problem, this should not cause suspension of the operation of elevators. Nevertheless, Government might start auditing upon completion of rectification work after June 1999 to ensure that HA/HD internal systems could interact smoothly with their counterparts and other external systems. PAS霡or H (PM) remarked that rectified systems had been put to test on the two high risk dates of 1蟵nd?鼦pril?999 and no report of failure had been received. DCS however admitted that despite all the testing, there always remained a possibility of service failure due to Y2K problem. Suitable contingency measures should therefore be in place. The establishment of an emergency service centre staffed by repair and maintenance professionals as proposed by Mr Edward HO would be included in the contingency plan to be completed by end of June 1999. A copy of the plan would be forwarded to members for reference. DCS said that HA/HD had not been affected by any of the high risk dates in April but undertook to report to the Panel any incidents occurring for the remaining high risk dates in?999.Admin

8. As to how HA/HD could alert tenants about the possible impact of Y2K problem on their daily lives, DCS advised that a series of publicity programmes would be launched. Leaflets setting out common computer/embedded systems in a home which might be affected by Y2K problem would be distributed to tenants. Tenants would also be informed of the actions taken by HA/HD in solving the problem and how they could reach HA/HD in the event of Y2K-induced service failures.

V Sandwich Class Housing Scheme projects: Pinnacle and Highland Park
(LC Paper Nos. CB(1) 1235/98-99(03) to (05))

9. The Executive Director/Housing Society (ED/HS) briefed members on the latest development of the two Sandwich Class Housing Scheme (SCHS) projects in Tseung Kwan O (the Pinnacle) and Kwai Chung (Highland Park).

The Pinnacle

10. ED/HS advised that HS had issued Completion Notices to invite all purchasers of the Pinnacle to complete assignment of the property. Arrangements had been made for purchasers to view their own flats in five batches before completion of assignment. Purchasers in the first three batches had already viewed their flats and those in the last two batches would view their flats in the coming two weeks. So far, about 80 purchasers in the first batch had completed the assignment. ED/HS also remarked that over 500 or 40% of the purchasers had applied for the top-up mortgage loan provided by HS. It was anticipated that all the assignments would be completed by the end of May 1999. Regarding requests from purchasers for extension of completion of assignment, ED/HS advised that if the purchasers had shown sincerity for completion, their requests would be considered on individual basis. However, HS would not accede to any requests for deferment of completion of assignment on grounds of sub-standard workmanship of the building because the Project Architect and the independent Building Surveyor appointed had confirmed that all building works of the Pinnacle were in compliance with the provisions under the Regulation and the flats were of satisfactory standard.

11. On rectification of defects reported by purchasers after completion of assignment, ED/HS advised that HS had pledged to complete the rectification works within three weeks from the date of receipt of the defect lists. Mr LAU Kong-wah however considered that HS should provide purchasers concerned with a written guarantee. In response, ED/HS said that HS had already posted a notice in the sales office of the Pinnacle informing purchasers about the arrangement for rectification of defects. In fact, the Contractor had been expediting the remedial works on site in order to meet the pledge. As to whether HS would extend the six-month defects liability period in view of the poor construction quality of flats, ED/HS advised that as HS would be responsible for the management of the Pinnacle, it would follow up and make good any latent defects reported by owners at a later stage. Mr LAU was doubtful about ED/HS's assurance given that HS had declined to rectify defects reported by owners of the Verbena Heights after expiry of the defects liability period. He therefore requested and ED/HS undertook that HS would arrange the Contractor to rectify any further defects reported by owners of the Pinnacle even after expiry of the defects liability period. Mr鼦ndrew WONG asked if the Executive Committee of HS was aware of the undertaking, ED/HS assured members that he would inform the Committee at its next meeting. In view of the importance of the undertaking, the Chairman explicitly instructed that this should be recorded in the minutes of the meeting. Subject to ED/HS's confirmation, the minutes would become an official record of HS. MrONG opined that the undertaking should also be included in the Agreement for Sale and Purchase.

12. Mr LAU noted that some purchasers had complained that the installation of bath drain and inspection panel was at variance with that in the show flat. In reply, ED/HS emphasized that the existing installation was the original design of the Project Architect which aimed to facilitate future maintenance. However, if purchasers concerned wished to adopt alternative installation methods, they could inform the representatives of the Project Architect or the Independent Surveyor who would make arrangement for the re-installation work.

Highland Park

13. ED/HS advised that HS had consulted the Project Architect who confirmed that the construction of Government quarters should not pose a significant impact on the view of Highland Park as the site was at a distance of over 200 metres from Highland Park. The fear that the buildings would form a screen was unfounded as the buildings were most likely to be divided into separate housing blocks. Therefore, HS would not accede to any requests for exchange of flats or refund of deposit. HS would start issuing Completion Notices to invite purchasers to complete assignment in mid-May?999. The Chairman however pointed out that the 200 metres referred to was the farthest distance whereas the nearest distance between the Government quarters and Highland Park was only 90 metres. ED/HS attributed the disparity to the use of different references by HS and the Chairman: the former took the average distance between building blocks while the latter used the distance between the fringes of both developments.

14. The Chairman stressed that it was not a matter of distance. As a responsible developer, HS should have informed buyers concerned of the construction of Government quarters near Highland Park before the signing of the Agreement for Sale and Purchase so that they could choose to withdraw. He added that although at present, there was no existing legislation regulating the disclosure of information in sales brochures by developers in the sale of uncompleted flats, HS should not exploit the loophole to shed its responsibility. In reply, ED/HS reiterated that HS had not been informed nor consulted on the construction of Government quarters and it had no knowledge of the proposed project. The Chairman was not convinced of ED/HS' explanation since it was inconceivable that the Project Manager of a development was unaware of other constructions nearby given that these would affect the property prices of the development. He pointed out that although HS might not be aware of the construction of Government quarters at the outset, it should have acquired more information on the project at a later stage, particularly after this had been upgraded from Category C to Category A under the Public Works Programme and the Finance Committee of the Provisional Legislative Council had subsequently approved the related funding proposal. As to whether HS had ever raised objection after it became aware of the construction of 38-storeyed Government quarters near Highland Park, ED/HS replied that unless there was a change in the zoning plan, there was no existing mechanism through which HS could oppose a Government project. He stressed that HS would have informed buyers concerned if it had been consulted on the construction of Government quarters. Besides, the effect of the project on the view of Highland Park would be minimal as this was over 200 metres from Highland Park. The Chairman however remained unconvinced of ED/HS's response.

15. Mr WONG expressed dissatisfaction that HS had excluded important information such as the construction of Government quarters near Highland Park and the change of the community centre in Lake Side Garden to a home help service centre from the respective sales brochures. He considered it contradictory that the Housing Bureau (HB) planned to introduce legislation to regulate the content of sales brochures on the one hand while allowing misrepresentation of fact by HS on the other. In reply, the Principal Assistant Secretary for Housing (1) (PAS for H (1)) clarified that in the case of SCHS, HB was responsible for formulating Government housing policies and ensuring adequate supply of land to meet housing targets. The actual implementation such as the preparation of sales brochures was the responsibility of HS as a developer. Besides, HB as a policy bureau could not be expected to have the manpower to carry out the work of the developer such as inspecting each and every sales brochure. Nevertheless, from a macro point of view, the Administration recognized that there was a need to improve the quality of sales brochures in order to enhance protection on purchasers. To this end, HB proposed to introduce legislation to require property developers, including HS, to provide sufficient and accurate property information in the sales brochures. As regards the omission of the construction of Government quarters from the sales brochures of Highland Park, PAS for H (1) stressed that this was not a misrepresentation of fact since HS was genuinely not aware of the proposed project, and that the construction of Government quarters had not been approved when the sales brochures were published. She however admitted that arguable descriptions such as open view used in the sales brochures might give rise to disputes. Aggrieved buyers might seek legal remedies to claim damages for losses arising from such descriptions in accordance with the common law.

16. Mr WONG considered it futile for buyers to institute joint civil proceedings against descriptions in sales brochures which were not legally binding. The Chairman said that it would be for the buyers to decide whether legal remedies should be sought. He nevertheless shared Mr WONG's view that if the Administration agreed that misrepresentation of fact was a problem with private developers, it should expect its housing agents, including HS, to be more conscientious in respect of provision of accurate information in the sales brochures. It was therefore inconceivable that buyers of Highland Park were not informed of the construction of Government quarters before the signing of the Agreement for Sale and Purchase. The Chairman reiterated that although the manner in which HS chose not to disclose the information on Government quarters did not contravene any existing legislation, this was unacceptable from a moral point of view.

17. As regards the submission from the Highland Park Owners Association tabled at the meeting, the Director (Planning and Development)/HS (D(P&D)/HS) advised that the related issues had been thoroughly discussed at various meetings between HS and the Association. On the request for extending the period of completion of assignment until the sale prices for the remaining flats in Highland Park were announced so that buyers concerned could decide whether they should proceed with the purchase, D(P&D)/HS replied that HS had yet to work out the sale prices and programmes for the remaining flats in Highland Park. Notwithstanding, as the sale details of these flats did not form part of the Agreement for Sale and Purchase of the buyers concerned, these should not affect the dates for completion of assignment. Mr LEE Cheuk-yan however pointed out that at the meeting between HS and the Association on 27 March 1999, HS undertook not to issue Completion Notices to buyers concerned until 14 days after HS had responded to the Association's requests. Given that a formal reply from HS was still outstanding, Mr LEE considered it inappropriate for HS to issue Completion Notices to buyers in mid-May 1999. ED/HS advised that HS would issue a letter to inform all buyers of its decision shortly and Completion Notices would be issued seven days after the date of the letter. Buyers concerned would be given 14 days to complete assignment of the property. This should allow sufficient time for them to reach a decision on transactions. Given that buying a property was an important decision, Mr LEE held the view that HS should provide a comprehensive response to concerns raised by the Association to facilitate buyers concerned to decide whether they should proceed with the purchase.

18. The Chairman and Ms CHAN Yuen-han considered that when determining the sale prices for the remaining flats in Highland Park, HS should take into account the situation of preceding buyers since the sale prices would have direct impact on the value of their properties which had already turned into negative assets after the financial turmoil. PAS霡or H (1) advised that apart from construction cost and market situation, HS would take into consideration buyers' affordability in determining the sale prices of SCHS flats. Given that the fluctuation in buyers' income was much less than that in the property market, substantial adjustment in the sale prices of SCHS flats was not expected. As regards the some 700 remaining flats in Highland Park, PAS for H (1) assured members that since these flats were public assets, HS would not sell these flats at unreasonably low prices as this would affect not only the interests of the preceding buyers but also of the Government. Such act would also damage the development of the property market as a whole. As SCHS buyers had to undergo an income and asset test to ascertain their affordability, ED/HS opined that unless there was a substantial change in their financial situation, they should be able to cope with the mortgage repayments, particularly with the provision of a 20% top-up mortgage loan by HS. Ms CHAN did not agree with the Administration's views. She considered that HS should re-assess the Full Market Value (FMV) of SCHS flats taking into account that many buyers were facing a substantial cut in salaries amid the economic downturn. In reply, PAS for H (1) reiterated that the proposal to re-assess the FMV of SCHS flats that had been sold would set an undesirable precedent whereby established contractual obligations could be varied due to changing market situation and price fluctuations. This would also have serious implications on other subsidized housing schemes such as the Home Ownership Scheme (HOS) of HA.

19. Mr James TO acknowledged that setting the right prices for the remaining flats in Highland Park was a difficult task since preceding buyers would be affected if the prices were too low while prospective buyers would be reluctant to buy the flats if the prices were too high. He also expressed concern that banks might institute loan calls on preceding buyers if the sale prices of the remaining flats in Highland Park were much lower than that of the previous batches. ED/HS clarified that loan calls would only occur in the event of non-repayment of mortgage loans. As HS had already undertaken to cover the banks' risk on the portion of loans relating to the difference between the banks' valuations of the flats and the selling prices within the first five years, the chances for loan calls on SCHS buyers was slim. In reply to the Chairman's question, D(P&D)/HS confirmed that no non-repayment of mortgage loans had been recorded in respect of SCHS buyers.

20. As to whether HS would provide a full buy-back guarantee for SCHS flats as in the case of HOS flats, PAS for H (1) explained that the objective of SCHS was to provide housing flats at a discounted rate of FMV to those who were unable to afford flats in the private sector and yet ineligible for public housing. Apart from the discount rate, no other assistance, including the proposed safety net, would be made available for SCHS buyers. She also pointed out that the decision to purchase SCHS flats was purely an individual decision of the buyers taking into account their own financial capabilities. It was therefore inappropriate for them to ask HS or the Government to buy back the flats in the event of changes in their financial situation as this would involve the use of public money. Under the existing SCHS, HS could only buy back SCHS flats with a view to preventing speculation. Moreover, unlike HA, HS did not have sufficient financial resources to provide a full buy-back guarantee. Given that HOS and SCHS were both subsidized housing schemes, Mr猂EUNG Yiu-chung held the view that the same buy-back guarantee under HOS should similarly apply to SCHS. He therefore urged the Administration to consider amending the relevant provisions under SCHS to bring it on a par with HOS. In response, PAS for H (1) emphasized that HOS and SCHS were two distinct housing schemes with different target clienteles. Moreover, since the Government had announced to shelve the construction of SCHS flats in October 1998, it was not desirable to make any changes to SCHS at the present stage.

21. Mr CHAN Kam-lam asked if the many problems such as miscalculation of floor areas arising from SCHS projects were due to the lack of an effective monitoring system within HS. ED/HS advised that HS had instituted a stringent monitoring system which aimed to detect irregularities at an early stage as in the case of the Pinnacle. He assured members that HS would ensure good quality of flats before they were handed over to buyers and would make good any defects after completion of assignment. As regards the miscalculation of floor areas in Verbena Heights, ED/HS clarified that this was a design problem rather than a monitoring problem. Mr CHAN however pointed out that as the sole Government agent in the delivery of SCHS flats, HS had the responsibility to ensure that the quality of SCHS flats was comparable with that in the private sector. This was also the expectation of buyers concerned since they would be investing heavily on the flats. It was therefore understandable that these buyers had acted in such a critical manner because they wanted to make sure that their flats were value for money, albeit the economic slump might have aggravated the problem.

VI Rent review for public rental housing
(LC Paper Nos. CB(1) 1235/98-99(06) to (08))

22. Ms CHAN Yuen-han questioned the accuracy of the figures on median household income outlined in LC Paper No. CB(1)?235/98-99(07). By way of illustration, the slight drop in the median household income of a four-person household from $15,900 in the fourth quarter of 1997 to $15,000 in the same period of 1998 was not a true reflection of the actual situation when many households had experienced a substantial cut in salaries amid the economic slump. The Head, Corporate Strategy Unit (H,CSU) replied that as the figures on median household income were based on the findings of the General Household Survey conducted by the Census and Statistics Department, they should be very reliable. PAS for H (2) added that there could be individual cases deviating from the figures since the figures only represented the median household income.

23. On setting rents for new PRH estates, H,CSU advised that HA would take into account tenants' affordability as reflected in the General Household Survey and factors such as the comparative values and locations of the estates. New rents would not exceed the median rent-to-income ratios (MRIRs) of 15% and 18.5% of the prospective tenants for the minimum allocation standards of five-and-a-half square metres and seven square metres per person respectively. In fact, the prevailing overall MRIR for all new PRH estates was less than 15%. As regards the basis for setting rents for new PRH estates, H,CSU replied that it was a long-standing practice that the level of rent was set with reference to the incomes of the new households which moved into the PRH.

24. Given that MRIR was only a median figure, Mr LEUNG Yiu-chung expressed worries that half of the tenants in new PRH estates would have RIRs exceeding 15%; some might even reach 30%. Expressing similar concern, Ms CHAN opined that rents for new estates were too high, particularly amid the economic downturn when tenants' affordability was low. The situation would be further aggravated if HA were to raise MRIR to the permissible limit of 18.5%. Mr LEUNG and Ms CHAN considered that there was a need for HA to lower the overall MRIR of all new PRH estates to 10%. H,CSU advised that a higher MRIR for new estates would also reflect the better design and more spacious living conditions of these estates. He did not agree that rents of new PRH estates were too high as they in general represented only one-third of the rental of comparable flats in the private sector. The low rents were made possible because of the heavy subsidy from the Government and HA. H,CSU cautioned that the proposed reduction of MRIR to 10% for new estates would inevitably increase public subsidies. Moreover, it would not be fair to tenants in old estates if MRIR of new estates were close to that of old estates but the age of buildings and their standards and design differed a lot.

25. In view of the significant difference between MRIRs of new and old PRH estates, Mr硓red LI expressed worries that sitting tenants who had been re-housed to new PRH estates upon redevelopment would have to pay higher rents than before. He asked if relief measures were in place to assist these tenants. H,CSU replied that apart from new PRH flats, many refurbished flats at lower rents were also available for tenants affected by redevelopment. Moreover, tenants who faced temporary financial hardship could apply for rent reduction under the Rent Assistance Scheme.

26. On rent review for existing PRH estates, members noted that under Section 16(1A) of the Housing Ordinance, the overall MRIR of all PRH estates could not exceed 10%. With the overall MRIR for new estates exceeding 10%, Mr CHAN Kam-lam opined that HA might have to reduce rents in the future in order to maintain the overall MRIR of all PRH estates below the ceiling of 10%. H,CSU assured members that HA would take into account tenants' affordability, the relevant legislation, the prevailing economic climate and all related factors when reviewing rents for existing PRH estates. Mr LEUNG was not convinced of the Administration's response. He pointed out that there were many tenants, in particular those living in Harmony Blocks, whose RIRs were much higher than the overall MRIR of 10%. By way of illustration, a four-person family with a monthly household income of $15,000 living in a one-bedroom flat in a Harmony Block had to pay a monthly rent of $2,400 which represented a RIR of over 16%. In response, H,CSU stressed that the overall MRIR was still below 10% at present and the prevailing PRH rents were well within tenants' affordability. In fact, 75% of PRH households were paying a monthly rent of less than $1,500. He added that the higher rents for flats in Harmony Blocks were on account of their better design and more spacious living conditions. Besides, of the existing 650,000 PRH flats, the Harmony Blocks were still in the minority. To facilitate members' understanding, the Administration was requested to provide data showing MRIR for HA rental households as well as rents by households size and by block type on a quartile basis for the period from 1995 to 2009.

(Post-meeting note: The Administration's response was circulated vide LC Paper No. CB(1) 1414/98-99 on 1 June 1999.)

27. As regards rent increase, Mr LEUNG considered that amid the economic downturn, HA should not increase the rents for those PRH estates when their one-year rent freeze period expired in September 1999. He urged HA to extend the rent freeze period and to apply an across the board 30% rent reduction on all PRH tenants. Mr James TO also considered that HA should conduct a comprehensive rent review exercise prior to the implementation of the rent increase in September 1999 taking into account the impact of unemployment and pay cuts on tenants. The exercise should be completed before the next rent review cycle in July 1999. H,CSU replied that the rent increase for those PRH estates upon the expiry of the one-year rent freeze period had yet to be decided by HA. He nevertheless undertook to relay members' concerns to HA for consideration.

(Post-meeting note: The Administration's response was circulated vide LC Paper No. CB(1) 1414/98-99 on 1 June 1999.)

28. As to whether HA would review the rents for PRH estates in light of the result of the General Revaluation of the Rateable Values of all properties conducted by the Rating and Valuation Department, H,CSU advised that the PRH rent were set with reference to tenants' affordability and not the rateable values. Besides, domestic rents were rates inclusive. Therefore, PRH rents would not be varied just because of an increase or a decrease in rates.

VII Lighting in corridors of public housing blocks
(LC Paper No. CB(1) 1235/98-99(09))

29. Mr Albert HO did not agree with HD's proposal of switching off half of the corridor lighting during midnight in PRH estates in fear that residents' safety and security would be compromised. CM/M(SS3) clarified that the proposal was to switch off half or less of the corridor lighting in estates which had been provided with Security System A viz PRH blocks with gates equipped with digital combination lock and door phones installed at the ground floor entrances, close circuit monitoring television system and provision of security guards at the ground floor lobby as well as break-in warning devices for rooftop gates. Estates not yet provided with such level of security system and those with a level of illumination less than 30 lux after switching off part of the lighting would be excluded from the environmental protection proposal. The scheme would also not be implemented at locations where it would require costly alterations to achieve the minimum lighting level of 30 lux after switching off part of the lighting. He stressed that residents' safety and security had always been the first and foremost considerations in the management of PRH estates, and they would not be compromised for the sake of energy conservation. He added that security guards would be deployed to step up patrol during these hours.

30. Mr CHAN Kam-lam opined that the proposal might not be feasible in old PRH estates having regard to their existing low level of illumination. CM/M(SS3) took note of Mr CHAN's concern but advised that over the years, HD had spent million of dollars to improve the security and lighting of various PRH estates, particularly those in old estates. In the past two years, some $160 million were spent on lighting improvement alone. The lighting level in these blocks and their communal facilities had been enhanced twofold or even more at strategic points such as staircases and lift lobbies despite the fact that such provision would increase the energy bill. Apart from improving the lighting level, efforts had also been made to standardize the level of illumination in these estates.

31. Mr HO considered it contradictory that HD improved the lighting in some estates while switching off part of the corridor lighting in others. CM/M(SS3) advised that there was no contradiction between the two initiatives. The objective of energy management was to utilize energy efficiently and effectively rather than to generate saving. Lighting level would be increased whenever there was a genuine need even though such improvements might incur higher costs. The proposal would focus in estates which were equipped with Type A Security System which provided opportunities for energy saving measures without compromising the security level. The scheme would only be implemented where circumstances permitted. To ascertain the feasibility of the proposal, HD had started consultation with the Estate Management Advisory Committees (EMACs) of those selected estates under the proposed environmental conservation programme. Of the 36 returns received so far, 12 had indicated their positive support to the proposal. HD would continue to consult other EMACs. Mr獱ames TO held the view that apart from EMACs, HD should consult the Police on the potential impact on residents' security. CM/M(SS3) took note of Mr TO's suggestion.

32. The Chairman considered that the best way to save energy was to reduce the load factor at peak hours. He therefore did not agree that switching off part of the corridor lighting during midnight was an effective energy conservation initiative, particularly when the resulting saving was only $3 million per year. In reply, CM/M(SS3) emphasized that it was a social obligation to explore energy conservation opportunities whenever practicable rather than a matter of mere financial saving. He assured members that HD would carefully consider residents' views collected during the consultation period before reaching a final decision on this energy saving proposal.

VIII Developments at Anderson Road and Choi Wan Road/Jordan Valley
(LC Paper No. CB(1) 1136/98-99, 1235/98-99(10) and (11))

33. Referring to paragraph 2 of LC Paper No. CB(1) 1235/98-99(11), Mr蟖HAN謭am-lam considered that the buffer distance of 100 metres between the quarry plant and the housing blocks of the Development at Anderson Road (DAR) project was inadequate to reduce the impact of quarry dust and noise on prospective residents. Given that the quarrying activities were operating at a level higher than the platform for the building blocks, any change in wind directions and wind speed would affect the quantity of dust being blown towards the building blocks. He asked if the Administration had taken into account the wind factor in setting the buffer distance. In reply, the Government Civil Engineer/Project Management (GCE/PM) confirmed that the potential dust problem from the quarry, including the wind factor, had been considered in the Environmental Impact Assessment (EIA) for the DAR project. The EIA modelling results showed that the risk of dust being blown towards the building blocks was fairly minimal. The current buffer distance of 125 metres, which had already exceeded the requirement under the planning standard, should be able to reduce the quarry dust and noise impact to an acceptable level. He nevertheless assured members that the Administration would liaise with the quarry operator to introduce additional mitigating measures when necessary.

34. The Chairman however remained of the view that the buffer distance of 125 metres was insufficient. Expressing similar view, Ms CHAN Yuen-han cautioned that as the quarry would continue to operate for another 15 years, residents nearby might be vulnerable to pneumoconiosis as a result of continuous exposure to dusty environment. She therefore urged the Administration to consider deferring the DAR project until the quarry plant was closed down. GCE/PM clarified that the 125 metres referred to was the distance between the quarry plant and the nearest housing block in the DAR project. The remaining blocks were much farther away. He assured members that the Administration would review the entire layout of the DAR project at the detailed design stage.

35. On traffic impact of the DAR project, Mr CHAN expressed concern that the capacity of the existing roads, including the Clear Water Bay Road and Po Lam Road, would not be adequate to meet traffic flow arising from the DAR project and other planned developments within the Kwun Tong District, including the Development at Choi Wan Road/Jordan Valley. The Senior Engineer/Housing and Planning/Kowloon advised that traffic impact of these developments had been considered in the traffic impact assessment for DAR project. A strategic elevated link between the New Clear Water Bay Road and Lung Cheung Road was proposed subject to detailed assessment to determine the feasibility of the implementation programme. The study also showed that, with the implementation of improvement works to enhance the reserve capacities of 19 associated road junctions, the volume/capacity ratios of the existing road links would be sufficient to meet the traffic volume generated by the increased population under the committed and planned developments within the district. To facilitate members' understanding, the Administration undertook to provide the reserve capacities and junction capacities as well as volume/capacity ratios of the respective road junctions and road links.

36. Members were not convinced of the Administration's explanation. They considered that further justifications in respect of traffic and air pollution for the two development projects should be provided by the Administration.

(Post-meeting note: The Administration's response was circulated vide LC Paper No. CB(1) 1348/98-99.)

IX Any other business

37. There being no other business, the meeting ended at 7:20 pm.

Legislative Council Secretariat
10 August 1999