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But this autumn he has so directed and the result is a surprisingly great increase in rateable values amounting to an average of 80%, although in some areas as much as 300%. I am not an expert on valuation, but I do know that as the property market is fairly constantly going up and rentals are fairly constantly going up, so of course a new rateable value for the first time in 4 years shows obviously a considerable increase. Whether or not we like it, from much needed increase in revenues, and I am now speaking as Chairman of the Finance Select Committee, we must not put too hard a burden on the middle-class owners of flats and the people of small income who rent flats or rooms in the private section all over the Urban areas. We have budgeted for a tremendous surplus this year and you, Mr. Chairman, quite rightly said the surplus is more apparent than real because over a 3 or 4 years' period it will be eaten up by an increase in personal emoluments which accounts for from 60 to 80% of our total income. Nevertheless, I think we must be prepared to cushion the effect of increase in rateable values by voluntarily lowering the proportion of the rates that goes to the Urban Council. The only thing is that I insist the Central Government lowers by a proportionate amount. The total rates used to be 15%, then 16%, then 17%, then 18% of the rateable values. But the Urban Council has from the beginning and under the Memorandum of Agreement that constitutes the independent financial status of the Urban Council, only taken 6% of that total amount. At present, the Government takes 12% and the Urban Council 6%, previously it was 9 to 6; if therefore the Urban Council took 5%, the Government should only take 10% at the most. If the Central Government took under 10%, the Urban Council should only be expected to reduce to 5% at the most. There are of course other ways of relieving the burden on middle-class people and people in the lower wage earning bracket. I elaborated on this in a speech in a Rotary Club the other day. Exemption from paying rates for instance could be increased. But the most acceptable proposal in my opinion, if the Governor does not intend to direct an annual evaluation, is to stagger the increases year by year. In other words, say the Government's policy was to have a further valuation every 4 years, then this 80% could be staggered over 4 years: 20%, 20%, 20%, 20%, so that it is only on the fourth year that the true rateable value is reached. This indeed would be more in line with the rent control Legislation which on the whole permits a gradual increase in the rents of domestic buildings throughout urban Hong Kong.
Finally on this subject, although we, the Urban Council need more income, we can serve the citizens of Hong Kong better by having more income; there are a lot of new buildings, essential buildings that could be erected if we have more income. Nevertheless, we must not allow the position to arise in which our income becomes a burden on the Hong Kong citizens.
Public Housing and the Urban Council
When I first came on the Urban Council in 1952, I inquired about public housing to receive the reply that it was not within the jurisdiction of the Urban Council and when I persisted in my enquiry I was told to sit down or get out. I did neither, and by 1954 the Urban Council was heavily engaged in public housing, both because of the formation of a Resettlement Department which was under the Urban Council and because of the creation of a Housing Authority that in effect was the Urban Council under another coat (just as education in London is given to the local councils under the coat of an education authority). Because the Resettlement Department was under the Urban Council, all its dealings were open to the public and subject to public criticisms, constructive or otherwise. And a very good thing it was. Even the Housing Authority had public meetings. In resettlement, the government appreciated its responsibility to persons of the lower income brackets to grant, in effect, subsidized housing. The Housing Authority, on the other hand, being a co-operation financed by Government loans and therefore having to balance its budget year by year to pay back the loans, was in consequence, only able to cater for the so-called middle classes. In 1973 when the Urban Council became quasi-independent, this responsibility of Public Housing was immediately taken completely from the Council. The Resettlement Department was abolished and the Housing Authority reformed. Admittedly, there are still representatives of the Urban Council on the Housing Authority, but these representatives are appointed by the Governor, not even elected by this Council. If the Governor does not want a certain individual, then however much he or she may be wanted by the Urban Council or the people, if he or she is not appointed, then he or she is not permitted to go on the Housing Authority. This is basically undemocratic—indeed it is a bureaucratic dictatorship. Again, the Government, through the Housing Authority, seems now disinclined to continue subventions and is raising the rents on all new estates to make the Authority a financially viable body. Admittedly, some families can afford relatively high rents, but other families definitely cannot, and the new Housing Authority is not even considering building an estate or estates for those people where the rentals are within their means. Nowadays, also as I have said, the Housing Authority works behind closed doors. Why?
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