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PROVISIONAL URBAN COUNCIL
The above facilities generate an annual income of some $67,500,000 for the Council. If the motion is carried, it is estimated that the annual revenue foregone will be some $19,000,000, being $67,500,000 × 0.3.
I understand that the motion will affect 98 contracts, which are awarded by open tender. Proposals are submitted by the operators and the dates of execution and commencement of the contracts vary. I would therefore suggest that if the motion is implemented, there should be a time limit, that is, only those operators entering into contracts in or before June 1998 will be benefited.
In her letter, the Director of Urban Services advised that the Council should not provide assistance to shops/organizations which are not in need. I don't agree with this. In fact, I have been receiving representation from them in recent months, requesting for assistance in view of the present economic downturn and difficult times in which the spending power has greatly diminished. In fact, some shop-operators have written to the USD requesting for reduction of rent. Some even request for a reduction as high as 50%. This shows that there is a pressing need for rental reduction. As an organization serving the community, the Council should give a helping hand to the shop-operators by reducing the rental of the above facilities, so as to minimize their loss and help them ride out the storm. Some of the shop-operators are here today to indicate their support with their presence.
At the same time, since the contracts for the refreshment kiosks, fast food kiosks, restaurants, refreshment bars and book/gift shops in the Council's recreational, cultural and entertainment venues and museums are awarded by tender, I consider that in order to be fair, these facilities should be treated the same as the market stalls by being granted a 30% rental reduction.
Rental reduction definitely is a short-term measure to help the shop-operators tide over their financial difficulties. Meanwhile, if the shops could maintain their business, steady income would be guaranteed for the Council.
It is also hoped that in reducing the rent, the Council will inspire the other public or private organizations and all the property-owners to take the lead in reducing the rental of their shop tenants, so as to stimulate the economy.
As to the suggestion that the issue has to be referred back to the various select committees such as the Culture, Recreation, Museums and Entertainment Select Committees for further deliberation, I don't agree to it. Rental reduction is an urgent measure affecting only 98 contracts. There should be no need to refer the issue back to the select committees for consideration.
I understand that the Council has to shoulder the loss of revenue itself, but through the financial practice of increasing revenue and reducing expenditure, such as the measure of leasing advertisement spaces which I strongly recommended recently, I am sure that we will have no difficulty in finding a suitable solution.
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