XN000022-1972-05-10 — Page 3

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Wednesday, May 10, 1972

Mr. Hong said the purpose of reassessing Crown rents upon expiry

of renewable Crown leases were two-fold: first, to bring Crown rents to

a more realistic level in line with market conditions, and, secondly, to

derive a higher revenue from them.

"Under ordinary conditions, this step would be the normal

procedure in the financial administration of a government. However,

every one is now aware of the abnormal inflation in land values in

recent years."

As the price of land affects rent, which is an important component

in the cost of living, it would be injudicious for Government to adopt a

formula which raises the Crown rents to too high a level, he said.

"If we do not control rent or at least Crown rent, which we can,

we will find that we will face the problem of controlling another factor

of production which is more tedious and almost impossible."

He said many of the leases concerned were industrial lots, and

already some industrialists had become disillusioned with the high land

price policy of Government and they had moved their factories elsewhere.

"If this policy is allowed to continue, the ill effects on our

economy should be obvious," he said.

Mr. Wong pointed out that the present lease holders were generally

not the original lease holders

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many were recent ones and owned small

lots for the purpose of their own living.

He cited several examples, where the share for a flat owner of

the new Crown rent, on renewal of the Crown lease, would amount to more

per annum than the total annual rental income.

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