XN000022-1983-05-25 — Page 11

WEDNESDAY, MAY 25, 1983

GREATER EFFORT ON SETTLEMENT OF FUTURE URGED

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THE TIME AND ENERGY BEING SPENT ON REDUCING RENT CONTROL COULD MORE PROFITABLY BE SPENT IN EVEN GREATER EFFORTS TO PERSUADE LONDON AND BEIJING TO GET ON WITH REACHING AN ACCEPTABLE SETTLEMENT ON THE FUTURE OF HONG KONG, THE REV THE HON PATRICK MCGOVERN SAID AT THE RESUMED DEBATE OF THE LANDLORD AND TENANT (CONSOLIDATION) (AMENDMENT) BILL 1983 IN THE LEGISLATIVE COUNCIL TODAY.

+BY ACCEPTABLE I MEAN SUCH THAT INVESTORS WILL HAVE CONFIDENCE TO INVEST IN LONG TERM PROJECTS ESPECIALLY THOSE INVOLVING LEASES, FR MCGOVERN SAID,

HE THOUGHT THAT MOST PEOPLE WERE HEEDING THE GOVERNOR'S ADVICE TO BE PATIENT AND TO GET ON WITH THE DAY-TO-DAY WORK, *BUT TO INVEST MONEY IN AN UNCERTAIN FUTURE IS A DIFFERENT MATTER,+ HE ADDED.

IN OPPOSING THE MOTION FR MCGOVERN SUMMARISED GOVERNMENT'S POLICY +AS BEING TO GRADUALLY PHASE OUT RENT CONTROL IN ORDER TO BRING ACTUAL RENTS UP TO THE LEVEL OF FAIR MARKET RENT.

*THE POLICY SHOULD, OF COURSE BE THE OPPOSITE. IT SHOULD BE TO BRING DOWN THE EXORBITANT, SPECULATION-FED UNFAIR MARKET RENT TO A LEVEL WHICH PEOPLE CAN AFFORD TO PAY, HE SAID.

FR MCGOVERN SAID THAT DUE TO SPECULATION AND OTHER REASONS THE +RENTS WERE ON THE WHOLE UNFAIR+.

+1 AM GLAD TO NOTE THAT AT LONG LAST GOVERNMENT INDIRECTLY ADMITS THIS FACT BY PROPOSING TO REMOVE THE WORDS 'FAIR MARKET RENT' FROM THE LAW.

+UNFORTUNATELY IN ADMITTING TO THE NEED FOR A CHANGE OF WORDS THERE WOULD APPEAR TO BE NO ADMISSION OF THE NEED FOR A CHANGE OF POLICY.

+POLICY IS STILL BASED ON THE UNCHANGED FACT. WHAT BECOMES *PREVAILING' REMAINS UNFAIR', +FR MCGOVERN SAID.

FR MCGOVERN EXPLAINED THAT HE OPPOSED RELAXATION OF RENT CONTROL AT THE PRESENT TIME FOR FOUR REASONS. IN ADDITION TO THE ONE ABOUT POLICY, THREE OTHERS WERE ABOUT SUPPOSITIONS WHICH COULD BE WRONG.+

REFERRING TO THE FIRST POSSIBLY WRONG PRESUMPTION, + THAT THE ONLY REAL SOLUTION TO THE HOUSING PROBLEM WAS THE SACRED LAW OF SUPPLY AND DEMAND, HE SAID THAT IT DID NOT, IN ITSELF, WORK.

AND HE COULD FIND NO EVIDENCE AMONG THE MASS OF VERY INTERESTING STATISTICS PROVIDED BY GOVERNMENT,+ THAT RENTS FOR MEDIUM AND SMALLER FLATS WERE GOING DOWN AS IT WAS CLARED THEY WOULD AS A RESULT OF SUPPLY AND DEMAND COMING INTO PALANCE, HE SAID.

+OUR REAL PROBLEM IS TO BALANCE SUPPLY AND NEED.

NEEDY ARE OFTEN IN NO POSITION TO TAKE PART IN THE DEMA + HE SAID.

/A SECOND