TNAG-0961-FCO40-1180-Legislation-for-piers-and-harbours-in-Hong-Kong-1980 — Page 7

G.S. 84

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XCR (80)64

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of Lands, Survey and Town Planning, the Director of Marine, the Director of Trade, Industry and Customs, the Registrar General and the Commissioner of Rating and Valuation. There is general agreement (except over the rental issue as described in paragraphs 6 to 10 above) that the proposals in paragraphs 11, 13 and 14 represent an equitable and appropriate means of enabling private pier facilities to continue in operation until such time as they are affected by public works.

Recommendations

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For the reasons given in the text of this memorandum, the proposals for regrants in paragraphs 11, 13 and 14 above are recommended for approval.

General Public Reaction

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As the main-in-the-street is not affected directly by the new policy, it is unlikely that there will be criticism or even much interest from the general public. However, individual lessees will probably object to the new annual rental of $150/m2. Because there will be a flat rate, it may well be criticised as being arbitrary and inequitable, and incapable of reflecting the different economic values of the piers. The fact that the annual rental is based on the 12-fold increase in industrial land prices since 1964 will probably be labelled as part and parcel of the so-called "high land prices" policy. However, as the lessees are large, profit-making corporations, it is unlikely that they will have much public support should they come out against the new rental. It is likely the public will take the view that the lessees, having enjoyed low rental for 30 years and, having made substantial profits over the years from the exclusive use of the pier facilities, should have no problem in absorbing the increase in rentals. While the increase may appear high in percentage terms, it is not excessive in relation to prevailing rent levels in the commercial sector.

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As the leases in question were originally renewed for a further 15 years, and as they are now to be regranted on monthly/annual tenancy or 10-year leases, there may be Press speculation on why this is so.

Publicity

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Routine publicity should be arranged for the proposals for regrant of the leases. If there is strong reaction to the new annual rental, there may be a need for further explanation of the basis of assessment.

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