Optimizing land supply initiatives
This article appeared originally in the ejinsight on 5 October, 2021.
Authors: Ryan Ip Man-ki, Head of Land and Housing Research, and Jacqueline Hui, Researcher at Our Hong Kong Foundation.
A handy tool makes a handyman. If land and housing supply are compared to flour and bread respectively, the shortage of housing supply in Hong Kong is not simply attributed to insufficient flour. The crux of the problem lies in the lengthy land development process, as if the society had a dysfunctional machine that failed to turn flour into bread. To tackle land scarcity, the preliminary planning and administrative procedures of land development must be expedited to enhance efficiency for the adequate and timely supply of land and housing.
Speed up land supply by assigning a task force
Between the 70s and 90s, nine new towns were built. It took 7.5 years on average for the first batch of residents to move in. The former Territory Development Department (TDD) should be credited for developing new towns with effective coordination between various departments to foster urbanization. New Territories Development Department was set up in 1973 and merged with the Urban Development Department in 1986 to become TDD. TDD was a cross-profession department with development offices in each new town fully responsible for project execution, application for relevant statutory procedures, drafting development plans, and supervising the acquisition and clearing of land, etc.
In the 2000s, the government saw the diminished need for new towns and restructured the organization of TDD. Large-scale development projects are now split among different departments. For instance, the Planning Department is committed to formulating planning framework and development plans while the Lands Department (LandsD) is dedicated to land administration. Not only does the accountability mechanism become obscure when multiple departments are involved, but communication is also impeded and all these result in slow development progress. Since the re-launch of the Hung Shui Kiu New Development Area (NDA) in 2007, it has taken 17 years for the first batch of residents to move in. To hasten the development of NDAs, the government should establish a task force for coordination and overseeing work progress to step up accountability and supervision.
Clear accountability mechanism with well-coordinated departments
An accountability system plays a vital role in speeding up land supply initiatives and housing development. In 1997/98, the Steering Committee on Land Supply for Housing (HOUSCOM) was established to provide a clear mechanism for coordination among the Housing Authority (HA), LandsD and TDD. For the housing projects in new towns and major development areas, the TDD was responsible for site formation works before the sites were delivered to the HA to construct public housing or to the LandsD for sale as private housing development. The HA and LandsD would then be accountable for the projects until the completion of works. A production timetable was stipulated for the departments to follow and frameworks existed in the HOUSCOM to resolve complications.
Thanks to the clear goals and transparent accountability system, an annual average of 68,200 flats were completed from 1999 to 2003 for public and private housing. Lamentably, gone are the days when such an effective mechanism existed. Despite the restructuring of the HOUSCOM into the Steering Committee on Land Supply in 2013, the progress is still lagging behind the target of supplying 46,000 flats per annum as laid down in the Long Term Housing Strategy. Only with a result-oriented management style can efficiency be enhanced and the supply of spade-ready sites be facilitated.
Review policies to balance conservation and development
Conservation must be given due consideration regarding the development of the N.T. North and Northwest where wetlands and fish ponds are abundant. However, existing policies are not conducive to both conservation and development. The Town Planning Board (TPB) has demarcated lands of over 3,000 hectares along the boundary of the wetland conservation area as a wetland buffer area, equivalent to 2.7% of Hong Kong’s total area. Although the TPB can restrict development on private lands, there is a lack of mechanisms to ensure that owners conserve the land properly. In fact, many fish ponds are left idle and covered with weeds.
60% of land in Hong Kong (approximately 66,000 hectares) is situated in country parks, green belts and other green areas, unavailable for development. Undoubtedly, country parks and green belts are important for conservation and leisure. That said, the ecological values of relevant areas have not been regularly reviewed. In particular, the boundary of country parks has not been reviewed for 40 years since its establishment. Land resources are so precious that it requires active planning by the government to optimize land use so that social and economic needs can be satisfied while balancing citizens’ livelihood and conservation, catering to different groups.
Conservation and development are not mutually exclusive. Overseas countries adopt policies to strike a balance, such as setting up a conservation trust. Meanwhile, the government ought to conduct scientific research regularly, focusing on preserving lands with high ecological values to release other lands for development.
Land reserve for a rainy day
To tackle the scarcity of land once and for all, the land reserve is of paramount importance. Many countries are equipped with land reserves with no immediate use but can be developed at any time. Such government land can help society address new development needs and cover unexpected land supply shortfall. While the government introduced the concept of land reserve last year, it is hardly possible to be implemented before comprehensive plans are finalized, given the existing legislative and administrative procedures. Land resumption and reclamation are the major means of land reserve creation. However, the government can only invoke the Lands Resumption Ordinance to resume private land after confirming its “public purpose” through NDA projects or other public housing projects. It is also stipulated in the government’s internal administrative procedure that outline zoning plans or revised outline plans must be prepared before reclamation.
The government can take reference from the land reserve mechanisms of other places. In Singapore, the widely adopted concept of the White Zone is a valid example. As long as a few parameters in the terms and conditions of sale/tenders are fulfilled, development projects are not restricted to any usage by default. The government can also set up public organizations to acquire land through market mechanisms. Only through land reserve can Hong Kong avoid the land supply crisis of today.
Enhance land supply initiatives against all odds
In face of the knotty housing problem, society yearns for a panacea to instantly increase land and housing supply. However, land development is slow in progress due to inadequate infrastructure, stakeholders’ discontent and policy imbalance. These three elephants in the room have long been overlooked. If we only focus on a particular housing project, it may not be worthwhile to review all sorts of complicated issues. It is exactly this mindset that renders land supply initiatives ineffective, also slowing down Hong Kong’s land supply in the short run. Our research analyzing the development prospect of the N.T. with recommendations concludes here – developing the N.T. can accommodate Hong Kong’s future development and sharpen Hong Kong’s competitiveness in the long run; optimizing land development processes can meet the housing demands by expediting the completion of several hundred thousands of flats in the short run.