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2017 Policy Address by Chief Executive (7)
Land Use - Development and Conservation

107. High property prices and rentals have been a critical livelihood issue in Hong Kong, placing a heavy burden on people.  The housing problem affects family structure and distorts our value system.  To own a home and repay a mortgage, many people set their eyes on making as much money as they can.  Money also weighs heavily on young people when they make academic or career choices.  The housing problem also poses the gravest potential hazard to the Hong Kong community as many families have no choice but to live in subdivided units, even in industrial buildings.

108. There are certain misunderstandings in the community about the demand and supply of land for housing.  On the demand side, with a very low population growth rate and rapidly ageing population, we cannot rely on curtailing population growth to reduce housing demand.  Over the past four years, despite a number of measures by the current-term Government which have successfully curbed external, investment and speculative demands, the difficulty in achieving home ownership remains an unresolved problem.  As for supply, with the low vacancy rate of industrial buildings, we cannot count on their redevelopment to increase the supply of residential units.  Even if we build in dense urban areas, flat production will still be very limited.

109. In terms of costs, it is not high construction costs but expensive land premiums that have led to high property prices and rentals.  Most families in Hong Kong can afford the construction costs passed onto them, yet the exorbitant land premium is beyond their means.  This is not due to inadequate land supply but shortage of land zoned for housing development.  Today, only 7% of land in Hong Kong is zoned for housing purposes.

110. The housing problem in Hong Kong boils down to land use, which is not a technical issue, but a conceptual one.  So long as we dare think out of the box and re-examine our land use planning in a serious, scientific and objective manner, we will be able to increase land supply and lower the levels of land premium, property prices and rentals, thereby alleviating the housing burden and improving the living environment of our community, and ultimately solving the housing problem at the root.

111. Although this is the last Policy Address of the current-term Government, it is incumbent on us as a responsible government and members of the Hong Kong community to sum up and share our experience with the public.  I invite you to re-examine our land use planning for the benefit of Hong Kong's long-term development and our next generation.

112. The most distinctive characteristic of land use planning in Hong Kong is the high proportion of country park area.  At present, our country parks account for 40% of the total land area of Hong Kong, six times that of our total residential land.  As the gap in development density between the urban and rural areas widens, people's living conditions in urban areas become increasingly cramped as population density intensifies.

113. Country parks are our precious assets for their leisure, recreational, sports and conservation values.  The current-term Government is committed to environmental protection and ecological conservation, and seeks to strike the right balance between development and conservation.  In the past few years, we have incorporated suitable enclaves, such as Sai Wan, into country parks, increasing the total area of country parks and special areas by 38 hectares.  In developing the Kwu Tung North and Fanling North NDAs, we will establish a Long Valley Nature Park of about 37 hectares.  To conserve more sites with high ecological significance, the Government will commence work on designating Robin's Nest, about 500 hectares, a new country park.  In addition, we are actively considering long-term conservation of Sha Lo Tung through a non-in-situ land exchange for the private land with high ecological significance at Sha Lo Tung by offering the rehabilitated Shuen Wan Landfill in Tai Po.  In tandem, we will continue to identify suitable sites for inclusion into country park areas.

114. Some remote rural areas are on the brink of desolation, leading to depletion of their valuable ecological and cultural resources.  Apart from the country parks, the Government has adopted a diversified and flexible approach in supporting and promoting the conservation of rural areas through harnessing community efforts in recent years.  Lai Chi Wo, for example, has great ecological value and a Hakka "walled-village" culture dating back to over 300 years ago.  With the support of local villagers, the Government is actively collaborating with a number of non-governmental organisations (NGOs) to take forward different revitalisation projects and minor improvement works with various funding sources to rejuvenate its ecological, cultural and architectural environment.

115. To further promote the revitalisation of remote rural areas, the Government will establish a preparatory committee to study the ambit and modus operandi of a conservation fund, as well as the legislation and resources required for setting up such a fund.  In the process, we will take into account relevant experience in and outside Hong Kong.  We will seek to conserve and revitalise the ecology and culture of rural areas based on the sustainability principle, and respond to the aspirations of urban dwellers for urban-rural symbiosis.  The fund will also provide an integrated and dedicated mechanism and resources for implementing policy initiatives relating to the conservation of biodiversity in the rural areas.

116. To underpin the sustainable development and conservation of Lantau, the Government will implement rural conservation pilot projects in areas such as Tai O, Shui Hau and Pui O.  Different government and community resources will be deployed to take forward various rural conservation initiatives, including nature conservation and education, revitalisation of old village buildings, as well as promotion of ecological and cultural tourism.

117. Apart from making strenuous efforts to conserve the rural areas and countryside, the current-term Government also adopts a multi-pronged approach to release land resources, which involves the NDAs and new town extension projects mentioned above as well as development of brownfield sites and reclamation, to address the pressing needs for housing and other development.  The reality, however, is that there are often diverging views in local communities or even in the whole society on land development projects.  During the planning and development process, we face all sorts of challenges and resistance that may lead to delays, downscaling or even the scrapping of projects.  I consider that regarding land use, we should incorporate more land with high ecological value into country parks, increase the total area of ecological conservation sites and country parks, and enhance their recreational and educational values.  At the same time, we should also consider allocating a small proportion of land on the periphery of country parks with relatively low ecological and public enjoyment value for purposes other than real estate development, such as public housing and non-profit-making elderly homes.  This issue matters to the well-being of our next generation and warrants serious deliberation of its pros and cons by the society.

Promoting Green Buildings

118. Under the current arrangement, a private housing development project is required, among other things, to register for Building Environmental Assessment Method Plus (BEAM Plus) as a prerequisite for application for gross floor area concession for amenity features.  We will review this arrangement to further promote green building.  In the review, we will consider tightening the prerequisite by requiring a development project to attain specific standards of performance in environmental protection, or even adopt performance-based and site-specific approaches to determine the maximum gross floor area concession.

Heritage Conservation

119. The Government is committed to promoting heritage conservation.  So far, five batches of projects under the Revitalising Historic Buildings Through Partnership Scheme have been rolled out, involving a total of 19 historic buildings.  Eight have completed revitalisation works and are open to the public.  Among these, four have won the Asia-Pacific Awards for Cultural Heritage Conservation from the United Nations Educational, Scientific and Cultural Organisation.  We will continue to collaborate with NGOs.

Land Restructuring and Enforcement

Agricultural Land

120. The New Agriculture Policy announced last year is making good progress.  The engineering feasibility study of the Agricultural Park will be completed soon.  The $500 million Sustainable Agricultural Development Fund started accepting applications from the end of last year.  A study on Agricultural Priority Areas will commence later this year to identify relatively large areas of quality agricultural land and formulate policies and measures to promote the rehabilitation of fallow agricultural land and improve the rural environment.

Brownfield Sites

121. The aim of re-organising the land use of brownfield sites and releasing such sites for development is to optimise their use, improve the rural environment and provide suitable land for relevant industries.  The priority is to develop areas concentrated with brownfield sites through comprehensive planning by way of large-scale new town development approach.  The developments in Hung Shui Kiu, Yuen Long South and Kwu Tung North/Fanling North NDAs currently underway cover about 340 hectares of brownfield sites.  Moreover, the Planning Department will conduct a survey on the distribution and use of all brownfield sites in Hong Kong this year.

122. Many brownfield operations related to such industries as logistics, port back-up, recycling, vehicle maintenance, as well as construction, are performing social functions.  Taking Hung Shui Kiu NDA as a pilot case, the Government is now exploring the consolidation of brownfield operations into multi-storey industrial buildings or through other efficient means of land use, so as to release the brownfield sites for development.

123. Meanwhile, the Government will continue to take stringent enforcement actions against illegal land uses, including unauthorised development under the Town Planning Ordinance and illegal occupation of government land, in the rural New Territories (including brownfield sites).

Enforcement against the Misuse of Industrial Buildings

124. The Buildings Department and the Lands Department will continue to take risk-based actions to address safety concerns for industrial buildings arising from non-compliance with or breaches of lease conditions.

125. Meanwhile, the Government will actively consider introducing new legislation to step up the enforcement efforts of the Buildings Department on different fronts to combat the problem of illegal domestic units in industrial buildings.  We aim to consult the LegCo on the specific proposals in this legislative session.

126. The Buildings Department will continue to take enforcement action against illegal subdivided units in industrial and residential buildings, including issuing removal orders to owners in respect of unauthorised building works and applying for closure orders from the court when necessary.

Harbourfront Enhancement and Development

127. There is a general consensus in the community for the need of a new mindset in taking forward harbourfront enhancement.  However, it is premature to establish a statutory Harbourfront Authority.  The Government has decided to first partner with the Harbourfront Commission and implement harbourfront enhancement initiatives through a dedicated team with dedicated funding.  The aim is to further extend the waterfront promenade along both sides of the Victoria Harbour, beautify areas in the vicinity and improve accessibility of the waterfront.  The Government has earmarked $500 million for the first stage for taking forward harbourfront development.

Construction Industry

Public Works Projects

128. While making substantial investment in infrastructure, the Government has also strengthened its construction cost control.  Last year, the Development Bureau established a dedicated office to manage project costs.  A comprehensive review of the public works requirements and policies is underway to enhance cost-effectiveness.  The Government will also enhance the existing procurement procedures for public works projects to reduce costs.

129. The Government is closely scrutinising the estimates of works projects at the planning and design stage to optimise designs and lower costs according to a "fitness for purpose" and "no frills" principle.  The Development Bureau has so far examined about 60 works projects and achieved savings of about $13 billion in project costs.

Technology Application and Innovation

130. Building Information Modelling technology allows construction professionals to carry out design and construction works in a virtual environment, which helps avoid changes in the construction process as far as possible, reduce risks and render clarity to project costs in various stages.  The Government will actively seek to require consultants and contractors to use this modelling technology when undertaking design of major government capital works projects from next year onwards.

131. The Construction Industry Council will set up an innovation and technology application centre to provide a platform for introducing innovative technologies into the industry to enhance productivity.  The centre will commence operation in the second half of this year.

(To be continued)
Ends/Wednesday, January 18, 2017
Issued at HKT 12:08
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