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LCQ6: Improving facilities and environment of existing public markets
     Following is a question by the Hon Shiu Ka-fai and a reply by the Secretary for Food and Health, Professor Sophia Chan, in the Legislative Council today (November 15):


     Over the years, many members of the public and tenants of stalls in public markets have complained to me about the poor environment of public markets which are currently not provided with air-conditioning systems.  Those markets are hot and stuffy during summer, which turns away customers.  As a result, the tenants have difficulties in doing businesses or even have to close down their businesses, causing a rise in the vacancy rates of the markets concerned.  In the Policy Address delivered by her recently, the Chief Executive indicated that "the Government will allocate resources to improve the environment of existing public markets.  One of the measures is to expedite the installation of air-conditioners".  In this connection, will the Government inform this Council:

(1) how the public markets with air-conditioning systems compare, in terms of the current vacancy rates, with those without;

(2) of the amount of resources that the Government will allocate for improving the environment of public markets in each of the coming five years; among such resources, of the estimated amount to be used for meeting the costs of works for retrofitting air-conditioning systems in various public markets, as well as the expected commencement and completion dates of the relevant works (with a tabulated breakdown by name of public market); and

(3) given that at present, only after a proposal for retrofitting air-conditioning system in a public market has obtained the support of at least 80 per cent of the tenants will the Food and Environmental Hygiene Department conduct a technical feasibility study on the relevant works, and that the recurrent expenses to be incurred and borne by the tenants after the retrofitting of an air-conditioning system are one of the major considerations of the tenants as to whether they support the proposal, whether the Government will consider helping the tenants in reducing their burden in this respect, so as to facilitate the improvement works of retrofitting air-conditioning systems for public markets; if so, of the details; if not, the reasons for that?



     In the 2017 Policy Address delivered in October, the Chief Executive stated that the Government would conduct a comprehensive review of existing public markets, formulate specific improvement measures for the facilities in a systematic manner and allocate resources to improve the environment of existing public markets, including expediting the retrofitting of air-conditioning systems.  The Government will form a dedicated team to take forward the above work.

     My reply to the various parts of the question raised by the Hon Shiu Ka-fai is as follows:

(1) The occupancy of public markets is influenced by many factors, such as competition from retail outlets selling similar commodities in the vicinity and demographic changes in the district.

     As at September 30, 2017, among the 99 public markets, excluding the stalls which are vacant due to upcoming consolidation or improvement works, the vacancy rates of markets with and without air-conditioning systems are both about 2 per cent.

     The Food and Environmental Hygiene Department (FEHD) has been seeking to improve the environment of public markets, in order to attract patronage and improve the operating conditions of stalls.  The FEHD also conducts promotional activities regularly to attract patronage and with a view to promoting the letting of market stalls.

(2) The Government has been implementing various improvement works in public markets to improve the operating environment.

     In addition to regular maintenance and daily management of markets, the FEHD will carry out improvement works in eight public markets in this financial year (note 1). The scope of works may include installation of goods lift, improvement of ventilation, electricity and fire services installations, and refurbishment of external walls and toilets, etc.  Besides, the FEHD has been following up on the improvement works for the six public markets previously recommended by a consultant (note 2).  The improvement works for Lockhart Road Market commenced in the second quarter of 2017 for completion in the fourth quarter of 2019.  The improvement works for Sheung Fung Street Market are expected to commence in the second quarter of 2018 for completion in the fourth quarter of the same year.  The estimated cost of all these works exceed $60 million.

     In addition, we have plans to replace in phases the aged escalators and lifts.  We have earmarked about $300 million for the replacement of more than 80 escalators and more than 30 lifts in 23 markets.  The replacement works are expected to be completed progressively in the coming years.

     Regarding the air-conditioning systems, as the retrofitting works to be carried out in public markets which have existed for a long time will inevitably affect the daily operation of the markets (including possible suspension of business for a period of time), we must consult the tenants on the proposals in advance.  When there is a request from market tenants for the retrofitting of an air-conditioning system at their public market, the request will first be discussed at a meeting of the relevant Market Management Consultative Committee (MMCC).  Where a consensus is reached by the MMCC that the request should be further explored, the FEHD will conduct a questionnaire survey to gauge the extent of support from market tenants.

     If 80 per cent or more of the tenants support the proposal, a technical feasibility study will be conducted.  Taking into consideration factors such as the findings of the technical feasibility study, scope of works, cost effectiveness, impact on business and market operation, and whether the implementation details are acceptable to the tenants concerned, the Government will decide whether funding should be sought for the works of retrofitting an air-conditioning system.  As at October 2017, a total of 11 public markets have obtained sufficient tenants' consent for the retrofitting works.  The works progress of these markets is tabulated at Annex.

     As for individual cases in which more time is required for consultation, the problems mainly stem from the existence of technical difficulties or failure to reach a consensus with the tenants on the works concerned, including:

(a) The design and layout of some older market buildings have not reserved space for the retrofitting of air-conditioning systems.  Such buildings often lack sufficient electrical capacity and/or the necessary space and headroom for adding plant rooms and transformer rooms;

(b) Also, the retrofitting of air-conditioning systems usually requires substantial capital works (note 3) and disproportionately high capital costs, and will cause significant disruption to the tenants' business and operation of the public markets;

(c) When undertaking such major retrofitting works, we have to comply with the latest prevailing statutory requirements on building and fire safety (note 4). With the possible need for space to accommodate the plant rooms and relevant equipment, the number of stalls may be reduced, hence it will no longer be able to accommodate existing tenants; and

(d) Air-conditioning plants generate noise and dissipate heat.  In some cases, they may adversely affect occupants of those buildings adjacent to the existing low-rise market buildings.

     In view of the above, the FEHD maintains active dialogue with the Architectural Services Department, relevant MMCCs, tenants and other stakeholders to seek agreement on the extent of works before proceeding with the work such as the technical feasibility study.  Regarding the 10 markets other than Tai Wai Market, the department will conduct assessments of the estimated commencement and completion dates, or the expenditures for the relevant works upon reaching a consensus with the stakeholders.

     We propose to set up a dedicated team to give priority to speeding up the air-conditioning retrofitting works, including formulating proposals in the light of the actual circumstances of individual markets with a view to reaching a consensus with the tenants as soon as possible on the extent of works.

(3) As for the suggestion of helping tenants relieve their burden of air-conditioning charges, it is worth noting that the high capital costs of retrofitting air-conditioning systems are already borne entirely by the Government.  Unlike landlords in private commercial venues, who seek to recover the capital costs of retrofitting of air-conditioning systems through rental adjustments, the Government does not recover the capital costs.  Bearing in mind the fact that tenants in public markets are in fact commercial operations, further Government subsidy in the form of air-conditioning charges may give rise to unfair competition between stalls in public markets and similar retail operators in private commercial retail premises or retail shops nearby.  Under the principles of "user pays" and "fair play", we need to consider the proposal carefully.

     The proposed dedicated team will conduct a comprehensive review covering, among others, the positioning of public markets and their operating details, such as management mode, arrangements on daily operation and cost-effectiveness, etc.  To ensure effective use of public resources, we must consider how the community can ultimately benefit from taxpayer subsidies for commercial operations.  We understand that Members of this Council and the public have expectations on public markets, in that public markets will serve as an alternative to those operating on a purely commercial basis.  In this connection, we will take into account the relevant factors as a package, including air-conditioning charges, rates, rent, cleansing and maintenance fees as well as the positioning of public markets.

Note 1: Including Fo Tan Cooked Food Market (East), Fo Tan Cooked Food Market (West), Tsuen Wan Market, San Hui Market, Kut Shing Street Cooked Food Market, Kwun Chung Market, Sai Ying Pun Market and Sai Wan Ho Market.

Note 2: Including Lockhart Road Market, Sheung Fung Street Market, Yau Ma Tei Market, Wing Fong Street Market, Tsuen Wan Market and Ngau Chi Wan Market.

Note 3: which may include structural strengthening works.

Note 4: e.g. satisfying the minimum width of corridors and the minimum number of fire escape routes.
Ends/Wednesday, November 15, 2017
Issued at HKT 17:45
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