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LCQ13: Private recreational leases
     ​Following is a question by the Hon Tanya Chan and a written reply by the Secretary for Home Affairs, Mr Lau Kong-wah, in the Legislative Council today (January 24):


     In October 2013, the Director of Audit published the results of value for money audits on the Government's "direct land grants to private sports clubs at nil or nominal premium".  In response to the report, the Government set up an inter-departmental working group (the working group) in June 2014 to review the policy on private recreational leases (PRLs), and it anticipated that preliminary findings of the review would be available by the end of that year.  However, the Government has not completed the review so far.  In this connection, will the Government inform this Council:
(1) of (i) the membership and (ii) the government official in charge of the working group; the number of meetings held by the working group so far, as well as the date and venue of each meeting; whether the relevant documents and minutes of meetings can be made public; the work progress of the working group, and whether a preliminary report has been completed; if so, whether it can be made public immediately;
(2) when the authorities will (i) publish the review report, (ii) report to this Council the review findings and (iii) consult the public on the recommendations in the review report;
(3) of the number and details of cases in the past five years in which lessees did not comply with the requirement in PRLs to submit quarterly reports on the situation of their facilities being opened up to outside bodies; whether the authorities can make public all of the quarterly reports received so far; the number of inspections conducted by the authorities in the past three years to examine whether the lessees had opened up their facilities in the same manner as that described in the quarterly reports submitted, and the details and findings of such inspections;
(4) whether it knows, in each of the past three years, the respective total numbers of hours for which the various PRL venues were (i) available for use and (ii) actually used, by outside bodies (set out in Table 1);

Table 1
  Name of lessee 2015 2016 2017
(i) (ii) (i) (ii) (i) (ii)
(5) whether it knows, in each of the past three years, the respective (i) total number of hours for which various outside bodies used PRL venues and (ii) the fees paid by such bodies for that (set out in Table 2);

Table 2
  Name of outside body 2015 2016 2017
(i) (ii) (i) (ii) (i) (ii)
(6) whether the seven PRLs expiring last year and this year have been/will be renewed; if so, of (i) the terms of the new PRLs and (ii)‍ the justifications for granting the new PRLs, broken down by name of lessee;

(7) of the current number of cases in which lessees are allowed to set up restaurants and accommodation facilities on the PRL sites, and set out such facilities by name of lessee;

(8) given that the Lands Department (LandsD) issued a "holding over" letter to The Clearwater Bay Golf and Country Club on six occasions during the period from March 2013 to December 2015, allowing the lessee to hold over the site the PRL of which had expired in 2012, of the reasons why LandsD subsequently granted the lessee a PRL for a term of 12 years, and by whom and on what ground that the decision was made; whether the authorities have assessed if it was appropriate to make such a decision while the PRL review is underway;

(9) of the number of cases of PRL renewal approved by LandsD since the launch of the review and the expiry dates of the renewed PRLs, broken down by name of lessee; and

(10) of the amount of government rent paid by each PRL lessee in each of the past three years (set out in a table)?


     My reply to the 10-part question is as follows:
(1) and (2) In June 2014, the Home Affairs Bureau (HAB) set up an inter-departmental working group to comprehensively review the policy on private recreational leases (PRLs), with standing members comprising representatives of the Development Bureau, the Lands Department (LandsD) and the Planning Department.  The Government understands the public has much concern about the review.  Given the extensive scope and complexity of the review as well as the need to strike an appropriate balance among various considerations (including sports development needs, land use and interests of lessees, their members and the public at large), the working group has examined a number of issues relating to the PRL policy and will recommend an array of measures to ensure that the operation of private sports clubs and the use of PRL sites can better meet the dual objectives of supporting sports development and optimising public resources.   We expect to report the review findings to the Legislative Council Panel on Home Affairs in 2018, and subsequently conduct public and stakeholder consultation.
(3) In the past five years, all lessees complied with the PRL requirement on submitting quarterly reports to HAB.  As information therein is provided by lessees as a third party, we have to seek their consent, as required by the Code on Access to Information (the Code), before disclosing such information.  Starting from 2015-16, HAB has been conducting annual inspections to all private sports clubs.  During the two rounds of inspections conducted so far, the opening up of venue facilities by lessees was found to be generally in line with the situation described in the corresponding quarterly reports.  HAB is planning to conduct a new round of annual inspections.
(4) and (5) To encourage lessees to support Government's sports development policy objectives, the Government required, upon renewal of PRLs expired/expiring in 2011 and 2012, the opening up of sports facilities by lessees to eligible outside bodies for a minimum of 50 hours per month.

     The list on available hours to eligible outside bodies for sports facilities on PRL sites held by private sports clubs in the past three years is at Annex I.  As for PRL sites held by community organisations (such as camp facilities operated by charitable organisations and indoor sports centres run by district sports associations), they are essentially open to members of the public.

     Regarding details of the opening up of facilities for use by eligible outside bodies, including names of user organisations, pre-disclosure consent from lessees, who provide such information as a third party, has to be sought in accordance with the Code as stated in part (3) above.   A summary on utilisation of private sports clubs' facilities by eligible outside bodies for organising activities in the past three years is at Annex II.

(6), (8) and (9) Under the PRL policy, all renewals of expired leases are subject to approval by the Executive Council (ExCo).  In May 2011, according to the current PRL policy, renewal of PRLs expiring in 2011 and 2012 at nominal premium were approved with amendments made to certain clauses in the renewed leases to include the greater access requirement.

     Renewal of the PRL site of the Clearwater Bay Golf and Country Club was approved in May 2011 for a term of 15 years.  The lessee, however, was required to fulfil all lease clauses, such as further opening up of facilities to outside bodies, before the grant of formal renewal.  As departments concerned needed time to process relevant renewal issues, such as thorough discussion with the lessee on details of enhancing access to facilities and drawing up of clauses for the renewed lease, LandsD issued six "holding over" letters to the lessee between July 2012 and February 2016, for avoiding creation of any "vacuum period" in the lease, to allow his holding over of the site concerned under the terms and conditions of the expired lease.  Upon completion of the renewal process in 2016, LandsD formally renewed the lease with the lessee for a term of 15 years (counting from the expiry date of the original lease).

     As for lessees of PRLs expiring in 2013, 2014 and 2015, they were permitted to continue using the sites concerned under the "holding over" arrangement ("holding over" arrangement is a transitional arrangement to cover the period from PRL expiry to completion of renewal procedures) until matters related to the policy review on PRL were completed.  In other words, no PRL renewals were approved since the launch of the review.  The concerned lessees only continue to use the sites under the "holding over" arrangement.

(7) Under the current PRL policy, lessees may provide recreational and sports facilities on sites as well as ancillary facilities to cater for sports training, competition needs and recreational use.  However, the operation of such ancillary facilities is governed by PRL clauses, such as prohibition on use for commercial purpose and opening up to non-members or non-users of recreational and sports facilities.

(10) Government rents payable by lessees in the recent three financial years based on information provided by the Rating and Valuation Department and LandsD are at Annex III.
Ends/Wednesday, January 24, 2018
Issued at HKT 14:45
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