LCQ18: Operation Building Bright

Following is a question by the Hon Lee Wing-tat and a written reply by the Secretary for Development, Mrs Carrie Lam, in the Legislative Council today (January 6):

Question:

The Government, in collaboration with the Hong Kong Housing Society and the Urban Renewal Authority, has implemented Operation Building Bright since May 2009 to provide grants and one-stop technical assistance to two categories of target buildings.  Category 1 covers buildings with owners' corporations (OCs), and Category 2 covers buildings having difficulties in organizing repair works (e.g. buildings without OCs).  In this connection, will the Government inform this Council:

(a) of the respective numbers of Categories 1 and 2 target buildings which have received grants for the cost of repair to date and, among such grants, the respective highest, lowest and average amounts of grants; and the number of applications involving eligible Category 1 target buildings for which grant was not approved;

(b) of the respective numbers of Category 2 target buildings which have been recommended by Members of the Legislative Council and each of the District Councils to date and, among such buildings, the respective numbers of those which were and were not approved grants, as well as the reasons for some buildings not being approved grants;

(c) whether the current amount of uncommitted funds are sufficient for accepting a new round of applications; if so, when it will start accepting applications; if not, whether it will seek additional funding from the Legislative Council; and

(d) of the respective numbers of Categories 1 and 2 target buildings which have commenced repair works at present, and when the works are expected to be completed?

Reply:

President,

As a specific measure for "Preserving Jobs" amidst the financial tsunami, the Government, in collaboration with the Hong Kong Housing Society (HKHS) and the Urban Renewal Authority (URA), has implemented a $2-billion "Operation Building Bright" (OBB) to provide subsidies and one-stop technical assistance to help owners of old buildings carry out repair and maintenance works.  The OBB aims to achieve the dual objective of improving building safety and the cityscape as well as creating more job opportunities for the construction sector.  The Finance Committee of the Legislative Council has approved a total funding allocation of $1.7 billion for the Government's contribution to the OBB while the remaining $300 million is contributed by HKHS and URA on an equal sharing basis.

Category 1 target buildings under the OBB cover buildings with owners' corporations (OCs).  OCs of eligible buildings may apply for joining the OBB to carry out repair works on a voluntary basis, including repair, maintenance and improvement works related to building structure, fire safety and sanitary facilities.  We have conducted a computer ballot to determine the priority of processing the applications of the eligible buildings.  Upon receipt of an approval-in-principle for participating as a Category 1 target building of the OBB, an OC should, in accordance with the stipulated procedures, appoint an authorised person to co-ordinate the repair works and a qualified contractor to commence the works within the specified periods.  The HKHS and URA will monitor the progress of the repair and maintenance works and disburse grants to the OC after completion of the works.

Category 2 target buildings cover buildings having difficulties in co-ordinating repair works, such as buildings without OCs.  Category 2 target buildings include buildings with defaulted repair orders issued by the Buildings Department (BD).  We have also invited the Legislative Council and District Councils to nominate buildings as Category 2 target buildings, and the BD has inspected these buildings.  The Steering Committee of the Operation Building Bright (the Steering Committee) comprising representatives from the BD, HKHS and URA has selected suitable buildings as target buildings according to their building condition.  Depending on the circumstances, the BD will issue statutory repair orders to the Category 2 target buildings.  If the owners of the buildings are unwilling or unable to conduct repair works by themselves, the BD will arrange consultants and contractors engaged by the Government to carry out the repair works stipulated in the orders on behalf of the owners.  After deducting the amount of subsidies available under the OBB, the BD will recover the remaining repair costs from the owners.  However, if the owners/OCs of the buildings are willing to organise repair works voluntarily, they could follow the approach for Category 1 target buildings to carry out repair works.  Apart from the requirements under the repair orders concerning building structure and drainage, the scope of works could include other works items such as fire service installations etc. covered by Category 1 target buildings.  The HKHS/URA will render assistance to them.

The reply to the four-part question is as follows:

(a) and (d) Category 1 Target Buildings

We have in total received 1,128 applications for Category 1 target buildings, among which 1,025 applications meet the eligibility criteria or have not been withdrawn by the applicants.  As we have increased the overall allocation for the OBB from $1 billion to $2 billion, all eligible Category 1 target buildings could receive grants.  We have followed the priorities accorded by the computer ballot held in June 2009 to gradually process the eligible applications. Up to December 21, 2009, 870 Category 1 target buildings have been granted "notices of approval-in-principle".  Amongst these buildings, 57 are undertaking repair works, and the works of another building have generally completed.  After completion of the works, the OCs will be provided with the grants.  Regarding the above-mentioned 870 cases, based on the number of units in the buildings and the past experience of HKHS/URA in coordinating building repair, it is estimated that the highest, lowest and average amounts of grants are around $7.82 million, $110,000 and $1.3 million respectively.  Moreover, the HKHS and URA are continuing to process the remaining 155 cases.  It is anticipated that "notices of approval-in-principle" could be granted to most of the remaining applications by the end of January 2010.  After completion of the works, the OCs will be provided with grants.  Since the preparatory work and the necessary repair works for individual buildings are different, we cannot accurately predict the works completion time of all the assisted buildings.  Generally speaking, it takes about six to nine months to complete the repair works.

Category 2 Target Buildings

Up to December 21, 2009, 603 buildings have been selected as Category 2 target buildings.  We are planning to select around 300 additional buildings as Category 2 target buildings.

Amongst those Category 2 target buildings where owners/OCs are not capable of organising repair works by themselves and need the BD to arrange the repair works, 123 buildings have commenced repair works, among which the repair works of 10 buildings have generally completed.   The initial estimates of the highest, lowest and average amounts of grants are around $370,000, $20,000 and $130,000 respectively.  The works for the remaining 113 buildings are in progress.  It is anticipated that the works of most buildings will be completed before mid-February 2010 (i.e. the Lunar New Year).

Regarding those Category 2 target buildings where the owners/OCs are willing to organise repair works, the number of cases with "notices of approval-in-principle" granted is 50.  Amongst them repair works in 16 buildings have commenced, and the works of another building have generally completed.  Regarding the above-mentioned 50 cases, based on the number of units in the buildings and past experience of HKHS/URA in coordinating building repair, the estimated highest, lowest and average amounts of grants are around $2.2 million, $110,000 and $630,000 respectively.  Besides, owners of another 43 buildings have also expressed their willingness to organise repair works by themselves.  Depending on the progress of organisation of works by the owners, the HKHS and URA will gradually process these applications with an aim to granting "notices of approval-in-principle" to the owners as soon as possible.

Regarding the remaining Category 2 target buildings, the BD, in collaboration with the HKHS and URA, will continue to consult the owners if they are prepared to organise repair works by themselves, and will gradually arrange Government contractors to carry out repair works for those buildings where the owners are unable to carry out repair works.

(b) The BD has in total received 513 nominations as Category 2 target buildings, among which 510 nominations were from 14 District Councils and three from two Legislative Council members.  After vetting the building condition and relevant information of the nominations, the Steering Committee has included 263 nominated buildings as Category 2 target buildings.  As for the remaining nominated buildings, 67 have earlier submitted applications to participate as Category 1 target buildings and they are being processed by the HKHS/URA.  The remaining buildings were not included as Category 2 target buildings as they do not meet the relevant criteria of the OBB, such as use of building, building age, number of residential units, average rateable value, building condition, etc.

The numbers of buildings nominated and included as Category 2 target buildings are tabulated by districts as follows:

* The three nominations were from two Legislative Council members.

(c) Based on our estimation so far, after completion of the works in all eligible applications as Category 1 target buildings and selected Category 2 target buildings, there will still be a small amount of uncommitted funds available out of the $2 billion for further deployment.  We are contemplating to make use of such remaining funds to assist more target buildings.  We will on January 26, 2010 report to the Legislative Council Panel on Development on the latest progress of the OBB, explain the proposed way forward and seek the Panel's views.

Ends/Wednesday, January 6, 2010
Issued at HKT 14:32

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