According to media news, the Legislative Assembly commission responsible for monitoring the public finances has discussed a curious proposal. Or at least some of its members made it, as the reports are not explicit about who exactly made them, and how much support they garnered. The suggestion purported to resolve or reduce the burden represented by the rental costs borne by the Administration.
For clarity, let us frame the issue. Several public services operate from private buildings – and, naturally, pay rent for that. In 2016, the Administration splashed out over 70 million patacas per month for those spaces. Some people feel that such rental expenses are excessive and unwarranted.
First, the Administration owns property in Macau that, in some cases, is unused or seems underused. Then, it holds most land and can decide unilaterally to build almost anywhere it fancies. Further, it has, fortunately, more than enough financial resources to build whatever installations its services may require. Ergo, why pay so much in rent to private landlords? It is a matter that, not unreasonably, deserves further clarification.
That appears more complicated than we might expect. Take, for example, the fact that legislators did not discuss the figures for 2017. They were unavailable; it appears they cannot be known because the corresponding accounts have not yet been audited. This justification is somewhat surprising.
We assume that rental contracts exist and rents are paid accordingly. That being the case, their value is not dependent upon final auditing of the public accounts, as seems implied. The amount is well defined at any moment, and the public coffers know for sure how much they have paid. That sounds more like an argument of convenience to limit or delay the development of the debate than a real obstacle to a more informed one.
The proposed solution is intriguing. It was defended that new building concessions should include some space reserved for public services. They would be provided, if we understand correctly, in place of the concession’s fees. Even ignoring other practical difficulties – concerning, for instance, the spatial distribution of services or the valuation criteria for the deals, such a solution would have significant consequences.
Depending upon and the timeframe of such arrangements, definitive or temporary, the forfeited fee income would amount, in practice, to either an acquisition or an advance on future rents. How would the government benefit, compared to the usual alternatives: directly building new premises, or buying or renting existing ones?
