Pay or leave it

The director of the Financial Services Bureau (DSF), Iong Kong Leong, admits that the SAR government is in a passive position when negotiating rents on office or warehouse venues for the use of public departments.
Replying to legislator Chan Meng Kam’s written enquiry, the financial bureau head indicated that public departments spent a total of MOP719 million (US$89.9 million) on renting private venues during 2015, despite the fact that only some 17 departments were fully working inside privately-owned offices.
“Frankly speaking, due to surging rents and frequent transfers of property ownerships amid the rapid development of local property market, the government has been in a disadvantageous position whenever it discusses tenancy contracts [with lessors],” the DSF director said.
The official added that the government has been avoiding frequently relocating the office venues of public departments in order “to serve residents better” and “not to cause public inconvenience”.
“As such, the government, as the provider of public services, has been passive when bargaining rents after analyzing the pros and cons,” Mr. Iong claimed.
In fact, the government’s rental expenses on offices and warehouses for public bodies have been growing in recent years.
Back in 2011, the government only spent some MOP420 million on renting private venues, yet such expenditure has increased to MOP1.9 billion in this year’s budget, suggesting a 3.5-fold increase in five years.
The directly-elected legislator queried in his interpellation whether the government has already drafted a timeframe and detailed plans for building its own office buildings in order to cut this part of expenses.
But the DSF director only replied that the government “would confirm as soon as possible the timeframe and the size” of its planned office building on lot O1 of Pac On in Taipa.