Weak debate on housing bill
By Salleh Buang
Only time will tell whether the new law is up to
expectations or still a major disappointment
The Bill to amend the existing Housing
Developers (Control and Licensing) Act 1966 went through the Dewan Rakyat
recently. It has its second reading followed by a debate by several
backbenchers and opposition members in the days immediately preceding the
presentation of the 2001 Budget by the Prime Minister.
It is a great pity that as yet, the full
text of the Bill is not yet available on the Ministry of Housing and Local
Government's website. Malaysia has long embraced IT and the Internet age,
but unfortunately, its positive and beneficial aspects have yet to be made
full use of by many government departments and ministries.
Thus, until the Bill has received its
Royal Assent and is printed by Percetakan Nasional for sale to the public,
the average Malaysian (not being an MP or someone close to the corridors
of power) would not have the opportunity of knowing exactly what the new
law provides. Consequently, much of what we know (based on what we have
been told by the media) at this stage is plain hearsay.
Reverting to the parliamentary debate on
the Bill, it is regrettable that its quality, scope and coverage (to the
extent that it is reported by the local media) is not something we can be
proud of. In fairness, however, I should add that we cannot put the blame
entirely on our MPs. Apparently many wanted to speak their minds on the
proposed amendments, but the Speaker ruled (in view of time constraints)
that each speaker can only be given 20 minutes to say his piece.
In reporting the debate, the print
media, as to be expected, focused its attention on certain issues only -
one of which is the issuance of certificate of fitness for occupation
(CF). In this regard, the Housing Minister was reported as having said
that CFs will henceforth be issued "faster and with more facilities
assured", apart from water and electricity supply. These CFs, however,
would be issued only when developers have fulfilled all the requirements
set by Tenage Nasional Bhd, Water Department, Works Department, Fire and
Rescue Department, sewerage services, Drainage and Irrigation Department
and Telekom Malaysia Bhd.
Earlier on when responding to a question
raised by the Barisan MP for Jelutong, Kee Kah Choon, on whether
developers' deposits would be kept until the CFs were issued or until the
expiry of the defects liability period, the Minister reportedly said CFs
could very well be issued before the expiry of the defects liability
period. Elaborating further, the Minister said that when developers have
been issued Form E by the technical departments (which means they have
fulfilled all the relevant technical requirements), local authorities are
required to issue the CFs within 14 days.
In short, with Form E in hand, there is
no reason for the issuance of CFs to be delayed. To emphasise the matter,
the Minister said that under an amendment in the law, developers can lodge
complaints to the Ministry if local authorities delay the issuance of CFs
without any valid reason.
On the issue of the role to be played by
the Ministry henceforth, the Minister said that under the new law the
Ministry can effectively monitor the progress of each and every housing
project across the nation because developers are now required to submit
reports twice a year to the Ministry.
"This is to ensure the projects are
progressing according to schedule," he added.
While these assurances are indeed glad
tidings for the purchasers, in my opinion what was said by the Minister on
this point is actually not something new. Even under the existing section
7 of the 1966 Act, paragraph (f) already states that each housing
developer is required to submit a statement in the prescribed form to the
Controller twice a year - one, not later than Jan 21 and two, not later
than July 21 of each year.
Likewise, under paragraph (g), a
developer is required to "forthwith inform the Controller" once he
considers that "he is likely to become unable to meet his obligations to
the purchasers". This proves what many of us believe to be true - that
what has been lacking before is not necessarily the inadequacy6 of the
law, but inadequacy of effective and consistent enforcement.
Reverting to the debate again, an
interesting question was raised by another back bencher regarding the new
amendment requiring developers to pay a minimum deposit of RM200,000. H
wanted to know whether the amendment has a retrospective effect. Citing
several abandoned projects in Pahang, some of which had been left idle for
more than 7 years, he suggested that developers should be compelled to pay
deposits based on the value or size of their projects, not a flat lump
sum. The answer to his question is obvious. Unless the new law expressly
states that it has retrospective effect, the general principle (that all
laws operate prospectively, not retrospectively) applies. To my knowledge,
the new amendment is not intended to operate retrospectively.
The MP for Tambun raised something
which, though outside the scope of the amendment Bill, is nevertheless
important for the well-being of the house purchaser. He suggested that the
authorities should impose a limit on the number of units a developer can
build on a plot of land. Failure to impose such a limit could lead
subsequently to a host of social problems, he added. In the past, an acre
could only accommodate up to 10 houses but of late the number has
increased to 18, in some cases 20 units. Nowadays, developers do not
even bother to design houses with open space. The density is sometimes so
high, especially among low-cost units, that living conditions in some of
these housing estates are far from conducive, he concluded.
Another suggestion by the MP for Kota
Melaka also deserves our attention. This MP suggested that the authorities
should consider establishing a housing developers' guarantee scheme, which
could be used to bail out developers who run into financial problems.
Saying that such a scheme could help protect house purchasers, the MP,
however, did not or could not elaborate further (possibly due to lack of
Looking back, it has taken the Housing
Ministry and the Attorney-General's Chambers three years to come up with
the present amendment Bill. During those years, as we had been told, the
Housing Ministry had listened to (and received input from) several
quarters - the industry players as well as consumer associations. But it
will only be much later that the house buying public (the target group
meant to be the real beneficiaries of this new law) will know for certain
whether the new law is up to their expectations or is still a major