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Weak debate on housing bill

26/10/2001 NST-PROP  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 time).

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 disappointment.


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