Penang Chief Minister Lim Guan Eng has responded to The Star’s criticism of hill-slope projects in the state.
Guan Eng said:
Star has developed a persistent blind spot by insisting that the previous BN government did no wrong whilst the present PR state government must shoulder the entire blame for inheriting all the hill projects above 250 feet approved by the previous BN government. The Penang state government has to put the record straight from this dishonest attempt to rewrite history.
In its enthusiasm to lynch the Penang PR state government, Star has ignored the fact that the Penang PR state government did not approve any development projects above 250 feet. At the same time, the MCA-owned paper makes the startling claim that there are PR or DAP assemblymen who agree with the Star that the hills in Penang are dying under PR’s stewardship. Nothing can be further from the truth.
The present PR state government has imposed stringent guidelines on hill projects approved by the previous state government that has been worked out by an independent professional committee newly set up, headed by Oxford geotechnical engineer Dr. Gue See Saw and two other members from The Institute of Engineers Malaysia and Perbadanan Akitek Malaysia. Whilst these new hill slope guidelines have caused unhappiness amongst developers about the legality of implementing these technical guidelines retrospectively, the state government is determined to compel compliance. And yet the Star and its BN accomplices continues to tag on the Penang PR state government as pro-developer and even claim that there is a gag order imposed by the state government and MPPP on those who wish to speak out on hill projects.
This is untrue. There is no gag order imposed by the state government on any assemblyman. I have checked with MPPP President AR Patahiyah binti Ismail and she has also confirmed that no gag order was imposed except stating the reminder by the Appeals Board and the courts not to publicly discuss cases that are being heard because they are subjudice. Even MPPP Councilor Lim Mah Hui has confirmed that there was no gag order imposed on him.
There is no need to respond to personalities quoted in the Star with a partisan political background, However, I wish to refer to the suggestion made by George Aeria, a resident who had supported the PR in 2008 general elections, that the PR state government must cancel all hill projects approved previously by the BN state government.
The Penang state government does not deny there are problems caused to residents by hill development projects approved by the previous administration. But much as the state government wishes to make these problems disappear by cancelling all the hill projects approved by the previous BN government, that solution is not feasible. To cancel these projects would require huge compensation being paid out to the developers, a sum that neither MPPP nor state government can afford.
As an estimate to the possible compensatory costs involved, Boustead Holdings Bhd is making a claim of RM60 million from MPPP following a reduction of the height of its building from 12 storey to 5 storey in the George Town Heritage area to comply with the 18 meter height requirement of UNESCO World Heritage City Guidelines. Again the 12 storey height limit was approved to Boustead by the previous state government, which broke its promise to UNESCO that no such approval above 5 storey would be given.
Based on the Boustead experience, if reducing the height by a mere 12 storey to 5 storey can attract a claim of RM60 million, the state or MPPP would have to fork out hundreds of millions of ringgit or even billions to cancel all the hill projects approved by the previous administration.
This would definitely bankrupt MPPP or the state government. PR cannot behave irresponsibly to 1.6 million Penangites to allow MPPP or the state to go bankrupt. For that reason, the PR state government has taken the difficult choice to manage the hill projects approved by the previous BN government with stringent hill slope safety guidelines to ensure public safety.
We know this decision will not make existing hill slope residents like George Aeria happy. For that reason, we would respect his choice should he decide to switch back his support to BN and trust the very party that has caused the problems in the first place. George Aeria will have to think through carefully whether BN can be trusted not to approve new hill projects above 250 feet or be able to cancel existing projects BN had approved prior to 2008.
The Penang PR state government can only assure the public that we will not follow the previous BN state government’s practice of approving development projects above 250 feet. The PR state government would continue to impose stringent guidelines on hill projects previously approved as monitored by the independent professional technical hill slope committee headed by Dr Gue See Saw.
In the case of Boustead, it initially submitted a claim of RM58m. The state very nearly granted it reclamation rights covering 100 acres of prime sea-front land in Bayan Bay. But residents’ objections put a stop to that.
In the event, the state eventually negotiated with Boustead to pay RM20m, as reported in theSun – a far cry from the excessively high compensation claim feared.
The report in theSun:
Penang gives RM20m in compensation to Boustead
Posted on 25 October 2011 – 05:28am
Himanshu Bhatt and Aaron Ngui
GEORGE TOWN (Oct 24, 2011): The state government has agreed to pay RM20 million to Boustead Holdings Bhd as compensation for scaling down its 12-storey hotel project to five-stories, as required by Unesco heritage requirements, in the city’s heritage enclave.
Local government committee chairman Chow Kon Yeow revealed to the state assembly today that Boustead had initially asked for RM58 million but following negotiations, the company agreed to the amount offered by the state.
“Further negotiations are continuing, focusing on the schedule of payment and at the same time, Boustead can go ahead with their project,” he said in reply to a supplementary question to Sim Tze Pin (PKR-Pantai Jerejak).
Sim had asked for updates on the plan to give Boustead reclamation rights near Bayan Bay.
Boustead initially was given the green-light to reclaim 100 acres of the shoreline as compensation to scale down its hotel project in George Town’s inner city.
However, the state government had revoked the reclamation project following objections by residents and Sim.
Generally speaking, I think we should refrain from conceding that the local government will have to pay high compensation for projects rejected or downsized. This may turn out to be a self-fulfilling prophecy as naturally, it may prompt developers to submit high compensation claims. I don’t think it is a street-savvy negotiating stance to concede right at the start that the local government may have to pay high compensation. It results in the public being cowed into silence and opens the door to potentially large claims.
Developers in general are free to submit all kinds of claims, but it is up to the local government to challenge or counter those claims and protect the interests of the people. The local government should make it known that it will vigorously contest any and all such claims to protect the public interest.
Developers who submit excessive compensation claims against the local government (which are accountable for public funds) should also be mindful that they stand to lose much in goodwill.
If the local government feels a particular developer’s action has been against the public interest, would it be possible to blacklist such a developer from future projects in the state?
The people of Penang threw out the BN administration, which had ruled the state for nearly four decades, and voted in this administration to protect the public interest and public funds more effectively. That is a huge responsibility.
The larger issue is, what kind of development model are we pursuing? Development for whom? Who stands to benefit and profit most from all these projects, not just in Penang but elsewhere in BN-ruled states as well? And at what cost to the environment?