Urban Renewal Act, for the people or a 'scam' to help developers?

The proposed Urban Renewal Act which stirred controversy over its potential impact on the urban poor has been met with mixed reactions including from one critic who calls it a scam.

The act, meant to launch development in Kuala Lumpur, earmarks 30 areas for renewal and was announced as early as 2015.

An urban planning expert told MalaysiaNow that the main benefit of the act was its ability to ensure that old buildings are upgraded to empower community living.

Koh Cha-Ly said some old buildings were constructed based on outdated designs and safety standards that did not meet modern levels.

"In terms of fire safety, lift equipment, and general community living, facilities don't keep up with the times," said Koh, the CEO of data company Urbanmetry, which analyses large amounts of city data.

"If left unkempt, the value of the building depreciates, homeowners move out, and the state of the building deteriorates further.

"The renewal act is important to protect the interests and safety of the homeowners, the community, and the city as a whole."

The act created a stir due to its reduction in the threshold for building owner consent from 100% to 80%.

This had led Muar MP Syed Saddiq Syed Abdul Rahman to dub it the "Home Seizure Act".  

Prime Minister Anwar Ibrahim told the Dewan Rakyat that the government would propose three threshold values according to the age of the building.

"If the building is less than 30 years old, (it will require) 80% of the owners to express their consent before negotiations can begin," he said.

"For buildings over 30 years old, 75% (of owners) must agree, and for abandoned and derelict buildings, 51%, which is a simple majority, will be required."

Koh said the rates were still relatively high, and that owners who disagreed with the proposed redevelopment would need to convince their neighbours of their stance.

Former town councillor Mak Khuin Weng however said that the government could carry out redevelopment through existing fair market practices.

He said it was difficult to trust the government and politicians to ensure that the compliance process was transparent and responsible.

"For example, how many times have people protested against a highway project only to be repeatedly told by the government that the majority supports it, without ever having to show what exactly constitutes 'majority support'?" he said.

"The government asks us to pay quit rent, assessment, and all sorts of other taxes, but affords us no protection when it comes to redevelopment orders."

Mak said the act appeared to be another layer of red tape which would add further confusion to the redevelopment process.

Fahmi Bahrudin of think tank IRIS Institute said the problem with the act was the consent threshold which followed the model of countries with small land areas such as Singapore and Hong Kong.

"There is no urgency here in terms of supplying new housing in major cities," he said.

"The main problem is that house prices have increased too much, making the people, particularly the Malays, unable to afford homes in the city."  

Fahmi said the Malays were concerned that their villages would be eliminated, as had happened in neighbouring Singapore under a Housing Development Board policy for the modernisation of urban areas in the city-state.

There are a number of Malay villages in Kuala Lumpur, especially in Kampung Baru Keramat and Titiwangsa.

Fahmi referred to a case in Kampung Sungai Baru where the government had used the Land Acquisition Act 1960 to force the acquisition of land.

Mak agreed, saying the act could be used in the interest of projects and highways deemed to be in public interest.

"Honestly, I think it's just a scam to help developers," he said.

Koh meanwhile said Malaysia already played an active role in introducing diversity in development such as through Bumiputera and affordable housing quotas and the provision of subsidised housing.

On the issue of homeownership which might be difficult for the urban poor, especially the Malays and Indians, Koh said an affordable and secure life was more important than owning a home.

"I would encourage the government to further develop or set up rental programmes in these redevelopment projects, and not to focus on homeownership."