Ong gets tough with errant builders
The Star 30/11/2006 By Florence A Samy

KUALA LUMPUR: Errant housing developers will not be spared action regardless of their connections, and cases involving them would be publicised, said Housing and Local Government Minister Datuk Seri Ong Ka Ting.

The ploy by some developers to settle their cases out of court just before the trial will also not work anymore, he said in winding up the Budget debate on his ministry in Parliament yesterday.

He said the cases and the punishments meted out would be publicised as a lesson to all.

Ong said developers had been known to settle cases with the housebuyers just before the trial in the hope that they would not be charged.

“This is no longer accepted. Even if they have settled, they will still be charged. There will be no escape,” he added.

He said 178 cases were brought to court and developers in 40 cases had received various sentences.

“There was not much publicity on this. That is why there is a perception that the Government is not doing anything,” he added.

Ong said 185 developers failed to complete their projects due to financial mismanagement.

“These involved houses which are delayed or sakit (sick projects), and not those that have been abandoned,” he added.

He said the developers were now meeting with 15 banks to find ways to restructure their financing, and were expected to hand over the houses to the buyers by next year.

Ong also told the House that 519 directors and 160 development companies had been blacklisted.

On services provided by the local authorities, Ong said a major exercise needed to be conducted, including amending federal and state laws and the Local Government Act, which may start as early as next year. Local authorities come under the purview of state governments.

At a press conference, Ong said the Housing Development (Control and Licensing) Act, which was tabled in Parliament yesterday, would further protect housebuyers.

He said developers who could not comply with the requirements of the legislation would be banned, and the good ones would continue to do well in the industry.

He said that under the Act the minister would be able to appoint a new company to take over housing developers who did not fulfil their obligation, without having to refer to the Finance Ministry.

“The ministry’s secretary-general will also have the right to freeze the housing development accounts of developers,” he said.

He said that if 70% of housebuyers of a project agree they would be allowed to terminate the sale-and-purchase agreement six months after signing if there was any problem relating to the progress of the project.

“Currently, only the developers have the right to terminate the agreement,” he said.

He said another piece of good news for housebuyers was that the Tribunal for Housebuyer Claims would soon be able to hear cases that involved a claim value of up to RM50,000 compared with the present RM25,000.