Aggrieved house buyers affected by abandoned schemes have the right to take the government to court for failing to ensure that they get their houses on time and in proper condition.

National House Buyers Association (HBA) secretary-general Chang Kim Loong said the housing law, amended in 2002, provides for legal action to be taken against the government, particularly the Housing and Local Government Ministry.

"(But) this has not been tested yet. Furthermore, we do not encourage house buyers to sue the government because it will cost them even more," he told a recent human rights dialogue on the rights of house buyers.

"We believe in settling the matter in a way that makes all the parties concerned happy.

Section 17 of the amended Housing Development (Control and Licensing) Act 1966 states that any suit against the government must be in good faith and filed within six months of the alleged breach. However, civil servants are granted immunity from prosecution under Section 22A.

The issue was raised by a participant, who asked whether the government, in particular the ministry, can be held legally responsible in cases of abandoned projects and where the developer cannot be traced.

The possibility of suing the government was discussed due to the large number of abandoned housing projects since the late 1980s, with inadequate redress for the thousands of buyers left in the lurch. Chang, a panelist at the dialogue, had traced the situation in his presentation.

Dissenting view

Another panelist, International Islamic University former deputy law dean Prof Salleh Buang said, however, that the government cannot be sued.

"We cannot sue the ministry if it does not do its work. When a developer gets into difficulties, the ministry can take over the project or appoint another developer. But, it doesn't do so (now)," he noted.

Stressing that the first objective of the law is to protect house buyers, he said the government should be stricter in licensing developers.

He said the amended law has a provision (Section 7) on the licensing of housing developers, something that came about after numerous court decisions over the last 20 years.

Chang claimed that many of the abandoned projects involved unlicensed developers, pointing to lax enforcement by the ministry.

Real Estate and Housing Developers Association past president Eddy Chen blamed the government and financial institutions for demanding collateral for loans, as well as prevailing laws governing property development.

"There is a need to revamp the sale and purchase agreement clauses, for example, the schedule of payments and the forfeiture of deposit by the buyer in the house price increases," he said.

"Maybe it's time the prime minister reviewed the national housing policy and the weaknesses therein."

Price factor

Addressing issues of pricing, Chen said more than 80 percent of all houses built are below the RM180,000 price-tag.

But he warned of an impending price increase given the emergence of open market economies in the region, particularly China, which he said would play a major role in exporting building materials to Malaysia.

"(While) Malaysia is an open market economy, the housing sector is not....in reality, it has a combination of central-control and market forces (at work)," he said.

"The centrally-controlled elements include bumiputera quotas and discounts, categorisation of low-medium and low-cost price and size, and provisions for public amenities."

Chen added, however, that the government also sees to the provision of public housing to serve the needs of those unable to buy houses.

About 250 participants, including squatters and disabled persons, attended the dialogue on adequate housing last Thursday, organised by the Human Rights Commission of Malaysia (Suhakam) in Kuala Lumpur.

This dialogue is the first in a series planned by Suhakam as part of its economic, social and cultural rights seminars.