China Launches a Controversial Directive to Open Up Gated Residential Compounds
By Zhihua Zhou

China Launches a Controversial Directive to Open Up Gated Residential Compounds

Apr. 19, 2016  |     |  0 comments


The State Council issued a guideline for urban development on February 21, 2016 in an effort to tackle problems associated with rapid expansion of cities in recent years. In the new blueprint, while committed to creating greener, more livable, and sustainable cities, the government promotes a street-block system (jiequ zhi) in which residential areas are divided into street blocks. More specifically, it states that “in principle, no more enclosed residential compounds will be built. And existing residential compounds will gradually have their interior streets integrated into the public road network.”1


This proposal has triggered fierce debates and strong opposition from the public. While people generally agree that the promotion of the street-block system is moving towards the right direction for sustainable urban development, many have voiced strong resistance to the opening up of the gates of their residential compounds. They argue that not only could this bring in noise and air pollution, there are also safety concerns.


Of the more than 98,000 respondents to a survey hosted on the Sina web portal on February 22,2 76 percent of participants said no to the opening up; 64 percent cited personal safety as their main concern; and 87 percent said owners should be compensated if their compounds are opened up to the public3. Many netizens urged the work-unit compounds to take the lead in opening up their gates. These compounds are mostly for civil servants and employees of large state-owned enterprises. They demanded that Party members and civil servants be examples for the masses. However, in the case of work-unit compounds, the residents do not own the facilities inside as the land has been allocated to them by the government.


Meanwhile, the proposal has also drawn criticism from legal experts, who have suggested that the policy contravenes the law. According to the Property Right Law, “roads and other public areas and facilities within a building zone are jointly owned by owners, with the exception of the public roads belonging to a city or township.”4 The Supreme People’s Court responded to the criticism on February 23, saying that legislative action will be needed before enforcing this rule; and the Court would pay close attention and proactively respond to it.5


To ease the increasing uproar, the Ministry of Housing and Urban-Rural Development published an article on its official website on February 24, assuring that the new directive will be implemented gradually and the government will not take the one-size-fits-all approach in opening up the gated communities. It also advises local governments to be cautious in implementing the policy by taking into account various interest groups and also to consult the public.6


Enclosure has been the dominant form in China’s residential development for many years. In the central-planning era, work-units normally constructed production and living areas in proximity, often large in size, on land allocated by the government and often in good locations such as the cities’ central districts. With onsite recreational facilities, shops, kindergartens, and even schools, residents in such compounds could stay inside for days. Such proximity has also enabled the Party and the government to maintain close ties with the residents. With massive migration since the 1990s, safety and security have become a big concern for residents, and many work-units put up walls around their open-access compounds out of safety concerns.


Gating is a standard practice in the development of commercial residential compounds, particularly in the cities of the wealthy coastal regions. Local governments have welcomed the enclosure form, as they can save labor and money by providing security and public facility construction and maintenance inside the compounds. The private Property Management Company takes care of the interior facilities and patrols the community, and receives property management fees from the residents. These Property Management Companies sometimes help the Residence Committee handle certain administrative affairs, such as resident registration. In this regard, some of the government’s workload has been transferred to the Property Management Company. At the same time, grassroots governmental organizations appear to have weakened their direct contacts with the community residents.


Better-off families, who want a respite from noise and a safe place to live, have also applauded the form of enclosure. The cost of roads and other shared spaces inside the compounds have already been factored into the price of the residents’ houses by the developers. In other words, residents pay extra to get a certain degree of quietness and safety in the midst of China’s hectic and often chaotic urban environment. The enclosure can be seen as a self-protection mechanism of the upper- and middle-classes in a society with serious income inequality, poor security, and deep social distrust.


As a whole, the enclosure of residential compounds has served as a simple and temporary solution to cope with the negative effects of massive urbanization and rapid economic growth of the past decades. However, it has brought many socio-economic problems, such as congestion, low efficiency in land use, and social segregation.


The government pins high hopes on the opening up to improve traffic, claiming that gated residential compounds are cut off from the traffic network and cause traffic congestion. However, the opening up alone might not help much. Many other factors, including a lack of good city master planning, and large gated communities, have contributed to congestion. In fact, those small and well-designed compounds, whether gated or not, normally do not add to traffic problems.


The urban layouts in many cities have been heavily criticized. Often, local governments, driven largely by GDP growth, intervene directly in the planning process and urban planners do not play a significant role. Meanwhile, local governments supply big plot because they could save time and money on the procedures of land sales. They would leave the site as a lump to developers for interior designs, while gaining from the sale of land used for interior public facilities. In the design of small communities and street-block communities, local governments have to put some land for public transport and facility usage, and also be responsible for maintenance.


With the new proposal, the government also expects the demolition of the walls to revive the neighborhood communities and ease social segregation and stratification. However, this could be ill-founded. Gating leads to spatial segregation, but not necessarily social segregation. Serious income inequality and differentiated access to public facilities and services are more fundamental to social stratification. Gating per se is a choice by the better-off to protect their interests; it only mirrors social segregation.



Gating leads to spatial segregation, but not necessarily social segregation. Serious income inequality and differentiated access to public facilities and services are more fundamental to social stratification.



The opening up might not revive the communities, rather it could result in numerous lawsuits between the government and homeowners regarding the legality of demolition and the compensation criteria. Homeowners in commercial residential complexes are on average more educated and have broader access to the internet and social media. They have a strong sense of community identity and have rich experiences in defending their rights and interests. This is evident from the fast growth of Community Owner Associations and their numerous activities against Property Management Companies and even the authorities.7


Residents in work-unit communities will also likely say no to the new proposal. It is conceivable that governmental and military organizations and state-owned enterprises will try every means possible to keep the walls of their compounds.


On top of congestion and social segregation issues, there may be a political concern underlying this initiative. The proposal of opening up the compounds could receive support from the grassroots, the majority of the Chinese population, as they might then have the chance to share the onsite educational resources and other facilities. In the aforementioned survey, many outsiders applauded the demolition.


Moreover, the directive has seemingly been used as a means to consolidate the Party’s leadership role inside the communities. The No. 26 clause of the blueprint urges the improvement of urban governance mechanisms by further upholding the core leadership of the Party organizations and increasing information transparency. While the enclosure of work-unit compounds has been quite effective in enhancing the party’s political influence and to facilitate administrative management, that of commercial residential compounds might have weakened the Party’s influence over the residents. Though it is unclear whether, and to what extent, the opening up could help consolidate the Party’s leadership in the communities, it will certainly increase the workload of grassroots governmental organizations. Given their tight fiscal status, local governments might be reluctant or unable to take up the responsibilities of social management and facility maintenance inside the compounds, leading to the deterioration of public facilities and social security. Some might begin charging fees on the residents, leading to more resistance and discontent.


Both the People’s Daily and the Ministry of Housing and Urban-Rural Development have cited the prevalence of the street-block system in many developed economies to justify the proposal.8 However, the circumstances are quite different. First, a balanced development on both sides of the wall in terms of incomes and public facility access is essential for the development of a street-block system. Such a balance is still lacking in China. In fact, the street-block system is more prevalent in developed economies with relatively more mature public service systems, and where the middle-class is dominant. Second, many Western governments have established fiscal sources for neighborhood development, such as property taxes. In China, as the legislation for a property tax levy is still on-going, many local governments lack the resources to implement the rules. Third, the shared ownership of onsite public facilities further complicates the opening up. While the Chinese residents in commercial compounds share the ownership of the onsite public facilities, homeowners in many Western countries normally have ownership rights to the houses and surrounding land.


As a whole, gating alone does not necessarily lead to congestion and social segregation, and the opening up itself is far from enough to ease the traffic problem and revive communities. For China, it is premature to push through the opening up, given the unbalanced development on both sides of the wall in terms of income level and access to public facilities, the complexity of shared property rights of onsite public facilities, and local governments’ lack of fiscal capacity. Mandatory enforcement might downgrade public facilities, worsen security, and raise social discontent. More efforts are needed before the rule can be implemented. These include reducing income inequality, providing more public facilities and services, improving the land supply system, enhancing governance capacity, further clarification of property rights, and increasing the size the middle-class. These will take time and effort, as well as financial resources which the currently slowing economy can ill afford.


The proposal to open up gated communities is likely to be unenforceable in the near future, except in some isolated cases. So far, there has been no new development regarding the rules. As many have suggested, the government could possibly wait for the 70-year land-use rights of existing commercial compounds to expire, before opening them up to the public. Meanwhile, more street-block communities are expected in future residential developments, which will not generate much conflict with vested interest groups.


Notes


1. Circular on Further Strengthening Urban Planning and Management (关于进一步加强城市规划建设管理工作的若干意见). (2016, February 21). Xinhua Net. Retrieved from http://news.xinhuanet.com/politics/2016-02/21/c_1118109546.htm


2. 70% Netizens are Unhappy about the Open-up of their Residence Gates (打开我家大门,七成网友不乐意). (2016, February 22). Sina. Retrieved from http://news.sina.com.cn/c/zg/2016-02-22/doc-ifxprucu3078247.shtml


3. The Property Right Law stipulates that the government could expropriate land in the public interest, upon compensations to the holders of land use rights. People’s Republic of China Property Right Law (中华人民共和国物权法). (2007, March 19). Xinhua Net. Retrieved from http://news.xinhuanet.com/legal/2007-03/19/content_5867318.htm


4. People’s Republic of China Property Right Law (中华人民共和国物权法). (2007, March 19). Xinhua Net. Retrieved from http://news.xinhuanet.com/legal/2007-03/19/content_5867318.htm


5. The Supreme Court Responds to the Contravention of Open-up the Residential Compounds (最高法回应开放小区是否侵权). (2016, February 23). Xinhua Net. Retrieved from http://news.xinhuanet.com/fortune/2016-02/23/c_128744707.htm


6. Ministry of Housing and Urban-Rural Development: Understanding Correctly about Gradually Opening up the Gated Residential Compounds (住建部:正确理解 “逐步打开封闭小区和单位大院”). (2016, February 24). Xinhua Net. Retrieved from http://news.xinhuanet.com/fortune/2016-02/24/c_1118142690.htm


7. The Property Management Ordinance in 2003 for the first time acknowledged the organization of Community Owner Association and the Property Right Law in 2007 reiterated its legal status.


8. People’s Daily: The Open-up of Residential Compounds is not an Imprudent Decision (人民日报:拆除小区围墙,不是中央拍脑袋决定的). (2016, February 23). Xinhua Net. Retrieved from http://news.xinhuanet.com/house/bj/2016-02-23/c_128742657.htm. Ministry of Housing and Urban-Rural Development: Understanding Correctly about Gradually Opening up the Gated Residential Compounds (住建部:正确理解“逐步打开封闭小区和单位大院”). (2016, February 24). Xinhua Net. Retrieved from http://news.xinhuanet.com/fortune/2016-02/24/c_1118142690.htm

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