LegCo Paper No. CB(1) 46/96-97
(These minutes have been seen by the Administration)
Ref : CB1/PL/HG/1

LegCo Panel on Housing

Minutes of Meeting held
on Monday, 3 June 1996 at 10:45 am
in the Chamber of the Legislative Council Building

Members Present :

    Hon LEE Wing-tat (Chairman)
    Hon Frederick FUNG Kin-kee (Deputy Chairman)
    Hon SZETO Wah
    Hon Edward S T HO, OBE, JP
    Hon Albert CHAN Wai-yip
    Hon Fred LI Wah-ming
    Hon James TO Kun-sun
    Hon Zachary WONG Wai-yin
    Hon CHAN Kam-lam
    Hon CHAN Yuen-han
    Hon Andrew CHENG Kar-foo
    Hon CHOY Kan-pui, JP
    Hon Albert HO Chun-yan
    Hon LEUNG Yiu-chung
    Hon LO Suk-ching
    Hon MOK Ying-fan
    Hon SIN Chung-kai

Members Absent :

    Hon Mrs Selina CHOW, OBE, JP
    Hon Ronald ARCULLI, OBE, JP
    Hon CHEUNG Man-kwong
    Dr Hon YEUNG Sum
    Hon CHEUNG Hon-chung
    Hon Bruce LIU Sing-lee

Public Officers Attending :

Items III & IV
Ms Sandy CHAN
Principal Assistant Secretary for Housing
Mr HUI Chee-chung
Assistant Director/Applications and Home Ownership Scheme
Mr FUNG Ho-tong
Assistant Director/Regional Management(1)
Mr CHENG Yao-kong
Chief Housing Manager/Applications

Item V
Ms Sandy CHAN
Principal Assistant Secretary for Housing
Ms L C WONG
Director (Estate Management)
Hong Kong Housing Society

Clerk in Attendance :

Mrs Vivian KAM
Chief Assistant Secretary (1)2

Staff in Attendance :

Miss Becky YU
Senior Assistant Secretary (1)3

I. Confirmation of Minutes of Previous Meetings

(LegCo Papers Nos. CB(1) 1439 and 1504/95-96)

The minutes of the meetings held on 12 March and 1 April 1996 were confirmed.

II. Date of Next Meeting and Items for Discussion

(Appendix I to LegCo Paper No. CB(1) 1502/95-96)

2. The next regular meeting originally scheduled for 1 July 1996 was re-scheduled to Thursday, 11 July 1996, at 2:30 pm to discuss the following:

    - Housing policy for new immigrants from China;

    - Five-Year Comprehensive Redevelopment Programme;

    - Operation of the Land Development Corporation; and

    - Abuse of Property Sales System.

(Post-meeting note: At the instruction of the Chairman, the meeting was subsequently re-scheduled for Friday, 12 July 1996, at 4:30 pm.)

III. Eligibility Criteria for the Rental Assistance Scheme

(Appendices II and III to LegCo Paper No. CB(1) 1502/95-96)

3. At the invitation of the Chairman, Mr HUI Chee-chung briefed members on the Rental Assistance Scheme (RAS), the objective of which was to provide assistance to public housing tenants who faced temporary financial difficulties.

4. In referring to the table prepared by the Society for Community Organization at Appendix II, a member opined that the eligibility criteria for RAS were more stringent than those of the Comprehensive Social Security Assistance (CSSA). He considered that households satisfying either the Waiting List Income Limit (WLIL) or the rent-to-income ratio (RIR) requirement outlined in paragraph 2 of the information paper at Appendix III should be eligible for the RAS. Some Members questioned the rationale for setting the allocation standard at 50% of the WLIL; others considered that the RIR was sufficient in assessing the eligibility of households for the RAS and suggested deleting the WLIL from the eligibility criteria.

5. In response, Mr HUI advised that the eligibility criteria were formulated to maximize the number of eligible households. By way of illustration, the WLIL for a four-member household was $14,700 per month. Households whose monthly income was less than $7,400 and who were required to pay a rent of more than $1,100 would be eligible for a 50% rent reduction according to criterion 2(a). On the other hand, households with a monthly income ranging from $7,400 to $8,900 and who were required to pay a rent of more than $1,780 would also be eligible for the same reduction under criterion 2(b). As regards the WLIL, Mr HUI advised that the existing level at 50% was adopted taking into account such factors as expenses on non-housing related items and average rental value. The levels of both the WLIL and RIR would be examined at the next RAS review taking into consideration adjustments for the CSSA in April 1996.

6. Members were worried that some elderly households might not be aware of the RAS and suggested that the Administration could conduct door-to-door visits to promote a better understanding of the Scheme. In reply, Mr HUI advised that such visits might not be possible owing to manpower constraints. However, every opportunity had been made to publicize the RAS through such channels as notification letters on rent review, pamphlets, daily contacts with tenants and outreaching services provided by the Estate Liaison Officers. Consideration would also be given to arouse public awareness of the RAS through Announcements of Public Interest.

7. Members did not agree that households in receipt of rent reduction for two years should be transferred to cheaper units. In response, Mr HUI re-iterated that the objective of the RAS was to provide assistance to households in temporary financial hardship; it was therefore justified to require tenants in need of long-term assistance to take up cheaper but self-contained accommodation in the same district. Since the introduction of the RAS, only two households had been required to move to cheaper accommodation. Mr HUI emphasized that elderly persons and households with disabled members would be exempted from the requirement for transfer. This would ensure that subsidies would only go to those households with genuine needs. In reply to a related question, Mr HUI said that under existing housing policy, it might not be possible for households so transferred to move back to their original units even after their financial situation had improved. Members were worried that the requirement for transfer might deter households in applying for the RAS; they considered a need to review the policy on transfer as well as the two-year rent reduction period taking into account the increased number of households seeking financial assistance as a result of economic restructuring. Mr HUI took note of members’ views and advised that the suitability of the two-year rent reduction period would be examined in the next RAS review.

8. Before concluding, the Chairman urged the Administration to duly consider in the next RAS review members’ opinions on the eligibility criteria, the two-year rent reduction period and the need to stepping up publicity of the RAS, and to report to the Panel in the next LegCo session.

Admin

IV. Follow-up on the Review on Overcrowding Relief in Public Housing Estates

(Appendix IV to LegCo Paper No. CB(1) 1502/95-96)

9. In referring to paragraphs 2 and 3 of the information paper, members were not optimistic that the Administration could resolve the problem of overcrowding as pledged since only 2,831 cases had been handled through overcrowding relief (OR) arrangements in 1995/96, representing only 6.7% of the overall number of overcrowded families. They asked for a definite time-table for rehousing the remaining 42,127 overcrowded families. Mr FUNG Ho-tung said in reply that the number of families with a living density below 5.5 square metres per person had dropped from 51,000 in March 1995 to 42,127 in March 1996. With the Administration’s pledge to rehouse 8,000 overcrowded families each year and with tenants seeking relief through other avenues such as the increase in supply of public rental housing estates, the Comprehensive Redevelopment Programme (CRP), the various home purchase schemes and applications through the General Waiting List, the situation was expected to improve substantially in two years.

10. Some members were particularly concerned about overcrowded families living in blocks not due for redevelopment within the next five years as these households would not benefit from immediate improvement to their living condition through the CRP. They considered a need for the Administration to adopt a more flexible approach by allocating additional flats to these overcrowded families and setting priority in the order of their degree of overcrowdedness. Consideration should also be given to rehouse overcrowded households within the same district to minimize disruption to their daily routines. Members further suggested that a certain percentage of flats in redeveloped housing blocks should be reserved for OR and that enforcement against abuse of public rental units should be stepped up to recover more flats for OR.

11. In response, Mr FUNG emphasized the need to strike a balance between limited housing resources and demand from various rehousing categories. All flats, including new or vacated ones, would be pooled by the Application Section of the Housing Department for allocation in accordance with the housing quota for various categories. Severely overcrowded households would be accorded priority in OR arrangements. Mr FUNG said that it might not be possible to rehouse overcrowded households within the same district in view of the very limited range of flat sizes available. Special consideration would be given to rehouse overcrowded households, in particular those in older urban estates, who were willing to take up accommodation in other districts. As regards the proposal for reserving flats in redeveloped blocks for OR, Mr FUNG cautioned that this might affect the overall progress of the CRP. Mr HUI supplemented that a review on the allocation criteria would be conducted shortly and members would be informed of the results in due course.

12. Members were of the view that applications for OR from co-tenants sharing a public rental unit as a result of addition of family members should be considered flexibly. Mr FUNG advised that these applications would be treated equally in the order of their overcrowdedness. The Chairman suggested that the subject could be examined more thoroughly when the issue of housing policy for new immigrants from China was discussed at the next meeting.

V. Operation of the Hong Kong Housing Society

13. The Chairman expressed his dissatisfaction at the information paper for this agenda item being tabled at the meeting, and re-iterated the need for the Administration to make available information papers to members at least three working days in advance of meetings. In response, Ms Sandy CHAN explained that since the Administration had received the relevant questions from the LegCo Secretariat only about two weeks ago and the Administration together with the Hong Kong Housing Society needed some time to gather the information, there had hence been a delay in submission of the paper.

14. In referring to Answer 1 of the information paper, members sought clarification on the position of Land Grant made before 1993. In response, Ms L C WONG emphasized that there were no restrictions in all Land Grant projects of the Hong Kong Housing Society (HKHS) which would prohibit the formation of Owners’ Incorporations (OI) by flat owners. On the contrary, owners of HKHS managed properties had been encouraged to set up their own OIs since the enactment of the Building Management Ordinance in 1993. Over 10 OIs had so far been successfully established and a list of these would be provided for members’ reference. A member was not convinced of the Administration’s response since according to the Lands Department (LD), flat owners of some HKHS managed properties such as Broadview Garden were not allowed to set up OIs on account of restrictions in the respective Land Grant. Ms CHAN said in reply that according to a recent random survey on the Land Grant of HKHS projects, there were no restrictions on the establishment of OIs. Nevertheless, she undertook to seek clarification with the LD in this respect.

Admin
Admin

15. Members enquired whether OIs so established were allowed to terminate the service of the HKHS and whether the HKHS would vote against such a decision in the case of mixed tenure. Ms WONG advised that OIs concerned could hire any private management agent (PMA), and the HKHS would abstain in voting if it was convinced that the OIs would have the ability to monitor the performance of the PMAs as in the case of Mei Sun Lau.

16. Members sought elaboration on the modification to the covenant on the transfer of ownership referred to in Answer 2 of the information paper. Ms WONG advised that reference had been made to similar provisions in the Home Ownership Scheme when such a modification was formulated. This would be implemented subject to the approval of the Administration. Under the proposed modification, flat owners were allowed to assign their interest to close relatives without going through the process of selling the properties back to the HKHS before re-selling them to their relatives. Ms WONG supplemented that the modification would only apply to those flat-for-sale projects endorsed before 1995, as a new arrangement had been incorporated in standard Land Grants after 1995 allowing the HKHS to approve applications for transfer of ownership or the addition of parties to the assignment.

17. Members were not convinced that the level of managers’ remuneration charged by the HKHS should be higher than that of the PMAs. Ms WONG advised that the managers’ remuneration charged by the HKHS covered both the costs of overheads and Head Office support; these were often charged separately by PMAs. She added that since the HKHS was not a profit-making organization, it had no intention to reduce the rate in order to compete with the PMAs. The important point was to maintain a high standard of management service. On a question relating to the accessibility of information on staff ranking and salary range of staff of the HKHS, Ms WONG advised that apart from salaries of individual staff, other general information would be released upon request by OIs.

18. There being no other business, the meeting closed at 12:45 pm.

LegCo Secretariat
4 October 1996

Last Updated on 20 Aug, 1998