The Chairman welcomed representatives of the Administration to the meeting and advised that this was the second briefing by the Administration on issues related to the Long Term Housing Strategy (LTHS). He then referred members to the letter dated 16 April 1996 from the Secretary for Housing (S for H) in response to the Panel's request for information papers in connection with the LTHS and invited their views on whether the proposals made therein were agreeable.

2. While members supported in general the arrangements proposed by the S for H, some considered additional information papers useful as these would facilitate the work of the Working Group on the LTHS Review which had been established under the Panel to undertake researches relating to the LTHS Review. Mr Andrew Wells said that the Administration was fully aware of members' concern but emphasised the need for the Administration to reach a considered view on proposals before submission to the Panel for scrutiny. He assured members that relevant information would be provided as far as practicable. As regards the report of the Working Group on Housing Demand requested by the Chairman, Mr Wells advised that the Administration was working on the initial conclusions and an in-camera briefing on the final recommendations would be arranged for the Panel before public consultation. In reply to a related question, Mr Wells said that participation of Panel members at meetings of the Housing Authority (HA) on the LTHS might not be feasible.

The 1987 Long Term Housing Strategy

3. At the invitation of the Chairman, Mr Wells introduced the Aims and Achievements of the 1987 Long Term Housing Strategy with the aid of presentation materials at the Appendix. He highlighted the main features of the strategy which were to extend the redevelopment programme, improve opportunities for sitting tenants to move to assisted home purchase flats, assess the need for rental and sale flats with a view to providing a sufficient balance of flats, earmark redevelopment sites for new Home Ownership (HOS) flats and accord priority to tenants affected by redevelopment programmes to purchase such flats, and to introduce a new scheme to help low income groups to purchase flats. He said that apart from some slippage in the clearance and re-development programmes, there had been significant achievements under the 1987 LTHS. The Administration would continue to monitor demand and adjust production targets in the light of forecasts in demand and resources available.

4. Members were not convinced of the results of the 1987 LTHS particularly in view of the shortfall in target. They expressed the concern that an under-estimation of housing needs alongside with the private-sector-led approach adopted in 1987 had given rise to a serious shortfall in the supply of public housing flats and the long waiting list (WL) for public housing. To avoid a similar recurrence, members urged the Administration to adopt the public-sector-led approach in the current review and reduce the average waiting time for allocation of public rental housing (PRH) from seven to five years to one year. In reply, Mr Wells emphasised that housing demand was a moving target affected by economic growth, social changes and policy decisions and could not be predicted with accuracy. The Administration had adopted a housing model which could be adjusted in response to changes to produce a range of best possible estimates of future demand. On the approach to be adopted in the current LTHS, Mr Wells advised that the intention of the Administration would be to promote home ownership both in the public and the private sectors. As regards the WL, Miss L K LAM explained that as the list comprised all applicants eligible for PRH units, some might already have been allocated public housing before their turn came up while other might have turned down the allocation. In the past three years for example, about 25% of applicants on the list were PRH sitting tenants. The Administration was examining means to improve the list so that it could reflect the actual situation. On the possible reduction of waiting time for allocation of PRH, Mr Wells advised that this would be reduced from seven to under five years by the year 2001 as promised in the Governor's policy address. At members' request, he agreed to provide a written note to explain how the under five-year waiting period had been derived.

5. Members urged the Housing Branch (HB) to liaise with relevant policy branches and departments to increase land supply for the construction of PRH estates and to devise an effective mechanism for tying in the various factors of demand, production and supply. They also requested the Administration to adjust the rate of flat production to take into account changing trends of housing demand, and to provide data on land available for the construction of various types of flats against the target of the Administration in order to facilitate participation by LegCo members. Mr Wells shared members' view that land supply was a paramount requirement in flat production. The HB would work closely with the Planning, Environment and Lands Branch (PEL) to ensure that every effort would be made to adjust planning parameters to accelerate land formation programmes and infrastructural provisions. On questions concerning review mechanism and flat production, Mr Wells re-iterated that a final decision on the LTHS had yet to be reached pending the collation of public opinion but assured members that their views would be considered in the context of the review. In recognition of the significant impact of land supply on the LTHS, members considered it necessary for another briefing to be held on land supply. Mr Wells advised that this might not be possible at that stage but undertook to revert to the Panel as soon as possible.

The Strategy

6. In response to members, Mr Wells advised that the validity of the "established priorities" referred to in paragraph 3(c) of the information paper was currently under review. As regards members' request for shelving the proposal in paragraph 4(c) for making use of resources earmarked for re-development to build new flats, Mr Wells said that this would be considered if tenants concerned had strong objections.

Demand for Public Rental Housing

7. In referring to paragraph 7, members noted that re-housing arrangements for 3,100 households (102,900 - 64,400 - 35,400) affected by the clearance programme would still be outstanding by the year 2001; they sought elaboration on the reasons for the slippage. Mr Wells attributed this to resistance by applicants and lack of reception flats available. As regards the basis upon which the demand of 80,000 families referred to in paragraph 9 had been arrived at, Mr Wells explained that this was based on the assumption that a substantial number of households would be ineligible or had been re-housed under other programmes by the time their turn came up. On the possible clearance of the WL by the year 2001 through increases in flat supply, Mr Wells advised that this would not be possible taking into account the time required (61 months) to produce the requisite number of flats, apart from the time required for land formation.

8. At members' request, Mr Wells undertook to include in the note for members:

the reasons for the slippage in some clearance programmes;
the targets for the 1987 LTHS Review and that for the year 2001 outlined in paragraph 7; and
the rationale for the calculation of an effective demand of 80,000 families on the WL.

Redevelopment of Public Rental Estates

9. Members were disappointed at the progress of the Comprehensive Redevelopment Programme (CRP) and questioned the rationale for deferring the target completion date of the CRP to the year 2005, as outlined in paragraph 12. Mr Wells said that about 70% of the total number of non-self contained flats in the programme had been redeveloped and the rest would be rehoused before the year 2001, and the Administration would continue to monitor both the production of new and redeveloped PRH flats to ensure timely completion. It was expected that about 86% of the programme would be completed by the year 2001. In reply to a related question, Mr Wells confirmed that the CRP had been included as a part of the LTHS. In response to a member, he agreed to include in the note for members the reasons for deferring the target completion date of the CRP to the year 2005.

Demand for Assisted Home Purchase

10. Members considered that the high prices of HOS flats had discouraged home purchasers and urged the Administration to review the pricing formula and delink the prices with the market rate.

Increase in Overall Demand

11. Members sought elaboration on the rationale for the increase in the number of one-person households as stated in paragraph 19(a). Mr Wells advised that according to information provided by the Census and Statistics Department, the increase was attributed mainly to: the increase in the number of elderly people who had to live on their own; the splitting of unextended nuclear family households with grown up children seeking separate accommodation; and the increase in legal immigrants from China. In order to meet the housing demand of this category, consideration would be given to increase 50,000 to 60,000 places in singleton flats and hostels over the period 1995/96 to 2000/01. Mr Wells also undertook to confirm the above in writing.

Increase in Demand from the Waiting List

12. In response to members, Mr Wells agreed to provide an analysis of the reasons which had given rise to an increase in demand from the waiting list.

Concluding Remarks

13. In conclusion, the Chairman emphasised the need for the Administration to:

ensure that the LTHS could meet its aims both in terms of the number of flats to be produced and the timing for production;
reduce the conservative waiting time of seven to five years to one year; and
devise an effective mechanism to tie in the various factors of demand, production and supply, and to make possible participation by LegCo Members.

A member further highlighted the fact that since housing was neither a welfare nor a service but an essential requirement of the needy, the Administration should map out its housing strategy and goal clearly and accurately.

14. There being no other business, the meeting closed at 6:30 pm.

LegCo Secretariat
8 July 1996

Last Updated on 20 Aug, 1998

LegCo Panel on Housing

Minutes of Meeting held on Monday, 27 May 1996 at 4:30 pm in the Chamber of the Legislative Council Building

Minutes of Meeting held
on Monday, 27 May 1996 at 4:30 pm
in the Chamber of the Legislative Council Building