taipei_housing_workshop_

Dr LAU Kwok-yu
Associate Professor
Department of Public Policy
City University of Hong Kong
(Presented at the 2013 International Workshop on Asian Public Housing Policy
on 26 October 2013, Taipei)
The workshop is hosted by the Urban Development Department of the Taipei City Government, and
organized by The Organization of Urban Re-s (OURs) and other housing and welfare NGOs.
saKYLAU@cityu.edu.hk 1

Housing the Needy in Hong Kong
 In-kind Public Rental Housing (PRH) provision ?
or
 In-cash Rent Allowance ?
Why???

Parameters for comparison
1. Quality of housing
2. Rent Burden
3. Choice
4. Equity
5. Cost
6. Politics, &
7.Stability

PRH: in-kind housing assistance
 It has been 60 years since the Hong Kong government provides
public rental housing units to people in need of government
assistance.
 Now, public rental housing (PRH) units has provided adequate
and affordable homes for 30% of Hong Kong people.
 about 763,000 PRH units in March 2013.
 the major provider is the Hong Kong Housing Authority (HKHA).
 HKHA(房屋委員會)provides 728,000 PRH units (about 96% of all) in
Hong Kong accommodating 2,026,900 people as at 31 March 2013.

Public sector housing used only 1.4%
of HK land to house 47% of HK people
•Public Sector Housing 公營房屋 =
PRH公屋(出租)+Subsidized Sale flats 資助出售房屋
•Provide homes for 47% of HK’s population
• used 16 sq. km. =about 1.4% of HK’s total land
area of 1,108 sq. km. (i.e. 16 square kilometer) (2011
year-end figures)
(author’s estimate: about 10 sq.m. (or 0.9%) of HK’s
land is used for PRH)
 High-rise & high density housing is common

saKYLau@cityu.edu.hk 6
PRH Units are located in different parts of HK
Table 1: Geographical Distribution of PRH Flats (as at end of March of the year)
Source: HKHA (2012) Housing Authority Executive Information Guide 2012, Table 2.3.
1992 2012 Change
Urban (市區) 332,058
(51.3%)
332,132
(46.0%)
+74
(-5.3%)
Extended Urban
(擴展市區)
185,112
(28.6%)
224,277
(31.0%)
+39,165
+2.4%
New Territories
(新界)
128,373
(19.9%)
163,832
(22.7%)
+35,459
(+2.8%)
Islands
(離島)
1,122
(0.2%)
2,127
(0.3%)
+1,005
(+0.15)
Total No. of Flats 646,665
(100.0%)
722,368
(100.0%)
+75,703

Rent Allowance (租金津貼):
In-cash housing assistance
provided by one government department:
Social Welfare Department社會福利署, and
one statutory organization: HKHA
香港房屋委員會

Social Welfare Department Hong Kong Housing Authority
Scheme Comprehensive Social Security Assistance
(CSSA) Scheme
Rent Allowance for Elderly Scheme (RAES),
introduced in August 2001
Target group and
who receives
rent allowance
• the landlord of public rental housing
(HKHA)
• the recipients who have rented private
sector housing.
eligible elderly
(a total of 623 applications were approved)
Figures and
considerations
As at June 2013, of 181,070 CSSA cases in
public and private rented flats in receipt of rent
allowance under CSSA,
 81% (146,472 cases) were used in
paying public rental housing rent
 19% (34,598 cases) were used in paying
private sector rent.
Among PRH tenants who used CSSA rent allowance
to pay for rent, only 2% of their actual rents
were higher than the maximum rent
allowance,
Whereas among private tenants who received
CSSA rent allowance, 52%of their actual rents
were higher than the maximum rent allowance
(not enough to pay for private rent)
most have to live in small and sub-
standard private rooms.
17,000 eligible elderly applicants on the
Waiting List were invited to use RAES but
there were only 623 successful cases. Due to
the lukewarm response to the RAES, HKHA
approved in September 2003 to phase out the
RAES by ceasing acceptance of new
applications.
The existing beneficiaries, after re-assessment
biennially, continue receiving the cash
allowance.
Alternatively, they may opt to revert to Public
Rental Housing (PRH), out of the 623
approved cases,
 365 beneficiaries (59%) opted to switch to
PRH,
 111 withdrew from the scheme
voluntarily,
 and 80 became ineligible due to various
reasons (including death of the recipients),
only 67 households (11%) which are still
receiving rent allowance under RAES as at the
end of February 2013.
Source:HKHA (2011) Memorandum for the Subsidised Housing Committee -- Revision of Monthly Allowance Payable under the Rent
Allowance for Elderly Scheme for Leases due for Renewal in 2011/12, Paper No. SHC 23/2011.

A long history of in-kind public rental
housing provision in Hong Kong
 Period: 1954-1973
 Post-1973 periods (1 April to 31 March):
 1973-1983,
 1983-1988,
 1988-1998
 1998-2003, and
 2003-2013 (1 April to 31 March)

Table 2: Average annual production of public
rental housing units in Hong Kong
Period
期間
No. of rental
units built per
annum
每年平均建成
出租公屋數目
change over the
last period
比對上一期間
的變化
No. of public sale
flats built per
annum
每年平均建成
資助出售房屋數目
Remarks on
public sales flats
1 April 1954 to 31 March 1973 18,321 -- 0 --
1 April 1973 to 31 March 1983 19,525 +6.6% 6,322 1978/79-1982/83
(annual average
based on 4 years
only) HKHA
HOS & PSPS
1 April 1983 to 31 March 1988 26,371 +35.1% 11,768 HKHA HOS &
PSPS
1 April 1988 to 31 March 1998 24,971 -5.3% 16,517 HKHA+HKHS
1 April 1998 to 31 March 2003 27,865 +11.6% 16,848 HKHA + HKHS
1 April 2003 to 31 March 2013 15,118 -45.8% 601 HKHA HOS &
PSPS
Source: Raw statistics are extracted from Census and Statistics Department (various years) Hong Kong Annual Digest of
Statistics and Websites of the Hong Kong Housing Authority and the Hong Kong Housing Society. The average annual
production of public rental housing and public sale flats is calculated by Dr LAU Kwok-yu of the City University of Hong Kong,
October 2013.

Change from basic housing to
adequate and quality public rental housing
In the 1950s : “basic” housing standards
 Five-person flats of Mark I resettlement blocks
 With a floor area of 11.15 square metres (m2),
 allowing space of 2.23 m2 (24 square feet per adult, half for child).
 NO internal partitions, no running water, no kitchens or bathrooms were
provided inside the unit.
In March 2012, PRH flats are bigger and with better facilities
 kitchen and bathroom have ecome standard provision
 flats for 1 to 2 persons (14.1 sq.m. to 18 sq.m. Internal Floor Area, IFA),
 flats for 2 to 3 persons (22.3 sq.m. IFA), and
 1-bedroom (31 sq.m.) and 2-bedroom flats (37 to 41 sq.m.) are available.
 On average, each person has a living area of 12.9 m2.
 Sustainability is now embedded in public housing development, with
initiatives implemented in energy efficiency, water saving, greening, and
water recycling. All these underline progress and advancement.

Rent Allowance (HKHA) :
chronology of events
 Demand for public rental housing assistance has been addressed with the supply of
public rental housing units in Hong Kong.
 In 2000, Hong Kong Government asked the HKHA to jointly explore with the
former Housing Bureau (HB) the feasibility of providing rent allowance in lieu of
PRH to eligible elderly applicants as an additional option to address their housing
needs.
 HKHA subsequently launched a pilot Rent Allowance for the Elderly Scheme
(RAES) in July 2001 (a quota of 500 allowances, with an additional quota of 600 in
2002 was provided to eligible elderly applicants to lease private accommodations).
 In 2001, Government further asked the HKHA and the former HB to jointly examine
the feasibility of extending rent allowances to non-elderly households on the
public rental housing Waiting List. After a few years (in 2005), Hong Kong
Housing Authority finally decided not to pursue Rent Allowance as a means to
help families in need of housing assistance.

Comparing PRH with Rent Allowance ‐ Quality
Public Rental Housing (in-kind provision) Rent Allowance (in-cash provision)
Quality: subsidized housing producer
(HKHA or HKHS) generally
• builds good quality housing
• also brings externalities: benefits
to the community as public housing
estates in Hong Kong are built with
community and welfare facilities;
• to generate jobs in housing
construction and housing
management and maintenance
related industries and thus boosted
the local economy);
• New town – PRH residents provide
workforce & as infra-structure is
more developed, private land value
has also gone up – government gains
Quality: private tenants generally were
found to have used rent allowance to
rent
• sub-standard private housing
units.
• Quality of the rented units are
normally NOT comparable to those
provided by the public housing
authority.
See photos of PRH units See photos of private rented units
(internal and external environment)saKYLAU@cityu.edu.hk 13

PRH brings good environment
(Yau Lai Estate in East Kowloon)

Old and New PRH
Shek Kip Mei Estate, housing blocks completed in 1976
(front) and in 2012 (back)

Living Room of a two‐bedroom PRH flat
(36 sq.m. Internal Floor Area in Yau Lai Estate)

Dining area of the two‐bedroom PRH unit
(one bedroom on right and one on left of photo)

Kitchen of a two‐bedroom PRH
flat (Yau Lai Estate, East Kowloon)

Bathroom of the same two‐
bedroom PRH flat

Victoria Harbour view enjoyed
by PRH tenant in Yau Lai Estate

Plan of Yau Lai Estate (PRH)

Location of Yau Lai Estate –
near underground station

Sitting out area in PRH estate

24‐hour security guard service +
CCTV (at main entrance of PRH block)

Shek Kip Mei Estate
(1976 and 2012)

Open space in
public rental housing estate

Old private vs New PRH

Single parent with two kids at a
private rental flat (the sub‐divided unit)

Rent allowance (under CSSA) is
typically used to rent sub‐divided units
(Photographer: Lei Jih‐Sheng 雷日昇)

Sub‐divided units – floor plan

Sub‐divided units with
illegal structures

Private rent (Shamshuipo)

Sub‐divided units (illegal structures)
in factory building
(Photographer: Lei Jih‐Sheng 雷日昇)

Comparing PRH with Rent Allowance –
Rent Burden
Public Rental Housing (in-
kind provision)
Rent Allowance (in-cash
provision)
Rent Burden: rental charges
are much lower than those of
the private sector housing.
Rent Burden: private tenants in
receipt of rent allowance are
typically asked to pay high
rent relative to its small units.
Examples of rental charge in
public rental housing :
Shek Kip Mei Estate (in West
Kowloon, an urban district, 3 to
5 minutes walk from mass
transit railway station )
Examples of rental charge in
private rental housing :

Public Rental Housing (PRH, in-kind provision) Rent Allowance (RA, in-cash provision)
Rent Burden: Rent Burden:
Examples of rental charge in public rental
housing :
Shek Kip Mei Estate (in West Kowloon, an
urban district, 2013/14))
For one person:
Average size of PRH unit: 17.79 to 18.24
sq.m. (IFA), housing blocks completed in
2006
Average unit rent: $63.4 per sq.m. (2%
increase since 2006)
Rental charge: HK$1148 to $1179 (or $993
to $1020 with rates concession) per month
Such units, if leased in the market, are
expected to charge a market rent of $3270
to $3352 per month.
Examples of rental charge in private
rental housing in urban district (2013/14):
For one person:
Average size of housing unit: 15.9 square
metres (Internal Floor Area, IFA),
typically completed 30 to 50 years ago
Average unit rent: $289 per sq.m. (77%
increase since 2006/07)
Rental charge: HK$4595 per month
Maximum rent allowance rate under
RAES: HK$2760
Portion paid by tenant: $1835 per month

Examples of rental charge in public rental
housing :
Shek Kip Mei Estate (in West Kowloon, an
urban district, 2013/14))
For two-person household:
Average size of PRH unit: 22.79 to 22.92
sq.m. (IFA), housing blocks completed in
2006
Average unit rent: $63.4 per sq.m. (2%
increase since 2006) [note: rental charge of
older PRH blocks built in 1976 in the same
estate is about 70% of that of the newer
blocks]
Rental charge: HK$1464 to $1474 (or $1256
to $1274 with rates concession) per month.
Such units, if leased in the market, are
expected to charge a market rent of $4212
to $4312 per month.
Examples of rental charge in private rental
housing in urban district (2013/14):
For two-person household:
Average size of housing unit: 22.4 square
metre (Internal Floor Area, IFA), very old
housing blocks, typically completed 30 to 50
years ago
Average unit rent: $260 per sq.m. (67%
increase since 2006/07)
Rental charge: HK$5824 per month
Maximum rent allowance rate under
RAES: HK$3490 per month.
Portion paid by tenant in receipt of rent
allowance (Rent Allowance for the Elderly
Scheme, HKHA): $2334 per month.

Additional benefits of being PRH tenants
 Hong Kong Government had offered to help tenants over financial
difficulties at various times, the Government paid rent on behalf of PRH
households for three months in 2008 (excluding well-off tenants), and
from 2009 to 2013, for two months in each year (covering also the net rent
of well-off tenants). That is to say, on top of the rent reduction of 11.6% in
August 2007, between 2007 and 2013 (7-year period), there are three
months of rent waivers offered by HKHA and 13 months of rent paid by
the Government (i.e. in a 84-month period, only 64 months of rents (80%)
were paid).
 Rates concession is also passed on to PRH tenants and hence rent is
further reduced.
 Half-rent payment or 75% payment will be granted if tenants who are
suffering from temporary financial hardship (as long as they have met
HKHA Rent Assistance Scheme eligibility criteria).

Additional benefits of being PRH tenants
 PRH tenants are not required to declare income and net
asset within the first 10 years of residence.
 As a contrast, beneficiaries of the rent assistance scheme (e.g. those
under HKHA’s RAES), will be re-assessed biennially to ascertain that
they have met the prevailing eligibility criteria. Those in receipt of
SWD’s rent allowance under CSSA are also required to go through
means tests (income and asset test) every year (or every three years in
the case of elderly single persons or couples).
 All the above are not enjoyed by the private tenants in receipt of rent
allowance.

saKYLau@cityu.edu.hk
39
Table 3: Median Rent-to-Income Ratio of Public
and Private Housing in Hong Kong 2011
Source: Census and Statistics Department (2012) 2011 Population Census Summary Results,
Table 32
A typical one bed-room flat = 31.9 sq.m.(IFA) for 3 or 4-person households.
Monthly rental charge in Urban district is = HK$2,000 in 2013
• (about one-third of its market rent or
• 80% of the estimated operational cost for each unit).
• Average monthly rent in PRH (HKHA) was $1,417 in March
2002 and $1,397 in March 2012 (decreased after 10 years)
Median Rent-to-Income Ratio, 2011
Public Housing 10.6
Private housing 25.7

Comparing PRH with Rent Allowance ‐
Choice

Choice: applicants on the PRH
waiting list will be given three choices
in the allocation process. Generally
speaking, non-elderly applicants are
not allowed to choose PRH in the
urban districts.
PRH flats are generally allocated by
means of random computer batching.
The reasons for refusing flat offers
vary among the applicants. 70% of
applicants who received the first flat
offer within three years refused the
offer.
Choice: private tenants using rent
allowance enjoy some degree of
freedom and flexibility to decide
where to live and to select
accommodations that suit their needs
at their own choosing.
In reality, due to the limited
availability of cheap accommodation
in the urban area, the choice is still
quite limited (choose among the bad
choices, e.g. sub-divided units in
illegal structures in factory buildings
or roof-top or in very old private
tenement blocks without lift access,
etc.)

Comparing PRH with
Rent Allowance
Equity

Equity: Due to time lag in producing PRH units,
applicants, though meeting the eligibility criteria,
are generally required to wait on the PRH waiting
list for some years before allocation of a PRH unit.
Equals therefore are not treated equally and the
principle of horizontal equity is violated. Reason:
those already living in PRH units are only
required to pay subsidized rent (low rent and
therefore resulted in a higher disposable income)
while those on the PRH waiting list, earning
similar income, will have to pay high private rent.
Vertical equity is also not practiced in HK’s PRH
estates as existing policies allow the better-off /
well-off tenant families to stay as long as they pay
additional rent (1.5 times rent or double rent)
while all those not living in PRH estates are not
given an offer if their income exceed the income /
asset limits.
Equity: subject to budget provision,
rent allowance can be provided to
people in need of housing assistance
immediately after vetting their
eligibility.
The principle of horizontally equity
is upheld as all equals (those in need
of housing assistance and of similar
situation) are given equal treatment
(same amount of rent allowance)

Comparing PRH with
Rent Allowance
Costs

Costs to Government: In-kind provision of
PRH requires huge initial capital outlay.
In 2004/05, it costs on average some
$275,000 to build a typical one-bedroom
PRH unit (about 30 sq.m. IFA or 51 sq.m.
CFA). (In 2013/14, project cost for building
a flat of size of 28.41 sq.m. (Internal Floor
Area) or 50.83 sq.m. (Construction Floor
Area) is about HK$780,000)
i.e. an increase of $0.5 million in about 10
years.
Costs to Government: Rent allowance
requires no initial capital outlay or
recurrent building management and
maintenance costs.
After completion, PRH also incurs
operational deficit ($360 per flat per
annum, $30 per month) [2013/14: Average
Operating Deficit per weighted average unit
per annum $1332, i.e. $111 per month]
Very high recurrent cash subsidy.
$23760 per annum for a 3-person
household under General Rent
Assistance Scheme as at 1st Quarter
2004 ($32,268 for RAES)
Huge bureaucracy (and high cost) required to
operate the PRH programme
Relatively lower administrative costs.
More in line with the principle of small
government

Comparing PRH with
Rent Allowance ‐ Costs
Public Rental Housing
(in-kind provision)
Rent Allowance
(in-cash provision)
Huge ‘opportunity cost” in
terms of land value
foregone
No land value foregone

Subsidy Analysis and Impact of Rent Allowance
on HKHA's finances
 Paragraphs quoted are shown in quotation marks. See HKHA (2005)
Memorandum for the Subsidised Housing Committee: Rent Allowance, Paper
No. SHC3/2005.
 Assumptions: HKHA assumes that if it was to introduce General Rent
Assistance Scheme (GRAS), the amount of rent allowance payable would be
based on the average rentals in extended urban areas and New Territories,
which should be lower than the rentals in urban areas for RAES.
 HKHA analysis also “shows that for a three-person household, the overall
public subsidy for PRH (including both direct monetary cost and potential land
value foregone) in urban and extended urban areas is 91% and 70% higher than
that under GRAS respectively. In the case of New Territories, PRH incurs
roughly the same level of subsidy as GRAS.”

on HKHA's finances (continued)
 “However, it is revealing that depending on locations, some 50% to 88% of
the total public housing subsidy under PRH is in the form of potential land
value foregone by Government.
 Direct monetary cost in terms of construction, management and
maintenance, etc. accounts for only 12% to 50% of the total subsidy.
 If land value cannot be hypothecated, the monetary cost of GRAS could
be 2 to 4.4 times higher than that of PRH, depending on the locations of the
PRH units.”
 “whether PRH or GRAS is more cost-effective therefore hinges on whether
Government could realize the potential opportunity cost in terms of land revenue
forgone under the PRH option. ”

on HKHA's finances (continued)
 In this connection, HKHA “believes any reference to land value
foregone would only be meaningful and realized if the
concerned sites earmarked for PRH developments would
actually be put onto the open market for disposal.
 The exact impact of so doing on land value is less than certain,
but the odds are land prices sold in the private market would
likely be dampened substantially if HK Government were to flood
the market with a large number of PRH sites”

Land is allocated free of charge to the
HKHA by the Government
Value of land since April 1973 =
HK$191,903 Million
(as at 31 March 2012)
(or simply HK$ 191.9 billion)
Recorded as government’s contribution
 Exchange rate: New Taiwan Dollar 100=HK$27.7 (20 Oct. 2013);
 Exchange rate: US$ 1 = HK$7.777

 “over the short term, replacing PRH by rent allowance could help
improve the cash flow of the HKHA because of the huge savings in initial
construction costs. ”
 However, analysis further “shows that in pure monetary terms, the
cumulative subsidy for GRAS would exceed that for PRH in
about 9 to 12 years’ time. It should also be noted that given its snow-
balling effect, rent allowance would pose a very serious drain on the HA’s
finances in the medium to long term.
 For instance, if the HKHA were to help out 5 000 families by way of rent allowances
each year, the cumulative cash outlay over a 10-year period would be as high as
$6.5 billion.”
 As shown from the above analysis, Rent Allowance is not the
preferred choice of both the Government and the potential
recipients.

Comparing PRH with
Rent Allowance
Politics

Comparing PRH with
Rent Allowance – Politics
Political costs to government
Government in power normally prefers
to use PRH (in-kind housing assistance)
because the new estates built come with
a better environment will result in good
image of the government officials
(showing that the ruling political party
really cares about the needs of housing
needy).
Good quality PRH estate is a show case
of good governance of leaders in power.
Political costs to government
Government opted to use Rent Allowance
may use it as stop-gap measure filling in the
vacuum when newly built PRH units are not
yet ready for meeting the housing needs of
the poor.
If used as a permanent measure, under
scarcity of supply of suitable units, value will
be captured by “greedy” landlords who
normally raise rents but not to
improve housing environment.
Government will be seen as
“uncaring” and “not responsible”.

Public Rental Housing
(in-kind provision)
Rent Allowance
(in-cash provision)
Responsiveness and Flexibility
Government is seen as
inflexible in meeting short-
term fluctuations in housing
demand. Cannot stop building
when demand is lowered and
cannot build more
immediately when demand is
increased.
Responsiveness and Flexibility
Potentially more flexible in
responding to short-term
fluctuations in housing
demand [easy to withdraw or
to provide additional number
of rent assistance, subject to
availability of resources)

A few issues relating to the political and social
dimension of public rental housing in Hong Kong
 For decades, public rental housing has been used as a
tool to smoothen the potential resistance from squatter
residents in the clearance operations.
 Political stability will be at stake if forced evictions
and clearance were resulted without the provision of
PRH to resettle them.
 Though PRH unit is not considered as compensation
to the squatters affected by clearance, rehousing them
into PRH is considered as an ex-gratia arrangement.

 A living unit in PRH estate has often be regarded as “a
compensatory resettlement unit” upon the demolition a
living unit in the squatter areas (many of these
targetted for clearance were illegal structures and were
sub-standard housing units which occupied many of
the good sites in urban fringe areas). PRH provision, in
Hong Kong’s case, is the most acceptable way to the
“victims” affected by squatter clearance operations.
[Note: some squatter residents “bought” the squatter
huts with a “big sum” of cash. When the huts were
cleared, they were resettled into PRH units and
required to pay public rent.]

 Clearing squatters is no easy task and if people in the
squatter areas affected by clearance were only given
rent allowance and displaced into another poorer area
(i.e. not properly re-housed / re-settled into PRH
units), the government would have to face strong
resistance actions. The public interest dimension (to
maintain stability) has to be accorded priority.
 The land recovered from squatter clearance has
been used for economic and social purpose (building
of public housing estates, schools, clinics and
community facilities, etc).

Comparing PRH with
Rent Allowance – Social Stability
 Both PRH and Rent Allowance can be used as a means
to an end for a stable society if there is a right mix of
them serving as housing assistance to the needy.
 On balance, PRH, from Hong Kong’s case, is seen as a
better alternative:
 When the government requires land occupied by
tenants of sub‐standard housing (like urban slums in
low density area) for social and economic
development, PRH, used as resettlement housing, is a
“lubricant” to speed up the clearance projects.

Rationales and justifications for
NOT introducing Rent Allowance as a means
to replace or to supplement public rental housing
1. Rent assistance would drain the HKHA's finances in the medium to
long term due to its snow-balling effect. A wide application of rent
allowance would therefore further deteriorate the financial position
of HKHA.
2. Unlike PRH, rent allowance might not help improve the living
conditions of the beneficiaries.
3. There was no such precondition of having an adequate supply of
suitable rental units in the private market. “Unless this precondition
is met, introducing rent allowance on a substantial scale will likely
push up rental level, thereby further increasing the total subsidy that
will be incurred.” (As shown in the 2011 Census data, among 2.368 million
households in Hong Kong, about 14% were tenants of private housing).
4. Introducing rent allowance might substantially increase the
demand for rental assistance from those households who are not
interested in PRH.

The complex nature of Rent Allowance:
1. Liberal economists and market believers generally
welcome Rent Allowance which is thought to be more
efficient and cost-effective than PRH.
2. Some perceive Rent Allowance as a lever to help
revitalize the private rental market.
3. A wider application of Rent Allowance may imply
Government’s withdrawal from the construction of PRH.
4. Should Rent Allowance be presented as an additional
option to, rather than a replacement of, PRH?

The complex nature of Rent Allowance (cont’d):
5. Some others consider that rent allowance should only be
granted as a stop-gap measure to households on the PRH
Waiting List pending eventual re-housing to PRH.
6. If Government and HKHA continue to uphold their pledges to
keep the Average Waiting Time (AWT) at around three years,
would the community at large accept the decision of not
pursuing rent allowance given the huge financial implications.
7. If Rent Allowance is introduced on a modest scale (say, limited
to a maximum of 3,000 quota per annum for those having
waited on PRH waiting list for over 3 years), would the
‘undesirable effects’ mentioned by HKHA in its paper SHC
3/2005 be there?

The Hong Kong public housing story continues …..
in the hope of sustainability and stability
1. PRH units were mainly used for those affected by
clearance projects in early years of its development
and then changed to focus on providing adequate
homes for the low-income families.
2. Public rental housing (PRH) units provide affordable
homes for 30% of HK people.

3. Cross subsidy (from surplus generated in subsidized
sale flats and non-domestic operations) is required as
PRH rents are unable to cover its operating costs.
4. Rent Allowance has been given to recipients of the
Social Welfare Department’s Comprehensive Social
Security Scheme as an income supplement measure to
the low-income group. Amount not adequate to
provide private rent of private flat.
5. Public rental housing unit (the in-kind provision) is
still the preferred choice of people in need of housing
assistance and of the Government.

Contact:
Department of Public Policy
Tat Chee Avenue
Kowloon Tong
Hong Kong
Tel: (852) 3442 8758
Email: saKYLAU@cityu.edu.hk
Thank you.

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