PLC Paper No. CB(1) 8/97-98
(These minutes have been seen
by the Administration and
cleared with the Chairman)
Ref : CB1/PL/HG/1

LegCo Panel on Housing

Minutes of meeting held on Monday, 2 June 1997, at 10:30 am in the Chamber of the Legislative Council Building

Members present :

    Hon LEE Wing-tat (Chairman)
    Hon Frederick FUNG Kin-kee (Deputy Chairman)
    Hon Mrs Selina CHOW, OBE, JP
    Hon SZETO Wah
    Hon Albert CHAN Wai-yip
    Hon Fred LI Wah-ming
    Dr Hon YEUNG Sum
    Hon CHAN Kam-lam
    Hon CHAN Yuen-han
    Hon Albert HO Chun-yan
    Hon LEUNG Yiu-chung
    Hon Bruce LIU Sing-lee
    Hon LO Suk-ching
    Hon SIN Chung-kai

Members absent :

    Hon Ronald ARCULLI, OBE, JP
    Hon CHEUNG Man-kwong
    Hon James TO Kun-sun
    Hon Zachary WONG Wai-yin
    Hon CHEUNG Hon-chung
    Hon CHOY Kan-pui, JP

Public officers attending :

    Items II, III and IV

    Housing Branch
    Mr Andrew R Wells
    Deputy Secretary for Housing

    Item II

    Housing Branch

    Miss L K LAM
    Chief Assistant Secretary (Housing Strategy)

    Planning Department

    Mr S M LAU
    Government Town Planner
    Mr John LEE
    Senior Statistician

    Item III

    Hong Kong Housing Society

    Mr Victor SO
    Executive Director
    Miss L C WONG
    Director (Estate Management)

    Item IV

    Housing Branch

    Miss Eva TO
    Principal Assistant Secretary for Housing

Clerk in attendance :

    Mrs Vivian KAM
    Assistant Secretary General 1 (Acting)

Staff in attendance :

    Mr George CHAN
    Senior Assistant Secretary (1)3

I Information papers issued since last meeting

Members noted that no information papers had been issued since the last meeting.

II Housing planning to cope with population projection

(LegCo Papers No. CB(1) 1698/96-97(01) and (02))

2. The Deputy Secretary for Housing (DS for H) briefly introduced the Administration’s information paper on housing planning to cope with population projection, which had reference to the Report on Hong Kong Population Projections 1997-2016 and the Long Term Housing Strategy Review (LTHSR) Consultative Document. Members noted the projection of a population of 8.21 million by mid-2016, and discussed the Administration’s pledge to provide sufficient land to facilitate the provision of 390,000 flats (including a safety margin of 7%) between 2001/02 and 2005/06, and 385,000 flats (including a safe margin of about 10%) between 2006/07 and 2010/11.

3. Members were seriously concerned about the accuracy of population forecast and the accumulative effect of possible slippage in land provision and flat production. They cited past predicament and expressed worries about future uncertainties including demographic changes. They cautioned against aggravating shortage as a result of slippage at early stages, referring to the pre-2001 target and the impact of its delay on subsequent planning. In the absence of implementation details for the present planning period up to 2001, members were dubious about the Administration’s confidence in accomplishing the present target, and their doubt deepened about the succeeding five-year target of 775,000 flats by 2010, which was equivalent to a capacity of housing the entire existing population of the New Territories. Members stressed the importance of the abilities to supervise the progress of converting vacant development land to serviced land, to detect and respond to slippages, and to keep management abreast of progress at all times.

4. In response, DS for H stated that the Administration was agreeable to updating housing demand at regular intervals with a view to accommodating increases if and when appropriate. As to whether the goals could be achieved, he assured members that the Administration’s confidence was borne out by actions under way. For the present period up to 2001, planning was being translated into action. All the requisite land had been granted or identified for building 141,000 public rental housing (PRH) and 151,000 Home Ownership Scheme (HOS) units, as stipulated in the Public Housing Development Programme. The Housing Authority (HA) and Hong Kong Housing Society (HKHS) had given the undertaking that the schedule could be met notwithstanding some members’ contrasting views. For private development, the position was similar except for a small percentage of relatively complicated land grants involving changes in land use and redevelopments. As for the following planning period from 2001/02 - 2005/06, efforts would be co-ordinated in formulating plans to achieve the goals set in the Territorial Development Strategy Review (TDSR) and in the light of the recent consultation on LTHSR. The Financial Secretary’s task force on land supply for housing would steer the policy and course of action to ensure successful implementation.

5. The Government Town Planner (GTP) supplemented that the population projection based on the 1996 Population By-census was 7.8 million in 2011. However, the TDSR adopted a higher population level of 8.1 million in 2011 to take account of uncertainties. He advised that a safety margin of 7% was reasonable, with regard to practicability, and that the Housing Demand Model (HDM) would be re-run at regular intervals to incorporate up-to-date information and respond to changes. For the present period up to 2001, preliminary figures on implementation details for private housing could be made available after the meeting. For the subsequent periods, the TDSR had identified ten Strategic Growth Areas (SGAs), three of which catered for the period of 2001/02 - 2005/06. They were located in South East Kowloon, North Lantau and Tseung Kwan O. For the period of 2006/07 - 2010/11, other SGAs, including the latter phases in North Lantau and South East Kowloon and the Green Island reclamation could provide additional housing land. Further development in the North West New Territories and North East new Territories above the currently planned levels (for which strategic planning studies would soon be conducted) could provide additional housing land to meet the demand beyond 2011.

6. A member had reservations about the efficiency of land provision, citing a few examples and a newspaper commentary. He hoped the Policy Branches concerned would monitor the subject. Regarding the production target of 141,000 PRH units by 2001, he offered two practical suggestions. The first was to expedite the total time taken for the whole process from site formation to construction of buildings, which usually took 62 months involving time-consuming tender procedures for each and every work schedule. It should be practicable to shorten it by entrusting the whole work to one developer, obviating the multi-tender procedures. An example was the "Richland Gardens" which was completed in 36 months by one singer developer. This should be, however, a one-off improvisation to ensure that the 2001 target could be met without any slippage. The second suggestion was to make better use of the existing community centre sites. According to the Home Affairs Department, the utilization rate of the 100 community centres in 160 public housing estates was 20% to 30%; such serious under-utilization was wasteful. These community centres could be rebuilt as residential blocks for say small nuclear families which were on a rising trend; the lower floors could be retained for community-centre purposes. About 12,000 extra new units could thus be created out of 100 such sites on the basis of 120 units per site, and this would be achievable in three years. DS for H appreciated the suggestions, and said that he would follow up the single-developer idea with Housing Department and HA, and consider the use of community-centre sites in consultation with parties concerned.

7. The Chairman summed up the discussions and members’ concerns, and concluded that, despite the Administration’s confidence expressed at this and previous meetings in accomplishing the targets of land provision and flat production for the present phase up to 2001 and subsequent planning phases up to 2015/16, members remained unconvinced of its ability to do so in the absence of concrete evidence. The Panel therefore decided that, as the Financial Secretary was chairman of the recently formed task force on land supply for housing, a letter be forwarded to him to draw particular attention on the following four aspects where members could not reach consensus with the Administration:

  1. The Administration had pledged to provide 141,000 public rental housing (PRH) flats and 175,000 subsidized housing flats between 1995 and 2001. However, since only about 22% of these flats had so far been produced (33,000 PRH and 38,000 subsidized flats) and with less than four years between now and March 2001, the Panel found it difficult to accept the Administration’s assertion that it was capable of meeting its target. Members were concerned as any slippage would consequentially affect production targets for subsequent years. If it could be ascertained at that stage that the target could not be met, the Administration should announce a revised target as soon as possible together with any contingency plans for making up the deficiencies.

  2. On the pledge to provide sufficient land for the construction of a total of 775,000 flats between 2001 and 2011, members asked if action had commenced on approving such land and if so, details of actions that had been taken so far.

  3. Members doubted if the strategic growth areas identified would be adequate to cope with the demand for housing development.

  4. Having regard to factors such as legal immigrants from China, and congested households and singletons in PRH estates, the safety margin of 7 or 10% was grossly inadequate and should be increased. The Administration should note that 775,000 flats could house the entire existing population in the whole of the New Territories and any under-estimate would translate into significant numbers.

The Panel requested the task force to examine the concerns in detail and provide a written bilingual response.

III Situation report on redevelopment of Kwun Lung Lau and Tanner Hill Estate

(LegCo Paper No. CB(1) 1698/96-97(03) -- Extract from minutes of Housing Panel meeting on 13 January 1997;

LegCo Paper No. CB(1) 1698/96-97(04) -- Situation report from the Hong Kong Housing Society)

8. Referring to the rehousing arrangements outlined in the situation report, a member pointed out that existing residents in Kwun Lung Lau (KLL) and Tanner Hill Estate were not being resettled to new estates, but to refurbished old PRH flats, such as Ming Wah Dai Ha and Yue Kwong Chuen. This contradicted one of the purported aims of the report for improving the living standards of residents in the two estates. He said that the majority of residents had asked for resettlement in the same district, and that was why 136 out of a total of 550 KLL Phase I households still resisted resettlement and had not returned their "transfer forms". As KLL was now better served by the Western Harbour Crossing, the KLL redevelopment would appear to be more profit-motivated than urban improvement. He sought an explanation from the Administration on this as well as the rehousing arrangements for the five streets in Kennedy Town scheduled for redevelopment.

9. DS for H replied that HKHS had much smaller resources than the HA and had done its best in satisfying the needs of its residents affected by redevelopment. The rehousing arrangements were in the main acceptable to the majority of the KLL residents, given the need for redevelopment and the practical problems involved in massive rehousing. It should be stressed, however, that any surplus arising from such redevelopment would be fully re-invested to subsidize or finance other public housing projects in the interest of a larger sector of the community.

10. The Executive Director, Hong Kong Housing Society (ED/HKHS) explained that, on top of improvement to the environment of older urban districts, redevelopment plans also endeavoured to assist in meeting the general demand for housing. The two redevelopment plans would create two completely new estates with modern recreational and community facilities to the locality. Affected residents would be accorded priority should they choose to revert upon completion of the redevelopment. As HKHS estates were relatively old, the present arrangement was the best that could be offered, and resettlement would necessarily be staggered and gradual, as with Ka Wai Chuen which took several years. An exception was the new estates at Tseung Kwan O, which attracted some KLL residents. He assured members, however, that all HKHS estates were well served by a maintenance team, and, for flats to accommodate affected residents, refurbishment even included certain fittings and fixtures. Regarding redevelopment in the five streets in Kennedy Town, HKHS’s role was to assist the Land Development Corporation, and the agreement was to provide rehousing opportunities as and when vacant flats became available.

11. The appropriate proportion between rental and sale units in redeveloped KLL was discussed. Some members disagreed that 800 rental units could fulfill affected residents’ wish to return, and suggested a larger figure. ED/HKHS said that 800 was a preliminary figure, with the caveat to strike a reasonable balance in meeting realistic needs after receiving all the "transfer forms" from affected residents. Experience indicated that there was a growing number of households in HKHS estates who, having lived there for many years, had attained the ability and cherished the wish to acquire property. At the same time, there was also a long queue of applicants waiting for PRH allocation. HKHS needed a complete picture, as would be reflected in the "transfer forms", for better reference in planning the redevelopment. He took the opportunity to appeal for early return of the outstanding forms.

12. A member remarked that, among the 136 households who had not returned the "transfer forms", many were elderly people. She hoped that the Administration would adopt a positive approach in handling this group and resettle them in the same district as far as possible. Director (Estate Management), HKHS (D(EM)) replied that demolition would not proceed until the tenants had been resettled, and there were neighbourhood counselling bodies and social workers providing counselling services and removal assistance. The redevelopment plans and rehousing arrangements were explained to them, and there was completely no element of cajoling or coercion. She would follow up on this issue.

13. A member referred to the special cash allowance for elderly singletons and couples who had no rehousing requirements, and said that the allowances of $20,000 for singletons and $35,000 for couples were too small vis-a-vis the six-month rent-free assistance for each and every affected household. He asked if there could be enhanced incentives for such elderly people. D(EM) replied that this group of elderly people would be entitled to both the special cash allowance and the six-month rent-free assistance, the former being primarily of an ex-gratia nature in helping to meet a special need more than an allurement. The level of allowance was arrived at with reference to comparable allowances in other organizations.

14. In response to the Chairman’s suggestion of offering a wider choice for residents affected by redevelopment, D(EM) said that there were already arrangements between HA and HKHS to facilitate eligible families to rent or purchase flats produced by both organizations. Consideration would be given, as suggested, to offer their respective residents affected by redevelopment the opportunity and choice of resettlement in either HA or HKHS estates.

15. In reply to a question on the level of rentals in redeveloped KLL, ED/HKHS said that it had not yet been decided, but would likely follow the model of Ka Wai Chuen rather than the more expensive Healthy Village Estate.

16. Concluding the discussion, the Chairman said that the Panel maintained its stance on the redevelopment of KLL and Tanner Hill Estate, as recorded in the motion passed at the meeting held on 13 January 1997, that it urged HKHS to freeze the redevelopment programme of the two estates before adequate, reasonable and affordable rental units on Hong Kong Island could be made available to re-house affected tenants, and before satisfactory re-housing compensation arrangements were made. HKHS should also re-consider the ratio of rental vis-a-vis flats for sale. He advised that the Panel would follow this up and seek a further report at a later date.

IV Proposed loan to the Estate Agents Authority

(LegCo Paper No. CB(1) 1698/96-97(05) -- Information paper from the Administration)

17. Referring to paragraph 5 of the Administration’s paper on the aspect of implementation, the Chairman noted that the Estate Agents Authority (EAA) would complete making all necessary regulations and rules pursuant to the provisions of the Ordinance within a year, e.g. those relating to licensing requirements, application procedures, practising guidelines, provision of property information, etc. He asked whether, in the interim, EAA could commence to function either as a forerunner or a receiver of complaints in the trade in preparation of its full statutory responsibilities. DS for H said that this was agreeable in principle but it was important to avoid any prejudicious effects on the EAA when its full statutory services were launched upon completion of the requisite rules and regulations. Some preparatory work had in fact started. The Principal Assistant Secretary for Housing (PAS(H)) supplemented that the present activities concentrated on educating the consumer and the public at large; the Housing Branch had also met with estate agents associations to discuss the operating guidelines.

18. In response to a question on the financial implications, PAS(H) advised that EAA would in future finance its operation through licence fees and other fees for services provided, requiring some assistance towards its initial operation before a licensing system could be put into place. This was borne out by the projected cashflow analysis at Appendix 4 of the information paper, subject to variations in the number of estate agents and companies and a fee increase to cope with inflation once every two years. Based on an estimate of 5,000 estate agencies and 17,000 estate agents currently practising in the trade, the annual licence fees would tentatively be around $5,000 and $1,500 respectively. In reply to the Chairman about profits, PAS(H) said that, towards the latter stage of the ten-year period under analysis, profits were expected. The running profit would be equivalent to EAA’s operating cost for three months, which was considered reasonable.

V Any other business

19. The Chairman announced that this was the last meeting for the session. He warmly thanked Mr Andrew Wells, DS for H, for his attendance and contributions at the meetings, and Mrs Vivian KAM, Clerk to Panel, for the secretarial support.

20. The meeting ended at 12:55 pm.

Provisional Legislative Council Secretariat
4 July 1997

Last Updated on 20 August 1998