For discussion FCR(96-97)57
on 19 July 1996

ITEM FOR FINANCE COMMITTEE

CAPITAL WORKS RESERVE FUND
HEAD 710 - COMPUTERISATION
Government Secretariat : Housing Branch
New Subhead "Integrated Housing Information System"
HEAD 150 - GOVERNMENT SECRETARIAT HOUSING BRANCH
HEAD 47 - INFORMATION TECHNOLOGY SERVICES DEPARTMENT
HEAD 82 - BUILDINGS DEPARTMENT
HEAD 91 - LANDS DEPARTMENT
HEAD 118 - PLANNING DEPARTMENT
HEAD 162 - RATING AND VALUATION DEPARTMENT
Subhead 001 Salaries

Members are invited -

  1. to approve the creation of a new Subhead "Integrated Housing Information System" with a commitment of $14,034,000 under Head 710 Computerisation; and
  2. to increase the ceiling placed on the total notional annual mid-point salary value of all non-directorate posts in the following departments for the creation of non-directorate posts to provide the necessary support for the implementation of the system -

Housing Branch

from $10,726,000 by $318,000 to $11,044,000

Rating and Valuation Department

from $237,916,000 by $1,864,000 to $239,780,000

Lands Department

from $885,094,000 by $683,000 to $885,777,000

Buildings Department

from $225,356,000 by $308,000 to $225,664,000

Planning Department

from $220,378,000 by $1,077,000 to $221,455,000

Information Technology Services Department

from $304,912,420 by $2,235,540 to $307,147,960



PROBLEM

We need a comprehensive, integrated and efficient housing information system to monitor housing development effectively and to take decisions on housing policy promptly.

PROPOSAL

2. We propose to set up an integrated computerised housing information system to bring together compatible and co-ordinated information on land supply, housing production and the property market.

JUSTIFICATION

3. At present, individual Government departments concerned process and maintain their own data on land and flat production without an overall, co-ordinated approach between them. Given the size of the stock of domestic premises in Hong Kong and the scale of housing developments in progress and under planning, Housing Branch (HB) have to spend much time and effort to collate the data maintained by the various departments in order to ensure data consistency and compatibilty and to provide meaningful analyses for policy making. This hampers the ability of HB to monitor the progress of housing production and hinders the Government in taking prompt decisions on housing policy. To overcome this problem, it is necessary to develop a comprehensive, integrated computerised system, the "Integrated Housing Information System" (IHIS), to bring together information on land supply, housing production and the property market. It will provide support for the formulation and review of housing policy, and the setting of realistic housing production targets. More specifically, IHIS will -

  1. integrate departmental information on land supply, land requirements, housing supply, residential property market and public housing statistics into a comprehensive and up-to-date central database;
  2. strengthen the basis for the forecast of housing supply and enable HB and relevant departments to monitor the progress of residential development and redevelopment projects;
  3. match land supply information with land requirement data for both private and public housing;
  4. provide early warning of possible shortfall of residential land and housing supply to meet demand; and
  5. facilitate the monitoring of the residential property market, including price movements and property transactions in the primary and secondary markets and the inter-relationship between property speculation, mortgage rates, household income, flat prices, affordability, and home ownership patterns.

4. In addition, IHIS will result in the following benefits -

  1. it will make available and provide prompt access to the latest information on all sales and transactions of residential premises within or outside the Consent Scheme, and also on the subsequent sales and transactions of residential premises after the completion of their first sales within or outside the Consent Scheme;
  2. it will align the different formats of lot descriptions and unify the designations of lots within sites, and of sites within districts adopted by the various departments. As a result, it will solve the long-standing problem of the lack of a common land identifier among different departments and improve the accuracy and completeness of land-related information of the Government. This will in turn facilitate any action Government may wish to take in maintaining a supply of residential premises capable of meeting the demand;
  3. it will be a flexible system with a wide range of functions. It will be capable of producing reports on different types of housing and related statistics to different formats which Government requires to perform its role of monitoring of housing production and formulation of policy. It will also be capable of, inter alia, developing forecast models on the basis of the data stored in it to identify the effects of socio-economic changes on housing. Also, we plan to allow IHIS to interface with other information systems on housing and related matters of other housing agents such as the Hong Kong Housing Authority and the Hong Kong Housing Society (HKHS).

5. IHIS aims to enhance the data collection, compilation and sharing mechanism of housing-related information within the Government, and will facilitate the provision of more timely and comprehensive analysis on the housing market. Furthermore, we expect that the system will -

  1. reduce the time taken to consolidate the housing supply and production information by various departments from the present seven to eight weeks to one to two weeks on average;
  2. improve responsiveness by departments to requests made by branches and/or Legislative Council (LegCo) on housing-related questions by 15% on average;
  3. allow common access and utilisation of housing and land related data by source departments and reduce duplication of databases on similar data in different departments;
  4. improve our ability to keep consistent, comprehensive and up-to-date residential property market performance indicators (including 26 data groups under private property market sub-system and six data groups under public housing sub-system) to improve monitoring of property market movements;
  5. enhance the efficiency and effectiveness of monitoring the development progress of residential projects (including five data groups under the land supply sub-system and six data groups under the housing supply sub-system) to improve the accuracy of flat supply forecast; and
  6. generate 12 new data groups (about one-fifth of the total) which we cannot otherwise produce in a cost effective manner.

Cost-benefit analysis

6. A cost-benefit analysis is at Enclosure 1. If the proposed computerised system is not in place but departments have to come up with different means to perform comparable functions, we estimate that we will need additional resources costing some $11,359,000 annually. Taking into account the avoidance of this estimated recurrent cost for providing comparable functions without the benefits of IHIS, the system will break even in the sixth year after full implementation.

FINANCIAL IMPLICATIONS

Non-recurrent cost

7. We estimate the total non-recurrent cost for implementing the proposed system to be $23,191,000, as follows -

1996-97

($'000)
1997-98

Total

Non-recurrent expenditure

(a) Computer hardware and software

3,668

0

3,668

(b) System development and implementation services

5,000

2,267

7,267

(c) Site preparation, cabling and datalines

812

0

812

(d) Training

200

100

300

(e) Data source departments expenditure

711

0

711

(f) Contingency for items (a) to (e)

1,039

237

1,276

Sub-total

11,430

2,604

14,034

Non-recurrent staff cost

(g) HB

261

0

261

(h) Information Technology Services Department (ITSD)

1,643

1,445

3,088

(i) Buildings Department (BD)

287

0

287

(j) Lands Department (Lands D)

515

0

515

(k) Rating and Valuation Department (RVD)

3,064

0

3,064

(l) Planning Department (Plan D)

1,942

0

1,942

Sub-total

7,712

1,445

9,157

Total non-recurrent cost

19,142

4,049

23,191

8. As regards paragraph 7(a), the cost of $3,668,000 is for acquiring computer workstations, database servers, software, peripheral and data communications equipment.

9. As regards paragraph 7(b), the cost of $7,267,000 is for contracting out services to develop and implement the proposed system. This covers the system analysis and design, system set-up, application development, support to data conversion, system testing and acceptance testing.

10. As regards paragraph 7(c), the cost of $812,000 is for site preparation for the installation of computer equipment, cabling works for the peripheral equipment and installation of data lines.

11. As regards paragraph 7(d), the cost of $300,000 is for training users of the proposed system.

12. As regards paragraph 7(e), the cost of $711,000 is for meeting the system development expenditure of the Land Registry ($92,000), HKHS ($74,000) and Housing Department ($302,000), as well as the contract staff services required by BD ($243,000) to develop the proposed system.

13. As regards paragraph 7(g), the sum of $261,000 represents HB's full staff costs for co-ordinating departmental efforts to input data in a standardised format to the proposed system, and in co-ordinating with ITSD in testing and building up statistical packages for the development of the forecast model function of the proposed system. It comprises a total of six man-months of Statistical Officer I.

14. As regards paragraph 7(h), the sum of $3,088,000 represents ITSD's full staff costs for the overall management of the project, the development of the system, and the acquisition and supervision of contract services, the acceptance and the nursing of the delivered system. It comprises a total of five man-months of Senior Systems Manager effort, 12 man-months of Systems Manager effort, 28 man-months of Analyst/Programmer I effort and seven man-months of Analyst/Programmer II effort.

15. As regards paragraph 7(i), the sum of $287,000 represents BD's full staff costs for the identification of the estimated number of residential flats from the building plans, the checking of the statutory forms for the commencement of works and for the applications for occupation permit, and for the input of other building related data into the proposed system. It comprises a total of six mon-months of Survey Officer effort and six man-months of Clerical Officer II effort.

16. As regards paragraph 7(j), the sum of $515,000 represents Lands D's full staff costs for the conversion of departmental lot numbers to the format of the proposed system, and the conversion and input of other land related data into the proposed system. It comprises a total of six man-months of Estate Surveyor effort and six man-months of Typist effort.

17. As regards paragraph 7(k), the sum of $3,064,000 represents RVD's full staff costs for setting up compatible interface between the data in RVD local computer system and the proposed system, and the conversion and input of other property related data into the proposed system. It comprises a total of 11 man-months of Senior Valuation Surveyor effort, 12 man-months of Valuation Surveyor effort, eight man-months of Senior Valuation Officer effort and 12 man-months of Valuation Officer effort.

18. As regards paragraph 7(l), the sum of $1,942,000 represents Plan D's full staff costs for setting up the mapping tables to link up the lots, sites and districts, and the conversion and input of data related to land supply, housing demand, and redevelopment potential into the proposed system. It comprises a total of 12 man-months of Town Planner effort, 12 man-months of Senior Survey Officer effort, and 24 man-months of Survey Officer effort.

Annually recurrent cost

19. The proposed system will result in additional recurrent cost of $6,389,000 upon full implementation in 1997-98. The breakdown is as follows -


$'000
Recurrent expenditure
(a) Equipment maintenance447
(b) Consumables229
(c) Training90
(d) Data source departments' expediture529
Sub-total1,295
Recurrent staff cost
(e) HB522
(f) ITSD728
(g)BD309
(h) Lands D837
(i) Plan D1,399
(j) RVD1,299
Sub-total5,094
Total recurrent cost6,389

A breakdown of the recurrent expenditure is at Enclosure 2.

20. As regards paragraph 19(a), the cost of $447,000 is for the hardware and software maintenance of the proposed system.

21. As regards paragraph 19(b), the cost of $229,000 is for the consumables, including toner, cartridge and data line charges for the proposed system.

22. As regards paragraph 19(c), the cost of $90,000 is for the on-going training to update the information technology knowledge of the staff.

23. As regards paragraph 19(d), the cost of $529,000 is for meeting the charges to be levied by the Land Registry and the HKHS for their provision of housing related data for input into the proposed system.

24. As regards paragraph 19(e), the sum of $522,000 represents the full costs of one Statistical Officer I in HB to provide on-going statistical analysis, data modelling and simulation, to liaise with ITSD on the continual enhancement of the system functions and report modifications, and to co-ordinate data compilation and input from various departments.

25. As regards paragraph 19(f), the sum of $728,000 represents the full costs of one man-month of Systems Manager effort, 11 man-months of Analyst/Programmer I effort, and four man-months of Analyst/Programmer II effort for ITSD to provide on-going system maintenance and enhancement, and technical support to the proposed system.

26. As regards paragraph 19(g), the sum of $309,000 represents the full costs of one Survey Officer in BD to provide on-going input, updating and maintenance of buildings related data in the proposed system.

27. As regards paragraph 19(h), the sum of $837,000 represents the full costs of one Estate Surveyor in Lands D to provide on-going input, updating and maintenance of land related data in the proposed system.

28. As regards paragraph 19(i), the sum of $1,399,000 represents the full costs of three additional staff required by Plan D to provide on-going input, updating and maintenance of land, housing supply and demand data, to carry out mapping of individual lots to sites and sites to districts, to co-ordinate and monitor data flow and interface between the proposed system and other information systems. These consist of one Town Planner and two Survey Officers.

29. As regards paragraph 19(j), the sum of $1,299,000 represents the full costs of two additional staff required by RVD to provide on-going input, updating and mapping of property related information in the proposed system. These consist of one Valuation Surveyor and one Valuation Officer.

Implementation

30. We propose to implement IHIS in two phases, with Phase one to be completed by the end of 1996, and Phase two by June 1997. The implementation plan is as follows -

Activity

Scheduled completion date

(a) System analysis and design

November 1996

(b) Procurement of equipment

November 1996

(c) Implementation services
(Phase one)

December 1996

(d) Phase one production

December 1996

(e) Implementation services
(Phase two)

June 1997

(f) Phase two production

June 1997

(g) System hand-over

July 1997

BACKGROUND INFORMATION

31. The project is one of the recommendations of the Task Force on Land Supply and Property Prices in June 1994, which the Government has undertaken to implement.

32. IHIS will comprise five sub-systems, namely, the land supply sub-system, the housing supply sub-system, the matching of land requirements with land supply sub-system, the private property market sub-system and the public housing sub-system. These sub-systems will extract and link up data from some ten data sources into a central database. A summary of the data groups of the sub-systems is at Enclosure 3.

33. While we intend the IHIS primarily to facilitate the central Government's formulation and review of housing policies, it will also serve to improve the scope and form of housing-related information which we can make accessible to the public. We will examine in detail the means of providing such information in the most comprehensible and cost effective manner during the development of the system.

Urgency

34. In order to meet our target implementation date of end 1996 for Phase one of the project, we need to obtain Members' approval of the necessary funding before the summer recess so that work on system analysis and design could start soon. When we presented the proposal to the LegCo Panel on Housing on 3 July 1996, Members expressed concern over the recurrent cost. We have reconsidered our requirements and means of absorbing the cost by redeployment. Due to the wide range of data groups and the number of departments involved, it has taken some time to finalise the recurrent cost required. We regret the late issue of this paper.

Housing Branch
July 1996


Enclosure 1 to FCR(96-97)57

Cost-benefit analysis of the proposed Integrated Housing Information System


1996-97
($'000)

1997-98
(Year 1)
($'000)

1998-99
(Year 2)
($'000)

1999-00
(Year 3)
($'000)

2000-01
(Year 4)
($'000)

2001-02
(Year 5)
($'000)

2002-03
(Year 6)
($'000)

Non-recurrent expenditure

19,142

4,049

0

0

0

0

0

Recurrent expenditure

0

6,389

6,389

6,389

6,389

6,389

6,389

Total cost

19,142

10,438

6,389

6,389

6,389

6,389

6,389

Annual notional savings

0

11,359

11,359

11,359

11,359

11,359

11,359

Net savings

(19,142)

921

4,970

4,970

4,970

4,970

4,970

Net Present Value @ 4%

(19,142)

884

4,580

4,397

4,221

4,052

3,890

Net cumulative savings @4%

(19,142)

(18,258)

(13,678)

(9,281)

(5,060)

(1,008)

2,882


Enclosure 2 to FCR(96-97)57

Breakdown of annual recurrent cost (excluding staff cost) of the proposed Integrated Housing Information System

Items of expenditure

Recurrent expenditure for departments
($'000)

Total
($'000)

HB

ITSD

BD

Lands D

Plan D

RVD

Equipment maintenance

415.9

10.3

5.2

5.2

5.2

5.2

447.0

Consumables

221.8

2.4

1.2

1.2

1.2

1.2

229.0

Training

50.4

25.2

3.6

3.6

3.6

3.6

90.0

Data source departments' expenditure

529.0

0

0

0

0

0

529.0

Total

1,217.1

37.9

10.0

10.0

10.0

10.0

1,295.0


Enclosure 3 to FCR(96-97)57

Summary of the proposed data groups of the sub-systems of the Integrated Housing Information System

Land Supply Sub-system

New land for private housing

New land for public rental housing

New land for assisted sale flats

Redevelopment for private housing (#)

Redevelopment for public rental housing (#)

Redevelopment for assisted sale flats (#)

Land disposal and sales

Revenue from land sales

Housing Supply Sub-system

Forecast completion of private residential flats

Actual completion of private residential flats

Forecast completion of public rental housing flats

Actual completion of public rental housing flats

Forecast completion of assisted sale flats

Actual completion of assisted sale flats

Matching of Land Requirements and Land Supply Sub-system

Comparison of land supply and land requirement for private housing (#)

Comparison of land supply and land requirement for public rental housing (#)

Comparison of land supply and land requirement for assisted sale flats (#)

Private Property Market Sub-system

Private residential stock

Vacancy rate

Take-up rate

Prices of flats in the secondary market

Prices of flats in the primary market (#)

Rental movements

Prices of private offices

Rentals of private offices

Affordability of home purchaser (10% downpayment and including all households)

Affordability of home purchaser (10% downpayment and excluding public housing households)

Affordability of home purchaser (30% downpayment and including all households)

Affordability of home purchaser (30% downpayment and excluding public housing households)

Factors affecting affordability (#)

Tenant affordability (for all households)

Tenant affordability (excluding public housing households)

Property transactions in the primary market (#)

Property transactions in the secondary market (#)

Short term resale

Speculation using companies

Sale of flats in residential development under the Consent Scheme (#)

Sale of flats in residential development outside the Consent Scheme (#)

Pre-sale consents processed by Legal Advisory and Conveyancing Office

Pre-sale consents issued by Legal Advisory and Conveyancing Office

Amount of total outstanding residential mortgage lending

Total gross loans made

Total new loans approved (drawn and undrawn)

Total new loans approved (but not yet drawn)

Movements of owner occupation rate

Permanent domestic housing units by category

Domestic households under various tenures

Domestic households under various living quarters

Public Housing Sub-system

Allocation of public housing by categories

Prices of assisted sale flats

Rentals of public rental housing flats

Housing Loan Schemes

Assisted sale flats schemes

Vacancy rate of public rental flats

(#) new data groups


Last Updated on 2 December 1998