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The following is issued on behalf of the Hong Kong Housing Authority:
The Subsidised Housing Committee (SHC) of the Hong Kong Housing Authority (HA) today (July 8) endorsed the outcome of the 2016 public rental housing (PRH) rent review in accordance with Section 16A of the Housing Ordinance.
The report compiled by the Commissioner for Census and Statistics (C for C&S) for the 2016 PRH rent review shows that the income index of the second period (2015) was higher than that of the first period (2013) by 16.11 per cent. The index was compiled by comparing the incomes of about 24 000 PRH households in 2013 and 2015. According to Section 16A(4)(a) of the Housing Ordinance, the HA shall adjust PRH rent by the rate of change of the income index, with the increase capped at 10 per cent.
"In accordance with the findings of the report and provisions in the Housing Ordinance, a PRH rent adjustment of +10 per cent will be effected from September 1, 2016. The amount of increase will be about $170 per month on average, ranging from $31 to $426. PRH tenants will be notified one month in advance of their new rent levels," a spokesman for the HA said.
The Housing Ordinance stipulates the PRH rent adjustment mechanism, which came into effect in 2008. The mechanism provides an objective basis for the HA to determine whether and by how much PRH rent should be adjusted, taking into account tenants' affordability.
Under the mechanism, a review of PRH rent will be conducted every two years. Section 16A(7)(b) of the Housing Ordinance specifies that the C for C&S shall compute the income index for the first and second periods under a rent review. For the 2016 PRH rent review, the first period was the 12 months in 2013 and the second period was the 12 months in 2015.
The SHC also had a detailed discussion on whether a rent waiver should be granted to PRH tenants. After carefully considering all relevant factors, including the growth in tenants' income, protection offered by the rent adjustment mechanism in maintaining tenants' affordability, and the HA's financial position, the SHC considered that there were no clear grounds for the HA to grant all tenants a uniform rent waiver this time. Instead, targeted assistance should be offered to tenants who are in need.
The HA operates the Rent Assistance Scheme (RAS) to help PRH tenants with temporary financial difficulties pay their rent, under which eligible tenants receive a 25 per cent or 50 per cent rent reduction. The SHC reviewed the operation of the RAS and endorsed two measures to further enhance the Scheme.
At present, the HA reviews the eligibility of RAS beneficiaries annually to determine whether rent assistance should continue to be granted to them. The SHC today endorsed the relaxation of the frequency of review of RAS eligibility from once every year to once every two years, to relieve RAS households from preparing income documents for vetting of their eligibility every year.
The SHC also endorsed the relaxation of the current requirement for non-elderly RAS beneficiaries living in newer block types to move to cheaper accommodation, if suitable flats are available, if they continue to require rent assistance after receiving it for three consecutive years to four consecutive years.
"Households that have received rent assistance for three consecutive years will only be granted one more year of rent assistance at the next review of RAS eligibility, in order to comply with the new requirement endorsed today of moving to cheaper accommodation in the same district after receiving rent assistance for four consecutive years," the spokesman for the HA added.
In the 2016-17 Budget, the Financial Secretary proposed that the Hong Kong Mortgage Corporation Limited (HKMC) would explore with relevant organisations the feasibility of extending its Reverse Mortgage Programme (RMP) to cover subsidised sale flats. Members also discussed the proposed extension of the RMP at today's meeting.
Since the proposal would improve the quality of life of elderly flat owners and would have no financial implications on the HA, Members endorsed the recommendation to allow elderly owners aged 60 or above of the HA's subsidised sale flats with premium not yet paid to join the RMP.
"Considering the fact that the HA does not need to vet individual RMP applications and the reverse mortgage loan will have no financial implication on the HA, a 'blanket consent' will be given to all participating banks of the RMP to enter into reverse mortgages with elderly owners of the HA's subsidised sale flats with premium not yet paid. This arrangement will streamline the application process and save time and costs for both the HA and the applicants," the spokesman said.
The HKMC and the HA will finalise the detailed arrangements and the documentation, with a view to implementing the relevant programme in October 2016.
Ends/Friday, July 8, 2016
Issued at HKT 19:14
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