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HOUSING AND LAND
Much, however, still remains to be done. Even discounting the additional demand for public housing created through the increased rate of immigration, it is estimated that more than half-a-million households are still in urgent need of proper or improved housing. Among these are 152,500 households registered on the authority's waiting list; 57,800 households living in overcrowded or unsatisfactory conditions in old estates built more than 20 years ago; and 130,000 households living in squatter huts scattered throughout the territory.
The increased rate of immigration is not the only problem confronting the government's housing programme. In the past 18 months, serious overheating of the economy and the heavy overloading of the construction industry have seen the cost of building a medium- sized flat rise from $38,000 to $60,000. As a result of this, it was decided to lower the ambitious target of production to about 35,000 flats (rented and for sale) in the public housing programme which is, nevertheless, the highest rate yet achieved - and is more than twice that of the previous year. This rate of production will continue for many years and, when economic circumstances and the capacity of the industry permit, it will be reviewed.
The Housing Authority
The Hong Kong Housing Authority, established under the Housing Ordinance 1973, is a statutory body responsible for co-ordinating all aspects of public housing. The Housing Authority advises the Governor on housing matters; plans and builds public housing estates for categories of people determined with the approval of the Governor; manages public housing estates throughout the territory including cottage areas, temporary housing areas and transit centres; clears land for development; and controls squatting. In addition, in 1977 the Housing Authority was invited, on behalf of the government, to plan, build and subsequently manage flats provided under the Home Ownership Scheme. Legal powers to carry out these functions are provided by the Housing (Amendment) Ordinance 1978. The Housing Authority is chaired by the Secretary for Housing and comprises 13 un- official members, eight of whom are Urban Councillors, and six official members. All members are appointed by the Governor. The Housing Authority is responsible for its own finances and management. Under revised financial arrangements drawn up in 1977, the Housing Authority is no longer required to pay any premium for land granted by the government for public rental housing. However, land value, derived from the residual valuation method, is written into the Housing Authority's balance sheet as a government contribution. Loans from the Development Loan Fund for new buildings are repaid over 40 years, interest-free.
Construction
The current government housing programme aims at producing 175,000 flats, for rental and for sale, over the next five years. Some 46 contracts were let during 1979 at a cost of $1,530 million. At the end of the year, 70 contracts, including 14 for Home Ownership Scheme projects and three handled by the Public Works Department, were in progress to provide 92,500 flats over the next three years.
Home Ownership Scheme
As public housing marked its silver jubilee in 1979, the infant Home Ownership Scheme reached maturity following completion of the first flats built under the project. The scheme was announced in 1976 to assist the growing aspirations of the low-to-middle income group
group which