were known as 'approved' areas and here the buildings had to conform to a standard. Squatters who could not afford to build to this standard went to what were called 'tolerated' areas which were less conveniently placed and where there was little control over the type of structure erected. Both types of areas were laid out in planned sites with roads, fire-breaks, communal water supply and communal latrines. They were administered by a new division of the Urban Services Department; but the screening of squatters to decide their eligibility for resettlement, clearance operations, and patrols to prevent new squatting were still organized by other Departments.
4. The main obstacle to rapid large-scale clearance and resettlement operations by these methods was that squatters did not like to move to the tolerated areas, since they were far from their places of work; and not many could raise enough capital to build in the approved areas. To help meet this second difficulty private contractors were given permission to build cottages in the approved areas for sale to persons eligible for resettlement. A more successful measure adopted in the same areas, with the same object in view, was the setting up in September 1952 of the Hong Kong Settlers Housing Corporation. This corporation was financed partly by Government and partly by private subscription; it built over 1,500 cottages for sale to settlers on hire- purchase terms, the instalments being $35 or $20 a month according to the size of the cottage. In spite of these expedients and in spite of a good deal of assistance to individuals from welfare agencies, the basic difficulty remained: most squatters could not afford the forms of resettlement offered to them.
5. Some 37,000 persons had been resettled by these methods when the situation was drastically altered. On Christmas night 1953 the worst fire in the history of the Colony broke out in the crowded squatter colony at Shek Kip Mei and within a few hours 53,000 people were homeless. The usual emergency relief measures were taken but it was immediately clear that the ordinary methods of resettlement would be quite inadequate to deal with a disaster of this magnitude. A major change in policy was made, and it was decided to put in hand at once the construction of emergency two-storey buildings on the fire site to rehouse the fire-victims, and to meet the cost from public funds.
6. At the same time the Urban Council appointed an Emergency Sub-Committee on Resettlement to consider the measures necessary for re-housing fire-victims as well as proposals for the solution of the squatter problem as a whole. This Sub-Committee came to the con-
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