of the area. If the permittee does not own the premises he is living in he also pays rent either to the Government or to a welfare agency. Rents for Government-owned cottages are $10 or $15 a month according to location.
81. Government's policy in fixing rents in the housing estates is to recover the original capital cost (including an assumed figure of $14 per square foot for land including site formation, piling and engineering cost, but excluding land to be occupied by schools, play- grounds, roads etc.), amortized over 40 years at a rate of 31% com- pound interest a year, plus all annually recurrent expenditure, including the cost of administration and maintenance. Rents are worked out in respect of a particular mark of block, on the basis of contract prices for the earliest ones to be constructed, and apply to all blocks of the mark irrespective of location and date of construction.
82. Except where the ratable value of the accommodation is below the minimum at which rates are charged, there is an additional element for rates which is collected with the rent. This amounts to about 17% of the ratable value in urban areas and 11% in the New Territories. A further charge is made for water, varying according to the size of the room, in those premises where individual meters have not been installed.
83. The basic rents for domestic accommodation in Mark VI blocks were calculated on the same principles outlined in the preceding paragraph, with the one exception that the assumed figure of $14 per square foot for formed land was increased by $3 per square foot to take into account the rising costs of site formation and engineering works.
84. Shop and workshop rents in estates are determined by the size and location of the premises. There are four grades based on location, and shops enjoying the best trading situations adjoining main roads or hawker markets are charged more than those less advantageously placed. Shop units in the Mark I and Mark II estates range in size from 120 to 310 square feet. The rent for a shop of 120 square feet in the urban areas now varies from $45 to $124.50 depending on the grade; the rent includes an element for rates and water charges. As with domestic rooms, Mark III and Mark IV estate shop rents are higher, a Grade A shop of 120 square feet in the urban area being charged $124.50 a month (including rates and water). Workshops are usually
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