XN000022-1993-04-28 — Page 21

WEDNESDAY, APRIL 28, 1993

9

SPEECH BY SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS,

MR TONY EASON IN MOTION DEBATE ON HOUSING AUTHORITY'S

FINANICAL ARRANGEMENTS

*

MR PRESIDENT,

INTRODUCTION

THE CURRENT FINANCIAL ARRANGEMENTS BETWEEN THE GOVERNMENT AND THE HOUSING AUTHORITY HAVE BEEN IN PLACE SINCE 1988 WHEN THE HOUSING AUTHORITY WAS REORGANISED. THE SPIRIT BEHIND THE REORGANISATION AND THE NEW FINANCIAL ARRANGEMENTS WAS TO GIVE THE AUTHORITY GREATER AUTONOMY AND FINANCIAL INDEPENDENCE. THE ARRANGEMENTS WERE INTENDED TO HELP THE AUTHORITY TO BE SELF-FINANCING AND TO PROVIDE THE AUTHORITY WITH THE FLEXIBILITY IT NEEDED TO ACCORD PRIORITIES то THE USE OF RESOURCES IN CARRYING OUT THE HOUSING PROGRAMME. A REVIEW OF THESE ARRANGEMENTS TO TAKE ACCOUNT OF THEIR OPERATION IN THE PAST FIVE YEARS IS CURRENTLY UNDER WAY.

2.

AT THE OUTSET, PERHAPS I SHOULD RECAP, VERY BRIEFLY, WHAT THE 1988 ARRANGEMENTS ARE. AT PRESENT, THE GOVERNMENT'S CAPITAL STRUCTURE IN THE AUTHORITY IS THREEFOLD ·

(A)

(B)

PERMANENT CAPITAL

THE

$2.8

FROM

IN

HELP

IN 1988, THE HOUSING AUTHORITY WAS ALLOWED TO RETAIN REMAINING BALANCE IN THE HOME OWNERSHIP FUND OF BILLION. OUTSTANDING LOANS AMOUNTING TO $13.5 BILLION THE DEVELOPMENT LOAN FUND WERE ALSO CAPITALISED. ADDITION, A FURTHER $10 BILLION WAS MADE AVAILABLE TO THE AUTHORITY MEET ITS CAPITAL REQUIREMENTS UP TO THE END OF 1993-94. INTEREST IN CASH AT 5% PER ANNUM IS PAYABLE ON THE TOTAL CAPITAL INJECTION OF $26.3 BILLION.

CONTRIBUTIONS TO DOMESTIC HOUSING

IS

THE

FOR

THE AUTHORITY IS NOT REQUIRED TO PAY THE GOVERNMENT THE LAND VALUE FOR THE DOMESTIC ELEMENT OF PUBLIC RENTAL HOUSING. IN RESPECT OF HOS DEVELOPMENTS, AS LAND VALUE THE AUTHORITY REQUIRED TO PAY 35% OF THE BUILDING CONSTRUCTION COSTS. LAND VALUE FOR BOTH, NET OF THE 35% LAND COST ELEMENT HOS DEVELOPMENTS WHICH IS PAID, ARE BROUGHT то THE AUTHORITY'S ACCOUNTS AS A CONTRIBUTION TO DOMESTIC HOUSING TO SHOW THE EXTENT OF THE GOVERNMENT'S CONTINUING SUPPORT. NO ACTUAL CASH PAYMENT, HOWEVER, IS INVOLVED. IN THE FIVE YEARS FROM 1987 TO 1988 ALONE, SOME 240 HECTARES OF LAND HAD BEEN MADE AVAILABLE FOR PUBLIC RESIDENTIAL PURPOSES. THIS COMPARES WITH JUST UNDER 100 HECTARES OF NEW LAND SET ASIDE FOR PRIVATE RESIDENTIAL PURPOSES DURING THE SAME PERIOD. THE GOVERNMENT'S CONTRIBUTION SEEN IN CONTEXT REPRESENTS A MASSIVE SUBSIDY.

(c) NON-DOMESTIC

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