TNAG-0270-FCO40-306-Policy-on-housing-and-resettlement-in-Hong-Kong-1971 — Page 78

CONFIDENTIAL

- 3

away from squatter resettlement and towards more orthodox

low-cost housing; and, indeed, very possibly calls for an

absolute reduction in the overall volume of Government-

aided housing to be produced over the next few years.

7

The arguments for an absolute diminution in the over- all housing progra me stom partly from a shortage of sites,

partly from the fact that the building industry is heavily over-taxed at the present time, and partly from the effect

on private investment of the present public housing. First,

so far as sites are concerned, our future estates will be in

relatively remote and inconvenient areas; housing there will be by no means as popular as that in the large central sites we were formerly able to develop, and it is no exaggeration to say that the large scale compulsory clearance of squatters

into these remotor areas could well meet with further resis-

tance such as is already beginning to become apparent from the squatters themselves. Even for low cost housing filled by orthodox selective methods, it is becoming clear that we shall probably have to relax the qualifications and criteria in order to fill these new estates with reasonable speed, and the more rapidly we build the more large will these difficul- ties loom since housing has already spread outwards more rapidly than factory development and the employment oppor--

tunities which factories bring.

8. Second, we have to take into account the capacity of

the building industry. Much of the labour force in this industry was drawn off into the factories during the building recession of 1965-68, and it may well be that even the con- tinuance of our present housing programme, in which unit costs are now showing very heavy increases, will set up dangerous inflationary pressures as domestic building activities compete for scarce labour and resources with the

nceds of the export industries.

9. The third point relates to the discouraging effect upon private investment. The massive scale of our own programme threatens to make commercial participation in this

/sector

CONFIDENTIAL