TNAG-0809-FCO40-1014-Legislation-for-Crown-lands-in-Hong-Kong-1978 — Page 61

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The Society has nequired a substantiel inasalin and

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an up-to-date development programme (Annex P) which will stay within the $100 million fund available. The rehousing coramitment under this programme will be greater than originally envisaged and will require consultation with the Housing Authority; indeed, the pace of the programme will have to be regulated by the availability of "reception" accommodation for the displaced families. The cash- flow in this latest programme assumes that the Society will sell all flats at the open market price, with any surpluses applied to further slum clearance schemes; while the Society has not finally decided to do so in all future schemes, it is clear that any other course of action would soon bring the programme to a halt. The intention is to advise the Society that the primary aim is the redevelopment of dilapidated properties, even if this means selling the new accommodation on the open market; and that rental or selling subsidies that would reduce the scope of the project within the funds available should be avoided.

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The economics of the first project, Mei Sun Lau in Western District, turned out to be unfavourable because of the price which had to be paid for a site in this area. The Society has there- fore bought over this scheme from the slum clearance project, using its own funds and so leaving Government's $100 million loan unaffected by this loss, The Society is offering these flats to tenants in its estates (so as to recover their flats for reallocation to families affected by this urban improvement scheme), but as the Building and Loan Agency mortgage terms involved too large a monthly payment the Society is using its own funds to offer 6% mortgages, repayable over 20 years, to its tenaats,

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(a)

(b)

Honourable Members will be asked to advise :

whether the Housing Society's slum clearance project should continue within the limits of Government financial support already approved; and

whether resumption powers can continue to be used to acquire sites for the Society's slum clearance projects, despite the fact that the resultant flats will be sold at full market value, and that it is therefore not possible to rehouse the displaced familites at subsidised rents or prices within the same area.

(The Secretary for Housing (Mr I, M, LIGHTBODY) and the Deputy Secretary for the Environment (Mr G. BARNES) will attend before the Council for the discusstop f this Hem!

5th t 1976

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CONFIDENTIAL