LEGISLATIVE COUNCIL ― 15 July 2021 8365

OFFICIAL RECORD OF PROCEEDINGS

Thursday, 15 July 2021

The Council continued to meet at Nine o'clock

MEMBERS PRESENT:

THE PRESIDENT THE HONOURABLE KWAN-YUEN, G.B.M., G.B.S., J.P.

THE HONOURABLE LAI-HIM, G.B.S., J.P.

THE HONOURABLE YU-YAN, G.B.S., J.P.

THE HONOURABLE KIN-FUNG, G.B.S., J.P.

THE HONOURABLE WONG TING-KWONG, G.B.S., J.P.

THE HONOURABLE WAI-KING, S.B.S., J.P.

THE HONOURABLE CHAN HAK-KAN, S.B.S., J.P.

THE HONOURABLE CHAN KIN-POR, G.B.S., J.P.

DR THE HONOURABLE MEI-FUN, S.B.S., J.P.

THE HONOURABLE WONG KWOK-KIN, G.B.S., J.P.

THE HONOURABLE MRS LAU SUK-YEE, G.B.M., G.B.S., J.P.

THE HONOURABLE WAI-CHUN, J.P.

THE HONOURABLE PUK-SUN, B.B.S., J.P.

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THE HONOURABLE STEVEN HO CHUN-YIN, B.B.S., J.P.

THE HONOURABLE CHI-MING, S.B.S., J.P.

THE HONOURABLE YIU SI-WING, S.B.S.

THE HONOURABLE MA FUNG-KWOK, G.B.S., J.P.

THE HONOURABLE CHAN HAN-PAN, B.B.S., J.P.

THE HONOURABLE LEUNG CHE-CHEUNG, S.B.S., M.H., J.P.

THE HONOURABLE MEI-KUEN, B.B.S., J.P.

THE HONOURABLE KWOK WAI-KEUNG, J.P.

THE HONOURABLE WAH-FUNG, S.B.S., J.P.

THE HONOURABLE , B.B.S., J.P.

THE HONOURABLE CHEUNG-KONG, G.B.S., J.P.

THE HONOURABLE POON SIU-PING, B.B.S., M.H.

DR THE HONOURABLE CHIANG LAI-WAN, S.B.S., J.P.

IR DR THE HONOURABLE LO WAI-KWOK, G.B.S., M.H., J.P.

THE HONOURABLE CHUNG KWOK-PAN

THE HONOURABLE JIMMY NG WING-KA, B.B.S., J.P.

DR THE HONOURABLE KWAN-YIU, J.P.

THE HONOURABLE HO-DING

THE HONOURABLE SHIU KA-FAI, J.P.

THE HONOURABLE CHONG-SHING, M.H.

LEGISLATIVE COUNCIL ― 15 July 2021 8367

THE HONOURABLE YUNG HOI-YAN, J.P.

DR THE HONOURABLE

THE HONOURABLE CHAN CHUN-YING, J.P.

THE HONOURABLE CHEUNG KWOK-KWAN, J.P.

THE HONOURABLE LUK CHUNG-HUNG, J.P.

THE HONOURABLE LAU KWOK-FAN, M.H., J.P.

THE HONOURABLE IP-KEUNG, B.B.S., M.H., J.P.

DR THE HONOURABLE CHENG CHUNG-TAI

THE HONOURABLE VINCENT CHENG WING-SHUN, M.H., J.P.

THE HONOURABLE WAI-CHUEN, B.B.S., J.P.

PUBLIC OFFICERS ATTENDING:

THE HONOURABLE FRANK CHAN FAN, J.P. SECRETARY FOR TRANSPORT AND HOUSING

MR TSE CHIN-WAN, B.B.S., J.P. UNDER SECRETARY FOR THE ENVIRONMENT

MR LIU CHUN-SAN, J.P. UNDER SECRETARY FOR DEVELOPMENT

CLERKS IN ATTENDANCE:

MR KENNETH CHEN WEI-ON, S.B.S., SECRETARY GENERAL

MISS FLORA TAI YIN-PING, DEPUTY SECRETARY GENERAL

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MEMBERS' OTHER MOTIONS

PRESIDENT (in ): The Council continues the debate on the motion on "Reforming the housing policy to resolve the housing problem".

Mr CHAN Kin-por, please speak.

MOTION ON "REFORMING THE HOUSING POLICY TO RESOLVE THE HOUSING PROBLEM"

Continuation of debate on motion which was moved on 14 July 2021

MR CHAN KIN-POR (in Cantonese): President, I am very grateful to Mr Tony TSE for proposing today's motion, which allows us to continue to discuss such an important issue as housing. I agree with all the profound views shared by Mr Tony TSE.

As the epidemic situation in has subsided to "zero infection" and the economy is also picking up, the housing market has naturally rebounded. With pent-up demand being accumulated over the past two years, buyers have gradually entered the housing market lately, resulting in an increasingly buoyant housing market. Property prices have been hovering near historic highs, and the market expects the rise has the possibility to hit 15% this year.

President, I am very worried about the current situation as the housing market is the core deep-seated problem and a source of public grievances in Hong Kong. Therefore, after "black-clad violence" has been stopped in Hong Kong, I urge the Government on multiple occasions to address various deep-seated problems as soon as possible to regain the people's support. If public grievances intensify rather than abate, members of the public will be easily incited and may commit all sorts of acts which are harmful to society. Nowadays, property prices are like unbridled horses running wild. If property prices are really going to increase by 15% a year, it will be absolutely detrimental to social stability.

The Government is now tackling the problem at root by increasing land supply. We can see that the Government has been working hard and delivered results, including having identified land required for providing public housing units to meet the demand in the coming decade, gradually proceeding with the "Lantau LEGISLATIVE COUNCIL ― 15 July 2021 8369

Tomorrow" project, constructing 15 000 transitional housing units, formulating tenancy control of subdivided units. However, the Government still should consider exploring ways to increase housing supply.

Recently, Our Hong Kong Foundation ("OHKF") published a research report, proposing nine new potential development areas, which can provide over 3 000 hectares of land in total. Although the proposed areas will not be readily available to satisfy the imminent need, they can facilitate Hong Kong's development in the long term. The report contains great details and is worthy of serious examination by the Government. To be honest, if members of the public can see that the Government has a well-planned development programme, they will be more confident.

Besides, in its report, OHKF made an analysis, which illustrates with concrete examples that the Government has taken more than double the time to develop new areas after the handover. The six new towns developed before 2000 saw their first population intake within six to 10 years, with an average of only 7.5 years, including 6 years for Tsueng Kwan O and 7 years for Tung Chung. However, the six new development areas developed after 2000 saw their first population intake within 12 to 23 years, with an average of 17 years, including 16 years for Kwu Tung North and 17 years for Hung Shui Kiu. I think all of us would like to know why the development time can suddenly increase from 7.5 years to 17 years. There are certainly many practical reasons, but I believe that the political environment over the past decade or so is one of the major reasons. Now that the general situation has been settled, it is hoped that many obstacles to land development can be removed, and we are now in a position to significantly shorten the lead time between commencement of development and population intake.

OHKF opines that the absence of a single government department responsible for new town development and a lack of coordination among departments may lead to a significant increase of development time. Mr Tony TSE has proposed today a reorganization of the government structure to enhance the efficiency in identifying sites for housing construction and in vetting and approving development project. I absolutely support this and hope that the Government will do so immediately.

Thank you, President.

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MR LEUNG CHE-CHEUNG (in Cantonese): President, I rise to speak in support of Mr Paul TSE's motion and Mr Wilson OR's amendment.

The housing problem has been plaguing Hong Kong for many years. Difficulties in housing, difficulties in acquiring the first properties and poor living environment are portraits of the lives of the grass roots. I remember during the two sessions of the National People's Congress and the National Committee of the Chinese People's Political Consultative Conference last March, Mr HAN Zheng, our State Leader, expressed his concerns about the housing problem in Hong Kong and hoped that Hong Kong could solve the deep-seated conflicts, which is the problem of housing shortage. When we talk about housing policies, resolving the housing problem is the concern of every one in Hong Kong. However, the issue has been discussed for many years. Mr LEUNG Chun-ying, the preceding Chief Executive, already said that the housing problem would be tackled when he took office, but until today …

(There was noise interference with the broadcasting system in the Chamber)

PRESIDENT (in Cantonese): Mr LEUNG Che-cheung, is your mobile phone beside you? Please move your mobile phone away.

MR LEUNG CHE-CHEUNG (in Cantonese): No, I have not turned on … should be … sorry.

The incumbent Chief Executive has also made a lot of efforts to resolve the housing problem, in particular, she said that we should have a big debate on land supply to resolve the problem of land supply when she took office. Nevertheless, up to now, what we see is that the solution to the housing problem is only a castle in the air, and it will take a decade before the housing supply for Hong Kong becomes normal.

According to statistics, there are now 210 000 residents living in subdivided units ("SDUs"). Apart from wage earners living in SDUs due to proximity to work, most of the SDU tenants are low-income families and new immigrants, who have tremendous difficulties in paying rent. We can thus imagine, in addition to the problem of insufficient housing, Hong Kong is also facing a problem of LEGISLATIVE COUNCIL ― 15 July 2021 8371 inadequate median living space. Some SDUs are only as small as 6.6 sq m. For this reason, I am in full support of Mr Tony TSE's proposal of formulating a standard for living space.

Recently, the Government has proposed a temporary policy called transitional housing to provide temporary accommodation with better living conditions and lower rent for applicants waiting for public rental housing ("PRH") and SDU tenants or squatter occupants having housing needs. I agree that this is a more desirable policy and should be promoted vigorously.

President, I also agree with Mr Wilson OR's proposal of incorporating transitional housing into the housing ladder and Long Term Housing Strategy. Transitional housing, instead of being a temporary policy, is one of the best ways to resolve the existing housing problem. Having said that, transitional housing cannot make a good reference. Transitional housing is currently being operated by non-governmental organizations and rented out to people in need of accommodation, but are not sufficient to meet the needs of tens of thousands of people waiting for PRH.

I hope that the Secretary for Transport and Housing can expedite housing construction in this regard as soon as possible. As Mr CHAN Kin-por has said just now, the current pace of housing construction is really too slow, moving at a snail's pace. Even though the Government has already planned for the development of new towns with the provision of tens of thousands of units, the first batch of housing blocks will only be completed 10 or 15 years later. This cannot meet our pressing needs. For this reason, President, I hope that the Government can expedite housing construction, especially when it comes to departmental coordination, and I urge other Policy Bureaux not to fold their arms and leave the matter to the Transport and Housing Bureau, or even stand in the way, making it impossible to solve Hong Kong's housing problem.

President, I hope that people's livelihood and living conditions can be improved with the strenuous efforts made by the Government. I so submit.

MRS REGINA IP (in Cantonese): President, the land and housing problems in Hong Kong mainly stem from inadequate supply. Despite the vigorous effort made by the two Chief Executives, namely Mr LEUNG Chun-ying and Mrs LAM, they still have not been able to resolve the problem regarding the need to provide a 8372 LEGISLATIVE COUNCIL ― 15 July 2021 large amount of land. As we all know, the preceding Chief Executive Mr LEUNG relied on measures including, first, rezoning and increasing the plot ratio on the supply side, as well as implementing demand-side management measures, i.e. the stamp duty, on the demand side. Yet, there was no way to provide a considerable supply of land. The same happens to the incumbent Chief Executive as well. The vacant property tax has been shelved, but actually I do not think a vacant property tax can help release much land. The Lantau Tomorrow Vision will take too long. The current-term Government has put forward a new initiative of introducing transitional housing. But then, the need to introduce transitional housing is a clear sign reflecting the Government's failure to provide a large amount of land for development of public rental housing. There are so many people on the waiting list, and the waiting time is so long. This is the reason why transitional housing has to be introduced. They have identified ways to provide 15 000 units, but they have just identified the ways. It will still take some time before development can be embarked. Therefore, a vast number of people are still living in grossly inadequate accommodation.

I thank Mr Paul TSE … Mr Tony TSE for proposing this motion. Yet, the New People's Party considers that we cannot support one point in Mr Tony TSE's motion, and that is item (2) of the motion which proposes the following: "Formulating a standard ratio of housing expenses to household income, so that the prices and rents of public and private housing can be maintained at a reasonable and affordable level". This is of course well-intentioned, but I think it is difficult for the Government to set a target ratio … It is possible for public housing, and the Government has already offered a huge discount on the price of the flats under the Home Ownership Scheme. The price of such flats used to be pegged with the market price, but is now pegged with the median income. They can do so in respect of public housing, but it is useless to set a target ratio for private housing since the price of private housing is market-driven and determined by supply and demand, right? The Government would make no intervention.

Yesterday, the Secretary for Transport and Housing quoted the Secretary for Financial Services and the Treasury in his reply to my question on whether the authorities can restrict the profits of the MTR Corporation Limited ("MTRCL"). From this we would know that it is very obvious … Why does the Government dare not cap the profits of MTRCL so far? It is because the Government actually has a high land price policy, since it relies on land sales and land revenue, including the stamp duty introduced by the previous-term Government, to generate a great deal of revenue. Without such land revenue, the Government would have to think LEGISLATIVE COUNCIL ― 15 July 2021 8373 of other ways to generate revenue or reduce expenditure. With this in mind, it will not change this policy casually. Therefore, it is useless to request the Government to set a target ratio for private properties. On the contrary, it would be possible if the Government can provide plenty of land, or if it is similar to the case in Singapore, where there is so much land to support a two-tier market, a two-tier housing market. In Singapore, 80% of the residential properties are public housing, whereas the remaining 20% can be sold at a price as high as they can be. People can buy it as long as they can afford it, and the developers can still make a profit. Unless the Government can provide such a large amount of land to reshape the housing market, otherwise it would not be able to set some indices for private property prices.

Lastly, I just want to raise two points due to the time constraint. Apart from the long time required by the Government to develop and plan for the various new development areas being proposed, two issues are also worth considering in regard to the provision of abundant housing supply. First, which has also been mentioned by Mrs LAM, it is reasonable to relocate the container terminal. There is a lot of land, hundreds of hectares of land in Kwai Tsing. But the problem is, we have to relocate the whole terminal to a new site. I mentioned Guishan Island before, and the former Director of Planning LING Kar-kan also mentioned that he had proposed Guishan Island, but Mrs LAM told us to forget it, as other people would think that we are shifting our problems to their places. But then, in view of the decreasing throughput of the container terminal, how should we deal with such a large piece of land? In addition, are the country parks something that we cannot touch upon at all? Can we not conduct a study? There are other options as well. I think the Government does not need to conduct a big debate or a large-scale consultation exercise again. Instead, it should make up its mind on how to provide a large supply of land with a view to resolving our problem of land and housing shortage.

MR MA FUNG-KWOK (in Cantonese): President, the motion proposed by Mr Tony TSE is directed at the housing policy in the hope that Hong Kong people can be provided with a more spacious and affordable living environment and that public housing can be allocated in a more reasonable manner. The amendments of Mr Wilson OR and Mr KWOK Wai-keung request that specific policy objectives be officially included in the Long Term Housing Strategy so that residents on the Waiting List can move into public rental housing expeditiously. I support them in principle.

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President, in the early 1990s, I participated in the planning of the production of the movie Cageman. The movie reflects the housing problem back then by depicting a group of people at the lower stratum living in cage homes in poor conditions. However, what I could not imagine is that after more than three decades, not only do cage homes continue to exist, there is also one more variant―subdivided units. Those who reside in subdivided units today are no longer confined to the grass roots, but include middle-class couples who live frugally to save money to buy their first home. These vivid real life stories continue to be the subjects of movies and television shows, like Hong Kong Love Stories produced by TVB last year and Drifting, a recent documentary that records the suffering of street sleepers. It is no exaggeration to say that stories about housing have become the greatest pain in life to Hong Kong people.

While increasing housing supply is a general consensus in society, a huge gap exists between the Government's ability to resolve this problem and social expectation, and the gap is widening as well. Even the Chief Executive mentioned in an interview a few days ago that it might take more than nine years to increase housing supply in order to catch up with the demand. Regarding the housing problem in Hong Kong, the Council has conducted many discussions over a long period of time in the past. Regrettably, the more discussions we had, the worse the problem became. I only wish to raise one point today and that is, the Government must regain the control of land supply which it has lost for a long time.

President, in theory, land must first be made available before housing can be built. As the exclusive supplier of land in Hong Kong, the SAR Government can regulate land supply through regular land sales. In 2002, in order to stabilize the property market which had then dropped by 70% already, the Government introduced the "Nine Measures of Michael Suen" to abolish land auctions. Subsequently, the Application List System ("ALS") was adopted, whereby the control of land supply was transferred from the Government as the vendor to real estate developers as the purchasers. It was not until 2013 that the Government abolished ALS and resumed scheduled land auctions, but the supply has fallen far short of the demand.

Despite resumption of auctions by the Government, the control does not necessarily lie in its hands. Over the past decade or so, it has been extremely difficult for large-scale reclamation works to proceed, and replanning of land takes at least five years' time. The Task Force on Land Supply appointed by the Government previously estimated that Hong Kong lacked 1 200 hectares of land in LEGISLATIVE COUNCIL ― 15 July 2021 8375 the long run, but the land reserves of the Government have been in deficit all along. Ironically, some media pointed out that a total of 1 000 hectares of agricultural land in the New Territories were currently held or controlled by the four major developers in Hong Kong as their land reserves.

Land is scarce and in limited supply. Land revenues, ranging between $40 billion and $110 billion during each of the past 10 financial years, have all along been the main source of revenue of the Government. Paradoxically, on the one hand, this high land-price policy safeguards Hong Kong's public revenue and indirectly reduces the pressure on the Government to increase other taxes, thereby benefiting Hong Kong's taxpayers indirectly; but on the other hand, it results in high land costs which are borne by the entire community. If the high land-price policy continues, the price of flour will remain high, leaving no room for the price of bread to fall, and there will be no way Hongkongers can turn around the predicament of expensive housing and small living space.

President, it is the expectation and consensus of the community that the housing problem should be resolved completely, which is also one of the keys to resolving the deep-rooted conflicts in Hong Kong. Recent policy addresses of the SAR Government have also focused on land development and housing construction, including by launching the mammoth project "Lantau Tomorrow". However, given that the housing problem in Hong Kong has become increasingly acute, in the short to medium term, the SAR Government needs to adopt a mentality of avoiding no difficult tasks and proactively promote collaboration with developers in developing land in the New Territories, and be determined to strive for the well-being of the wider community, or even consider invoking the Lands Resumption Ordinance when necessary to recover deserted agricultural land and brownfield sites. In addition, the SAR Government needs to commence the rezoning of part of the periphery of country parks with low conservation value for housing purposes as soon as possible. In the final analysis, to resolve the housing problem in Hong Kong, the Government must seize the control of land supply in order to acquire sufficient land reserves, and only then can Hong Kong people see a ray of hope in solving the problem. Thank you, President.

MR SHIU KA-FAI (in Cantonese): President, I thank Mr Tony TSE for his motion, and Mr Wilson OR and Mr KWOK Wai-keung for their amendments. I believe that reforming the housing policy and resolving the housing problem is the most important issue which many Hong Kong people hope can be settled. 8376 LEGISLATIVE COUNCIL ― 15 July 2021

However, I am afraid that my party and I cannot support this motion because, as many other Members have said, regarding the second point of the motion: "formulating a standard ratio of housing expenses to household income, so that the prices and rents of public and private housing can be maintained at a reasonable and affordable level", I think as far as public housing is concerned, we may draw reference from this view, but if private housing is also planned in this way, the normal supply and demand in the free economy of Hong Kong will actually be disrupted. In view of this point, we cannot render our support. However, the other points are in fact beneficial to Hong Kong.

Secretary, what I would like to say is, as we have discussed repeatedly in the Legislative Council and on many occasions, we need to resolve the problem of supply. This is the first point. The second problem is about the pace of construction, and the third, the cost. In respect of supply, I support Lantau Tomorrow. Regarding brownfield development, there are some sites which I think should be supported. Those in the periphery of country parks deserve support too. Mrs IP has even asked whether it is feasible to construct housing and arrange development at the Kwai Chung Container Terminals. In fact, in my view, consideration should be given on various fronts rather than to only one option because there is indeed a lack of land. Hence, there is actually the need to give consideration on various fronts. Even for rural areas, as I have mentioned a number of times before, now some village houses are only three storeys high. If 30-storey buildings can be constructed at these places, it can already meet the housing need of 10 times more people. Can such directions be considered? If there is doubt about the traffic problem, complementary facilities can be constructed in respect of roads. This is the same old issue which has been visited many times. I believe the SAR Government has done something, but we really need to see what can be achieved. Moreover, the people of Hong Kong are not happy with the property prices, be they the grass roots or the middle class.

Apart from the supply, the problem about the pace has been slammed many times. From site identification to the construction of a building, it often takes more than a decade. As it is said, site formation has to be conducted and consultation has to be carried out. The preliminary work will take five or six years, followed by unknown years of construction. As such, it will drag on for over a decade. As I have mentioned many times, the Braemar Hill Pedestrian Link alone has expended 14 years since 2007 when I was not yet a District Council member. It has just been gazetted for construction which will then take five or six years. The whole process will take 20 years.

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Come to think about it. How can Hong Kong actually achieve anything if it develops in this way? Let us look at the Mainland. Recently, there has been a popular video report that a building can be constructed in one day. More than 10 floors have been built in just one day. Although it was precast, that means built with prefabricated components, it was done in just one day. Let us set aside such an extraordinary example and talk about the pace of construction in other places. I believe that when compared with Hong Kong, they are far ahead of us. Are we going to continue with the old practice of consultation, under which we have to keep waiting when we hear this group is unhappy and that group is not pleased either? In that case, I believe it will be extremely difficult to resolve the genuine housing problem. It will persistently remain unsolved while public grievances continue to boil over.

As regard the cost, will the Secretary please think about whether the high land price policy should be adopted after site identification. Will he think of a way to generate more revenue so that the cost can be reduced? Apart from reducing the cost of land, another important issue is wages. Mr Tony TSE mentioned the need to provide people with a more spacious and better living environment. It is everyone's wish, but can the price be lower? In fact, if the supply is large and the cost is low, then people will be able to buy a bigger house and enjoy a better living environment. However, to keep the cost low, it will involve wages as mentioned by me just now. Let us take a look. The daily wage of scaffolding workers reaches some $1,000 to $2,000, whereas that of some bar benders is $2,000-odd. In some regions, foreign workers would be imported for housing development. They would be assigned to a certain construction site to assist in certain types of work. The cost would thus be low, and so would the purchasing price of those flats. However, when it comes to importation of labour into Hong Kong, when has the Government ever made any effort or given any serious thought concerning such construction sites and projects? If workers always play the dominant role, the cost can hardly be reduced. Thank you, President.

MS ALICE MAK (in Cantonese): President, first of all, I would like to thank Mr Tony TSE―some Members have got his name wrong―for proposing this motion, as well as Mr Wilson OR and Mr KWOK Wai-keung for their amendments. I will support the motion and amendments proposed by these three Members.

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As we can see, in this year, the property market in Hong Kong has all along been … Despite the fact that the economy has been so hard hit by the impact of the epidemic this year, there is one thing that will never go down, and that is, the property prices. No matter what the economic condition is, the property prices would still go up. In particular, the rents of grass-roots dwellings―subdivided units―have increased even more out of line with the market prices. It is because no matter what the market price is, such rents still shoot up like an upward arrow. Mr Peter WONG, a football commentator, has once remarked that there are two chances for young people to buy a home: First, there is slim chance; second, there is no chance. What makes it so difficult for young people to buy a flat? It is because we do not have a clear home ownership ladder. The Hong Kong Federation of Trade Unions ("FTU") suggests that there should in fact be a clear home ownership ladder in our property market, so that every member of the public can choose a suitable living environment according to their financial ability and actual needs.

Public rental housing is provided for the grass roots, whereas those with higher affordability can consider purchasing flats under the Green Form Subsidised Home Ownership Scheme or the Home Ownership Scheme ("HOS"); or the sandwich class can apply for the Starter Homes pilot projects; and those with even higher affordability can purchase a flat in the private market. There should be a home ownership ladder which is step by step. However, the present problem is that the number of flats on each step of the ladder is actually inadequate. Why is it so? As a number of Honourable colleagues have pointed out earlier, it often hinges on―which is also the most critical issue―land supply, we do not have adequate land supply.

Let us take a look at it. The ("URA") has been making considerable efforts in recent years to offer flats under the Starter Homes pilot projects, thereby providing the public with a lot of choices. For instance, the number of applications received for eResidence is 45 times of the actual number of units offered. From this we can see that many people, especially young families, may aspire to buy a flat. As such, some people have said that being successful in applying for HOS is better than winning the Mark Six lottery.

Let us take a look at WSM as well, which is the White Form Secondary Market Scheme introduced by the Government to subsidize members of the public to buy subsidized housing. But then, the prices of such flats are soaring like private property prices. For example, an HOS flat in is recently sold LEGISLATIVE COUNCIL ― 15 July 2021 8379 under WSM at the price of $14,000 per square foot, representing an increase of 1.4 times during the period. Is this the Government's objective when it plans to build subsidized housing? The Government plans to build flats under HOS or the Starter Homes pilot projects with a view to resolving people's … with the hope that they can own … for home ownership. Such flats are not intended for speculation in this way. Therefore, this is why we actually think that the Government should consider imposing more stringent restrictions on the resale of these subsidized flats. Take HOS for instance, on the one hand, the Government allows the resale period of HOS flats to be extended to 10 years, but on the other hand, the Government allows buyers under WSM to sell their flats without paying any premium after three years. This has turned into an opportunity for speculation. In addition, while we from FTU have also proposed the Starter Homes pilot projects, we have also raised to URA that the resale of such flats is allowed after five years under the existing mechanism. As such, a person who has bought a flat can resell it after five years. Speculation will then keep going.

Therefore, we think it is necessary to formulate more stringent restrictions in respect of the resale of these subsidized housing, including the length of time of holding such flats. Should it be made longer? Now that the resale period of HOS flats has already been extended to 10 years, should we consider imposing a resale period of 10 years or even longer for these subsidized housing units? By doing so, a person who has bought a subsidized housing unit―we have already subsidized him to buy a flat―will indeed own the flat and live in it for a long time, instead of being able to put it on the market for speculation again within a short period of time. In addition, will the target buyers of the flats resold still be allowed to sell the property freely in the market after five or 10 years, which is the same as the arrangement at present, so that such flats will become private properties? In fact, should the target buyers of such resold flats be confined to eligible applicants for such kind of housing? This is to ensure that these subsidized housing units offered by us will not eventually become a tool for speculation after five or a few years. Of course, some people would expect to make a fortune through buying a flat, but given the acute shortage of housing supply nowadays, should we not resolve the problem of home ownership first, so that each step of the housing ladder being created can help the real users? (The buzzer sounded)

PRESIDENT (in Cantonese): Ms Alice MAK, please stop speaking.

8380 LEGISLATIVE COUNCIL ― 15 July 2021

MR CHUNG KWOK-PAN (in Cantonese): President, Mr Tony TSE proposed this motion today with good intentions, but is there really any chance that this issue can be resolved after this motion has been moved? I believe that this issue can by no means be resolved in the short or medium term. The key point is that nowadays people always complain about the rising property prices which they cannot afford. However, we have to understand why property prices are soaring and why, structurally, the issue cannot be resolved. Just now, some Members mentioned the high land price policy, which has all along been denied by the Government. Yet, we could see on many occasions that the Government would rather withdraw the land from sale when the bid price offered by developers does not meet the target. Only when a reasonable price―surely a high price―is reached would they release the land. This is already a cost issue.

Second, we have been criticizing the "curb" measures, especially the three-year sale restriction after transaction. If 10 000 flats are sold this year, 10 000 flats are locked up; in the second year, 10 000 more flats are sold, so 20 000 are locked up; in the third year, 10 000 more flats are locked up, so 30 000 flats are locked up in total. Only in the fourth year will the initial 10 000 flats be released. As a result, tens of thousands of flats can never be put into supply.

The third factor is mortgage. For private properties, frankly speaking, except those priced under $10 million, the down payment is at least 40% or 50% of the property price. Many middle-class wage-earners can afford the mortgage payments, but not the down payment. This is an issue of property prices which cannot be resolved. Developers can provide a second mortgage of 85% or 80%, which will really benefit the developers.

Another policy is the 70:30 split for new housing supply. That means 70% is public housing and 30% is private housing. while the previous ratio was 60:40. The reduction of the ratio of private housing construction will lead to less supply and a further increase in property prices.

Of course, there is also the demand from the Mainland which did not exist before. Nowadays, many Mainlanders are interested in purchasing properties in Hong Kong. They can afford it no matter how high the prices are. Moreover, as the whole world is "printing money" under quantitative easing, money has become too cheap. Due to these factors, I believe the property prices in Hong Kong, and even around the world, will not drop easily. How should this be addressed? At present, there is no long-term plan to forecast future supply. If LEGISLATIVE COUNCIL ― 15 July 2021 8381 we resort to reclamation, we will not see the completion of a building within 10 years. Mr LEUNG Chun-ying, the preceding Chief Executive, suggested developing housing on the periphery of country parks, which the current-term Government disapproved. Even if the current-term Government did approve the suggestion, it will take at least five years for the supply to be available.

Therefore, due to these various factors, property prices in Hong Kong will not drop. How do we handle this? The Secretary may give a response later on, but for me, one of the options worthy of consideration is to work with the Greater Bay Area. While it was not possible to do so in the Greater Bay Area in the past, we can now travel north bound within an hour on the high speed rail, or travel west bound within an hour along the Hong Kong-Zhuhai-Macau Bridge. Within this "one hour living sphere", one may purchase a flat of 700 sq ft in Zhuhai or Zhongshan in the Greater Bay Area at the same price of a parking space in Hong Kong. Hence, I think we may carefully examine and consider integration with the Greater Bay Area in respect of housing supply, or else Hong Kong will have to depend on its own capacity. The previous-term Government already made housing supply its top priority in 2012. Ten years later, housing supply is still its top priority. The issue of housing supply will probably still be its top priority in another 10 years. Hence, I think integration with the Greater Bay Area is possibly the ultimate solution to the problem.

Thank you, President.

DR JUNIUS HO (in Cantonese): President, the housing problem is a topic which we frequently discuss. I certainly render my strong support. Although we cannot accept all the 11 points raised by Mr Tony TSE, Mr Wilson OR and Mr KWOK Wai-keung today, the main principle is that given the shortage of housing, we need to aim at the right target in our work. This is a must.

Currently, is it true that we have no land at all? No. If we look at the North District, we can readily find 2 000 hectares of land. Those who do not believe me may travel there with me. Last time the Development Bureau had originally arranged for us to take a tour by air, but it was cancelled twice because the black rainstorm warning was hoisted. So we need to continue to follow it up. Although we cannot take an aerial view, I can travel by land and make an observation all the same. It is not necessary to do the observation by air. Since I live in that area, I know it very well. Yesterday, it was said that as long as the 8382 LEGISLATIVE COUNCIL ― 15 July 2021

"three connections and one levelling" (which means water supply, electricity supply, roads and site formation works) were taken forward, it would do. There would be no need to think too much about innovation and technology for them. So long as land was provided and a policy was in place, they would go ahead to do the work. All other laws or restrictions would have to give way. Today, "" has already been cleared from the Legislative Council. In the past, it was said that there were people standing in the way, but today, there is none. We will grant the authorities whatever they wish. Sometimes I even consider that they have not got enough and should get more. Now the leaders of the Central Authorities say that the housing problem in Hong Kong is a top priority, but the authorities have remained idle here. The Legislative Council has previously suggested that the authorities make amendments relating to the harbour, but they say they cannot do so, given the need to consider this and that. Why should they give thoughts to so many things? It is pointless to keep thinking. Just go ahead, and it will do.

Thirdly, on the judicial front, no one can obstruct the Government either, because that lady―she will be present later―is the first in command according to the Basic Law. The three powers operate under the executive-led system. She is the Chief Executive and chairs the Committee for Safeguarding National Security of the Hong Kong Special Administrative Region. Her words are final, and funding approval of the Legislative Council is not necessary. At most, she only needs to give us a briefing. What does it mean? It means that judicial review is not allowed. Today, the Government has all the powers in its hands, but it is still looking around, saying this will not work and that will not work either. If something is really unworkable, it is because they do not work. They are incompetent. They are supposed to be able to do everything, but they turn out to be incompetent in everything. What should be done? It is very simple. Housing is always expensive. Where would there be any land which does not cost any money? Who must be provided with readily available housing? Who can get a house to live in without any toil and sweat? Where on earth will there be such a thing? Will money fall from the sky? It is impossible. Land must be developed, and people can make a purchase if they have money.

Let me cite a specific example. The day before yesterday, I had lunch with my friend. He said that there was a site in with a flyover in front and another flyover on one side. To his surprise, the Government put up such a site for auction. It was simply unbelievable. I said yes, the site is irregular in shape, but owing to its poor location, the auction price was just $4,500 per sq ft. Later, LEGISLATIVE COUNCIL ― 15 July 2021 8383 it was calculated that the cost was $8,500 per sq ft, and it was put up for auction again. What was the selling price? It was $12,000 per sq ft. The price kept going up. Eventually, it was sold for $22,000 per sq ft. How ridiculous! It was originally thought that the site was not fit for residential use at all, but the tactic was that even decayed wood could be turned into magic. If it was converted to a beautiful place with a grand lobby, people would come over to make purchases. It was just like a roach bait station. Since the smell was good, people could not leave after entry. Therefore, so long as the Government is willing to develop housing, people will come. It does not matter whether the ratio mentioned by Mr CHUNG just now is 3:7 or 4:6. The land supply in Hong Kong is always short no matter what is said. If the plan of building 88 000 flats each year is put forward again, there will be 880 000 flats in 10 years. The current approach is so conservative, constructing only some 300 000 flats in 10 years. Other things aside, it is already insufficient to cope with the natural growth rate of Hong Kong's population and the population brought by the One-way Exit Permit, not to mention the 200 000-odd people waiting for public housing. Such figures actually do not add up. What should be done? After the "three connections and one levelling", the North District will be settled. Today, the says that cross-border travel will not be resumed in Hong Kong until 2024. The internal pressure is mounting. Cross-border travel cannot be resumed, and public grievances cannot be allayed. Eventually, everyone will come out to slam the Government. The Government currently holds enormous power, but can it go so far as to invoke the Hong Kong National Security Law to suppress everything? We should share the urgent concern of the public. There should be no problem at all in opening up the land. All the power is in the hands of Secretary Frank CHAN. If there is any obstruction from his two working partners, i.e. the Environment Bureau and the , or any hindrance from such factors as the harbour, he can draw the "imperial sword" to remove all the obstacles. If he approaches us, he will be able to get the job done for sure.

PRESIDENT (in Cantonese): Does any other Member wish to speak?

(Dr Pierre CHAN indicated his wish to speak)

PRESIDENT (in Cantonese): Dr Pierre CHAN, please speak.

8384 LEGISLATIVE COUNCIL ― 15 July 2021

DR PIERRE CHAN (in Cantonese): President, the living environment in Hong Kong is extremely crowded, while property prices and rent are unrealistically high. It is difficult for middle-income residents to purchase properties and repay mortgages, let alone the grass roots. According to a report published this year by Demographia, a research institute, Hong Kong has remained the most unaffordable housing market in the world for 11 consecutive years. The median property price to median household income ratio reached 20.7. In other words, people can only afford to buy their homes if they do not spend any money on food and drinks for 20.7 years.

According to the 2016 Population By-census, the median domestic rent to median income ratio was 30%. Some studies reveal that the rent to income ratio is even higher, at nearly 40%, for tenants living in subdivided units ("SDUs"). The more grass-roots they are, the greater the need to spend most of their income on rent. There are a total of 210 000 people living in SDUs, which is not a small number at all.

According to a report published by the Census and Statistics Department in late March, median monthly household income in Hong Kong was $27,000 last year, $1,700 lower than that in the previous year. This income level is only $2,000-odd higher than the maximum monthly income limit of a family of three applying for public rental housing ("PRH"). The situation of high rental level and poor living environment will not improve unless there is a significant adjustment in the property market to substantially bring down property prices and rent. Given that the future outlook of Hong Kong's economy is extremely uncertain, people can hardly expect a strong income growth. In fact, some media reported that between 1999 and 2007, wage growth outstripped that of property price in Hong Kong, but since 2008, the annual property price growth has already exceeded wage growth. Over the past 15 years, property prices have increased nearly four times. Even if property prices drop by dozens percent, most people still cannot afford to purchase properties.

These are old topics which have been discussed repeatedly in the past decade or so, but under the high land price policy and the monopoly in land ownership by the Government and private developers, it is impossible for property prices to return to an affordable level, and the popular dream of home ownership of the last generation have become increasingly unrealistic. The fact that a large number of young people apply for PRH lately shows that they are not optimistic about their employment prospects and expect their income will remain low for a prolonged period. They have problems in paying rent, let alone purchasing properties. LEGISLATIVE COUNCIL ― 15 July 2021 8385

The number of PRH constructed by the Government in the past decade or so is woefully inadequate and has led to an increasing number of applicants on the waiting list. The waiting time has extended from an average of three years, as pledged by the Government, to four-odd years, and the queue is getting longer and longer. In the Long Term Housing Strategy Annual Progress Report 2020 published by the Government last year, the target for public/private split of total housing supply is set at 70:30, while the total housing supply target will be 430 000 units in the next 10 years, of which 301 000 units are public housing units, but as some of them are units for Green Form Subsidised Home Ownership Scheme and other subsidized sale flats, it is possible that only half of them are actually used as rental units. With a total of 250 000 PRH applicants at present, the construction target definitely cannot solve the problem of a large number of people waiting for PRH. I therefore support revising the construction target of PRH in the Long Term Housing Strategy and pegging it to the objective of three-year waiting time for PRH allocation.

As for formulating a standard for the average living space per person to provide Hong Kong people with a more spacious living environment, and formulating a standard ratio of housing expenses to household income, so that the prices and rents of public and private housing can be maintained at a reasonable and affordable level, these are good intentions but it is believed that even if legislation is introduced to provide for a minimum standard for the average living space per person, it would be difficult to rigidly specify the average property price per square foot. Currently, the Housing Department adjusts the rent according to the change in the income index every two years. When the index increases by a certain percentage, the rent goes up by the same percentage, but the rate of increase cannot exceed 10%. It can provide some protection to tenants since the rent is linked to income. I do not object to further reviewing the mechanism to incorporate factors like inflation, so as to better reflect the affordability of PRH tenants.

On the question of how to curb speculation in the private sector, the Government has introduced many so-called "harsh measures", which were proven ineffective, while the public has made many suggestions, such as vacancy tax. The bill on vacancy tax on first-hand properties submitted to the Legislative Council in 2019 was withdrawn finally. Under these circumstances, I think the reinstatement of tenancy control might genuinely help the public. As the Government has already proposed to regulate the rental of SDUs, can such proposal cover general rental flats as well in the future, so that rent can be maintained at a reasonable and affordable level?

I so submit.

8386 LEGISLATIVE COUNCIL ― 15 July 2021

PRESIDENT (in Cantonese): Does any other Member wish to speak?

(No Member indicated a wish to speak)

PRESIDENT (in Cantonese): Mr Tony TSE, you may now speak on the amendments.

(Mr Abraham SHEK indicated his wish to speak)

PRESIDENT (in Cantonese): Mr Abraham SHEK, please speak.

MR ABRAHAM SHEK (in Cantonese): President, I thank Mr Tony TSE for his motion and the two colleagues for their amendments.

President, as I sit here listening to my colleagues' speeches today, I realize that many of them have a very good grasp of the housing problem. The housing problem does not pop up only today, and it has existed in Hong Kong for many years. Since the post-war years, in the 1950s and 1960s, we have been facing population growth and changes in demand, and thus the housing problem has emerged gradually. However, we often do not have time to solve the problem, nor do we want to solve it.

Secretary Frank CHAN is really having a hard time, as he has to take charge of two major areas, of which one is transportation and the other is housing. Even if he does not sleep, he only has 24 hours a day, but he has to ponder the problem of MTR and the housing problem at the same time. Therefore, in this regard, some colleagues have advised the Government to carefully study the overall organization to see if the work in these two areas should be split. This is my first point.

Second, many colleagues have mentioned that the problem stems from the high land price policy, and housing units developed are smaller but more expensive. We understand all these matters, but I would like to examine the crux of the problem from a different perspective. I agree with Dr HO's remark just now that the problem will always exist, but does the Government have the will to solve it? We understand that we could not do it in the past, but we should be able to do it now. We see the problem but do nothing about it, and then we do LEGISLATIVE COUNCIL ― 15 July 2021 8387 something about it but fail to solve it. The problem is therefore only getting bigger every day. Perhaps let me look at it from PAC's point of view. We have been observing the housing problem over the past four years and discussed it many times. In fact, it is impossible for Secretary Frank CHAN to solve the problem because it is not a policy issue. If we suppress the high land price policy, some 1.7 million homeowners will be affected. Do we want to see the collapse of the financial market which will affect the banks? No. Should we, as Mrs YIP said, abandon the high land price policy? How can we deal with the revenue issue?

In respect of the above problems, Mr CHUNG mentioned stamp duty. While the Government wants to solve one problem, it aggravates another problem and reduces supply. I agree with Dr HO that special cases should be dealt with on an ad hoc basis, and at this point, government departments should no longer work in isolation, otherwise it will take at least 20 years for us to allocate a site for housing development. I do not agree that only the rich can climb onto the housing ladder. The policy of the Government should not be to build homes for people to take profit through transactions, but to help people who are not homeowners to secure a roof over their head. Some 250 000 people are on the waiting list for public rental housing, and some 110 000 people are living in subdivided units. These are the areas for which we should bear primary responsibility. We should not let the Town Planning Ordinance stop us, we should not let people challenge our authority and stand in our way, and we should not allow legislation of the Environmental Protection Department to impede our development. We should set a timetable, so that everything that needs to be done is done immediately, and there is no way that housing development is not undertaken. The Long Term Housing Strategy sets a target of developing 300 000 units, but this is not enough. We need to build at least 600 000 units in the next 10 years to solve these problems. The Government should have all departments work together to solve the problem, so that people can live and work in contentment. Thank you, President.

PRESIDENT (in Cantonese): Mr Tony TSE, you can now …

(Dr CHIANG Lai-wan pressed the "Request to speak" button)

PRESIDENT (in Cantonese): Members who wish to speak should press the "Request to speak" button as early as possible.

Dr CHIANG Lai-wan, please speak.

8388 LEGISLATIVE COUNCIL ― 15 July 2021

DR CHIANG LAI-WAN (in Cantonese): President, regarding the housing problem in Hong Kong today, I think the situation is really like "treating the head when it aches and treating the leg when it hurts", yet it is still very sick. It is only when the leg hurts so severely that you cannot even stand and the head is aching so bad as if it is going to explode that you start thinking about ways to cure it. The problem all boils down to the lack of a long-term policy. Therefore, Mr Tony TSE proposed today that the housing policy be reformed to resolve the housing problem, but actually it is all the more necessary for us to formulate a truly visionary plan.

How many housing flats do we need for the next decade? Before telling us how many housing flats we will need, perhaps you should ask yourself what the desired population size is. Is it 8 million, 10 million or 20 million? If it is a population of 20 million, then, when we have a population of about 8 million today and there are already 300 000 to 400 000 people on the waiting list for public rental housing, with a population of 20 million, there may be more than 1 million people waiting. So, as the sayings go, "one should make plans for a day in the morning and make plans for a year in spring", I think when it comes to the planning of the housing policy, long-term plans should be made for at least the next three decades because only after planning is made will we know how many green belts we will need and how many times we will need to carry out reclamation. Although reclamation is said to be a solution to the housing needs of hundreds of thousands of people, nearly half of the land reclaimed may still be used for developing subsidized housing and the proceeds to be generated from this type of housing is insignificant. You may say that a portion of it can be sold to property developers and revenue can hence be generated. But as many Members have said, while you can sell it at this price today, will you be able to sell it at the same price tomorrow? Besides, do we always have a few hundred billion or a thousand billion dollars in the treasury for carrying out reclamation? Therefore, this kind of investment is indeed questionable. I just hope that the authorities can seriously think about how many people can be accommodated by the housing projects to be developed in the future? Just as we have often criticized today, the subdivided units are so small in area, and as Mr HO said earlier, those flats are irregular in shape, so how can people live in them? Nowadays there are some new flats which are referred to as the new subdivided flats but they are just big enough for putting a bed inside, and there is a toilet, an open kitchen with a small stove and some small electrical appliances, and they are put up for sale at several million dollars or even 10 million dollars. This is something very terrifying. We do not wish that our next generation will have to live in these conditions any longer.

LEGISLATIVE COUNCIL ― 15 July 2021 8389

A responsible government must make long-term planning. I hope that the Secretary, after finishing with this motion today and listening to the speeches made by many Members, can learn a bitter lesson and seriously discuss with the Chief Executive how a long-term, visionary plan can be drawn up, rather than saying that they only look at what concerns the next five years or what will happen two years down the line, or that with only a few months remaining in their term of office, they will not look at anything. No, so long as you are in office, you have the responsibility to make comprehensive plans for the long-term planning of Hong Kong for the benefit of the people.

PRESIDENT (in Cantonese): Does any other Member wish to speak?

(No Member indicated a wish to speak)

PRESIDENT (in Cantonese): Mr Tony TSE, you may now speak on the amendments.

MR TONY TSE (in Cantonese): President, I have always respected the free market, including the property market. Because of this, and because the Government is the key supplier of land and public housing in Hong Kong, the supply under the Government's policy has a significant impact on the market. If the Government does not have any indicator or goal in respect of people's living space and quality, then the market can hardly continue to operate normally and effectively, and a result satisfactory to the society cannot be achieved.

I thank Mr Wilson OR and Mr KWOK Wai-keung for their amendments and agree with their general directions. Mr Wilson OR suggested incorporating the average living space per person and the objective of three-year waiting time for public rental housing in the Long Term Housing Strategy. He also suggested requiring the Government to report the progress of various land and housing development projects annually. I am supportive of this. As I have pointed out in my main speech, policies must have goals and timetables for public officers to follow, so that Members and the public can monitor the progress effectively.

With regard to incorporating transitional housing into the housing ladder, I believe that transitional housing should strictly be transitional. The goal of the Government should be to allocate public housing to eligible households within a reasonable time so that transitional housing will no longer be necessary. 8390 LEGISLATIVE COUNCIL ― 15 July 2021

Regarding the relaunch of the Tenants Purchase Scheme ("TPS"), one of the main issues to be addressed is maintenance and management under the fragmented ownership of public housing after sale. For public housing estates in which some units have already been sold, I support the relaunch of TPS. As for adjusting the existing stamp duty on property transactions to plug potential tax avoidance loopholes for "bogus first home purchase", the key issue is the definition of "bogus first home purchase". The "curb measures" for the property market were supposed to be temporary. The goal of the Government should be to significantly increase public and private housing supply, so as to maintain property prices at a reasonable and affordable level. In doing so, the "curb measures" can be withdrawn completely and the Inland Revenue Department will not have to differentiate between first time buyers and other buyers when collecting stamp duty.

As for Mr KWOK Wai-keung's proposal to stipulate the minimum size of flats in the land sale conditions, I understand that there are similar requirements in many places. The problem is that, even if the minimum size of flats is stipulated, it is still hard to stipulate the number of residents in each flat and prevent owners from dividing the flats into multiple small subdivided units after sale. Hence, supply is still the most critical issue.

As for disallowing owners of newly built subsidized sale housing to remove the alienation restrictions by paying a premium, I am supportive in principle because as subsidized sale housing turns into private housing that can be traded freely by paying a premium, the overall public housing supply will reduce. If the demand remains the same, the Government will have to build more public housing units to make up for the shortfall. I previously suggested that owners of subsidized sale housing should only be allowed to sell their units to the Government, which will then sell the units to eligible households in need according to an established allocation and pricing mechanism. The key is to set a reasonable repurchase price.

Mr KWOK asked the Government to put forward comprehensive policies on rehabilitation and redevelopment of public housing. I am supportive of it. At the meantime, I also urge the Government to pay attention to the maintenance and repair of private buildings, particularly "three nil" buildings. In recent years, there have been several incidents of concrete collapse, fatal fire and virus transmission through pipes under the epidemic in old buildings, highlighting the safety and public health risks posed by ageing, disrepair and unauthorized conversions of LEGISLATIVE COUNCIL ― 15 July 2021 8391 private buildings to society. The Government must intervene more proactively and vigorously instead of simply claiming that maintenance and repair are the responsibilities of private owners.

With these remarks, President, I support the two amendments.

PRESIDENT (in Cantonese): The meeting is now suspended. The Chief Executive's Question and Answer Session will be held from 10:30 am to 12:00 noon. The regular meeting will resume immediately after the Chief Executive's Question and Answer Session. I will then first call upon the public officers to speak. After that, I will put the motion and the amendments to vote.

9:57 am

Meeting suspended.

12:02 pm

Council then resumed.

PRESIDENT (in Cantonese): This Council continues to deal with the motion on "Reforming the housing policy to resolve the housing problem".

Under Secretary for Development, please speak.

UNDER SECRETARY FOR DEVELOPMENT (in Cantonese): President, first of all, I would like to thank Mr Tony TSE for moving the original motion, Mr Wilson OR and Mr KWOK Wai-keung for proposing the amendments, as well as all Members for putting forward their valuable views. Next, I will respond to the parts relevant to the Development Bureau ("DEVB").

Shortage of land resources in Hong Kong is an indisputable fact. With our strenuous efforts in the past few years, the number of public housing units to be completed in the next 10 years is expected to reach 316 000, which has exceeded 8392 LEGISLATIVE COUNCIL ― 15 July 2021 the demand for about 301 000 public housing units estimated by the Long Term Housing Strategy in the same period, that is, in the 10-year period from 2021-2022 to 2030-2031. The number of 316 000 public housing units to be completed actually represents a substantial increase when compared with 272 000 units in 2019 and 316 000 units (which should be 248 000 units) in 2018. However, since two thirds of the supply of these 316 000 units (i.e. more than 200 000 units) will only be available in the last five years of the 10-year period, we will still face considerable challenges in the next few years.

In other words, while we acknowledge that Hong Kong still needs to make improvement in terms of enhancing livability and improving living space, in view of the persistent shortage in land and housing supply, our current priority is to meet the basic accommodation needs of the people through increasing housing production. Additional land is required for either the increase in housing production to address needs for accommodation or the increase in average living floor area per person to improve living standard. The Government needs to strike a reasonable balance between housing production and average living floor area per person. When the land shortage situation is alleviated in the future, the community will be in a better position to explore whether a standard for the average living space per person should be formulated.

We cannot rely on the Government to set hard targets for living space alone to improve living space. A more important and fundamental approach is to increase land supply in a sustained manner.

The New Territories North ("NTN") Development and the artificial islands in Central Waters will be our main source of land supply in the medium to long term. We are now pressing ahead with the development of three potential development areas in NTN, namely the San Tin/Lok Ma Chau Development Node, Man Kam To Logistics Corridor, and the NTN New Town. Occupying a total area of about 1 400 hectares, these three development areas have the potential to accommodate a population of almost 300 000 and bring about approximately 200 000 job opportunities. With respect to the San Tin/Lok Ma Chau Development Node, we will study the further streamlining of the planning and design process of the project, and will carry out the works in phases with a view to commencing construction works in 2025. As regards the NTN New Town and Man Kam To Logistics Corridor, they are expected to be completed in phases in the medium to long term. Regarding the artificial islands in Central waters, subject to the findings of the engineering and planning study on reclaiming 1 000 LEGISLATIVE COUNCIL ― 15 July 2021 8393 hectares of land around Kau Yi Chau, we expect the first phase of the reclamation work to be commenced in 2027. Based on current estimates, the relevant development can bring about an additional population of approximately 400 000 to 700 000.

We hope to properly reflect the public's aspirations for enhanced living space with the implementation of the NTN Development and the artificial islands in Central Waters. We would adopt a more aggressive approach in forecasting the long-term demand for housing sites in the "Hong Kong 2030+: Towards a Planning Vision and Strategy Transcending 2030" study which will soon be completed. The findings of the study will be released in the coming months, and we hope that it can respond to the aspirations of Members and the public for a more spacious living environment.

As regards Mr KWOK Wai-keung's suggestion to provide for in the land sale conditions the minimum size and the number of flats to be constructed, our current priority is to meet the basic housing needs of the people through increasing housing production. Generally speaking, having regard to the unique features of each site and the ever-changing market conditions and demand, we do not have any plan for the time being to require across-the-board developers to provide flats no less than a specific number or size in the land sale conditions apart from indicating the floor area in respect of housing sites put on the market by the Government. The Government will closely monitor the market conditions and respond to the needs of the market in a timely and appropriate manner.

Mr Tony TSE has proposed to speed up the redevelopment of old districts with a new mindset. As regards urban renewal, the Government will continue to give full support to the Urban Renewal Authority to promote sustainable urban renewal by adopting the "planning-led" and "district-based" approach.

Mr Tony TSE and several Members have expressed deep concern about the issue of enhancing the efficiency and speed of identifying land for housing construction as well as the vetting and approval of development projects. We believe that apart from making every effort to open up new land, speeding up the land development process is of vital importance as well. Increasing land supply is a long-term task and is closely related to issues such as transport infrastructure and conservation. As announced by the Chief Executive in the 2020 Policy Address, the Steering Group on Streamlining Development Control under DEVB has expanded its composition and remit to include vetting departments other than those under DEVB, with a view to reviewing more comprehensively the 8394 LEGISLATIVE COUNCIL ― 15 July 2021 development approval processes for both Government and private projects, and rationalizing the development-related requirements imposed by different bureaux. Apart from the administrative vetting procedures of individual departments, DEVB is also examining whether there is any room for accelerating or streamlining the development process under respective legislation, including the town planning process and procedures related to road works. This also includes the review of the time frame for processing development applications and the procedure for handling representations under the existing legislation, etc.

In addition, the Government has set up the Development Projects Facilitation Office ("DPFO") under DEVB in December 2020, which is tasked to facilitate the processing of development approval applications of larger-scale private residential development projects (i.e. those providing 500 residential units or more) prior to the commencement of works. DPFO maintains close liaison with the dedicated coordinators of the relevant bureaux and departments with a view to ensuring smooth processing of development applications. In the meantime, DPFO is monitoring and following up the applications for planning, lease modification/land exchange, building plans or construction permit of about 40 private residential development projects. Within the first six months after the setting up of DPFO, 16 residential development projects followed up by DPFO have already obtained the relevant consent and approval in respect of applications for planning, lease modification/land exchange or building plans/commencement of building works for superstructure construction.

Several Members have raised concern over the issue of the cost of housing and the "high land price policy". We have to reiterate that the Government does not have the so-called "high land price policy". Land sales have all along been conducted in response to market conditions. The sets the reserve price of the land for sale through tendering with reference to the prevailing market price in order to prevent selling land at dirt cheap prices and to protect public revenue.

President, I would like to thank Honourable Members once again for putting forward their suggestions and views today. DEVB will continue to strengthen cooperation with other bureaux to expedite the supply of land and housing with a view to meeting the needs of society.

President, I so submit.

LEGISLATIVE COUNCIL ― 15 July 2021 8395

UNDER SECRETARY FOR THE ENVIRONMENT (in Cantonese): President, I thank Mr Tony TSE for moving the motion, Mr Wilson OR and Mr KWOK Wai-keung for their amendments, and various Members for putting forward valuable views.

The Environment Bureau ("EB") fully understands the urgency of resolving the housing problem. From the perspective of striking a balance between environmental protection and housing development needs, EB and the Environmental Protection Department ("EPD") will strengthen their roles as "facilitators" by collaborating with other bureaux and departments to enhance the efficiency in identifying land for housing construction and vetting and approving development projects. EPD will provide professional advice on environmental protection and recommend necessary measures in respect of the work related to increasing land and housing supply, including the development and planning of land, as well as specific housing development projects etc., so as to reduce the time required for the processes. For example, in order to reduce the constraints posed by road traffic noise on housing development, EPD took the initiative to participate in the research and development, and promoted the adoption, of such response measures as acoustic windows and acoustic balconies. Not only is building design made less difficult, more land can also be released for housing development.

As for individual development projects, EPD will provide project proponents with professional advice on environmental protection, and assist proponents in addressing related environmental issues by way of Environmental Impact Assessment ("EIA") studies at the planning stage, so as to enable smooth planning, construction and operation of projects. In addition, to expedite the EIA process, for some designated works projects of a small scale or a nature that basically has no impact on the environment, a simplified EIA process is already provided in the Environmental Impact Assessment Ordinance, whereby project proponents can apply for environmental permits directly without conducting EIA studies.

In order to help project proponents conduct the studies and complete the EIA reports efficiently, EPD will form a study management group for each EIA study to coordinate the views and requirements from various relevant government departments. EPD will also issue guidelines in respect of different environmental issues and organize training and seminars, etc. to help project proponents understand various environmental standards and requirements. EPD even encourages them to communicate with different stakeholders as early as possible at the initial planning stage of projects, so that all environmental issues of concern can be addressed right at the beginning, which in turn allows the related work to be completed more efficiently. 8396 LEGISLATIVE COUNCIL ― 15 July 2021

To promote balanced development between nature conservation and housing needs, a Public-Private Partnership Scheme ("the PPP Scheme") has been set up under the existing nature conservation policy of the Government, whereby some private land with high ecological significance can be used for development purposes on the condition that the landowners are willing to undertake long-term conservation of the land portions with high ecological significance. Under the PPP Scheme, prior to carrying out development projects, landowners may appoint conservation agents and pay the Environment and Conservation Fund a lump sum to support the conservation and management work on the land with higher ecological significance in the long run.

On the premise of due conservation of sites with high ecological significance, the PPP Scheme offers a mechanism to allow suitable development of private land while encouraging landowners and non-profit-making organizations to take part in nature conservation together. In March this year, an agreement was reached for a piece of land in Wo Sang Wai under the PPP Scheme.

President, EB will continue to strengthen its role as a "facilitator" by collaborating with other bureaux and departments to protect the environment while helping the Government enhance the efficiency in identifying land for housing construction and vetting and approving development projects. I would like to express my gratitude again here to Mr Tony TSE for proposing the motion today, Mr Wilson OR and Mr KWOK Wai-keung for their amendments, and various Members for their valuable views.

I so submit.

SECRETARY FOR TRANSPORT AND HOUSING (in Cantonese): President, first, I thank Mr Tony TSE, Mr Wilson OR, Mr KWOK Wai-keung and Members who have spoken for their concerns about land and housing and for putting forward valuable views.

I have already responded to issues related to the Well-off Tenants Policies and the under-occupation policy, ageing in place and inter-generational harmony, redevelopment of aged public rental housing ("PRH") estates and old districts, as well as pricing and sales arrangements of subsidised sale flats ("SSFs").

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In this concluding remark, I will focus on responding to Members' amendments and the areas touched upon in earlier discussions.

A Member proposed incorporating for the average living space per person in the Long Term Housing Strategy ("LTHS"). The current PRH allocation standard of the Housing Authority ("HA") is no less than 7 sq m internal floor area per person. PRH households living below 7 sq m internal floor area per person may apply for transfer to a larger flat under the Territory-wide Overcrowding Relief Transfer Exercise and the Living Space Improvement Transfer Scheme implemented in one-go annually. As a matter of fact, the current average internal floor area of PRH households is 13.5 sq m per person, which is way higher than the standard of 7 sq m. According to the statistics of the Census and Statistics Department published earlier on, the median per capita floor area of private residential flats was about 18 sq m. As I have pointed out in my opening speech, when the supply of housing sites is in place and relatively adequate, we will examine comprehensively the per capita floor area of public and private housing in a timely manner, so as to provide people with a more spacious and better living environment.

It was proposed that the projection of the 10-year housing supply target in LTHS should be linked to target of providing the first flat offer to general applicants at around three years on average. The projection model for long-term housing demand in LTHS determines the housing demand per annum for the next 10 years, taking into account four components, i.e. net increase in the number of households, households displaced by redevelopment, inadequately housed households and miscellaneous factors. The 10-year housing supply target in LTHS seeks to meet the housing demand, both public and private, in the next 10 years. As the time and quantity of housing supply depend on the supply of housing sites, it is irrelevant and thus should not be linked to the three-year waiting time on average. Providing the first flat offer to general applicants at around three years on average is our established target. We understand the good intentions behind Member's proposal. We will work towards this target and continue to increase and accelerate PRH supply.

Just now, I heard discussions in the Council about the redevelopment of Tai Hang Sai Estate by the Hong Kong Settlers Housing Corporation Limited. Let me give a response here. The Hong Kong Settlers Housing Corporation Limited ("HKSHCL") is a private organization which owns the site of Tai Hang Sai Estate as a private property right. During a long period of time in the past, despite the 8398 LEGISLATIVE COUNCIL ― 15 July 2021 intention of the community and HKSHCL to redevelop Tai Hang Sai Estate, the redevelopment project of Tai Hang Sai Estate could not be implemented due to various reasons, such as rehousing of the residents, transitional housing arrangements and finances, etc. The Government intervened proactively upon learning about the situation. Seeing that the project could not be taken forward for a long time, the Government took the initiative to liaise with the Urban Renewal Authority. As a result of our coordination effort, HKSHCL and the Urban Renewal Authority eventually entered into a partnership to redevelop the Tai Hang Sai Estate.

For the impacts of large-scale redevelopment of PRH estates under HA, I will not repeat here as I have given a comprehensive and detailed explanation in my opening speech. However, I wish to make it clear once again that the Government and HA will examine the existing PRH estates according to the actual circumstances and needs to ensure that they are safe and liveable. We will also take forward the redevelopment of individual PRH estates when there are practical needs. HA and the Government address the housing needs of the grass roots by ensuring that housing resources are spent on people most in need of housing, particularly those waiting for PRH and living in inadequate housing, such as subdivided units. I hope Members will understand and render us support.

A Member proposed to publish in the LTHS Annual Progress Report the progress of various land development projects and housing development projects, and the reasons for delays or cost overruns of such projects. We recognize the importance of transparency. In respect of publishing the progress of housing development, the Transport and Housing Bureau ("THB") will upload the updated estimated total production of PRH in the five-year period on a quarterly basis to the websites of THB and relevant organizations, including HA and the Hong Kong Housing Society, for public inspection. We will also brief the Panel on Housing of the Legislative Council annually on the public housing construction programme for the coming five years. Relevant papers are also accessible on the Legislative Council website.

Members also mentioned the Starter Homes for Hong Kong Residents ("SH") pilot project and the relevant alienation restrictions. The SH pilot project aims at meeting the home ownership aspirations of families with higher income which are not eligible for the Home Ownership Scheme but cannot afford private housing in the face of the high property prices.

LEGISLATIVE COUNCIL ― 15 July 2021 8399

Nearly 500 units have been sold since 2018, while projects under planning can provide more than 3 000 units. As for the alienation restrictions on SH units, owners cannot sell or let their SH units in the first five years after purchase. After the first five years, owners have to pay a premium to the Government before they can sell or let their units in the open market. The alienation restrictions have taken into consideration the positioning of SH units as private housing and the balance between home ownership and speculation.

Furthermore, a Member proposed to abolish the arrangement which allows owners of newly built SSFs to sell their flats in the open market by paying a premium, so that these flats can only be circulated in the Home Ownership Scheme secondary market. We agree that there has to be some restrictions on the sale of SSFs by the owners. However, the circulation of SSFs cannot be neglected. HA has tightened the alienation restrictions for SSFs launched in or after 2019. Owners of SSFs may resell in the secondary market at no more than the original price during the first two years from first assignment to eligible buyers specified by HA; or at freely negotiated prices in the secondary market to eligible buyers from the third year. For resale in the open market, owners may resell in the open market after 10 years from first assignment upon payment of premium. When considering the revisions of the alienation restrictions for SSFs, HA has struck a balance between the demand in society for tightening the alienation restrictions and the need to ensure the circulation of SSFs.

In the future, we will continue to closely monitor the sales and data of the secondary market of SSFs, overall development of the residential property market, as well as the opinions of various stakeholders in society, and review the policy on alienation restrictions of SSFs.

A Member also proposed to relaunch the Tenants Purchase Scheme ("TPS"). We are aware that there are PRH tenants who would like HA to re-launch TPS, so that PRH tenants outside the existing 39 TPS estates can also purchase the flats in which they reside to achieve home ownership. Relaunching TPS in other PRH estates will reduce the amount of PRH units available for allocation in the short term and thus, inevitably prolong the waiting time for households applying for PRH. In view of the severe shortage of PRH units at present, and for the sake of effective use of housing resources, it is difficult to implement TPS for the time being. The Government will ask HA to conduct further studies when the overall PRH supply becomes more assured and adequate.

8400 LEGISLATIVE COUNCIL ― 15 July 2021

On private residential property, maintaining the steady development of the private residential property market is one of the important objectives of Government's housing policies. At present, as the housing supply is still tight, the overall residential property prices remain at a level beyond the affordability of the general public. According to the latest information from the Rating and Valuation Department, the mortgage-to-income ratio for private sector households with median household income (i.e. the home purchase affordability ratio) in the first quarter of 2021 was 73%, which was higher than that of 72% in the fourth quarter of 2020, and much higher than the average of 47% over the past 20 years. Therefore, we believe that the current conditions do not allow for the withdrawal of the demand-side management measures on residential properties. As always, the Government will continue to monitor the situation of the residential property market, make reference to relevant indictors, and take appropriate measures to respond to market changes in a timely manner.

As we all know, many residents of subdivided units are living in deplorable conditions. The Task Force for the Study on Tenancy Control of Subdivided Units has completed its study and recommended the Government to implement suitable tenancy control on subdivided units in order to safeguard the interests of grass-root tenants of subdivided units. The Transport and Housing Bureau has introduced a Bill which seeks to (1) mandate the subdivided unit landlords and tenants to sign a written tenancy agreement setting out their respective rights and obligations; (2) provide four-year security of tenure for the tenants; (3) restrict the rate of rent increase on tenancy renewal; and (4) prohibit landlords from overcharging tenants on utility charges, etc. The Bill has been read the first time yesterday. If it can be passed by the Legislative Council in this legislative term, it is expected to be implemented at the end of this year at the earliest.

In addition, the Government has launched the three-year Cash Allowance Trial Scheme to provide cash allowance to those not living in public housing, not receiving the Comprehensive Social Security Assistance, have been waiting for PRH for more than three years and have not yet been provided the first PRH flat, with a view to alleviating the livelihood difficulties faced by those who have been waiting for PRH for a long period of time. We will start disbursing the cash allowance at the end of this month.

Another Member proposed to incorporate transitional housing into the housing ladder in LTHS. The current-term Government has been proactively promoting the development of transitional housing. By making better use of LEGISLATIVE COUNCIL ― 15 July 2021 8401 vacant land and premises, we aim to provide transitional accommodation for people with pressing housing needs, with a view to alleviating the difficulties faced by households living in inadequate housing and have been waiting for PRH for a long period of time. As I have said in my opening speech, as at last month, we have already identified sufficient land to provide about about 15 000 transitional housing units. We will continue to look for sites and premises being left idle for use of transitional housing and will not cease our efforts. Having said that, as transitional housing is a short-term relief measure which is transitional in nature, the time and quantity of its supply may vary over time. On the other hand, various levels on the housing ladder are long-term and stable housing options. Therefore, it is inappropriate to incorporate transitional housing into the long-term housing ladder. In the long run, the day when transitional housing is no longer necessary is believed to be the beginning of improvement to Hong Kong's housing issue.

President, opening up land for housing construction is the most fundamental way to resolve the imbalance between supply and demand of housing in Hong Kong. The Government will continue to adopt a multipronged approach to actively identify land for housing construction, so as to accelerate and increase the supply. Meanwhile, we will strive to make good use of the existing housing resources and help residents living in inadequate housing improve their living environment and quality.

President, I so submit.

PRESIDENT (in Cantonese): I now call upon Mr Wilson OR to move an amendment.

MR WILSON OR (in Cantonese): President, I move my amendment.

The amendment moved by Mr Wilson OR (See the marked-up version at Annex 2)

PRESIDENT (in Cantonese): I now propose the question to you and that is: That the amendment moved by Mr Wilson OR be passed.

8402 LEGISLATIVE COUNCIL ― 15 July 2021

PRESIDENT (in Cantonese): I now put the question to you as stated. Will those in favour please raise their hands?

(Members raised their hands)

PRESIDENT (in Cantonese): Those against please raise their hands.

(No hands raised)

PRESIDENT (in Cantonese): I think the question is agreed by a majority of each of the two groups of Members present, that is, those returned by functional constituencies and those returned by geographical constituencies through direct elections.

I declare the amendment passed.

PRESIDENT (in Cantonese): Mr KWOK Wai-keung, as Mr Wilson OR's amendment has been passed, you may move your revised amendment.

MR KWOK WAI-KEUNG (in Cantonese): President, I move my revised amendment.

The revised amendment moved by Mr KWOK Wai-keung (See the marked-up version at Annex 3)

PRESIDENT (in Cantonese): I now propose the question to you and that is: That Mr KWOK Wai-keung's revised amendment be passed.

PRESIDENT (in Cantonese): I now put the question to you as stated. Will those in favour please raise their hands?

(Members raised their hands)

LEGISLATIVE COUNCIL ― 15 July 2021 8403

PRESIDENT (in Cantonese): Those against please raise their hands.

(Members raised their hands)

Mr CHUNG Kwok-pan rose to claim a division.

PRESIDENT (in Cantonese): Mr CHUNG Kwok-pan has claimed a division. The division bell will ring for five minutes.

PRESIDENT (in Cantonese): Will Members please proceed to vote.

PRESIDENT (in Cantonese): Will Members please check their votes. If there are no queries, voting shall now stop and the result will be displayed.

Functional Constituencies:

Mr CHAN Kin-por, Mr YIU Si-wing, Mr MA Fung-kwok, Mr Martin LIAO, Mr POON Siu-ping, Dr Pierre CHAN, Mr CHAN Chun-ying, Mr LUK Chung-hung and Mr Tony TSE voted for the amendment.

Mr Tommy CHEUNG, Mr Frankie YICK, Mr CHUNG Kwok-pan and Mr SHIU Ka-fai voted against the amendment.

Mr Abraham SHEK, Mr Jeffrey LAM, Mr WONG Ting-kwong, Ms Starry LEE, Mr Steven HO, Mr Christopher CHEUNG, Ir Dr LO Wai-kwok, Mr Jimmy NG, Mr Holden CHOW, Mr LAU Kwok-fan and Mr Kenneth LAU abstained.

THE PRESIDENT, Mr Andrew LEUNG, did not cast any vote.

8404 LEGISLATIVE COUNCIL ― 15 July 2021

Geographical Constituencies:

Mr WONG Kwok-kin, Ms Alice MAK, Mr KWOK Wai-keung, Dr Junius HO and Dr CHENG Chung-tai voted for the amendment.

Mr CHAN Hak-kan, Dr Priscilla LEUNG, Mrs Regina IP, Mr CHAN Han-pan, Mr LEUNG Che-cheung, Ms Elizabeth QUAT, Dr CHIANG Lai-wan, Mr Wilson OR, Ms YUNG Hoi-yan, Mr CHEUNG Kwok-kwan and Mr Vincent CHENG abstained.

THE PRESIDENT announced that among the Members returned by functional constituencies, 25 were present, 9 were in favour of the amendment, 4 against it and 11 abstained; while among the Members returned by geographical constituencies through direct elections, 16 were present, 5 were in favour of the amendment and 11 abstained. Since the question was not agreed by a majority of each of the two groups of Members present, he declared that the amendment was negatived.

PRESIDENT (in Cantonese): Mr Tony TSE, you still have 18 seconds to reply. Then, the debate will come to a close.

MR TONY TSE (in Cantonese): President, the very serious housing and living problems in Hong Kong must be dealt with expeditiously. I sincerely implore Members to support my motion to urge the Government to take concrete follow-up actions. Thank you.

PRESIDENT (in Cantonese): I now put the question to you and that is: That the motion moved by Mr Tony TSE, as amended by Mr Wilson OR, be passed. Will those in favour please raise their hands?

(Members raised their hands)

LEGISLATIVE COUNCIL ― 15 July 2021 8405

PRESIDENT (in Cantonese): Those against please raise their hands.

(Members raised their hands)

Mr Tommy CHEUNG rose to claim a division.

PRESIDENT (in Cantonese): Mr Tommy CHEUNG has claimed a division. The division bell will ring for five minutes.

PRESIDENT (in Cantonese): Will Members please proceed to vote.

PRESIDENT (in Cantonese): Will Members please check their votes. If there are no queries, voting shall now stop and the result will be displayed.

Functional Constituencies:

Mr Abraham SHEK, Mr Jeffrey LAM, Mr WONG Ting-kwong, Ms Starry LEE, Mr CHAN Kin-por, Mr Steven HO, Mr YIU Si-wing, Mr MA Fung-kwok, Mr Christopher CHEUNG, Mr Martin LIAO, Mr POON Siu-ping, Ir Dr LO Wai-kwok, Mr Jimmy NG, Mr Holden CHOW, Dr Pierre CHAN, Mr CHAN Chun-ying, Mr LUK Chung-hung, Mr LAU Kwok-fan, Mr Kenneth LAU and Mr Tony TSE voted for the motion as amended.

Mr Tommy CHEUNG, Mr Frankie YICK, Mr CHUNG Kwok-pan and Mr SHIU Ka-fai voted against the motion as amended.

THE PRESIDENT, Mr Andrew LEUNG, did not cast any vote.

8406 LEGISLATIVE COUNCIL ― 15 July 2021

Geographical Constituencies:

Mr CHAN Hak-kan, Dr Priscilla LEUNG, Mr WONG Kwok-kin, Mr Paul TSE, Mr CHAN Han-pan, Mr LEUNG Che-cheung, Ms Alice MAK, Mr KWOK Wai-keung, Ms Elizabeth QUAT, Dr CHIANG Lai-wan, Dr Junius HO, Mr Wilson OR, Mr CHEUNG Kwok-kwan, Dr CHENG Chung-tai and Mr Vincent CHENG voted for the motion as amended.

Mrs Regina IP and Ms YUNG Hoi-yan abstained.

THE PRESIDENT announced that among the Members returned by functional constituencies, 25 were present, 20 were in favour of the motion as amended and 4 against it; while among the Members returned by geographical constituencies through direct elections, 17 were present, 15 were in favour of the motion as amended and 2 abstained. Since the question was agreed by a majority of each of the two groups of Members present, he declared that the motion as amended was passed.

NEXT MEETING

PRESIDENT (in Cantonese): I now adjourn the Council until 11:00 am on Wednesday, 21 July 2021.

Adjourned accordingly at 12:46 pm.

LEGISLATIVE COUNCIL ― 15 July 2021 8407

Annex 2

The marked-up version of the amendment moved by Mr Wilson OR (Translation)

That, since the housing problem has been plaguing the public for a long time, this Council urges the Government to comprehensively reform Hong Kong's housing policy to practically resolve people's housing problem, thereby improving their living environment and upgrading their quality of life, with specific proposals including:

(1) formulating a standard for the average living space per person to provide Hong Kong people with a more spacious living environment, and including the standard in the Long Term Housing Strategy ('LTHS');

(2) formulating a standard ratio of housing expenses to household income, so that the prices and rents of public and private housing can be maintained at a reasonable and affordable level;

(3) enhancing the home ownership ladder, including reforming the balloting system for subsidized sale housing so that the middle class, singletons and young people can see the hope of acquiring their first property;

(4) reviewing the policies on well-off tenants and under-occupation households in public rental housing and examining the introduction of subsidized rental housing with higher rents;

(5) proactively coping with the ageing of population and buildings by encouraging ageing in place and inter-generational harmony and speeding up the redevelopment of old districts with a new mindset; and

(6) reorganizing the government structure in respect of the policy areas of housing, land, transport and environmental protection, and strengthening the Government's role as a 'facilitator', so as to enhance the efficiency in identifying sites for housing construction and in vetting and approving development projects;

8408 LEGISLATIVE COUNCIL ― 15 July 2021

(7) formulating clear housing policy objectives for LTHS, including incorporating transitional housing into the housing ladder, realizing the objective of three-year waiting time for public rental housing allocation and assisting the public in home ownership;

(8) revising the supply target of public housing in LTHS and pegging it to the objective of three-year waiting time for public rental housing allocation;

(9) publishing in the LTHS Annual Progress Report the progress of various land development projects and housing development projects, and setting out the reasons for delays or cost overruns of such projects;

(10) conducting a study on revising and relaunching the Tenants Purchase Scheme; and

(11) adjusting the existing stamp duty on property transactions to alleviate the burden on genuine first-time home buyers while plugging potential tax avoidance loopholes for 'bogus first home purchase'.

Note: Mr Wilson OR's amendment is marked in bold and italic type or with deletion line.

LEGISLATIVE COUNCIL ― 15 July 2021 8409

Annex 3

The marked-up version of the revised amendment moved by Mr KWOK Wai-keung (Translation)

That, since the housing problem has been plaguing the public for a long time, this Council urges the Government to comprehensively reform Hong Kong's housing policy to practically resolve people's housing problem, thereby improving their living environment and upgrading their quality of life, with specific proposals including:

(1) formulating a standard for the average living space per person to provide Hong Kong people with a more spacious living environment, and including the standard in the Long Term Housing Strategy ('LTHS');

(2) formulating a standard ratio of housing expenses to household income, so that the prices and rents of public and private housing can be maintained at a reasonable and affordable level;

(3) enhancing the home ownership ladder, including reforming the balloting system for subsidized sale housing so that the middle class, singletons and young people can see the hope of acquiring their first property;

(4) reviewing the policies on well-off tenants and under-occupation households in public rental housing and examining the introduction of subsidized rental housing with higher rents;

(5) proactively coping with the ageing of population and buildings by encouraging ageing in place and inter-generational harmony and speeding up the redevelopment of old districts with a new mindset;

(6) reorganizing the government structure in respect of the policy areas of housing, land, transport and environmental protection, and strengthening the Government's role as a 'facilitator', so as to enhance 8410 LEGISLATIVE COUNCIL ― 15 July 2021

the efficiency in identifying sites for housing construction and in vetting and approving development projects;

(7) formulating clear housing policy objectives for LTHS, including incorporating transitional housing into the housing ladder, realizing the objective of three-year waiting time for public rental housing allocation and assisting the public in home ownership;

(8) revising the supply target of public housing in LTHS and pegging it to the objective of three-year waiting time for public rental housing allocation;

(9) publishing in the LTHS Annual Progress Report the progress of various land development projects and housing development projects, and setting out the reasons for delays or cost overruns of such projects;

(10) conducting a study on revising and relaunching the Tenants Purchase Scheme; and

(11) adjusting the existing stamp duty on property transactions to alleviate the burden on genuine first-time home buyers while plugging potential tax avoidance loopholes for 'bogus first home purchase';

(12) stipulating the minimum size and the number of flats to be constructed in the land sale conditions to regulate 'nano flats';

(13) disallowing owners of newly built subsidized sale housing to remove the alienation restrictions by paying a premium such that these flats can only be circulated in the Home Ownership Scheme secondary market; and

(14) putting forward comprehensive policies on rehabilitation and redevelopment of public housing.

Note: Mr KWOK Wai-keung's amendment is marked in bold and italic type.