South China Morning Post
Comment›Insight & Opinion
Paul Yip says public flats provide a vital buffer for low-income groups, and it is important to ensure they go to those who need them most
Chief Executive Leung Chun-ying renewed his pledge to rebuild the housing ladder and play a more active role through the provision of public housing to tackle soaring property prices and rent, following the veto of the electoral reform proposal. Indeed, the provision of public housing provides an important buffer for low-income families. Renting privately is unaffordable to many, and the prospect of buying is remote at best, given that it would take the average person more than 14 years of saving every cent to afford an average-sized home.
Hong Kong offers an interesting Asian case study, since the city is highly connected to the global economy and shows similar trends to other world cities with regard to housing scarcity and urban inequality. Public rental housing constitutes the largest part of our public housing programme. Hong Kong currently operates the largest public housing system among cities in the capitalist world. More than two million residents live in public rental-housing (30 per cent of the population) and nearly 1.4 million (17 per cent) in subsidised home ownership flats.
In its 2013 report, the government stated that support from its provision of subsidies (mainly in the form of public housing) has led to a reduction in the overall poverty rate, from 14.5 per cent to 9.8 per cent. Scholars examining housing here point out that the city’s success and position in the global economy are partly a result of the extensive public housing programme, which contrasts sharply with the laissez-faire policy regime that Hong Kong is often associated with.
Furthermore, when factors such as social fragmentation, the number of elderly in an area and district income levels are taken into consideration, living in public housing can actually reduce a person’s risk of dying early.
There are other benefits, too. First, public housing estates in Hong Kong are usually properly maintained and managed by the Housing Authority. The associations in Western studies between public housing and health disadvantages may be due to the poorer conditions of the estates themselves. This underlines the importance of not only delivering public housing, but also maintaining and improving the stock – showing that a rethink is needed in the debates on public housing in some Western cities.
Public housing should also be seen as an in-kind benefit that represents a transfer from market-level rents to subsidised rents. This indirectly increases households’ disposable income and potentially expands material assets relevant to people’s health and well-being. In addition, the Home Ownership Scheme has enabled households to directly accumulate capital within the public housing sector. Those who own their property under the scheme are allowed to resell to those eligible for public housing, or pay the land premium cost and sell on the open market.
Second, the wide presence of public housing in high-quality locations means there is not the same stigma typically associated with public tenants in a Western context. There, housing and location-related stigmas may limit opportunities in life and could be detrimental to health. But with a significant proportion of the population living in public housing estates, many of which are well connected by public transport, that may not be the case here. Also, if tenants feel secure living in public housing, it may help them cope with social stress.
Third, there is evidence that social cohesion is higher in public housing estates in Hong Kong, which also contrasts with experiences in the West. Our public housing policy gives priority to applicants living with their families. It therefore follows that living in public housing offers possibilities for improved well-being with more family support compared with the low end of the private rental sector. The Housing Authority says there were close to 270,000 applicants on the waiting list in December, suggesting that public housing is, in general, highly desirable here.
Fourth, as in other global cities, access to housing and transport is a crucial determinant for quality of life in Hong Kong, and a stable, strategic public housing programme may be an important policy mechanism to guarantee higher levels of physical and mental well-being in the community. It is very unfortunate that the previous administration under Donald Tsang Yam-kuen suspended public housing and the Home Ownership Scheme, as this is one of the major causes of the current undersupply of housing. Public housing constitutes a stepping stone for upward social mobility; unfortunately, that link has been broken in the past decade.
It is important to make these precious commodities available to those who need them most. A recent audit report revealed that the income of some 200,000 households living in public housing was above the median level. Clearly, with 270,000 on the waiting list, there are more needy cases out there. Abuse and misuse of public rental housing is a real concern. The whole tenure system of public rental housing needs to be re-examined.
Providing a decent living space for the hard-working community should be a priority of any responsible government, and no government should survive on income from high land premiums. The electoral campaign got us nowhere and consumed lots of goodwill and resources. Let’s now return to the basics.
The government should at least honour its pledge to improve the livelihood of the population. The community at large should also work together to ensure Hong Kong has a better future with an enhanced well-being for all.
Paul Yip is a professor of social work and social administration at the University of Hong Kong