Policy Address is both visionary and pragmatic on housing problems

    10/20/2022 - 08:05

    This article appeared originally in the China Daily on 20 October, 2022.
    Authors: Ryan Ip, Research Director and Head of Land & Housing Research, and Jason Leung, Researcher at Our Hong Kong Foundation.

    Policy Address is both visionary and pragmatic on housing problems

    Amid overwhelming public anticipation, the new Hong Kong Special Administrative Region administration unveiled its maiden Policy Address on Wednesday. Numerous policies and initiatives were outlined in 150 paragraphs, accompanied by 110 key performance indicators (KPIs) for specified tasks. Overall speaking, in terms of the land and housing aspects, we are satisfied with the overall direction presented by the Policy Address, which has proposed practical policies and set measurable KPIs in various key areas. Many of the measures proposed are very pragmatic, but details need to be discussed or clarified.

    Regarding the Northern Metropolis, we are pleased to see that the Policy Address has specific targets for land and housing development, industrial policies, and the corresponding geographical layout — all of which point to the gradual maturing of the Northern Metropolis concept. Moreover, the chief executive will set up dedicated bodies to supervise and coordinate the relevant departments in developing the Northern Metropolis, which is in line with past suggestions of Our Hong Kong Foundation (OHKF). Currently, with functions dispersed among various departments, it may result in unclear authority and unclear responsibility. Meanwhile, besides the Northern Metropolis, the city is also considering a number of other major infrastructure projects, such as Lantau Tomorrow Vision, and the newly proposed three major roads and three strategic railway projects. Therefore, the relevant departments need to engage in detailed planning regarding Hong Kong’s construction capacity.

    In terms of public housing, while the chief executive has repeated the “back-loaded” description regarding future supply trends, the newly proposed “light public housing” (LPH) provides a solution to the short-term housing shortage, while the waiting time for public rental housing (PRH) has also been capped. These are sensible measures, but I hope the government will disclose the source of land for constructing the LPH units. Moreover, since the Housing Authority and Housing Society are already required to substantially raise their production capacity for traditional PRH, it is of concern if they can cope with constructing another 30,000 LPH units in the next five years.

    Besides, we welcome the initiatives regarding land supply proposed in the Policy Address. The conversion process to “spade-ready” land in the past has been long and cumbersome, as illustrated by the 13 years that Hung Shui Kiu took from initial planning to completing the first batch of land formation. The government’s pledge to substantially compress the time required for land production, especially for large-scale projects from 13 to seven years, is in line with OHKF’s long-standing advocacy. We hope that the government can give further details, including whether internal administrative procedures without statutory time limits are included, as well as how it is going to strike a balance between public participation and streamlining procedures.

    For transport infrastructure, we support the government’s proposal for the three major roads and three strategic railway projects, which require individual alignments similar to what OHKF has proposed. Currently, the north-south traffic in the New Territories is already at capacity, as evidenced by the Tuen Ma Line reaching 86 percent capacity in 2021 despite being affected by COVID-19. Coupled with the planned increase from less than 1 million in population to 2.5 million in the Northern Metropolis, the new transport infrastructure will not only relieve traffic pressure in existing built-up areas, but also support the development of the Northern Metropolis. However, we believe that the detailed alignments need to be further discussed. Given the substantial investment costs for these infrastructure projects, the alignments should take into consideration how much land potential can be released, so as to maximize the project benefits, and fund the construction costs using proceeds from land sales.

    All in all, the policies outlined in the Policy Address show the government’s determination to tackle the long-standing problems that have plagued Hong Kong. This is a good omen for the next five years, as we seek to break new ground and make another giant step forward by taking advantage of the opportunities that lay before us. If implemented, these policies will make a material change to people’s livelihoods and standard of living, as well as Hong Kong’s economic prospects. We hope that the government will follow through with its proposed policies, and that through the concerted efforts of the society, we will be able to realize a better Hong Kong for all.