Lift the burden on those hardest hit by private-sector housing costs

PUBLISHED : Saturday, 30 June, 2012, 12:00am
UPDATED : Saturday, 30 June, 2012, 12:00am


Mrs Lee, a recipient of the Comprehensive Social Security Assistance scheme, squeezes her family into a small cubicle apartment in Sham Shui Po.

Her two teenage daughters refuse to stay at home, she says, because it is too hot. Instead, they go to a social services unit for young people or the public library, returning only to sleep.

Although there is a small window, it only opens onto the alley behind the building. Foul smells from the restaurant kitchen downstairs and rubbish at the back alley make the air intolerable.

Mrs Lee used to open the front door to try to improve the ventilation, but rats came in.

Life is just as hard for an elderly couple who live in a subdivided unit in To Kwa Wan.

They have no space to move around in and have to eat on the bed. Their so-called 'kitchen' is a side table in the corner of the tiny toilet.

Most of us would imagine that such poor living environments would be relatively cheap, but in a cruel twist to these peoples' plight, this is not the case.

A 40 sq ft bed space in this kind of dilapidated private apartment building rents for about HK$1,400 a month, or HK$35 per sq ft. Compare that with a pleasant 732 sq ft flat in Mei Foo that recently rented for HK$15,000 a month - HK$20.50 a square foot.

Such rents are a great burden for welfare recipients. At the moment, people on CSSA qualify for a maximum rent allowance of HK$1,335 a month for one person or HK$2,695 for a two-person household.

But since January, 60 per cent of such households living in private housing have had to pay more than the rent allowance. More than 10,000 had to pay an extra HK$500 or more a month. This means they have to divert money away from daily necessities to pay the rent.

As most of us are aware, housing costs are one of the largest financial drains on all economic sectors in Hong Kong, but those in the lower strata are the hardest hit.

Data from the 2009-10 Household Expenditure Survey shows that some of the poorest 20 per cent of households living in private housing have to allocate HK$3,742, or 42.3 per cent, of their HK$8,836 average monthly household income for rent.

For those in public housing the situation is better; their average housing cost is just HK$1,008, which is about 15 per cent of their expenditure.

Grass-roots families living in private housing have no choice but to squeeze this extra money out of their budgets by cutting down on essentials to make ends meet.

No categories of spending are likely to be spared, and the result is that these households spend, on average, only HK$3,000 a month on food, while those in public housing can afford to spend HK$500 more.

After deducting the costs of housing and food, the families in private housing have very little left to meet other basic needs.

All this data, and our frontline observations in the welfare sector, tell us that grass-roots households in private units are shouldering a huge burden in paying for their shelter.

The cost is enough to force families to cut spending on basic goods and services that are vital for the physical and social well-being for all the individuals in the family.

This, of course, can have long-term impacts.

Clearly, the best way to help these low-income households is to provide more public housing, so they have more spending power to meet other basic needs - as spending patterns of public housing households clearly show.

However, it will take at least three years before new flats come on stream.

The government should therefore take immediate measures to improve the living conditions of the families on the waiting list for public housing and of those who are not.

One possible way to help so-called 'N-nothing' households - those who miss out on giveaways because they are not welfare recipients, taxpayers or public housing residents - would be to provide additional financial support until they are allocated a public flat, for instance by regularising the sort of living allowance introduced by the Community Care Fund.

The fund's new assistance programme will provide one-off subsidies for people on a low income who are inadequately housed.

The amount of assistance is HK$3,000 for one-person households, HK$6,000 for two-person households and HK$8,000 for three-or-more person households. It is estimated that 30,000 people from 13,000 households will benefit from the programme.

As for the CSSA recipients, the government should increase the rent allowance without delay, and review the existing mechanism for setting and adjusting the maximum rate allowance.

Mariana Chan Wai-yung is chief officer, policy research and advocacy, at The Hong Kong Council of Social Service