Elderly face 3-year wait for care home places as developers' incentive scheme flops

Not a single unit for elderly is built under 2003 policy offering tax breaks to developers, with waiting lists longer than they were 10 years ago

PUBLISHED : Monday, 30 December, 2013, 4:59am
UPDATED : Monday, 30 December, 2013, 10:10am

A decade-old government scheme giving tax breaks to developers who build care homes for the elderly has been a total failure.

Investigations by the South China Morning Post revealed that not a single care unit has been built under the scheme. And the city's old and needy are now waiting even longer for housing than they were 10 years ago.

A total of 29,763 elderly were waiting for a subsidised nursing place at the end of November, with queuing time now at an average 36 months. The average wait was 30 months when the scheme was launched in 2003.

The scheme gives property developers a waiver on land premiums for nursing homes that are incorporated into their private sector housing projects. But developers say the scheme has failed because demand is likely to fall in projects in which care homes are built.

Care homes would also reduce the value of other properties within the development and and increase the cost to construction companies.

Real estate professor at the University of Hong Kong, Chau Kwong-wing, said the scheme should be overhauled.

He said: "It's not attractive at all. It's meaningless to waive the land premium of the care home as the facility has a negative impact on new developments."

And surveyor and lawmaker Tony Tse Wai-chuen, who was general manager of the sales department of Henderson Land from 2005 to 2009, said: "No matter what incentives are given, adding a nursing home in a private residential project would reduce the price of flats. It sounds cold-hearted, but it's the reality."

Tse said operating a care home was not a profitable business given the difficulty in recruiting nursing staff and the huge investment required for medical facilities.

The incorporation of care homes into private developments also imposed constraints on designing an estate and increased construction costs.

For example, he said the developer would have to build a separate entrance to the care home " to address the concerns of home owners".

Kenneth Chan Chi-yuk, chairman of the Elderly Services Association of Hong Kong, asked: "Where can the elderly go if residents in every district say 'no' to nursing homes? It's saddening to see the selfish side of Hongkongers and it's actually a kind of discrimination."

Campaigners for the elderly said the provision of care home facilities should be made compulsory in new developments, wherever necessary. They said this was even more important given the city's rapidly ageing population, which would become an increasing problem in the next decade.

While the government encourages the elderly to keep living at home, the lack of day care services and the poor accessibility of old buildings has forced many families to put elderly relatives into care facilities.

But the Labour and Welfare Bureau confirmed to the Post earlier this month that no care home had been built using the scheme. Under it, developers who provide quality care homes, capped at 5,400 square metres, are exempted from paying land premiums and are free to lease, sell or operate the homes at the going rate.

In return, the homes should not be vacant for a period of more than a year and the developers must pay for construction and the cost of basic utilities.

Elderly Commission chairman Alfred Chan Cheung-ming, criticised developers for being concerned only about profit and the government for its poor planning. He said: "While developers should bear the social responsibility, the government should plan early and request that developers provide care homes in their own space as a land sale condition."

He added that the government should force MTR Corporation, in which the government is the major shareholder, to provide care homes in its projects.

A spokeswoman for the Labour and Welfare Bureau said two care homes have been incorporated into two private estates in Tai Kok Tsui and day care centres would be provided in two other private projects in Tuen Mun and North Point. These were not done under the scheme.

The Real Estate Developers Association said it had no mandate to influence members' decisions regarding such initiatives.