Housing Authority announces bigger budget and upbeat forecast on HOS sales

The Housing Authority has announced a more optimistic annual budget and five-year forecast than it did last year, less than three weeks after the government pledged to set up a HK$27 billion reserve to help it meet its new target of building 290,000 public flats in the next decade.

While still warning of "increasing fiscal pressure in the longer term", the chairman of the authority's finance committee, Professor Raymond So Wai-man, said it still had enough funds to cover expenses in the coming five years, and stopped short of saying when it would seek money from the new housing reserve.

According to the revised budget, which the committee endorsed at a closed-door meeting yesterday, the authority has an estimated consolidated surplus of HK$5 billion for the fiscal year ending in March - 36 per cent more than the HK$3.7 billion projected last year.

"The rent increase on public rental housing last year has helped improve the Housing Authority's financial position," So said at a press conference after the meeting.

The authority predicts a surplus of HK$4.6 billion in the coming fiscal year.

In contrast with the dire warning a year ago that the surplus would drop to HK$958 million in 2017/18, the latest budget forecasts a surplus for that fiscal year of HK$4.2 billion, largely thanks to projected Home Ownership Scheme flat sales.

But the authority still forecasts that its cash and investment balance will drop over the coming five years from the present HK$65 billion.