The indefinite suspension of the Home Ownership Scheme (HOS) in 2002, as part of a package of measures, was intended to signal the government's intention to get out of the private property market. It was an integral part of moves to bring much-needed consistency and certainty to our city's housing policies. So the sale - in stages - of thousands of remaining HOS flats from this year should mark the final stage in the phasing out of the scheme.
Now, however, there are fresh calls from within the Housing Authority for the government to resume the building of new flats and reactivate the scheme. Worryingly, officials seem receptive to the idea. They should resist it. If the scheme is resumed, it will mark a return to the flip-flopping housing policies and periodic market intervention of the past. What is needed is consistency and transparency. The government should aim to avoid disturbing market forces. The time for subsidising better-off tenants to vacate their public rental units by letting them buy flats under the scheme has passed.
Public housing is supposed to serve only the needy. Critics have, with justification, argued the HOS effectively subsidises - for a second time - tenants who have prospered. Since the scheme was suspended, fewer tenants have left their public flats for remaining HOS premises in this way. New demand has been met mainly by new construction. Clearly, that is unsustainable over the long term. There is a need to get sitting tenants who have become well-off to make way for truly needy ones.
But there are more efficient and cost-effective ways to encourage the better-off tenants to move out than by reviving the HOS. One is to make the existing means test for housing applicants and tenants more stringent. Currently, applicants undergo a means test before they are assigned a flat, but they are not screened again for a further 10 years. Even then, the thresholds on earnings and assets are very loose, and well-off tenants always have the option of paying higher rents to stay on. More frequent tests and tougher standards need to be introduced.
Wong Kwun, an authority member who represents the view of some of his colleagues, argued yesterday that there were good reasons to restart the scheme. He said private flats were becoming too expensive and out of reach of even many well-off tenants. But his arguments are not convincing. Only the luxury and upper ends of the property market have returned to the peak levels that existed before the handover. Prices at the lower and bottom end of the secondary housing market have barely moved in many districts and are still relatively affordable.
The building and selling of new flats under the HOS would, indeed, mean the return of a valuable source of income for the authority. This, however, should not be the priority. What matters most is the integrity of the government's housing policies and its perceived role in the private property market.
The government should not send conflicting signals by suggesting that it is open to reviving the scheme. Instead, officials should make it clear they stand by the decision made in 2002 - and consign the scheme to history.