Court ruling may lead to lower rents but it will compromise services and extend waiting lists, housing chief warns The government may have to lower service quality at public estates and slow down the construction of flats if it adheres to a High Court ruling delivered last week, Secretary for Housing, Planning and Lands Michael Suen Ming-yeung warned yesterday. The court ruled the government had breached the Housing Ordinance, which puts public rents at no more than 10 per cent of public housing households' median income. Mr Suen, speaking at a special meeting of Legco's housing panel to explain the judgment, said it was up to the Housing Authority to decide whether to appeal the ruling. It would meet next Thursday to decide on its next step. Lawmakers passed a non-binding motion calling on the authority to review rent levels as soon as possible and ensure they do not exceed the 10 per cent income limit. This followed a warning by Mr Suen, who said it would be impossible for the Housing Authority to maintain service standards or keep up with its policy pledge that public housing applicants would be allocated a unit within three years. 'Do you think the government should subsidise the rent and service without limit? I can tell you I doubt if we can maintain the current quality and service. Perhaps we will be forced to downgrade our public housing,' he said. With the current public housing household median income at slightly over $10,000, keeping rents below 10 per cent would mean monthly rents of less than $1,000. 'Can we construct the flats and maintain the quality of services at the present level with a rent lower than $1,000 every month?' Mr Suen asked. 'If we can't charge rent of more than 10 per cent, I am not sure if we can keep constructing new estates and make the applicants get their subsidised flats in three years.' Mr Suen said many tenants had the option to stay in cheaper flats if they thought their current rent was too expensive, but 90 per cent of the tenants chose new flats with modern facilities when given the choice. At present, the cheapest rent is $241 for a 7.85 sq metre unit at 36-year-old Lower Ngau Tau Kok Estate. The most expensive flat is a 60 sq metre flat at Tsui Lok Estate in Chai Wan, where the tenant pays $3,800. Mr Suen said the Housing Authority already provided rent relief for families whose rent accounted for more than 25 per cent of their income. About 10,000 families received this subsidy. Public tenants have been overcharged according to the 10 per cent rule since April 2000, with the exception of a three-month period in 2001. The rent-to-income ratio now is 13.8 per cent. Yesterday's meeting was interrupted by April 5th Action Group member Lui Yuk-lin, who waved two bank notes from the public gallery.