Financial Secretary John Tsang today announced the Government has established a Housing Reserve to meet the 10-year public housing supply target.
In a statement, he said: “The Government will ensure the Housing Authority has adequate funding to meet the target. Given the huge financial commitment, we have to make advance planning. We will make provision by instalments to reduce fiscal volatility.
“It is prudent for us to earmark a sum for establishing the Housing Reserve when we are in a steady financial position. This could help alleviate the increasing fiscal pressure due to the public housing production target.”
Mr Tsang has instructed the Monetary Authority Chief Executive to set aside the $27 billion investment return on the Government’s fiscal reserves for the Housing Reserve.
The reserve and the cumulative investment return will be used to support the public housing development programme and related infrastructure.
The Government and the Housing Authority will discuss long-term financial planning, and will seek Legislative Council approval to draw funds from the Housing Reserve.
Secretary for Transport & Housing Prof Anthony Cheung said the public housing supply target will be 290,000 units in the coming 10 years, comprising 200,000 public rental housing units and 90,000 subsidised sale flats.
The preliminary estimate shows the authority will face a huge deficit and a substantial injection from the Government is required.