The Housing Authority will cut its consolidated recurrent expenditure for 2003-04 and 2004-05 by $1.3 billion and $1.6 billion respectively to achieve the Government's savings target.

Secretary for Housing, Planning & Lands Michael Suen told legislators today that funding to implement housing policy in 2004-05 will be about $24.6 billion, representing 8.6% of total public expenditure. Of this, the authority's expenditure accounts for $24.1 billion, or 98%.

To reduce spending, Mr Suen said that apart from cost-control measures, the second-stage civil service pay adjustment in January will bring a $100-million saving in 2004-05.

Authority to cut 3,500 posts

The authority's staff establishment will be streamlined by 30%, about 3,500 posts, by March 2007, bringing annual savings of $1.3 billion.

A re-organisation proposal concerning directorate staff will be submitted to the Legislative Council for consideration in the middle of the year.

On the divestment of retail and car park facilities, the          authority is preparing for the injection of relevant assets into the Real Estate Investment Trust, which is tentatively scheduled for Stock Exchange listing in 2004-05.                                                                                                                                              

Consultation on domestic rent policy to launch

Mr Suen also revealed that the public will be consulted later this year on the formulation of a comprehensive, objective and flexible domestic rent policy which reflects tenants' rental affordability and ensures the sustainability of the public rental housing programme.

He hoped the public will discuss the issue objectively with regard for the interests of the community-at-large, and strike a balance between maintaining the financial viability of the authority and the provision of public rental housing.