Construction and Building Control
	Subsidised Housing
	Commercial Properties
	Corporate Services

This chapter sets out the key activities of the HA in four main areas, namely Construction and Building Control, Subsidised Housing, Commercial Properties and Corporate Services.

The Development and Construction Division plans, designs and constructs the HA's public housing estates and associated facilities. In 2008/09, its focus would be placed on optimising the use of and securing land resources for PRH production, building for cost-effectiveness and environmental, social and economic sustainability, as well as enhancing construction quality, site safety and labour protection measures.

The Independent Checking Unit is responsible for applying building control practices to new HA projects and existing HA buildings. It models its standards and practices on those of the Buildings Department and the Buildings Ordinance.

The Lift Ordinance Enforcement Unit regulates the operation of new and existing HA lifts and escalators in accordance with the requirements of the Lifts and Escalators (Safety) Ordinance.

The objectives of the construction and building control operations are:

	To construct PRH flats, retail space and carparks in accordance with the Public Housing Construction Programme and secure land resources for PRH production
	To enhance design, build smart and employ "green" materials and systems for green and healthy living and environmental sustainability
	To enhance cost-effectiveness and economic sustainability by optimising design, monitoring cost and improving efficiency
	To promote a harmonious community and social sustainability and to strengthen neighbourhood interaction by developing new estates with their own identities, allowing for socio-spatial equity for users of all abilities and enhancing community engagement in the delivery process
	To improve building quality, site safety and labour protection
	To implement building control measures in the HA's new construction projects and existing properties with reference to the practices of the Buildings Department and the requirements of the relevant Ordinances

To construct 20 900 PRH flats[5], 1 190m2 (GFA)[6] of retail facilities and 66 car/lorry parking spaces

	To develop environmentally responsive design for green and healthy living
	To apply innovative technology for energy efficiency and resource conservation
	To employ "green materials" and "green construction methods"
	To secure land resources for PRH production
	To adopt site-specific design to optimise site development without "wall effect"
	To monitor cost-effectiveness of building design
	To make effective use of IT and research findings in improving design and operational efficiency
	To enhance provision to meet new demands brought by advancement of communications technology
	To enhance the sustainability of aged PRH estates
	To develop new estates with their own identities, promote social cohesion and strengthen neighbourhood interaction
	To develop new estates to allow for socio-spatial equity for users of all abilities for mutual care and support
	To enhance community engagement in the delivery process
	To enhance communication with users and other stakeholders

	To improve procurement practices
	To lift the standard of workmanship
	To improve safety performance of construction sites
	To strengthen monitoring of contractors' performance in relation to labour protection measures

	To implement building control measures on new construction projects with reference to the practices of the Buildings Department
	To implement building control measures on existing HA domestic and non-domestic buildings with reference to the practices of the Buildings Department
	To regulate the use and operation of the HA's lift and escalator installations in accordance with the requirements of the Lifts and Escalators (Safety) Ordinance

Construction expenditure for 2008/09 is budgeted at $6,720 million, up $1,340 million (24.9%) as compared with the 2007/08 Revised Budget expenditure of $5,380 million. The higher construction expenditure budget for 2008/09 is due to the expected higher level of PRH production in 2008/09 as compared to that in 2007/08.

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The main function of the subsidised housing operations is to allocate, manage and maintain the HA's domestic rental properties. In 2008/09, great importance would be attached to the objectives of promoting mutual family support and care for the elderly through public housing arrangements, ensuring rational allocation of public housing resources and improving living environment in PRH estates.

In 2008/09, the HA would continue to put up the surplus HOS flats for sale in an orderly manner.

The objectives of the subsidised housing operations are:

	To ensure rational allocation of public housing resources and enhance turnover of PRH stock
	To maintain the AWT for PRH at around three years
	To minimise vacancy of PRH flats
	To implement the new rent adjustment mechanism and follow up the outcome of the Review of Domestic Rent Policy
	To reduce domestic rent arrears
	To implement a series of enhanced public housing arrangements to promote mutual family support and care for the elderly
	To coordinate proactively supporting services for caring the elderly
	To maximise life expectancy of PRH estates through proper and timely maintenance
	To adopt modern technology and new materials to improve maintenance services
	To sustain cleanliness and environmental hygiene in PRH estates
	To promote green living environment in PRH estates and strengthen environmental protection work
	To encourage partnership with customers and stakeholders to promote community building
	To review the outsourcing strategy for service contracts and step up the monitoring of performance of service contractors
	To make greater use of IT and promote e-business
	To put the surplus HOS flats on sale in an orderly manner

Chart 3: Stock of Public Rental Housing Flats

Chart 4: Average Waiting Time for Public Rental Housing

	To ensure rational use of public housing resources and intensify actions against tenancy abuse through effective tenancy control and implementation of the Biennial Declaration System and the Housing Subsidy Policy
	To maintain the AWT for PRH (except for non-elderly one-person applicants) at around three years
	To minimise the vacancy rate of PRH units
	To provide opportunities for relief of overcrowding and continue to implement the Living Space Improvement Transfer Scheme
	To implement the new rent adjustment mechanism and follow up the outcome of the Review of Domestic Rent Policy
	To reduce domestic rent arrears

	To continue fostering harmonious family relationship by enhanced public housing priority schemes and other enhanced public housing arrangements
	To promote and support services for elderly in collaboration with non-government organisations

	To continue the implementation of the Total Maintenance Scheme (TMS)
	To review the TMS to cover post in-flat inspection and maintenance service for both in-door and out-door areas
	To develop a maintenance data bank
	To enhance the provision of estate facilities for aged PRH estates
	To adopt new technologies and methodologies to improve maintenance services

	To continue the implementation of the Marking Scheme for Estate Management Enforcement in PRH estates
	To step up control on illegal cooked food hawkers, dog-keeping and the prevention of mosquito breeding
	To introduce landscape improvement programmes and thematic plantings, and promote environmental care and greening environment in PRH estates
	To reduce domestic waste and implement source separation of domestic waste
	To explore the feasibility of implementing the "Green Roof" environmental improvement programme

	To enhance the operation of the Estate Management Advisory Committee for community building
	To foster a partnering working relationship amongst tenants, management staff and contractors

	To implement a new tender system and a revised tender assessment mechanism for cleansing and security service contracts
	To step up the detection of exploitation of non-skilled workers and promote the awareness of the labour protection requirements
	To strengthen the monitoring of performance of Property Service Agents and service sub-contractors

	To adopt IT and new technology solutions to enhance service quality
	To carry out full implementation of the Auto-dialing Rent Reminder Service
	To enhance the Domestic Tenancy Management Sub-system, and the Applications and Allocation Sub-system

To proceed with the sale of surplus HOS flats in phases and in an orderly manner

Income and expenditure of the rental housing operating account for 2008/09 are budgeted at $10,830 million and $13,946 million respectively. An operating deficit of $3,116 million in 2008/09 is forecast, as opposed to an operating deficit of $2,028 million in the 2007/08 Revised Budget. The higher operating deficit is mainly attributable to the full-year effect of rent reduction of 11.6% commencing from August 2007, higher personal emoluments as a result of pay adjustment assumed to be 4% per annum, higher other recurrent expenditure (such as cleansing and security services) as a result of inflation.

Income and expenditure of the home ownership assistance operating account for 2008/09 are budgeted at $9,840 million and $6,242 million respectively. The operating surplus of $3,598 million in 2008/09 is forecast, as opposed to an operating surplus of $2,039 million in the 2007/08 Revised Budget. The higher surplus of $1,559 million in 2008/09 is mainly due to the higher number of surplus HOS flats scheduled to be sold in 2008/09 as compared to 2007/08, lower interest payments for home purchase loans sold to the Hong Kong Mortgage Corporation on declining loan balances, and lower Home Assistance Loan Scheme subsidy payments upon expiry of the residual cases.

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As at 30 September 2007, the HA runs approximately 1 473 542 m² IFA of commercial and other non-domestic properties (including retail, government lettings, welfare, kindergarten, flatted factories and others) and 26 732 carparking spaces^[9] . In 2008/09, we would strive for minimising the vacancy rate, revitalising the under-utilised non-domestic properties and reducing rent arrears.

The objectives of the commercial operations are:

	To tap private sector experience in trade mix, shopping centre design and marketing promotion to optimise business potential of the HA's new commercial developments
	To reduce the vacancy rate of the HA's retail premises
	To review the management and operation mode of the HA's non-domestic properties including shopping centres and carpark facilities
	To review the relevant policies, and formulate more proactive and stringent measures to reduce rent arrears rate

	To draw in private sector experience in trade mix and shopping centre design
	To tap private sector experience in marketing promotion
	To conduct upgrading works in the HA's retail premises

	To implement flexible letting strategies to increase the letting rate
	To explore opportunities to convert unpopular retail premises and carpark facilities for welfare and community use
	To monitor the vacancy rate of the HA's commercial properties and develop specific measures to improve the occupancy position and business environment

	To strengthen management control over financial performance
	To enhance central support, coordination and staff training on the leasing and management of non-domestic properties
	To make effective use of private sector resources in the delivery of shopping centre and carpark services
	To review the management mode of factory estates
	To enhance the efficiency for collection of carpark charges to keep abreast with the private sector practice
	To make effective use of IT to enhance operational efficiency

	To set up a monitoring mechanism to closely monitor rent arrears position
	To adopt more stringent measures against habitual rent defaulters of non-domestic properties
	To minimise debt owed by ex-tenants

Income and expenditure of the commercial operating account for 2008/09 are budgeted at $1,322 million and $881 million respectively. The operating surplus before exceptional items is projected at $441 million in 2008/09, which is $11 million or 2.4% lower than the 2007/08 Revised Budget of $452 million. The slight decrease in projected operating surplus in 2008/09 is mainly due to higher other recurrent expenditure (such as cleansing and security services) as a result of inflation and expected increase in personal emoluments.

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Corporate services comprise a wide range of supporting services that facilitate the efficient operation of the HA and HD. These include general administration, human resources management, legal services, financial management services, corporate and community relations, management consultancy/advisory services and IT.

The objectives of corporate services operations are –

	To make the best use of human resources to meet corporate goals
	To make greater use of IT to enhance business efficiency and support business initiatives
	To work in partnership with customers and other stakeholders
	To facilitate business operations of the HA through the provision of general administration, legal, management consultancy and various other supporting services
	To promote environmental and safety understanding and practices in HA's workplace and PRH estates
	To provide an open, fair, transparent and cost-effective procurement environment
	To maintain sound financial and fund management for the HA in meeting its missions in a sustainable manner

	To build a vibrant, flexible and sustainable workforce for the HA through strengthening human resources management and regular review of manpower strategy and staffing requirement
	To communicate changes to staff and obtain feedback to enhance operational effectiveness
	To promote the HA's core values amongst staff
	To enhance staff competence in serving their customers and supporting business initiatives through training

	To enlist the support of customers and stakeholders in promoting policies and initiatives of the HA
	To enhance communication with the general public

	To ensure delivery of business applications in a cost-effective and timely manner
	To enhance the effectiveness and efficiency of business through IT or new technology
	To provide legal services to different Divisions
	To provide management consultancy services to support corporate goals and initiatives
	To enhance value-for-money in procurement and strengthen procurement related training
	To implement and review a wage monitoring system for our contractors

	To manage HA's funds in accordance with approved investment strategies and guidelines
	To manage HA's finance in a prudent manner to meet its long-term policy objective

	To promote staff awareness of environmental protection issues
	To promote staff awareness and practices of occupational safety and health system in HA's workplace
	To promote environmental awareness among PRH tenants and continue our joint efforts with green groups in publicising environmental awareness

The 2008/09 proposed expenditure budget of $638 million for corporate services is higher than the 2007/08 Revised Budget of $600 million by 6.3%. The increase in 2008/09 is mainly due to higher personal emoluments and IT capital expenditure. The increase in personal emoluments is mainly due to assumed pay rises and increase in the number of staff for IT projects while the increase in IT capital expenditure for corporate services is mainly due to the development of IT systems in 2008/09.

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