HDB LESSEES AND TENANTS IN ARREARS SERVED WITH NOTICES OF COMPULSORY ACQUISITION (Particulars)

[Mr Speaker in the Chair]

Dr S. Vasoo asked the Minister for National Development if he will state (i) the number of rent and instalment arrear cases served with notice of compulsory acquisition of flat, (ii) the types of problems faced by such cases and (iii) the various steps that will be taken to enable particularly those facing financial hardship to cope with payment of their arrears without undue stress.

The Minister for National Development (Mr S. Dhanabalan): Mr Speaker, Sir, for the past one year, 759 lessees who were in arrears of mortgage instalments and service and conservancy charges were served with notices of compulsory acquisition. Of these, 16 had their flats recovered by the Housing and Development Board. In addition, 845 tenants in rent arrears were served with Court Judgments and 48 flats were recovered.

Lessees and tenants who are in arrears fall into one or more of the following categories:

(a) those who lost their sole-breadwinner;

(b) families which suffer a loss of income owing to prolonged illness of a family member or the loss of employment by the head of household;

(c) families who depend on a sole-breadwinner to support many young dependants;

(d) delinquent cases who mismanage their finances; including those who are gamblers and alcoholics.

The HDB makes a great effort to help lessees and tenants to settle their arrears. For those who would be eligible for assistance, the Board refers them to social agencies and the Social Welfare Department. The Board also helps lessees and tenants who are in financial hardship by the following measures:

(a) allowing payment of arrears by instalments;

(b) allowing subletting of rooms;

(c) allowing resale of home-ownership flat (owned for more than five years) and purchase of smaller flat for a lessee or transfer from a bigger to smaller flat for a tenant; and

(d) approving home-based work in the flat.

In addition, lessees are also given the following assistance:

(a) extension of loan instalment payment period up to 25 years;

(b) easy repayment scheme(Ballooning Scheme, which is lower amount in the initial years and a bigger amount in the subsequent years);

(c) return of home-ownership flat in exchange for 1-room rental flat; and

(d) inclusion of third or even fourth co-lessees.

The HDB takes compulsory acquisition action of a home-ownership flat or court action on a rental flat only as a last resort. Before a notice of such an action is served, the lessee or tenant concerned will have received at least three written reminders and several personal advices to pay up the arrears.inders and several personal advices to pay up the arrears. HDB will also arrange for him to pay his arrears over a reasonable period. It is only when all these measures have been taken and failed that the Board takes compulsory acquisition or court action. In many cases such action is only taken as a last resort after the lessees or tenants have repeatedly broken their undertaking to pay their arrears by instalments.

Dr S. Vasoo (Bo Wen): Sir, in cases of families that have problems which are beyond their control and they are unable to pay the arrears, what steps would be taken to help such families to still continue to live in HDB flats?

Mr Dhanabalan: Mr Speaker, Sir, I have already mentioned some of the measures. One way out for the family, if the family is occupying a leased flat, ie, a purchased flat, is to give up the bigger flat and buy a smaller flat or even give up the purchased flat and rent a flat. HDB will make the arrangements. But what cannot be done after repeated attempts to help the family, is to allow the family to continue to live in the flat when there seems to be no way for the family to pay the instalments.

Mr Heng Chiang Meng (Jalan Kayu): Sir, despite what the Minister has said, may I ask why is it that at Area Offices, partial payments initiated by the tenants themselves are normally not permitted? I have received many such complaints.

Mr Dhanabalan: Sir, in every case that I have come across, the tenant or lessee wants to make partial payment only after he has accumulated arrears of a large amount, and after repeated reminders to the tenant or lessee concerned to pay up. Once the amount accumulated reaches a very high figure and court action is taken or compulsory acquisition action is taken and the process is in train, if the tenant or lessee comes along and says, "Look. I want to pay 10% or 20%", HDB would normally not allow it. The whole process only starts after many attempts to get the person concerned to pay up. Once the process starts, I think the HDB will insist that a substantial amount be paid, which is at least 50% or 75%, in order to ensure that we do not unravel the whole process and then find that the person does not pay and we have to start the process all over again. But if the tenant or lessee has accumulated three or four monts' arrears and he wants to pay up by instalments, that would always be welcomed provided action has not started yet through the court or compulsory acquisition process.