Assoc Prof Jamus Jerome Lim (Sengkang): To date, the Government has approached the issue of urban renewal of public housing in two ways. The Selective En bloc Redevelopment Scheme (SERS), identifies projects for urban renewal. Since August 1995, HDB has identified a total of 78 SERS projects with an additional four in the pipeline. But economic viability of SERS is limited by whether a more intensive redevelopment of a given site is even possible.
Now, this then led to the Government’s Voluntary Early Redevelopment Scheme (VERS). There is less clarity about how much compensation exactly this would entail. We have been told to stay tuned, since 2019. But HDB stated that the terms will be less generous than those offered under SERS. The main attraction of VERS then, is that it will offer leaseholders at least a vote to remain in their homes; although doing so, could inadvertently, impede more systematic urban renewal efforts as well as long-term town planning.
Now, while SERS offers non-trivial compensation to affected leaseholders, it has also attracted some controversy especially when residents prefer the status quo of remaining in their homes instead of forced relocation. In contrast, VERS is voluntary, but the Government runs into the difficulty of securing buy-in from residents.
While there is no indication to date as to the voting threshold required for selection, it is by definition more than 0%. In 2019, the Workers’ Party released a working paper on alternatives to address the issue of lease decay and affordable housing. Our paper offered policy proposals, including a universal sale and lease buyback scheme, a more widespread SERS programme and an expanded public rental scheme. Our expanded SERS proposal will, however, be bound by similar challenges of ensuring economic viability and securing buy-in as the Government’s own programme.
If more intensified redevelopment does not yield sufficient economies of scale in and of itself, the taxpayer will have to absorb part of the costs in the name of the public benefits of urban renewal and ensuring that the population, indeed, has a roof over their heads. One potential middle-ground approach between the largely voluntary nature of VERS and the compulsory stipulation of SERS, is to introduce moving voting thresholds for passage of a VERS project.
These thresholds would shift as the lease winds down, making an upvote easier when renewal needs become ever more pressing. For example, a flat with 50 years’ lease remaining may require a 75% supermajority; but one with half the time remaining, could perhaps, only need a simple 50%. This allows homeowners to both have a say on whether they choose to move but at the same time, respect the need for systematic urban renewal.
The Minister for National Development (Mr Desmond Lee): Mr Chairman, Mr Chong Kee Hiong and Assoc Prof Jamus Lim have also asked about VERS. Assoc Prof Lim focused on the mechanics of the scheme and the impact on home owners, specifically making a suggestion for lower voting thresholds for older flats. We will take note of his suggestion. While Mr Chong Kee Hiong also spoke about the wider context of urban rejuvenation and redevelopment.
Indeed, VERS should be seen as part of a bigger strategy for us to comprehensively plan for the redevelopment of our public housing, improve the environment and quality of life in our heartlands, create towns that further embrace “live-work-play” strategies, and bring jobs and amenities closer to our people. It is a big, complex, long-term task. It involves re-imagining all over again, the concept of public housing and reinvigorating our ageing HDB towns. In doing so, we have to take care of the current generation’s housing needs even as we cater for the needs of future generations.
We will need to carefully stage redevelopment in the older parts of the towns, while minimising disamenities to the residents in the newer parts. Some Singaporeans will need to relocate as a result of this, so we will need to work through the detailed mechanics and processes and the package for VERS. We will also need to ensure that there are sufficient homes available at the right time for them.
We are developing these details and plans and will announce more information and details in due course. This is the Government’s commitment to you. We have taken care of Singaporeans’ housing needs for the past 60 years. It is a work in progress. We will continue to do so for the next 60 years and beyond.
Ministry of National Development
5 March 2024
https://sprs.parl.gov.sg/search/#/sprs3topic?reportid=budget-2376
Office of the Leader of the Opposition 