HDB: SPECIAL CPF HOUSING GRANTS IS 2% OF SALES PROCEEDS?

Nunber getting Special CPF Housing Grant tripled

I refer to the article “More take Special CPF Housing Grant” (Straits Times, Dec 3).

It states that “In the 12 months up to March 31, 10,213 households received the Special CPF Housing Grant, up from 3,380 in the previous financial year. This increase came after changes in July 2013 raised the income ceiling for the grant and extended it to four-room flats. The Special CPF Housing Grant goes up to $40,000 currently, depending on household income.

$137m in housing grants?

According to the HDB’s Annual Report 2014/2015 – there were “$137 million in CPF housing grants to eligible buyers”.

94% discount after housing grants?

For example, the selling price (including grants) is from only $5,000 for the 2-room flexi BTO flats in Bukit Batok launched last month, against the price of $84,000 (without grants).

This works out to a maximum discount (after grants) of about 94 per cent ($5,000 divided by $84,000) on the selling price (without grants).

HDB sale proceeds $6.7b?

The sale proceeds for housing was $6.7 billion.

Grants only 2% of sale proceeds?

So, does it mean that the housing grants was only about two per cent ($$137 million divided by $6.7 billion) of the sale proceeds?

In other words, in a sense, the housing grants amounted to only a two per cent discount of the sale proceeds.

As an analogy, if you are a food seller, and you say that you would give up to a 94 per discount to the lower-income subject to various criteria, and the end result is that only two per cent of the total revenue was actually given out as discounts – would you be happy as to the significance of the quantum of the discounts?

HDB deficit $2b?

The net deficit was $2.018 billion after government grants of $2.171 billion “to finance its deficit”.

How are govt grants determined?

How is the quantum of government grants determined?

For example, if the government grants are increased to $2.018 billion – the HDB would not incur any deficit.

Land costs 50%?

The capital expenditure on land and buildings was $5.518 and $4.958 billion respectively, representing 50 and 48 per cent of total capital expenditure respectively.

What percentage of the price of BTO flats is attributed to land costs? About 50 per cent?

How is the price of land charged to the HDB determined?

For argument’s sake – if the land costs is halfed – does it mean that BTO flats may be about 25 per cent cheaper than they are now?

Reciprocate trust with more transparency?

Since the people have given their trust and mandate – shouldn’t we reciprocate by being more transparent?

We should also spend more to help Singaporeans.

Leong Sze Hian

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