MONTHS after offering grants to poor families to buy their first home, the Government plans to build more rental flats so that those who cannot afford to buy will still have a roof over their heads.
However, to ensure that these rental units are taken up only by those who really need them, the rent they pay will be raised as their income goes up over time.
National Development Minister Mah Bow Tan announced this in Parliament yesterday as part of a wide-ranging speech which reaffirmed the Government's commitment to home ownership as a cornerstone of the public-housing programme.
'The Government will continue to support and subsidise home ownership for eligible Singaporeans. This will contribute to the building of a Singapore that is 'secure and prosperous, harmonious and cohesive',' he said, quoting a previous speech by President SR Nathan.
He quickly sketched the Housing Board's history, and listed three challenges it faces in the coming years: a greying population, giving low-wage earners a stake here, and building cohesive communities for an inclusive society.
On giving poor families their stake, he acknowledged that some families were simply not ready to buy property, even with Government grants of between $5,000 and $20,000.
Therefore, the Government's response to these families' plight was to increase the stock of smaller rental flats: About 1,000 one- and two-room units will be carved out from existing bigger units in Boon Lay and Woodlands; another 1,000 units will also be built in new and mature estates.
These units will add to the existing stock of about 40,000 rental flats, which are at least 20 years old.
Rental rates for these units are heavily subsidised. Households earning below $800 a month pay $30 a month for a one-room flat and $60 for a two-room one.
Mr Mah announced yesterday that to ensure that needy tenants do not rent flats for longer than they should, the Government intended to raise rentals as their household incomes rise over the years, so as to nudge them into buying a home when they become able.
Mr Mah also disclosed that rental tenants who had previously sold their subsidised flats would pay higher rentals. More details will come soon from the Housing Board.
He assured the House that over 80 per cent of existing tenants, including households earning less than $800 a month, would not be affected by the rental rate adjustment. But he also urged Singaporeans not to abuse the rental flat system by dumping their elderly parents there.
The move to plump the stock of rental flats drew praise from MPs like Mr Charles Chong, who chairs the Government Parliamentary Committee on National Development and Environment.
He said: 'The Government has recognised that it's impossible to get 100per cent home ownership. There will always be some who cannot own flats, and some who, by choice, stay in rental units.'
As for the challenge of housing an ageing population, Mr Mah said the Government would monitor its current options on the elderly 'monetising' their flats and refine the policies where necessary.
The Government's final challenge - that of making HDB estates places where inclusiveness is fostered, will be met head on by a feedback-gathering session led by Minister of State for National Development Grace Fu, Mr Mah said.
Her team of MPs will want to hear from Singaporeans 'how we can strengthen rootedness, community ownership and mutual support in housing estates', he said.
tanhy@sph.com.sg
The housing scene
New flats: 4,000 new flats on market next year; half are two- and three-room flats and studio flats. Housing grants: Housing grants of between $5,000 and $20,000 for poor households, introduced in March. They have reached 1,500 families. New option: HDB is considering releasing more sites for flats designed, built, priced and sold by private developers. Estate upgrading: Twenty-three private estates have been picked for upgrading. Earning money from flats: Between January 2003 and June this year, about 18,000 households with at least one named owner aged 50 years or over either sold their flat or sublet it for extra income. Building community: Public consultation exercise to be held soon to discuss bonding communities in public housing estates. 
