SINGAPORE – Senior Minister of State for National Development Sim Ann has invited Non-Constituency MP Leong Mun Wai to file a parliamentary motion so that the pricing policies for Build-To-Order (BTO) flats can be fully debated.
She had issued the invite in a Facebook post on Tuesday (Dec 20), which rebutted the points made by Progress Singapore Party’s (PSP) Mr Leong in a post on his Facebook page last Friday.
Responding a day later on Facebook, PSP secretary-general Francis Yuen said his party welcomes the Government’s offer, and “will file a motion in due course to have a free and open discussion on the challenges facing our public housing market”.
In his Dec 16 post, Mr Leong had questioned if Housing Board flats were truly subsidised.
“This is because the Government has net positive cash flow from each HDB flat it sells disregarding land costs,” he wrote, before reiterating his view that the cost of land belonging to the state should not be priced into HDB flats.
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He had previously stated his view that HDB flat prices should only account for construction costs, and price differences between locations.
To this, Ms Sim had said in a Facebook post on Dec 11 that state land forms part of the nation’s reserves, and not paying back the fair market value of the land would, in effect, run down the value of the reserves “to the detriment of current and future generations”.
On Tuesday, she refuted Mr Leong’s claim that BTO flats are not subsidised. “This is simply incorrect,” she wrote, adding that BTO flats are sold at a significant subsidy, and that many buyers also get grants on top of that.
These subsidies are realised when BTO owners sell their flats on the resale market, she wrote.
Taking up Mr Leong’s assertion that land costs should be disregarded, if necessary, in the pricing of BTO flats, Ms Sim wrote: “It is one thing to discuss the price of BTO flats... However, questioning the accounting of land value as part of our reserves, which Mr Leong has mixed up with the discussion on BTO prices, is another matter altogether. There is no room for magical thinking here.”
She added that Mr Leong “is far from being the first Government critic to have over-confidence in the adequacy of our reserves and to call for Government to use more investment returns to fund current spending”.
She wrote that he “wants Singaporeans to believe that we should save less in our Reserves for future generations, and can afford to draw down more of our Reserves for today’s needs”, adding that “this is a wrongheaded proposal which carries serious consequences”.
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The two crossed swords on social media after the HDB revealed the breakdown of the development costs of BTO flats on Dec 7. The board said then that the total development costs for the 13,506 new flats HDB handed over to buyers came to $5.346 billion for the 2021-2022 financial year, with the bulk of it – $3.167 billion – coming from land costs.
This prompted Mr Leong to assert in a Facebook post on Dec 8 that land costs should not be factored into the pricing of HDB flats, which drew Ms Sim to write on Dec 12 that disregarding these costs would hurt Singaporeans.
Calling on Mr Leong to “go beyond social media posts”, Ms Sim on Tuesday invited him to file a motion in Parliament “so that we can have a full debate”.
ALSO READ: How are BTO flats priced? HDB gives the breakdown
This article was first published in The Straits Times. Permission required for reproduction.
