Source : Channel NewsAsia - 26 Aug 2008
The Lease Buyback Scheme (LBS) to help low-income households monetise their flats for their retirement needs could be implemented as early as January next year.
Senior Minister of State for National Development Grace Fu gave this update in Parliament on Tuesday when replying to a question brought up by MP for Aljunied GRC Cynthia Phua.
Under the scheme, first announced by Prime Minister Lee Hsien Loong in his 2007 National Day Rally speech, the elderly will get a S$5,000 up-front bonus when they sell their remaining flat lease, less the first 30 years, to the Housing and Development Board (HDB).
The remainder of the sale proceeds will be used to buy a CPF LIFE Plan, which provides a lifelong income stream of about S$550 a month for the flat owner.
Some 25,000 low-income elderly households owning 2- and 3-room flats could benefit from the scheme.
Ms Fu also addressed a concern that the elderly have over the scheme.
She said: “A commonly asked question on the LBS concerns the arrangement should the flat owner outlive the 30-year LBS lease. I want to assure Madam Phua that no elderly will be left homeless in that scenario.
“One option is lease extension. However, we do recognise that not all can afford the full price for such extension. HDB will have to assess the housing options available for each case on an individual basis, and be sensitive to the financial health and family circumstances of the elderly concerned.
“On the other hand, if the lease needs to be terminated prematurely because the elderly has passed away, his estate will receive a pro-rated refund on the residual lease.”
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