A REGULATION on the management of the compulsory housing provident fund has sparked controversy for the strict conditions applying to people withdrawing money from the fund.
The compulsory housing fund is a long-term savings program for the purchase, building, rent or reconstruction of homes, with monthly contributions from individuals and employers.
The regulation, which was circulated for public discussion last week, specified 14 conditions under which people could withdraw money from the fund, the Guangzhou-based National Business Daily (NBD) reported yesterday.
In addition, the regulation requires a minimum balance in housing accounts equivalent to three months contributions.
People who own at least three homes would be prohibited from withdrawing money from the housing account, according to the regulation.
Shenzhen s policy on withdrawals from the housing fund was strict and not people-friendly, said Lin Jianhui, market supervisor of the southern branch of the China Index Academy.
The minimum balance requirement would be lowered gradually, according to the Shenzhen housing fund management center.
It is just a trial policy and will be changed, Lin said.
Shenzhen s strict withdrawal policy was inspired by the fear that money from the housing fund would be used to speculate in the overheated housing market.
The housing management center said the detailed housing fund mortgage policies were due to be issued in the second half of this year and mortgage services would start at the end of the year.
Shenzhen started promoting the compulsory housing fund at the end of last year. It is open to all residents regardless of whether they have Shenzhen hukou (permanent residence permit).
According to a national regulation, deposits paid by employees and employers are owned by the staff. It is to be used by employees to buy, build, renovate or repair homes and cannot be used for other purposes by any unit or individual.
Shenzhen first implemented a regulation on a housing provident fund in 1992, but the rule covered employees in only a few companies. Government agencies and public institutions were not covered. (Li Hao)
