Affordable housing in Penang: Whither PDC?

The Penang Development Corporation (PDC) – and even municipal councils – once used to play an admirable role in providing Penangites with affordable housing.

Goh Ban Lee recalls in this piece for Seri’s Penang Eonomic Monthly (August 2009) that:

The issue of shortage of housing for the poor in Penang is puzzling. As early as in 1950s, even before the country achieved independence from Britain, there were efforts by the government to help the lower income groups to have adequate shelter.

More specifically, George Town’s Municipal Council which eventually evolved into the Penang Island Municipal Council of today began building quarters for its lower paid workers as early as 1946. Two years later, it also built low-cost houses for sale to the public at $2,775 each (Penang – Past and Present, 1966:86). It then went on to build many housing units to be rented to the poor, such as those in Trengganu Road and Cintra Street. After almost half a century, these are still among the most sought-after housing units for the lower income groups.

The Seberang Perai Municipal Council (MPSP) and its predecessor also built low-cost housing units to be sold to the poor. For instance, in 1959 the Butterworth Town Council built low-cost houses in Jalan Mohd Saad costing between $5,000 and $12,000 each.

The Penang State Government has also been building low-cost houses for the poor. They include those in Kampung Melayu, Nordin Street Ghaut, Riffle Range, Kedah Road and recently, in cooperation with the federal government and MPPP, in the Lines Road area.

Discussing the role of the PDC, Ban Lee observes:

A vehicle to build houses and set standards

The most effective way for the state government to solve the housing problems, especially those related to affordability, is for it to have a vehicle, such as a housing board to build houses. While it is always good to have a vehicle to do things directly, the idea of a board should be treated as an agenda, rather than as a project to be carried out without further deliberations.

The state has the Penang Development Corporation (PDC). In the early days of its incorporation in the early 1970s, it was the major mover in the development of housing in areas where the state government wanted to have development. For instance, to push for the development and popularity of the Bayan Lepas Industrial Zone and the Bayan Lepas Free Trade Zone, the state government also incorporated the development of the Bayan Baru town-ship. Apart from promoting industrialisation, PDC was also tasked to build houses. The first batch of houses built were single-storey terrace houses and single-storey semi-detached houses with prices ranging from about RM18,000 to RM40,000 each in mid-1970s.The PDC was not building low-cost housing in the first phase of the project. The terrace houses in Island Glades then were selling from RM27,000 to RM50,000. Indeed, to attract buyers, the PDC even gave a stove, garbage bin and a choice of a fruit tree to each of the first batch of house buyers. Today, these houses are selling for RM400,000 to RM700,000 each! The contributions of PDC in building houses and successful industrialisation of Penang deserve a book-length documentation. It is clear that its roles have changed substantially. It is a sad reflection of how far it has gone awry when it is building houses costing more than a million ringgit each and selling large chunks of land to other property development companies.

While the pros and cons of a board or company to build and manage houses are being considered, the state should not forget that PDC was able to perform this role rather adequately. It is also useful to remember that the job that InvestPenang is doing was also part of the portfolio of the PDC. For the full article go here.

I hope PDC can return to the role it played in providing affordable housing – a task it once performed with distinction.