The Penang government has denied claims that the rich are living in affordable housing units in the state due to weaknesses in its Housing Department's selection process.

State executive committee member in charge of housing, Jagdeep Singh Deo, said the selection process is done by the Selection Process Enhancement Committee (SPEC), formed in August 2013.

This was after he was put in charge of the Housing, Town and Country Planning Committee.

SPEC is chaired by Jagdeep, who sits on the board with eight others - state exco members Phee Boon Poh, Abdul Malik Kassim and Dr Afif Bahardin, state assemblypersons Ong Chin Wen and Teh Lai Heng and MPs Jeff Ooi, Ng Wei Aik and Sim Tze Tzin.

The affordable housing Jagdeep was referring to are the Type A (formerly known as low-cost) and Type B (formerly known as low-medium-cost) units priced at RM42,000 and RM72,500 respectively.

"Selection for the project referred to in the press reports commenced prior to the formation of SPEC, namely on June 2, 2011.

"In order to be eligible for such Affordable Housing Type A and Type B projects, an applicant must apply to the State Housing Department through form PN1.

"Applicants are not eligible if their salary is beyond RM2,500 and RM3,500 for Affordable Housing Type A and Type B respectively.

“For Affordable Housing Type A and Type B units, the applicant must not have owned any property, that is, they must be first-time home buyers,” Jagdeep said at a press conference today.

'Cannot be rented out'

Jagdeep said the form PN1 also clearly stipulates that these units are to be owner-occupied, that is, they cannot be rented out.

“For Affordable Housing Type A and Type B units, there is a moratorium for its subsequent sale, namely a unit owner can only sell the unit after 10 years from the date of principle purchase, unless  state consent is obtained for its sub-sale within the moratorium, in special circumstances,” Jagdeep noted.

“I have earlier raised my concern that these conditions may have been subject to abuse and action must be taken against those suspected of such abuse,” he said.

Jagdeep said applicants of Affordable Housing Type A and Type B, upon receipt of the offer letter, also have to execute a Statutory Declaration (SD).

The SD requires them to declare that they are first-time house buyers; their income is not more than RM2,500 and RM3,500 for Affordable Housing Type A and Type B respectively, and also to agree that the units offered to them should be owner-occupied and not rented out nor be used to carry out any commercial activities.

The SD also stipulates that these successful applicants must adhere to the 10-year moratorium and also these applicants will allow the state government to repossess the unit if they failed to adhere to the terms in the SD.

“The said SD also stipulates that legal action can be taken against those who give false information, under Sections 193, 199 and 200 of the Penal Code, which is punishable with a term of imprisonment that may extend to three years, and shall also be liable to fine,” he added.

Jagdeep welcomed any party with information of such suspected abuse to forward it to the state Housing Department so that it can conduct its own internal probe into the matter,

“We welcome any other form of investigation into the same as such abuse is intolerable and those complicit with such abuse must be brought to book.”

Jagdeep said this in response to Parti Cinta Malaysia vice-president Huan Cheng Guan, who yesterday claimed that the rich were living in low-medium-cost units in Penang, despite earning above the maximum household income limit for affordable housing applicants.

Huan said this came about despite many deserving applicants still on the waiting list to secure low-cost and low-medium-cost units, and he vowed to lodge a report with the Malaysian Anti-Corruption Commission on the matter.