Official estimates of the housing backlog, based on a 2006 study, put the shortage at around 410,000. With the R1,58 billion the province will receive from the national government this year in terms of the Division of Revenue Act the Western Cape government can build in the region of 16,000 housing units and 18,000 serviced sites. At this rate, and if the housing shortage remained static, it will take us up to 28 years to eradicate the backlog.
That was the word on Thursday by Minister Bonginkosi Madikizela, MEC for Housing in the Western Cape in delivering his budget speech. According to the MEC, the backlog was not static. It is a moving target. Between 2001 and 2007, the population of the Western Cape grew by 17% spurred largely by high rates of in-migration to the province. If we continue on a high growth trajectory, by 2040 the housing backlog in the Western Cape will have nearly doubled to 804,000. Clearly, a radical re-think of the way that we deliver housing is required. One way is to increase the share of the funding we receive from national government.
The MEC said he would use every inter-governmental forum to lobby for more money for housing in the Western Cape. But whatever increase in funding we might be able to secure, we must recognise that it will not solve our housing shortage overnight. We do not need reminding that we are now officially in a recession the effects of which are likely to be felt, especially amongst the poor, in years to come. As unemployment rises, so too will the demand for subsidised housing.
He said it was clear that the challenges were immense, but I can assure the people of the Western Cape that we will not collapse under the weight of expectation upon our collective shoulders...
Interventions
Madikizela said there were a number of interventions that could be introduced to accelerate the delivery of housing opportunities within current budget constraints and economic realities. Currently, the bulk of projects approved by the Department utilise a project-linked subsidy system which covers contractor-led projects on greenfield sites. These account for 45% or R711m of our housing grant budget and remain the mainstay of the Departments housing programme.
I believe that the emphasis on greenfield projects and contractor-built houses has to shift if we are to make a serious dent in the housing backlog. In-situ upgrading, for example, tends to be more cost-effective and less disruptive. This is why this administration intends to focus more on this type of project going forward, he said.
The Upgrading of Informal Settlements Programme (UISP) already in place aims to upgrade and provide basic services to communities in well-located informal settlements. The upgrading of informal settlements must not be seen, as some critics suggest, as a means to perpetuate apartheid-era town planning.
If implemented correctly, it can be a cost-effective way to create a dignified environment for shack dwellers without uprooting families and communities. In this financial year, the Department will spend 26% of its budget or R411m on this programme. This is something, I believe, we need to re-evaluate and increase in the years ahead, the MEC said.
To assist with selecting sites for future upgrade, the Department recently completed work on a vulnerability index that will inform the prioritisation of funding for informal settlements. This will allow us to objectively measure which informal settlements should be prioritised, based on the greatest need. The Department is also currently in the early stages of developing a masterplan for in-situ upgrading based on a province-wide assessment of informal settlements. This will allow us to develop time-bound targets to progressively provide informal settlement households with opportunities for improved infrastructure, services and tenure as well as support to improve their housing options over time.
Selling up or renting out
Madikizel said many beneficiaries sell on or rent out their houses and move back into shacks. Those that they sell to are often people who are not eligible for a subsidised house, which has the effect of increasing the backlog further. In some cases this behaviour is understandable. Many of our beneficiaries are the poorest of the poor. They are in survivalist mode; they are not in a position to consider the long term benefits of owning an appreciating asset. They need to put food in their childrens stomachs today.
However, the MEC said it was necessary to consider ways to ensure that the people who live in subsidised houses are the intended beneficiaries. One way of doing this is to increase the number of Peoples Housing Projects or PHPs relative to project-linked subsidies.
Unlike projects where beneficiaries are passive recipients, PHPs encourage people to get involved in the design of their house plans, to build or monitor the construction of their house and ensure that their houses are built to the requisite standard. The close involvement in the construction process confers a sense of ownership that is often not felt by recipients of other types of government subsidised housing.
PHPs also enhance consumer choice. A beneficiary can choose to design and build a house bigger than the subsidy allows, provided that she or he can finance the shortfall. A sweat equity contribution can result in a cut in labour costs which means more value for money for the beneficiary.
Corruption
The minister reported that the provincial government was currently spending 11% of its total budget or R174m on building housing structures through PHP methods. This is something I would like to increase over time providing that we can iron out some of the problems we have experienced with PHPs. In this regard, I am encouraged that the National Department of Housing recently completed its Enhanced PHP policy to improve the way that these projects are managed.
Madikizela said it was apparent that PHP projects despite their potential are beset with challenges. These include corruption, insufficient capacity of support organisations, lack of adherence to the PHP model in practice and insufficient capacity within the Department to deal with these challenges. The quality of some of the housing units built has sometimes been poor because PHP projects are not required to be registered with the National Home Builders Registration Council, he added.
I have requested the Department to develop a plan to improve our capacity to deal with PHP projects. We are also looking at ways in consultation with the Special Investigating Unit to stamp out the corruption that has riddled some of these projects, resulting in blockages. Furthermore, I plan to investigate ways to ensure that the houses built under the PHP programme are of the required quality.
Backyarders
He said besides the plight of those that suffer the indignity of living in unserviced informal settlements, he was deeply concerned about the fact that people who live in backyards have not been prioritised. Many backyarders have waited patiently for years for a house.
They have as much right as anyone else to dignified housing. We aim to oblige municipalities to strike the right balance between informal settlement dwellers and backyarders in the selection of beneficiaries for new housing projects. It cannot be right that people as young as 21 years old get preference over people who have been waiting for a house for three decades.
He pledged that his administration would take the plight of backyarders very seriously indeed, particularly with regards to the allocation of housing. We are starting the process of reviewing the way in which municipal so-called housing waiting lists are used to allocate housing. We will re-examine the allocation ratio of 70:30 which discriminates against backyarders and change it to 50:50.
Part of the reason for unfair allocations is because the data used is of poor quality: geographic coverage is limited, data is incomplete, out of date or simply inaccurate. Because poor data leads to unfair selection decisions, the Department is putting in place a programme to assist municipalities to improve their housing demand data collection, management and procedures.
He said the department would develop ways to simplify, standardize and demystify the manner in which houses are allocated. The Departments research shows that approaches to allocation differ across municipalities and are complicated for residents to understand and follow. We aim to make the process transparent and easy for everyone to understand. Without transparency, the perception will persist that some groups receive preferential treatment over others.
- Voice Of the Cape
That was the word on Thursday by Minister Bonginkosi Madikizela, MEC for Housing in the Western Cape in delivering his budget speech. According to the MEC, the backlog was not static. It is a moving target. Between 2001 and 2007, the population of the Western Cape grew by 17% spurred largely by high rates of in-migration to the province. If we continue on a high growth trajectory, by 2040 the housing backlog in the Western Cape will have nearly doubled to 804,000. Clearly, a radical re-think of the way that we deliver housing is required. One way is to increase the share of the funding we receive from national government.
The MEC said he would use every inter-governmental forum to lobby for more money for housing in the Western Cape. But whatever increase in funding we might be able to secure, we must recognise that it will not solve our housing shortage overnight. We do not need reminding that we are now officially in a recession the effects of which are likely to be felt, especially amongst the poor, in years to come. As unemployment rises, so too will the demand for subsidised housing.
He said it was clear that the challenges were immense, but I can assure the people of the Western Cape that we will not collapse under the weight of expectation upon our collective shoulders...
On the contrary, we will work even harder to find innovative ways to reduce the housing backlog and create sustainable, integrated communities.
Interventions
Madikizela said there were a number of interventions that could be introduced to accelerate the delivery of housing opportunities within current budget constraints and economic realities. Currently, the bulk of projects approved by the Department utilise a project-linked subsidy system which covers contractor-led projects on greenfield sites. These account for 45% or R711m of our housing grant budget and remain the mainstay of the Departments housing programme.
I believe that the emphasis on greenfield projects and contractor-built houses has to shift if we are to make a serious dent in the housing backlog. In-situ upgrading, for example, tends to be more cost-effective and less disruptive. This is why this administration intends to focus more on this type of project going forward, he said.
The Upgrading of Informal Settlements Programme (UISP) already in place aims to upgrade and provide basic services to communities in well-located informal settlements. The upgrading of informal settlements must not be seen, as some critics suggest, as a means to perpetuate apartheid-era town planning.
If implemented correctly, it can be a cost-effective way to create a dignified environment for shack dwellers without uprooting families and communities. In this financial year, the Department will spend 26% of its budget or R411m on this programme. This is something, I believe, we need to re-evaluate and increase in the years ahead, the MEC said.
To assist with selecting sites for future upgrade, the Department recently completed work on a vulnerability index that will inform the prioritisation of funding for informal settlements. This will allow us to objectively measure which informal settlements should be prioritised, based on the greatest need. The Department is also currently in the early stages of developing a masterplan for in-situ upgrading based on a province-wide assessment of informal settlements. This will allow us to develop time-bound targets to progressively provide informal settlement households with opportunities for improved infrastructure, services and tenure as well as support to improve their housing options over time.
Selling up or renting out
Madikizel said many beneficiaries sell on or rent out their houses and move back into shacks. Those that they sell to are often people who are not eligible for a subsidised house, which has the effect of increasing the backlog further. In some cases this behaviour is understandable. Many of our beneficiaries are the poorest of the poor. They are in survivalist mode; they are not in a position to consider the long term benefits of owning an appreciating asset. They need to put food in their childrens stomachs today.
However, the MEC said it was necessary to consider ways to ensure that the people who live in subsidised houses are the intended beneficiaries. One way of doing this is to increase the number of Peoples Housing Projects or PHPs relative to project-linked subsidies.
Unlike projects where beneficiaries are passive recipients, PHPs encourage people to get involved in the design of their house plans, to build or monitor the construction of their house and ensure that their houses are built to the requisite standard. The close involvement in the construction process confers a sense of ownership that is often not felt by recipients of other types of government subsidised housing.
PHPs also enhance consumer choice. A beneficiary can choose to design and build a house bigger than the subsidy allows, provided that she or he can finance the shortfall. A sweat equity contribution can result in a cut in labour costs which means more value for money for the beneficiary.
Corruption
The minister reported that the provincial government was currently spending 11% of its total budget or R174m on building housing structures through PHP methods. This is something I would like to increase over time providing that we can iron out some of the problems we have experienced with PHPs. In this regard, I am encouraged that the National Department of Housing recently completed its Enhanced PHP policy to improve the way that these projects are managed.
Madikizela said it was apparent that PHP projects despite their potential are beset with challenges. These include corruption, insufficient capacity of support organisations, lack of adherence to the PHP model in practice and insufficient capacity within the Department to deal with these challenges. The quality of some of the housing units built has sometimes been poor because PHP projects are not required to be registered with the National Home Builders Registration Council, he added.
I have requested the Department to develop a plan to improve our capacity to deal with PHP projects. We are also looking at ways in consultation with the Special Investigating Unit to stamp out the corruption that has riddled some of these projects, resulting in blockages. Furthermore, I plan to investigate ways to ensure that the houses built under the PHP programme are of the required quality.
Backyarders
He said besides the plight of those that suffer the indignity of living in unserviced informal settlements, he was deeply concerned about the fact that people who live in backyards have not been prioritised. Many backyarders have waited patiently for years for a house.
They have as much right as anyone else to dignified housing. We aim to oblige municipalities to strike the right balance between informal settlement dwellers and backyarders in the selection of beneficiaries for new housing projects. It cannot be right that people as young as 21 years old get preference over people who have been waiting for a house for three decades.
He pledged that his administration would take the plight of backyarders very seriously indeed, particularly with regards to the allocation of housing. We are starting the process of reviewing the way in which municipal so-called housing waiting lists are used to allocate housing. We will re-examine the allocation ratio of 70:30 which discriminates against backyarders and change it to 50:50.
Part of the reason for unfair allocations is because the data used is of poor quality: geographic coverage is limited, data is incomplete, out of date or simply inaccurate. Because poor data leads to unfair selection decisions, the Department is putting in place a programme to assist municipalities to improve their housing demand data collection, management and procedures.
He said the department would develop ways to simplify, standardize and demystify the manner in which houses are allocated. The Departments research shows that approaches to allocation differ across municipalities and are complicated for residents to understand and follow. We aim to make the process transparent and easy for everyone to understand. Without transparency, the perception will persist that some groups receive preferential treatment over others.
- Voice Of the Cape
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