The Premier of the Western Cape says the current model has proved unsustainable
This week saw the completion of a housing quality audit conducted by the National Department of Human Settlements. It found that the quality of houses built by the state was so poor that R1.3 billion is needed for repairs.
To put this into perspective, this amount is a full 10% of this year's national housing adjustment budget - just shy of the R1,58 billion of housing funds allocated to the Western Cape.
Minister Tokyo Sexwale has expressed anger, and justifiably so: This R1.3 billion could have been used to build around 13,000 new houses for people in need. It means that beneficiaries who have already received their full R100,000 subsidy will receive an additional significant allocation to make their houses habitable.
Minister Sexwale's admission of what is ultimately a failure of his department is refreshing and we commend him for it. So too is his tough stance against the perpetrators and his commitment to rectify the situation. It is indeed a national shame - as he put it - that billions need to be spent on rectification at the expense of new housing opportunities.
But Minster Sexwale's candid approach should not stop at the quality of houses being built by the state. It is time for us all to take a long, hard look at the way the state delivers housing and ask: is it fair? Is it affordable? Is it sustainable? Is the current approach achieving (or undermining) the policy's objectives?
This is happening for three main reasons:
1) The demand for free, state-sponsored housing greatly outstrips the supply and this mismatch is growing. This is the result of natural population growth, escalating urbanisation, and the growing influx of asylum seekers. The assumption that a free house is a right has become entrenched -- and the number of people claiming this "right" is growing exponentially.
2) Stringent laws regulating planning and land use make it impossible to keep ahead of the demand for housing land. The 3-year long process required to release land for housing encourages land invasions. The result is that unserviced shack settlements mushroom, complicating the housing delivery process further, and setting up conflicts between shack dwellers and back-yard dwellers for access to housing opportunities.
3) Beneficiaries of free housing increasingly regard their house as a potential income source rather than a place to live. More and more are moving out of their houses, back into a shack, and letting (or selling) their house at a fraction of its value to a person who does not qualify for a free house. The result is that shack settlements continue to grow while state subsidies, intended to benefit the very poor, end up subsidising the emerging middle class. Even though this practice is illegal, it is very difficult to monitor. This practice further entrenches the notion that a "free" house is a "right" for everyone, not just the indigent.
Given this situation, it is not surprising that the backlog is growing. The Department of Human Settlements has said that in three years time, R102 billion will be required to clear the housing backlog, a figure which will more than double to R253 billion in 2016. (This is nearly 20 times the entire current annual housing budget)
1) How much of the national budget should South Africa spend on housing -- given all the competing priorities in a developing country?
South Africa's national budget for ‘housing and community amenities' is currentlyR73.2 billion (8.7% of the national budget, of which around R13 billion is distributed to provinces for housing subsidies). In a developing country, with only 5 million registered personal taxpayers, this is about as much as the state can spend on housing, given the pressing competing priorities.
2) Who should benefit from this money? Should we spread this amount as equitably as possible, thus doing a little for many people, or should we rather do a lot for a few?
Our current housing policy opts for the latter. Each RDP house costs about R100,000. This means, in the Western Cape for example, the R1.6-billion Rand allocated to housing provides around 16,000 RDP homes every year (if enough land can be made available).
This is a tiny fraction of the estimated backlog in the Western Cape of 500,000 houses. And this backlog is growing. It is estimated that, at the current rate of delivery, the backlog in 2040 will be at around 800,000. In other words, the waiting list in the province is growing by 10,000 families per annum, despite government spending all of its housing allocation each year.
The alternatives include:
1.) Site and Service: The provision of a serviced site (with water, sewage, electricity and road access) requires the beneficiary to build a dwelling and improve it incrementally.
2.) In Situ upgrading, which focuses on upgrading informal settlements, where they are, providing services and enabling families incrementally to upgrade their shacks.
3) Social housing (often in the form of flats). These are state subsidised but require beneficiaries to pay rent in order make the economic model replicable and sustainable.
All of these steps seek to address the intractable problems of providing housing for the poor. They are still bedevilled by two factors.
The first is the amount of land required to implement the RDP, the site and service, and the in-situ upgrading options. They are premised on the notion of a single dwelling on a separate site. This leads to low-density urban sprawl with serious consequences ranging from the environment to the viability of public transport.
The second factor undermining the diversified approach to housing is the entrenched expectation that a free, formal house on a separate plot is a right. People resist the option of a "flat" (especially if they have to pay rent for it) when other people are getting a free house. It does not always help to explain to beneficiaries that it costs three times as much to construct a flat than to build an RDP house on a separate site. They reject these explanations because they experience what sociologists call "relative deprivation". They believe they are being deprived of a benefit that others are getting. And this often leads to refusal to pay rents, meaning that the building of flats grinds to a halt because the process is unsustainable.
"Relative deprivation" also often leads to "service delivery protests". Such protests are sometimes about demands and expectations that cannot be met. An extreme example of such a protest was the one where people "demanded" an extra room on their free RDP houses. Another was the protest of some shack-dwellers in Masiphumelele, who refuse to accept the offer of a highly subsidised flat (combining both the R100,000 state subsidy as well as generous donor funding). The protesters are deliberately blocking the development because they are demanding an individual house on a separate site.
While some continue to make unmeetable demands, many others live in absolute deprivation and do not even get the most basic services.
Figures released recently by the Department of Co-operative Governance and Traditional Affairs show just how many people are still without access even to basic services, let alone a house: 2.5 million (19.3%) households do not have access to running water, 3.4 million (27.3%) households are without electricity and 4.2million (32.6%) households do not have access to basic sanitation.
Access to clean water, sanitation and electricity is the first step on the road to dignity. Government policy should increasingly focus on meeting these basic needs.
We must be honest that housing policy is notoriously complex terrain. There are no easy answers and there are no quick wins. We must start by getting some of the basics right, such as speeding up the release of land for housing, cutting the red tape that delays delivery, tackling corruption and ensuring that the houses built are of the requisite standard.
We must also recognise that the current model of a free house on a free-standing plot is unsustainable. Once we acknowledge this, it is possible to think of alternatives that are fairer, more equitable and more affordable. A combination of fresh thinking, bold policy decisions and good implementation is required to enable the state to play the appropriate role in providing opportunities for people to lift themselves out of poverty. We are committed to working together with all spheres of government and all political parties, to find appropriate solutions to this most complex of public policy challenges.
- Politicsweb
This week saw the completion of a housing quality audit conducted by the National Department of Human Settlements. It found that the quality of houses built by the state was so poor that R1.3 billion is needed for repairs.
To put this into perspective, this amount is a full 10% of this year's national housing adjustment budget - just shy of the R1,58 billion of housing funds allocated to the Western Cape.
Minister Tokyo Sexwale has expressed anger, and justifiably so: This R1.3 billion could have been used to build around 13,000 new houses for people in need. It means that beneficiaries who have already received their full R100,000 subsidy will receive an additional significant allocation to make their houses habitable.
Minister Sexwale's admission of what is ultimately a failure of his department is refreshing and we commend him for it. So too is his tough stance against the perpetrators and his commitment to rectify the situation. It is indeed a national shame - as he put it - that billions need to be spent on rectification at the expense of new housing opportunities.
But Minster Sexwale's candid approach should not stop at the quality of houses being built by the state. It is time for us all to take a long, hard look at the way the state delivers housing and ask: is it fair? Is it affordable? Is it sustainable? Is the current approach achieving (or undermining) the policy's objectives?
An honest assessment would show that national housing policy isn't working.When former Housing Minister, Lindiwe Sisulu, unveiled the ‘Breaking New Ground' policy in 2004, she announced that its aim was to eradicate shack settlements by 2014. In practice, however, the policy is leading to an increase in the number of unserviced shack settlements, across the country.
This is happening for three main reasons:
1) The demand for free, state-sponsored housing greatly outstrips the supply and this mismatch is growing. This is the result of natural population growth, escalating urbanisation, and the growing influx of asylum seekers. The assumption that a free house is a right has become entrenched -- and the number of people claiming this "right" is growing exponentially.
2) Stringent laws regulating planning and land use make it impossible to keep ahead of the demand for housing land. The 3-year long process required to release land for housing encourages land invasions. The result is that unserviced shack settlements mushroom, complicating the housing delivery process further, and setting up conflicts between shack dwellers and back-yard dwellers for access to housing opportunities.
3) Beneficiaries of free housing increasingly regard their house as a potential income source rather than a place to live. More and more are moving out of their houses, back into a shack, and letting (or selling) their house at a fraction of its value to a person who does not qualify for a free house. The result is that shack settlements continue to grow while state subsidies, intended to benefit the very poor, end up subsidising the emerging middle class. Even though this practice is illegal, it is very difficult to monitor. This practice further entrenches the notion that a "free" house is a "right" for everyone, not just the indigent.
Given this situation, it is not surprising that the backlog is growing. The Department of Human Settlements has said that in three years time, R102 billion will be required to clear the housing backlog, a figure which will more than double to R253 billion in 2016. (This is nearly 20 times the entire current annual housing budget)
This is clearly unsustainable. We have to re-think our approach to housing policy by asking a few fundamental questions, starting from the beginning.
1) How much of the national budget should South Africa spend on housing -- given all the competing priorities in a developing country?
South Africa's national budget for ‘housing and community amenities' is currentlyR73.2 billion (8.7% of the national budget, of which around R13 billion is distributed to provinces for housing subsidies). In a developing country, with only 5 million registered personal taxpayers, this is about as much as the state can spend on housing, given the pressing competing priorities.
2) Who should benefit from this money? Should we spread this amount as equitably as possible, thus doing a little for many people, or should we rather do a lot for a few?
Our current housing policy opts for the latter. Each RDP house costs about R100,000. This means, in the Western Cape for example, the R1.6-billion Rand allocated to housing provides around 16,000 RDP homes every year (if enough land can be made available).
This is a tiny fraction of the estimated backlog in the Western Cape of 500,000 houses. And this backlog is growing. It is estimated that, at the current rate of delivery, the backlog in 2040 will be at around 800,000. In other words, the waiting list in the province is growing by 10,000 families per annum, despite government spending all of its housing allocation each year.
So, under the current policy we are, in fact, going backwards. The policy of providing a lot for a few is making the backlog grow.To be fair, national government policy has recognised these problems, and has diversified its strategy in an attempt to address them. There are now various policy options and instruments designed to widen the "choices" offered through national housing policy.
The alternatives include:
1.) Site and Service: The provision of a serviced site (with water, sewage, electricity and road access) requires the beneficiary to build a dwelling and improve it incrementally.
2.) In Situ upgrading, which focuses on upgrading informal settlements, where they are, providing services and enabling families incrementally to upgrade their shacks.
3) Social housing (often in the form of flats). These are state subsidised but require beneficiaries to pay rent in order make the economic model replicable and sustainable.
All of these steps seek to address the intractable problems of providing housing for the poor. They are still bedevilled by two factors.
The first is the amount of land required to implement the RDP, the site and service, and the in-situ upgrading options. They are premised on the notion of a single dwelling on a separate site. This leads to low-density urban sprawl with serious consequences ranging from the environment to the viability of public transport.
The second factor undermining the diversified approach to housing is the entrenched expectation that a free, formal house on a separate plot is a right. People resist the option of a "flat" (especially if they have to pay rent for it) when other people are getting a free house. It does not always help to explain to beneficiaries that it costs three times as much to construct a flat than to build an RDP house on a separate site. They reject these explanations because they experience what sociologists call "relative deprivation". They believe they are being deprived of a benefit that others are getting. And this often leads to refusal to pay rents, meaning that the building of flats grinds to a halt because the process is unsustainable.
"Relative deprivation" also often leads to "service delivery protests". Such protests are sometimes about demands and expectations that cannot be met. An extreme example of such a protest was the one where people "demanded" an extra room on their free RDP houses. Another was the protest of some shack-dwellers in Masiphumelele, who refuse to accept the offer of a highly subsidised flat (combining both the R100,000 state subsidy as well as generous donor funding). The protesters are deliberately blocking the development because they are demanding an individual house on a separate site.
While some continue to make unmeetable demands, many others live in absolute deprivation and do not even get the most basic services.
Figures released recently by the Department of Co-operative Governance and Traditional Affairs show just how many people are still without access even to basic services, let alone a house: 2.5 million (19.3%) households do not have access to running water, 3.4 million (27.3%) households are without electricity and 4.2million (32.6%) households do not have access to basic sanitation.
Access to clean water, sanitation and electricity is the first step on the road to dignity. Government policy should increasingly focus on meeting these basic needs.
We must be honest that housing policy is notoriously complex terrain. There are no easy answers and there are no quick wins. We must start by getting some of the basics right, such as speeding up the release of land for housing, cutting the red tape that delays delivery, tackling corruption and ensuring that the houses built are of the requisite standard.
We must also recognise that the current model of a free house on a free-standing plot is unsustainable. Once we acknowledge this, it is possible to think of alternatives that are fairer, more equitable and more affordable. A combination of fresh thinking, bold policy decisions and good implementation is required to enable the state to play the appropriate role in providing opportunities for people to lift themselves out of poverty. We are committed to working together with all spheres of government and all political parties, to find appropriate solutions to this most complex of public policy challenges.
- Politicsweb
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