The financial stability of the City of Cape Town could be jeopardised by a recent High Court judgement that makes municipalities responsible for providing rent or accommodation to illegal squatters, Mayco member for finance Ian Neilson has revealed.
The full implications of a landmark ruling earlier this month by Johannesburg High Court Judge Brian Spilg are still unclear, but both Cape Town and the City of Johannesburg - the two metros facing the brunt of urbanisation - are worried.
Gabu Tugwana, Johannesburg director of communications, told the Cape Argus yesterday that the city intended to take the matter all the way to the Constitutional Court, as there was "not any municipality in any part of the world" able to spend the kind of money proposed in the ruling.
The matter concerns about 80 squatters who illegally occupied a private property in Berea, Joburg and who face eviction because the landlord wants to develop the site.
Judge Spilg ordered this month that the property be vacated no later than March 31, when the squatters become the responsibility of the City of Johannesburg, which will have to provide them either with temporary accommodation, or pay each occupier or household head R850 to rent elsewhere.
Meanwhile, development company Blue Moonlight Properties 39 would also be entitled to market-related rental - paid for by the city - to cover the cost of the squatters' occupation of the property.
Judge Spilg's written judgment was not available yesterday, but the reasons for his decision were expected to be delivered today.
While the precedent created by his judgment is likely to be welcomed by both illegal occupants and property owners who have struggled in the past to evict squatters, cash-strapped local authorities and ratepayers could be faced with a heavy additional financial burden.
Although the precedent is only binding on courts in Gauteng, it would in future have national consequences if not overturned on appeal.
Tugwana said that although the city respected the legal system and would not want to undermine it, if municipalities were forced to subsidise their fast-growing populations, they would "go broke".
The principle of the matter was also cause for concern, he said, in that the city's housing policy was used to allocate housing, but the ruling now allowed for people to invade unoccupied buildings and thereafter demand city housing, effectively jumping to the top of the housing list.
Neilson agreed that it was a concern that the ruling could encourage illegal squatting.
It was also a concern that the City of Cape Town would not be able to plan adequately, and implement a "decent housing policy" if it was forced to "simply respond to legal actions".
It was "worrying" that the city could be forced to pay for situations where people had acted illegally, he said.
"In the end we might have to look at the way we operate ... we might have to act in a way to secure ourselves financially," he said.
The full implications of a landmark ruling earlier this month by Johannesburg High Court Judge Brian Spilg are still unclear, but both Cape Town and the City of Johannesburg - the two metros facing the brunt of urbanisation - are worried.
Gabu Tugwana, Johannesburg director of communications, told the Cape Argus yesterday that the city intended to take the matter all the way to the Constitutional Court, as there was "not any municipality in any part of the world" able to spend the kind of money proposed in the ruling.
The matter concerns about 80 squatters who illegally occupied a private property in Berea, Joburg and who face eviction because the landlord wants to develop the site.
Judge Spilg ordered this month that the property be vacated no later than March 31, when the squatters become the responsibility of the City of Johannesburg, which will have to provide them either with temporary accommodation, or pay each occupier or household head R850 to rent elsewhere.
Meanwhile, development company Blue Moonlight Properties 39 would also be entitled to market-related rental - paid for by the city - to cover the cost of the squatters' occupation of the property.
Judge Spilg's written judgment was not available yesterday, but the reasons for his decision were expected to be delivered today.
While the precedent created by his judgment is likely to be welcomed by both illegal occupants and property owners who have struggled in the past to evict squatters, cash-strapped local authorities and ratepayers could be faced with a heavy additional financial burden.
Although the precedent is only binding on courts in Gauteng, it would in future have national consequences if not overturned on appeal.
Tugwana said that although the city respected the legal system and would not want to undermine it, if municipalities were forced to subsidise their fast-growing populations, they would "go broke".
The principle of the matter was also cause for concern, he said, in that the city's housing policy was used to allocate housing, but the ruling now allowed for people to invade unoccupied buildings and thereafter demand city housing, effectively jumping to the top of the housing list.
Neilson agreed that it was a concern that the ruling could encourage illegal squatting.
It was also a concern that the City of Cape Town would not be able to plan adequately, and implement a "decent housing policy" if it was forced to "simply respond to legal actions".
It was "worrying" that the city could be forced to pay for situations where people had acted illegally, he said.
"In the end we might have to look at the way we operate ... we might have to act in a way to secure ourselves financially," he said.
- IOLProperty
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