South African Housing Co-operatives: briefing by SA Housing Co-operatives Association

Human Settlements, Water and Sanitation

23 February 2010
Chairperson: Ms B Dambuza (ANC)
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Meeting Summary

The National Chairperson of the South African Housing Co-operative Association briefed the Committee on the concept of co-operative housing, and the experiences on the ground. He explained the concept of different housing models and highlighted the main principles of co-operatives, and their advantages over the rental social housing or sectional title schemes. Co-operative housing envisaged that a group of people, who shared a common need for housing, would pool their money, their skills, and their time, and would set up and register a co-operative, which was a legal entity. They then negotiated for land and good prices on building materials and they built houses collectively. In this type of co-operative the unemployed could be accommodated, because they would qualify for a government subsidy, and the rest of their contribution would be in “sweat equity” by working in the construction team. The advantages of this model were that the beneficiaries were actively involved in every stage of the development of the project and thus they would be happy with the end result. They worked actively for their houses and did not receive them passively. Such a model also created jobs, training opportunities that could subsequently use the skills to help others, and could also encompass other service jobs in the community, such as childcare. In particular it was suited for development opportunities for youth. This development type of co-operative mostly operated in the township and rural areas. SAHCA outlined that a continuous housing co-operative mostly operated in the inner cities, in large blocks of flats, where working, but low-earning people, might pool their funds to register a co-operative, collectively purchase a high-rise building, elect a Board of Directors who would then manage the finances as well as maintenance of the building, and where each co-operative member would own a unit in the block, for which a share certificate was given. If the member left the building, this would be traded for an exit payment. In the meantime the share certificate could be used as collateral security for borrowing funds. Because there was no profit motive, the co-operative model was affordable even to the poor, and there was security of tenure. SAHCA was in the process of developing a model for student co-operatives.

The questions of the members centred around SAHCA as an organization, its history, its structure and its footprint nationally. It also touched on the two models of housing co-operatives and how it accommodated poor and unemployed people. Members asked questions around the differences between the co-operative model and sectional title. The questions also touched on the challenges that SAHCA faced in the acquisition of land and lastly, pertinent questions were asked about the nature of the relationship between SAHCA and the National Department of Human Settlements and the National Housing Agency.

During the questions, it became apparent that the Portfolio Committee had not been fully advised by the Department of Human Settlements about all the options available, and the Committee members had not even been made aware in the past of co-operative schemes already in existence. Members were concerned that the Department had not been forthcoming with all the information, and were further concerned about some statements by the Housing Development Agency that it apparently was not supporting the co-operative model, despite the fact that this was included in the legislation on Social Housing yet no policies had been developed for it, but rather that the rental social housing model had been actively promoted. She asked that a strong message be conveyed to the Department that senior officials would in future be expected to attend such meetings, and that explanations would be required on the issues.


Meeting report

South African Housing Co-operative Association (SAHCA) briefing
The Chairperson welcomed representatives of the Office of the Minister and the Office of the Director General of the Department of Human Settlements, and the Language Unit, to the meeting. She tendered the apologies of the six members who were attending to Parliamentary oversight, or by-elections, and one member who had suffered a bereavement. She welcomed a new Member, Ms Dorothy Dlakude (ANC)

Mr Zacharia Matsela, National Chairperson, South African Housing Co-operative Association (SAHCA) said that SAHCA was formed in May 2004, by primary co-operatives. Although at that time there were many co-operatives in existence, there was no legislation governing their operations, and it was felt that there was a need to form an organisation at a national level to address issues that needed co-operative engagement.

He defined a housing co-operative as a community of people who rallied around a particular need, in this case to house themselves. They shared an economic situation where they were homeless, and they did not earn enough to acquire houses via the conventional channels of obtaining bonds through the banks. They then set up an organisation and registered it as a legal entity to facilitate the building of houses for themselves, on a non-profit basis. The principle of ubuntu was important in the formation and operations of  housing co-operatives. It also had to use co-operative alliance principles.

The reason why housing co-operatives were so important in the country at this moment was that the Minister of Human Settlements recently indicated that there was going to be mass participation by communities who were going to contribute towards building their own houses. The ruling party had had a policy of giving houses to people, but this model was fraught with problems, even to the extent that some of the houses provided later had to be demolished as unsuitable for human habitation. The beneficiaries of these houses also had many complaints pertaining to the quality of the houses. This all pointed to the need for a different model, in this case involving communities providing houses for themselves and contributing towards them. This approach would eliminate the dissatisfaction that people had towards the houses in the previous model, because they would make all the decisions themselves. Their contribution would also result in a bigger and better quality house at the end of the process.

Co-operatives existed in rural and urban areas in different forms. There were two types: developmental and continuous co-operatives.

Mr Matsela outlined some of these cooperatives. He illustrated that cooperatives in Greenfields development had taken barren land, and, with contributions from the members and assistance from government, had built townhouse-like developments, or where e-PHP came on board to erect new houses.

There were co-operatives where former single-sex hostels were being converted into family units, and where there was cooperative engagement with the municipalities, such as some happening in Cape Town.

Other co-operatives operated in renovated buildings in the inner cities. There were situations where buildings were dilapidated and in some cases deserted by the owners, because they might be in default of financial obligations. There were also cases where inhabitants faced evictions. The inhabitants decided to form a co-operative and take over the building, renovated it and paid the dues to the municipalities. In other cases like the e-PHP form, the members set up co-operatives to become service providers to themselves, engaging the municipalities to develop e-PHP housing. These instances demonstrated that co-operatives could play an important role in making it possible for people to provide housing for themselves.

He reported that co-operatives started in the 1800s and started to transform from consumer co-operatives to workers’ co-operatives and then into housing co-operatives. They existed in Canada and the United States, Sweden, Norway and Germany and elsewhere. The concept of co-operatives came about as a result of people having a common goal or a common bond. He reiterated that individuals wanting to buy houses would need to raise the deposit, and obtain a bond, and a recent survey had shown that it was almost impossible for anyone in South Africa, who was earning less than R15 000 per month, to buy a house. In a co-operative, members pooled their subsidies and skills and bargained collectively for better prices on building materials and land. Economically, things that were impossible to achieve as an individual, became possible in a collective. Within the co-operative there was division of labour, in the sense that certain teams were responsible for laying foundations, whilst others would do the bricklaying, roofing, plumbing or electricity. Members elected the board of directors from their own ranks. Their collective bargaining power was crucial to the operation of a co-operative, and so was the security of tenure that resulted. Members were involved from the inception of the project to its completion. This resulted in all participants being happy with the end product, which is turn created a happy and stable community. The advantages of co-operatives included opportunities for security of tenure, job creation and empowerment, because in the process people acquired skills in construction that they did not have before, and that they could then use to build houses for other members.

He noted that co-operatives made housing affordable. For example, in a townhouse complex the members would only charge enough rent to cover the necessary expenses, like rates and short and long-term maintenance, but had no profit motive. In a co-operative, members were shareholders. The shares were all equal, because the members were all equal. The unit became a share. This share could be used as collateral to get a loan from the bank.

Another advantage was community concern. If, for example a breadwinner lost his job, and could no longer afford the rent, he could contribute in “sweat equity”, in other words, work for the co-operative in construction or cleaning, instead of his monetary contribution. This became possible because of the spirit of ubuntu which was a fundamental principle in the way in which housing co-operative worked.

Within the housing co-operative one could also find minor co-operatives. Childcare was an example. Instead of the members taking their children to outside childcare facilities, they could establish a childcare facility in the co-operative. By doing this they created employment, and the money circulated within the co-operative, and that contributed to community development.

Before a co-operative could be established there were requirements .There had to be buy-in concerning security of tenure. In order to establish a co-operative, it was necessary that the community be employed and earning a certain amount of money. Most members of co-operatives earned R7 000 and downward, per month. There was also the issue of organisation and management. People needed to be trained in order to perform their duties of collecting monies and paying municipal and other accounts.

Mr Matsela outlined the difference between co-operatives and sectional title and rental markets. In a co-operative, the members owned the building, were involved in the development of the building, and after completion were still involved as co-operative members. In the rental market, the landlord owned the property and made all the rules. In sectional title, the individual approached the bank for a bond, and bought a unit in a complex. The sense of ownership that came along with owning the building caused members to protect their asset, which caused the monthly running costs to be low. The co-operative owned the mortgage on behalf of all the members. The board of directors was responsible for the management of the co-operative according to the Co-operative Act of 2005. In a case where people were part of a co-operative for 20 years in the inner city, but decided to retire to their rural village, they should get an exit payment when they left.

SAHCA was presently busy establishing student co-operatives. Students stayed in rental places for three or four years, paying rent, but would then leave with nothing. In the case of a student co-operative, the student would get an exit payment which he or then could then use for other studies, job seeking and so forth.

When a new housing co-operative needed to be established, SAHCA held information sessions with the affected community. Membership of a co-operative was always voluntary. SAHCA would arrange workshops for members of co-operatives in order for them to understand the role of a member of a co-operative was.

One of the main objectives of SAHCA was to educate the different sectors of society, including government, about SAHCA and the role that it played. It also united, represented and served its member organisations. It trained members of housing co-operatives. It needed to be a legal entity in order to be taken seriously, and to be able to sue and be sued. Other Housing Associations did not have the same legal status. SAHCA also continuously lobbied government to develop a policy that would cater for housing co-operative development and support. In other countries, in particular Scandinavia, this model had proved to be successful. When working with a legal entity, issues of governance – such as how finances were handled, maintenance of the properties, and how conflict was resolved within the organization – all became important. Co-operatives must be run smoothly and efficiently. SAHCA also had the responsibility to develop and mobilise resources for its member co-operatives as well as developing pilot projects. The current presentation was an instance of lobbying government. SAHCA also had to engage local government to the extent that they could see co-operatives as a way to deliver housing to the population. It was important also to network with similar organisations or entities whose areas of interest overlapped.

Mr Matsela described the statistics for SAHCA. In Gauteng, there were 23 projects, with another 11 in North West, 3 in Western Cape, 10 in KwaZulu Natal (KZN) and 11 in the Eastern Cape. Previously these were all black-owned, but the idea was taking root amongst other cultural groups. Thus far 1 715 permanent jobs were created. These included renovation work, construction, management, maintenance, security and cleaning .The demand for housing co-operatives was increasing. In Tswane for example SACHA was involved in helping a group of people from the Indian Community to form a co-operative to take over a building that previously belonged to the City of Tswane.

Previously the Co-operative Act was geared for agriculture. SAHCA had contributed to the team drafting the new Co-operative and Social Housing Acts. SAHCA, together with the Department of Human Settlements (DHS) had drafted a Housing Co-operative Strategy. SAHCA had to see that that strategy was incorporated with the main co-operative strategy in the country that was being finalized by the National Economic Development and Labour Council (Nedlac).

Mr Matsela described some of the challenges at this stage. There was no dedicated policy for housing co-operatives. There was a Housing Code that mentioned co-operatives, but there was no understanding from government officials as to what the nature of housing co-operatives were. At present, co-operatives were self regulatory, and so there was a need to bring municipalities and provincial offices of the Department of Human Settlements on board for proper regulation of  housing co-operatives. Currently, due to a lack of proper regulation and conflict resolution, disputes deteriorated to the extent that they often ended in the High Court. Previous promoters of housing co-operatives caused damage to the image of housing co-operatives, as illustrated by a particular example. The lack of understanding of housing co-operatives by government officials, with the result that co-operatives were not included in the budget, posed resource problems for co-operatives. They also then found it difficult to get assistance from banks or financiers without support from government. Although housing co-operatives were part of social housing, in the inner cities this was competing with the rental market and the sectional title market. Lack of legislation made it difficult to be reliable.

Mr Matsela noted that some co-operatives were involved in legal battles with the National Housing Finance Corporation. There were intermediary companies involved which were liquidated. The financing company wanted its money back and SAHCA was involved in trying to get the co-operatives to own up to their responsibilities and smooth the relationships. SAHCA would like to request the help of the Committee in this regard.

Mr Matsela added that there were attempts being made to coerce some of those entities that were involved in legal battles to convert to something other than housing co-operatives. SAHCA would like to avoid this by all means.

He noted that SAHCA wished to ask that the Portfolio Committee firstly document the challenges and establish a subcommittee to investigate the report. Secondly, he asked that it assist housing co-operatives to continue to operate in this way. Thirdly, he asked that the Committee engage the Department of Human Settlements (DHS) on the position of policies for co-operatives, and request that these be included in the financial planning. He asked that the Committee could perhaps visit co-operative projects already in existence, so that Members could see how these operated. He stressed that communities should be part of the housing solutions and co-operatives were an ideal vehicle for housing delivery that could be utilised by the Department.

Discussion
The Chairperson said that the Members who attended the Committee’s PC five year strategy meeting would recall the importance attached to the promotion of co-operatives. The Department had been asked, but could not answer the questions on what it was doing and how many co- operatives were established.

Ms T Gasebonwe ANC) asked whether there were any criteria for an individual to join a co-operative and in particular whether employment was a prerequisite and how those without an income could be accommodated.

Ms G Borman (ANC) asked how SACHA handled poor and unemployed members.

Mr Matsela said that there were two types of co-operatives, developmental and continuous. Developmental co-operatives could take on unemployed people, because government gave a subsidy, supplemented by “sweat equity” by the member, who would then be required to work as part of the construction team. The continuous model did not cater for unemployed people. In this case people had to be earning and they paid rent on a sliding scale, according what they could afford. The primary target market for SACHA was households with an income of R 3 500 and less. If a person earned R1 200 a month he could, for example, afford a 1 bedroom unit for R300 a month. A member who earned R 3 500 a month could afford a two bedroom unit for R700 a month. If a person become unemployed while part of the scheme, then the co-operative would look at ways to temporarily employ the person until she or he found another job.

Ms Gasebonwe asked how the movement dealt with the scarcity of land.

Ms Borman asked about the issue of land in urban settings. In informal settlements, availability of land was very tight. When there was development, some people had to be moved away and there was always resistance to this. In the cases that she was familiar with, the project was given to a development manager in the local municipality. She asked how SAHCA dealt with this in cities.

Mr. Matsela replied that with a co-operative the people would not resist moving, because they would have been part of the whole planning and decision making process.

Ms M Njobe (COPE) asked whether the Department had any policy for co-operatives and what its attitude was. If there was no policy, then she questioned how a government department could spend funds on something.

She noted that according to the statistics most of the programmes were concentrated in Gauteng. She asked the presenter to elaborate on programmes in other provinces of the country, since he had referred to SAHCA as a national body.

Mr Matsela said that SAHCA  promoted itself by making representations to the Heads of Department in Limpopo, Northwest and the Northern Cape , but there was no further engagement. SAHCA was working with the members on the ground, trying to open up more opportunities for them. He urged Members to pay visits to co-operative projects on the ground. He committed himself, together with the provincial chairperson of SAHCA to accompany them on such a visit, and said that Members would be able to interact with co-operative members living in the units acquired through the co-operative, and see the realities, rather than the theory.

Ms Njobe agreed that it would be a good idea to arrange visits, which would enable the Committee to make recommendations.

Ms Borman reflected positively on the idea of people working for houses instead of receiving them passively. She said that a current priority programme in the DHS was one to upgrade informal settlements. She had dealt with the Housing Federation, which was rendering a similar service as SACHA. She wanted to know whether SAHCA had a relationship with this body.

Mr Matsela noted that SAHCA was aware of the Housing Federation and the South African Homeless People`s Federation. Contracts entered into by co-operatives were binding and co-operatives could be sued. Members received share certificates and their units became assets which they owned and could use for collateral purposes. He reiterated that membership of co-operatives was primarily targeted at those earning R3 500 and less, but people earning up to R7 500 also could be members of co-operatives.

Ms Borman asked whether SAHCA had an office or whether the organisation was only now being established. She wanted to know who ran SACHA from day to day and what the people earned. She also thought that visits by Members to projects on the ground would be a good idea

Mr Matsela replied that the organisation was run by its members. The recruitment and training of members and office bearers took place from the offices of provincial chairpersons of SAHCA, which was basically their own homes. Because of the demand SACHA would have to establish properly structured offices in the provinces.


The Chairperson said that the presentation outlined Peoples Housing Project (PHP) programmes. It could be confused with social housing if the audience did not have a deeper understanding of the concept of co-operatives. The Department had, when presenting to the Committee, only put forward the rental model, without any mention of the co-operative model, whereas this report proved that there was a market currently for co-operatives.

The Chairperson added that South Africa had a Memorandum of Understanding (MOU) with the Scandinavian Countries around social housing. Cope Housing Association was formed as a result of that MOU. The Social Housing Foundation Accord was approved by the Cabinet in 1996. The Act that was passed in 2005 also allowed for housing co-operatives to exist and function. Since then, however, government had done nothing to promote co-operatives, and she felt that it was wrong to perpetuate rental housing instead of the co-operative system that built cohesive communities, although government had said that rents should be lower. Members of the Committee had not had sufficient insight into the nature of these schemes, and, during a visit to Eastern Cape in October 2009, was not aware of the 11 co-operative projects that existed there. In the Western Cape there were hostel upgrade and flat renovation co –operatives, which, once again, Members had not known about. She reiterated that she would like to know from the Department why it was stalling on formulating a policy on the co-operative system.  

Mr Matsela answered that the Memorandum of Understanding that the South African Government had with the Scandinavian countries included a commitment to promote co-operatives in the country. In recent communications with the Scandinavians it emerged that they still wanted to know what happened to the money that they gave to Cope Housing Association. That episode left the donor countries disgruntled and wary of organisations in this country. They needed an unambiguous commitment to accountability, before becoming involved again.

The Chairperson asked if there had been any problems around payment of water bills, insurance or rates by co-operatives.

Mr Matsela said that SAHCA was trying to engage with as many municipalities as possible, tried to work in all areas where it had members on the ground, and tried to demonstrate the models as clearly as possible, so that other provinces would be able to export models that were working correctly to their own provinces.

The Chairperson also advised Mr Matsela to intensify education campaigns for the municipalities on the ground regarding co-operatives.

The Chairperson said that government was talking about housing models, and was building cities and towns. There should be competition in the housing market, and she asked how this market would expand if only one model was promoted by government .She felt that government was running away from the competition. The co-operative system fell under the Social Housing Act. The Committee would have to deal with the issue.

The Chairperson asked what the difference was between the co-operative model and sectional title ownership.

Mr Matsela answered that sectional title meant that a person bought a unit in a complex. Each buyer acquired a bond individually for his or her share. There was no legal obligation on the owner to properly maintain his own unit. Often, units were bought and rented out. If the owners failed to maintain the complex, or did not pay municipal bills, all the people in the building could be evicted, irrespective of whether the individual had paid or not. In this case there was no security of tenure. If the person had a bond with a commercial bank, he would still be liable to pay his debt to the bank, although he did not occupy the property any more.

If the building was owned by the tenants in the form of a co-operative there would be security of tenure. At the moment the property market and ownership of property was still dominated by the white population. This co-operative model made it possible for other cultural groups to become part of the property market by owning buildings collectively.

Thus, he summarised, the main difference between the sectional title model and the co-operative model was that in the former, the person owned his own unit, whereas the latter was share-driven. The co-operative owned the whole building. Members took share certificates. When they left the co-operative, the co-operative would take back the certificate and the exiting member would get an exit payment. Sectional title, on the other hand, was financed by banks.

With Sectional Title, a Body Corporate managed the building. It charged a levy for cleaning and maintenance, and this often caused disputes. It worked well in the medium density areas, but in high-rise buildings in the inner cities it was problematic. Sectional title was profit driven. Management changed quickly and maintenance ran the risk of becoming neglected. Buildings became run down. In the case of a co-operative, there was a Board of Directors, elected by the members. They had to make sure that monies were collected and bills paid. At the end of the month, financial statements were circulated. If some members could not pay, the board of directors had to follow up and assist those who for some reason could not pay. The sense of community, or ubuntu, was one of the principles of the co-operative.

The Chairperson reminded Members that in the most recent State of the Nation Address, the President had said that the government would subsidise those households who earned too much to qualify for social housing, but too little to qualify for a bond from a commercial bank, so that they could buy a house. She asked how SAHCA responded to this .

The Chairperson also asked for comment on SAHCA’s position on youth employment and empowerment.

Mr Matsela noted that the youth who had matriculated, but did not have other job prospects, could be trained through ePHP to maintain the buildings that they lived in. The Youth would be trained by partner training institutions, through the EPWP to empower them as members of the co-op.

The Chairperson asked whether there was any relationship between SAHCA and the Housing Development Agency (HDA).

Mr Matsela said that the Department and SAHCA were already driving the processes, until the Social Housing Act had come into force, at which stage the Social Housing Foundation and the Department of Housing (as it was then named) stopped interacting with SAHCA. At present, there was not much of a relationship, because recently the HDA was requested to make a representation to Nedlac. Mr Matsela was also a convenor for the Community Constituency Forum for Nedlac. The presenter from the HDA had said to Nedlac that the Agency did not see how co-operatives could play any role in the Agency, and this had angered representatives from other community constituencies present. The HDA was given a particular task, but had not reported back to Nedlac as yet.

Mr R Bhoola (MF) noted that the HDA ,which had the express task of acquiring land for housing, did not collaborate on this issue with SAHCA, and this meant that it was not fulfilling its function. This assertion had the potential to open up a can of worms. SAHCA had to work with the HDA, who were in turn to make land available.

Mr Bhoola asked whether the relationship with the Department had not suffered because perhaps SAHCA had not yet got itself fully in order, and whether it was only now that it was doing so in the face of the emphasis on co-operatives.

Mr Bhoola wanted concrete facts regarding SACHA`s involvement in alleviating the hardship in informal settlements, in terms of delivering on housing

Mr Bhoola questioned the challenges were around willing buyer / willing seller. He wanted more information on the obstacles to acquiring land, and asked if SACHA was ever involved in expropriating land in its attempt to execute its programme.

Mr Bhoola noted that SACHA was essentially the overarching body for co-operatives, and he wondered what it would do in regard to continuous co-operatives. He also asked for further explanation on whether the municipalities would engage SACHA on its management services.

Mr Bhoola noted that not enough information had been given on the subsidy announced for those earning too little to otherwise be able to access bonds, and asked that details be given of how the subsidy money would filter into the process. He further referred to the Enhanced Extended Discount Benefit Scheme (EEDBS) which was passed by Government in 2004, and asked if SAHCA had looked into the apparent conflicts around debts being able to be registered, so that on disposal of the property, the debt must be paid.

Mr Matsela said that land scarcity was a challenge everywhere. He said that this, linked to the willing buyer/willing seller principle that Mr Bhoola had mentioned, was an issue that SAHCA was looking into. SAHCA was elated with the formation of the Housing Development Agency specifically for the issue of land availability. 1 000 members in Orange Farm were at the stage where they needed to raise funds to acquire land to start building their houses.

In 2009 a national task team, referred to as EPHP, which was tasked with the issue of Expanded Public Works Programmes (EPWP) within the housing sphere, was formed. One of its teams had to make sure that there was land made available. In most cases when members approached SAHCA they had land in mind. What was then important was to assist them in acquiring the land. At this point it was important to bring in the municipalities with their technical expertise to do environmental impact studies. It also needed to determine whether the land was feasible for housing construction. The national Task team on EPHP had the tasks of community mobilisation, land availability, development of manual documentation for capacity building and the raising of finances for housing. Its last meeting was held in July/ August 2009.

Ms Borman noted the references to the 2006 legislation, but said that there was also an Act of 1981 that covered the position. She enquired about the management of each of the co-operative and sectional title models. In both instances, an individual would pay for, and essentially own her or his own unit. In the case of a sectional title scheme, the Body Corporate paid rates and taxes, and in the case of a co-operative, it would perform this duty itself. There was now provision being made that each sectional title unit owner would be responsible for paying his or her own rates. She wondered if neglect, similar to that cited by Mr Matsela, could not also happen with the co-operative models.

Mr Matsela explained that the 2006 legislation was a continuation of that of 1981. Co-operatives had existed in South Africa since the 1930s, when they had received a great deal of government support at that stage. The 1981 Act was specifically designed for the agricultural sector, but, after 1984, based on experience of other countries, there were amendments, and the 2006 Act applied to banking and insurance and other co-operatives. Further amendments were to be made for housing co-operatives.

The Chairperson said that they as government took a shortcut because the co-operative option had more challenges than the rental housing option, but government should not shy away from challenges. Rental Social Housing legislation mentioned co-operatives, and they were clearly government policy. She said that this issue was very sensitive, because it had implications for other legislation. She expressed her disappointment that the Department had not sent a senior official to this meeting.

The Chairperson said that the international community regarded South Africa as irresponsible in some areas. She therefore asked who was responsible for monitoring the MOU and the money that came into the country. Co-operatives were feasible, but she wanted to know what could be done to make sure that they were promoted.

Mr Matsela felt that the task of monitoring of MOU was the role of Government.

Mr Matsela said that at the moment the property market was dominated by white business. Through the Property Charter Council in Nedlac, there was an attempt to transform the sector to open it up to other cultural groups, to the extent that black people were involved in developing big projects like shopping malls, and housing estates, and that was the focus of the engagement with Nedlac at the moment. There was a need for continuous involvement with municipalities. SAHCA required its members to attend the Integrated Planning meetings at the beginning of each year so that its agenda formed part of the planning and strategies of the local municipalities. He added that the Enhanced Extended Discount Benefit Scheme needed to be explored in meetings with the municipalities.

Mr Bhoola said that Ms Borman had raised an important aspect of body corporate and sectional title models. He noted that he had been confronted with challenges from communities in KwaZulu Natal. The EEDBS had been devised because pre-1994 government had wanted to dispose of the rental stock, and Ethekwini had followed this scheme. Mr Matsela had mentioned the challenges poor people faced in securing bonds. Under the current subsidy structure of government, some of these rental stocks and units were fully covered by a government subsidy. The decision makers in Durban transferred the property and registered the debt on the deed. Mr Bhoola questioned some of what had been presented, and what was in fact available, and wondered what SAHCA would ultimately achieve. He also thought that it was important that the Department be present so that it could hear what was being said.

A representative from the Department promised to convey the message to the Minister and Director General`s offices

Mr Matsela said that SAHCA had had meetings with the Durban municipality, but again very little mention was made about co-operatives. SACHA`s position would be to steer the process in a co-operative direction.

The Chairperson noted that this had been a fruitful meeting. This Committee would meet with the Portfolio Committee on Trade and Industry to discuss issues.

The Chairperson felt that the HDA had responded irresponsibly to NEDLAC about co-operatives. The Committee would communicate with the Department to come up with a strategy. She committed the Committee to visiting co-operatives in Cape Town and involve them in the planning process, and also to further engagement with SAHCA.

The meeting was adjourned.


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