Rental Housing Bill: discussion

Meeting report

HOUSING PORTFOLIO COMMITTEE
31 August 1999
RENTAL HOUSING BILL (B29-99): BRIEFING

 

Documents handed out
Rental Housing Bill
Draft of the Programme for 1999

 

SUMMARY
In her briefing on the Rental Housing Bil , the Director-General touched on the background and aims of the Bill, the response received from the public and the outline of the different chapters of the Bill.

 

MINUTES
The Director-General of the Department of Housing, Ms M Z Nxumalo-Nhlapo, indicated that the Rental Control Act had not reduced the demand for housing. The demand for housing resulted in the Department drafting the Rental Housing Bill Public comment was soliticed in September 1998. Sixty submissions and a number of responses from the public had been received. The final draft of the Bill was submitted to parliament at the beginning of 1999.

The Director-General outlined the aims of the Bill as follows:
to address the concern of non-payment among tenants,
to encourage private investment,
to empower tenants to challenge irresponsible landlords,
to make provision for the clarification of the roles, duties and responsibilities of each party to the lease agreement.

The Director-General explained that Chapter One outlines the definitions. Chapter Two states what is the responsibility of government in promoting the housing rental market and it empowers local and the provincial government to take measures to pursue this responsibility. It also provides for the Minister to introduce a rental subsidy programme and it empowers Parliament to appropriate money to finance this programme.

Chapter Three deals with relations between tenant and landlord. It stipulates that the landlord may not discriminate on certain specified grounds. The chapter also lists the different rights of the tenant and the landlord. It allows that the lease contract need not be in writing but where the tenant requests this, the landlord is obliged to produce it in writing. The landlord is obliged to give the tenant a receipt of any payment he has made. The chapter requires the landlord to invest any deposit received from a tenant into an interest-bearing account. Such deposit and the interest must be paid back to the tenant after the deduction of any damage made to the property by the tenant.

Chapter Four grants the MEC the power to establish the Rental Housing Tribunal and it also set out the composition and the functions of the Tribunal. It empowers the MEC to appoint the members of the Tribunal. It also empowers the local authorities to establish the Rental Housing Information Office and stipulates the functions of such an institution.

Chapter Five deals with offences and penalties which may be imposed on someone who contravenes the provisions of this Bill. It provides that the decision of the Tribunal may be reviewed by the High Court and it repeals and saves certain provisions of the Rent Control Act.

Questions from the committee members

Mr T Lee ( DP): Will copies of Rent Control Act be made available to the committee? Will the Director-General (D-G) tell us the effect the Bill will have on the municipalities and what is their role?

Director-General: Copies of the Act will be made available to members. Consultation included the municipalities and they participated. Local government will play a role in establishing the Rental Housing Information Offices. Local government will be the first tier in resolving the disputes and it is also the first area in getting information about the rights and the obligations of the parties. On the other hand local government may play the role of the landlord where their properties are leased.

Unidentified committee member: Could you give a clarification about the Tribunal. If the Tribunal operates in provinces where there are thousands of landlords, will everybody be expected to come to a central place? Are the leases going to be normal leases? Who will pay for the leases?

Director-General: The Tribunal will operate on the provincial level. The provinces will pay for the administrative staff of the Tribunal. The meetings of the Tribunal will be held under Section ten of the Bill. Local government will provide the venue. The lease will be a legal document and it will be the responsibility of the landlord to pay for it. The Bill also caters for unwritten leases.

Unidentified committee member: Will the provinces be able to deal with the funding and introduction of the Rental Housing Tribunal?

Director-General: The demand for housing is not same in different provinces. That is the reason why we would not like to impose the same standard regarding the introduction of a Tribunal. Every province should be allowed to decide whether to introduce a Tribunal.

Response of the Chairperson: The NCOP is the proper forum to consider the interests of the provinces.

Unidentified committee member: Will the Bill apply as soon as it is enacted?

Director-General: The provision of this Bill will apply as soon as the Bill is enacted. It will apply to renewed leases. This Bill will not apply retrospectively.

Unidentified committee member: Is the tenant entitled to be informed where the landlord has invested the tenant's deposit.

Director-General: If the landlord chooses not to invest the deposit then he owes the tenant a deposit plus the interest. The landlord is not obliged to inform the tenant where he invested the deposit but landlords normally establish a trust account to invest these monies.

Unidentified committee member: What would be the role of the landlord in the event that his leased property is used as the instrument of crime?

Director-General: The above situation has not been catered for in this Rental Housing Bill. The landlord will have the power to report the matter to the Tribunal and then the Tribunal resolves it. But under certain circumstances it would be appropriate for the landlord to report it to the police.

Mr B Douglas (IFP): The power to appoint the members of the Tribunal vests with the MEC. Is there any way the MEC may be prevented from appointing "politically correct members"? The outcome of the Tribunal can be deemed as an order of the magistrate court. Does that mean a person can institute action in court again?

Director-General: The MEC will hire the members of the tribunal on the basis that they are competent. The members should have expertise either in property management or in consumer matters. Political affiliation is not prescribed in this Bill as a requirement and the process of the tribunal is an open process involving mediation and negotiation. The Tribunal is not intended to replace ordinary courts. The tribunal idea was developed with the view that tribunals avoid lengthy, costly proceedings. What had been learnt is that tenants and landlords do not want to resolve their disputes by engaging in lengthy, costly court proceedings. The whole idea of tribunals is to get a speedily resolution and most of the lease disputes do not involve legal questions.

Mr W Skhosana (ANC): Section 9(6) provides that in the absence of the chairperson, the meeting of the Tribunal must among themselves designate one to be a chairperson subject to the approval of the MEC. Why does the Bill not omit the requirement that the designation should be approved by the MEC?

Director-General: It is important that the responsibility should vest in the MEC because the Tribunal will be funded from money appropriated from the province therefore the MEC has to be accountable.

As there were no further questions the meeting was adjourned.

 

Appendix 1: Draft of the Programme for 1999

PORTFOLIO COMMITTEE ON HOUSING

PROVISIONAL PROGRAMME FOR 1999

31/08 Briefing on: Rental Housing Bill [B 29-99] - Department of Housing

01/09 Deliberation on: Rental Housing Bill [B 29-99] - Department of Housing

07/09 Deliberation on: Rental Housing Bill [B 29-99] - Department of Housing

14/09 Briefing on: Acts passed on Housing matters - Department of Housing

21/09 Deliberation on: Rental Housing Bill [B 29-99] - Public Hearing

19/10 Deliberation on: Rental Housing Bill [B 29-99] - Finalise

26/10 Briefing on: Role of Housing lnstitutions - Servcon, Nurcha & NHFC

02/11 Briefing on: Women in Housing - Housing Department: People's Housing Process

16/11 Briefing on: Housing Delivery in the Inner City - Department of Housing

23/11 Provincial Visits: Gauteng / Western Cape

30/11 Briefing on: Incidence of corruption in Housing Dev. - Department of Housing

 

Please note that this is a provisional programme. Should you have any suggestions to enrich the programme bring them to the attention of the Committee.