National Housing Strategy: briefing by Minister

Meeting report

HOUSING PORTFOLIO COMMITTEE
9 September 2004
NATIONAL HOUSING STRATEGY: MINISTERIAL BRIEFING

Chairperson: Ms Z Kota (ANC)

Documents handed out:
Press Statement by Minister of Housing on the New Housing Plan
Department Media Briefing Kit
Department Media Release
Department presentation Part1
Department presentation Part2

SUMMARY
The Committee received a briefing on the recently drafted National Housing Strategy by the Minister of Housing and accompanying officials. A broad outline of the strategy was provided and information was disseminated on the N2 Corridor and District Six projects. The Minister proposed that a workshop be held in the near future to provide greater clarity on the specifics of the plan. Aspects of the plan such as the promotion of an integrated delivery system and the encouragement of non-racial human settlements were stressed. Most political parties expressed principled support for the strategy, but some reserved judgement until more specifics were made available to the Committee.

MINUTES

Minister's briefing
The Minister of Housing, Ms L Sisulu, introduced the recently drafted National Housing Strategy as a sound example of teamwork between the three spheres of government, namely, national, provincial and local. Due to the excessive amount of detail contained in the plan, it was recommended that the meeting focus on an overview of the strategy with greater detail to be provided at a workshop to be arranged in the near future. The present meeting would focus on a brief outline of the envisaged strategy and implementation programme, budgetary implications, legislative implications and a general overview. Information would also be provided on the N2 Corridor component of the project that served as a microcosm of the overall plan and planned activities within District 6. The Minister expressed dissatisfaction with a recent Sunday Times headline that painted an illogical impression of the proposed strategy and stated that discussions had been held with the Editor to address matters.

The plan had been devised following extensive research and consultation with a wide array of interested stakeholders and political parties. Input from Members of Parliament had been acquired during the recent Budget vote and various concerns had been noted. Provincial research had been conducted in seven provinces. Concerns had been separated into four categories: Demand, Supply, Funding and Implementation.

Wide consultation was held with banks, construction companies and other bodies capable of assisting in the overall implementation of the project. Numerous letters were also received from members of the public. Approximately 2,4 million households currently existed in informal settlements and 800 000 names were on the subsidy waiting list. The previous approach to subsidies had not been adequately meeting the demand that was growing at a disproportionate rate. Many smaller households were being created which increased the numbers and rapid urbanisation exacerbated the problem. Most of the financial resources tended to be spent on basic infrastructure resulting in sub-standard houses due to lack of funds. Little choice of house was offered and poor quality tended to be the norm.

The Government had enjoyed success in meeting the demand for housing with 1,6 million houses provided thus far. However, a new approach was needed to address demand. The government had also decided to focus on the intermediate income bracket (R3000 - R7000 per month) in order to assist in asset creation. The envisaged strategy centered on an integrated approach encouraging a partnership between key role players and was designed to provide sustainable human settlements. The emphasis would no longer be on simple housing provision but on the establishment of inclusive community areas containing improved transport, basic services, health, economic and other key facilities.

The current subsidy regime had been collapsed with those earning between R10 and R3500 per month receiving a subsidy of R25000. Recipients would be divided into three sections: the hard-core poor, the poor with some form of employment and lower earning professionals. It was hoped to attract financial institutions back into the lower earning market with government providing 50% of the required down payment. The government wanted to inculcate the notion of property as an asset capable of improving lives and creating economic opportunities.

A combined effort on the part of relevant government departments was proposed and the linking of different property markets was an overall objective. The Department of Housing would introduce a scholarship designed to create black estate agents. In order to promote wealth creation through property ownership, the time restriction on selling a subsidised house was to be reduced from eight to five years. This would "energise" the secondary market and reduce barriers within the overall property market. The strategy was to be driven by strong management from a central and co-ordinated point with accountability and responsible implementation. Municipalities would be accredited to assist in the process. A national implementation team was in place and an inter-Ministerial committee would oversee service delivery. Each Province would have two projects as part of the pilot stage with the entire plan to be underway by April 2005.

Cape Town Municipality briefing on Gateway project
Mr P Oscroft, project co-ordinator within the Cape Town Municipality, provided an account of the N2 corridor component of the plan which provided a sound microcosm of the overall strategy highlighting the interaction between the three spheres of government. Approximately 10 000 households within informal settlements were included in the plan. The idea was to reduce dwellings to 150 per hectare catering for 7000 people. The plan was premised on the linking of previously separated zones into more inclusive and functioning locations. District Six was to undergo a cultural regeneration and economic opportunities would be fostered around Epping and Airport Industria. Both sides of the N2 line would be linked allowing for more improved access to facilities such as education and transport. Certain areas where housing could not be developed could be used for agricultural production and sporting facilities. Single individual ownership would be encouraged.

Department briefing on District Six Project
Ms M Nxumalo, Director-General of the Department of Housing, provided an account of the District Six component of the plan indicating a desire to link the area with the overall N2 project. Emphasis would be placed on residential, recreational and economic facilities with inner-city regeneration of paramount importance. District Six had the potential to serve as a prime example of a sustainable, non-racial settlement.

Discussion

The Chairperson invited Members to interact with the Minister and raise questions and comments.

Rev M Khumalo (ACDP) expressed satisfaction with the plan as it provides much hope to the poor and unemployed. The N2 project was particularly exciting as the informal settlements along the highway remained a key concern and had to be addressed. The creation of non-racial, integrated communities was important and further clarity was needed during the workshop phase to clearly determine the envisaged process to be followed in achieving this objective. The proposed paradigm shift in encouraging the notion of houses as assets was welcomed.

Mr A Steyn (DA) stated that the proposed plan appeared to capture most aspects but a concern lay in how priorities were to be determined. The myriad of problems demanded a system of prioritising in order to create a realistic strategy. Many of those on waiting lists did not fall within informal settlements and the apparent combining of the hard-core poor and rental stock did not seem appropriate as the poor did not qualify in most instances for rental opportunities. This disparity between the poor and rental opportunities was most visible in the Gateway project as the majority of residents in the N2 location were clearly poor.

Mr B Dhlamini (IFP) supported the plan although a complaint was raised around the distribution of the details of the strategy as Members would have appreciated the details earlier in order to devise substantive responses. The idea that choice and quality could be simultaneously offered was questioned. The shift from housing to sustainable settlements was welcomed as was the notion of property as an asset. The plan to transform the hostel situation was of particular interest but the Member proposed self-contained units as a more appropriate term than family units.

The Mayor of Cape Town welcomed the idea of accreditation of municipalities as this would assist in the fast-tracking of delivery. The plan would also assist those not classified as squatters as this section of the population was not the only one in need. The Cape Town municipality had been involved in promoting integrated communities for some time with much success. People were moving into areas where previously they had not been resident. The plan would not be biased towards rental stock as choice was a primary part of the project and not only informal settlement dwellers would be targeted for assistance.

The Minister agreed that the term "self-contained units" appeared appropriate to describe the archaic hostel system. Reference was made to the unavailability of details pertaining to the housing strategy and the slowness of provision. Information was released to the media as the plan had been cleared by the Cabinet and needed to be made public. A meeting with the Committee could not have been arranged before the press conference. The Democratic Alliance's support of the project was welcomed and the Mayor's emphasis on integration was important. Choices had to be provided to all people in different social circumstances. Hard-core poor were pensioners, the disabled and the indigent. The ACDP's appreciation of the creation of non-racial settlements was noted.

Mr G Schneemann (ANC) claimed that the strategy presented by the Minister indicated willingness on the part of Government to listen to the demands of people and devise meaningful plans to address the concerns. The Government was not only interested in policy-making but also in delivery.

The Minister acknowledged the support of the media in helping to publicise the details of the plan to the wider community. Big business had been approached by representatives of the Department to discuss opportunities for collaboration in various aspects of the strategy such as the upgrading of facilities. The plan was to be conducted in accordance with the principle of social partnerships and any participation would be encouraged. The provision of housing was regarded as a catalyst to change the economic face of South Africa.

The meeting was adjourned.