delivery
Tebello Radebe
Private developers look set to be next in line for criticism over slow housing delivery. So far, the government and the banks have borne the brunt of most of the attacks.
A report by the Centre for Policy Studies (CPS), the focus of a housing workshop in Johannesburg next week, recommends that the government policy shift away from “developer-driven” housing delivery towards a more “people-centred housing delivery process”.
The study, conducted by senior research consultant Mary Tomlinson, contradicts many beliefs held by state policy-makers and others by stating:
l Contrary to popular opinion, people are dissatisfied, not because they do not get the conventional “four-roomed” house; rather they feel they are not able to obtain maximum value for their R15 000 state subsidies.
l Given a choice, people would have preferred to have purchased their own building materials with, say, a housing voucher, to build.
l Developers have failed to “negotiate proper” social compacts with communities, contradicting the general view that negotiations have been held up by talks with “unrepresentative leaders”.
Among the most startling findings of the study is that most beneficiaries have never heard of “social compacts” — a key requirement of the government housing subsidy scheme designed to ensure community participation in housing projects.
“Therefore problems do not lie with a needless insistence on involving beneficiaries in decisions, but with a failure to follow this approach vigorously enough,” says the study.
Mpumalanga Provincial Housing Board chairman Saths Moodley told the Mail & Guardian that if four of the top developers awarded the bulk of the housing projects in the province had been on target, “we could be showing a higher delivery rate”. Mpumalanga leads all the other provinces with the fastest delivery.
One of the developers, the New Housing Company (Newco) had to deliver more than 8 000 houses and has managed only 2 204 to date. Significantly, 1 906 of these houses fall within the R15 000 subsidy limit and therefore go to people who cannot afford housing credit.
Deon Sutherland, Newco director responsible for Mpumalanga, admitted that the rate of delivery has been slow, but “was confident that his company will be able to deliver more houses now”.
Sutherland warned that delivery delays pushed up costs owing to materials and interest hikes on holding costs. He estimated interest on holding costs for Newco Mpumalanga at about R1,8-million a year. Material costs were rising at the rate of one percentage point a month and electricals at 16% annually.
These hikes are ultimately paid by the beneficiary; otherwise, the overall value of what can be built for the R15 000 subsidy is reduced, he said.
Sutherland pointed out that the social compact concept served a useful purpose during the apartheid era — to ensure housing delivery was not a top- down process and that it was legitimate.
Many social compact processes now delay delivery because some people use them as platforms to pursue other agendas, he charged.
Social compacts need change from being dominated by “community representatives” to being forums for the beneficiaries. He said the recently elected local authorities served the roles of community representatives adequately.
Mawela said: “Social compacts do not work well in all areas. There are also administrative problems such as delays in conveyancing and deeds registration, as well as the different prices developers have to pay to obtain land, which influence the ultimate product that can be delivered and also at which time.”
Mawela was emphatic that private developers were essential to the housing process. “Just imagine what would happen if people just took money from the government to do their own thing. How would you ensure that the money really gets used for housing?”