DEPARTMENT OF HOUSING ANNOUNCES THE ESTABLISHMENT OF HOUSING DEVELOPMENT AGENCY

The South African Department of Housing is the latest to look outside of itself for solutions to meet their deadline for delivery. Minister of Housing Lindiwe Sisulu recently announced the planned establishment of a Housing Development Agency (HDA), which would help and not replace existing mechanisms for housing delivery.

The department aims to double delivery in the next two years from the current 250 000 annual delivery of houses to 500 000. The effort is estimated to cost the department R345 bn by 2014.

The decline and the roll-overs from 2001 in housing delivery have been attributed to the withdrawal of large construction companies from low-cost housing. It identified that a significant factor too had been slowness in the ‘identification, acquisition, assembly and release of state-owned and private land in terms of the revised procurement framework’. It indicated further ‘Capacity constraints’ in ‘all spheres of government’ but especially at ‘local government level’ in facilitating housing delivery.

The agency’s main tasks would be to develop, manage and coordinate the development of housing nationally. The theory behind the agency is that it would aid with minimizing red tape in the approval of developments by both government and the private sector which have been known to take as long as three years, before developers can lay the first brick.

The model has been described to be similar to the Department of Transport’s National Road Agency and the Malaysian Syarikat Perumahan Negara Berhad (SPNB), which are state owned companies that complement provincial and local government structures.

“There are several aspects of the Comprehensive Plan which require a quick decision making body which is able to meet the needs of a dynamic and changing residential housing market.  The role of land acquisition, holding costs once land has been acquired, ensuring that developments are fully integrated and ensuring that the right land is identified, are all aspects which can be administered by an agency. 

“It is anticipated that the Agency would identify land in suitable areas and purchase it for residential development.  It would also be responsible for holding the land and paying for municipal service charges until such time as the land is developed and transferred.  The agency would work closely with the provinces and municipalities in which the land is situated. The Agency would also negotiate with developers to ensure that the development meets the needs of the community and to enforce the 80/20 principle or whatever is agreed upon to ensure that the lower end of the market is catered for in each development. The department is currently engaging with Sapoa which represents most of SA’s developers on a policy of inclusionary housing. The agency would ensure that the principle of inclusionary housing is adhered to in the developments.

“The Agency would be situated within the Department which would have a dedicated secretariat to undertake the administrative work and to support the management of the Agency whatever form it may take.  Turn around times would be greatly reduced leading to greater efficiency and reduction of project completion times.  This is particularly important when considering undertakings by government to eliminate informal settlements.  It should be noted that the Agency would also work not only with ownership developments but also with, for example, social housing developments,” said Minister.

Minister Sisulu said from the Breaking New Ground document of 2004 it had become crucial for the Department of Housing to investigate ways in which to improve both the delivery of housing as well as the product of housing delivery, namely, the environment in which houses are built and the quality of the houses themselves. 

Several commentators have pointed out that there have been little improvements since 1994, apart from the sheer number of houses built, in the delivery of houses to the poor and marginalized citizens of South Africa. 

“A large percentage of the houses built since 1994 have been built on the outskirts of urban areas away from work opportunities, schools, clinics and community facilities, in effect perpetuating apartheid principles of housing such citizens on the periphery of towns and cities.  Apart from the lack of facilities, the beneficiaries of state subsidized houses have had to put aside a large portion of their monthly income on transport costs which further reduces their ability to pay for municipal services.

“The agency would then have to identify and facilitate the purchase of unutilised state land that is within the amenities that people were seeking, and develop units that range from low and middle income houses.

“They would also ensure the development of stock for low rental options for people wishing to reside in cities. If all processes are completed on cabinet level we aim to have the agency up and running this year.” said Minister Sisulu.

Author: Xolile Bhengu

Edited: Ndivhuwo Mabaya

For more information contact: Monwabisi Maclean on 082 88 22 962

                                                      Chief Director Communications

                                                      National Department of Housing