Few, if any, noticed that as it closed in June the ANC National Policy Conference adopted a resolution calling for a consideration of ‘A once off injection of resources’. This was to support an ‘extraordinary effort’ to enable a rapid delivery of housing. The background to the call was a realisation that despite an impressive delivery since 1994 of 2,3 million subsidised housing units the state had as yet to irreversibly and tangibly beat the historical backlog now standing at approximately 2,4 million units. To be sure, in the 2005/6 financial year government succeeded to reverse a decline in housing delivery rates when 217 348 units were delivered against the previous year’s 193 615. Upward delivery trends that became consistent since the time were demonstrated in the actual delivery of 270 00 units for the 2006/7 financial year. All of this being due to a strategy adopted at the end of 2004 that is premised on ups-calling.

Having an adopted strategy, however lauded for both its being quite comprehensive and ambitious as the Breaking New Ground strategy is, does not necessarily translate into the achievement of the goals set. Massive which implies additional resources must be linked to the success of the adopted strategy.

The professional services company, KPMG, last year handed over to the Department of Housing a report estimating the costs of the Breaking New Ground strategy. This highlighted a shortfall of R168 billion by 2016 were a massive allocation of resources not realized. A bulk of the cost of R162 billion is for the implementation of the informal settlement upgrading program, which is a key instrument in the strategy. Being the biggest it targets the eradication of all informal settlements by 2014, a goal the KPMG report highlights could be achieved even a year earlier were all the potential resources to be committed and delivery is in accordance with capacity.

The achievement of the goal carries the potential to ward off threats of increasing violent unrests over service delivery in urban areas. Eradicating informal settlements however also holds out what could become a significant revolutionary achievement in South Africa’s management of the urban environment. For first, the reach of poverty alleviation programs would become much more clearer. In aiming to change spatial settlement patterns that have remained strong even under democracy the informal settlement programme will enable access to well-lo cated land and a variety of social amenities and infrastructure. This will enable an integration process that will result in quick gains. Health facilities including schools will be brought closer to an integrated community whose members would subsidize each other for the required services. Second, the efforts of individuals for significant self-employment and entrepreneurship would receive support since improvements in the living conditions and infrastructure will, as anticipated by the Breaking New Ground strategy, result in an injection of private  investment.

With an urbanized population of 56.25% recorded in 2001 and having 5,8 million people below the minimum living level in the major economic centres to achieve the ambitious goals of the strategy is the only option. Indeed, as it is being implemented, it promises not only to help curb increasing social unrest over claims of lack of service delivery but can also save the state massive amounts of funds that a delayed effort implies. Consider in this regard the impact that spiralling construction costs which are inclusive of labour will have on the state’s housing roll-out programme by 2016 as companies chase after more and more profits thereby dwarfing whatever yearly increases there are on housing. This, in fact, is already evident. Where, for example, building material prices rose by 143% between 1998 and February 2005, notwithstanding inflation, the housing subsidy rose by just under 50%. And there is to be more pressure on it as more than 1,775 million new qualifiers for housing subsidy were added following the extension made to also cover those earning below R7 000.

Considerations of injecting more resources into housing have of course to be guided by what is realistic and available. Currently, a national budget surplus of 0.3% exists. It is due to a sustained higher revenue collection and good management of public finances and is expected to grow to 0.6 percent in 2007/08. In comparison with other developing countries that face as much as the same challenge in housing as ourselves but have to depend on aid to meet the challenge there are immediately available resources to make use of. That the call is for a ‘once off injection’ addresses concerns relating to continued good management of macro-economic policy and is being realistic to what is achievable. The latter relates not only to actual delivery but also to the management of what would be a complex undertaking requiring daily monitoring and evaluation. Experimentation with the N2 National Project on up-scaling had revealed that private sector induced delays can happen. Yet the project showed that it is possible to up-scale despite missing set targets. It also showed that with increased resources bigger companies could be lured back into low-cost housing and deliver a superior product to what low-cost housing has to date been used to. Furthermore, the 2007 Women’s Build which constructed 25 houses within two weeks on the project, in New Rest, highlighted the potential to mobilize community members as up-scaling occurs. Then there is the role of banks and other private sector partners who responded well to the unfolding implementation of the Breaking New Ground strategy.

There is undoubtedly a newly created moment in South Africa’s housing landscape and environment. The ANC recognised it and used the opportunity of its National Policy Conference to emphasise the strategic importance of housing in our evolving democracy. It rightly placed housing on its list of its political, social and economic priorities for the coming ten years. It may well turn out to have been the best ever political decision made by the National Policy Conference for South Africa’s urban environment. 

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Thembinkosi Lehloesa is Head: Secretariat for the African Ministerial Conference on Housing and Urban Development (AMCHUD). These are his personal views.