SPEECH BY LN SISULU, MINISTER OF HOUSING AT THE OCCASION OF THE LAUNCH OF THE N2 GATEWAY

Premier Rasool,
Prof Adedeji and Members of the African Peer Review Mechanism,
Ministers and Deputy Ministers,
Members of the Executive Council,
Distinguished guests,
Ladies and Gentlemen,
All Protocol observed.  

I am sorry that the Deputy President is not here – here in her capacity as a Member of Parliament that had been deployed in this area, because she forms part of a team whose pioneering work gave rise to this project.  I am glad, however, that we have most of the others we would want to give tribute to: The Premier of the Western Cape, Mr Ebrahim Rasool, Deputy Minister of Provincial and Local Government, Ms Nomatyala Hangana, MEC Marius Fransman, former Mayor Nomaindia Mfeketo and Ms Zoe Kota, Chairperson of the Parliamentary Portfolio Committee on Housing would share our sense of achievement today. 

          I am reliably informed that around the middle of 2003, both the former MEC for Housing, Nomatyala Hangana and the former Mayor of Cape Town, Nomaindia Mfeketo, seemed to have found a solution to a somewhat intractable problem of what to do with the crisis situation of the informal settlements and in particular this site, which, you will all agree, did tend to thrust itself in your face as you as you drive to and from the airport and where, for some inexplicable reason, there will always be the highest number of fires.  It cried out for immediate intervention. 

          When the two politicians had put their heads together, given the necessary energy and support by the Deputy President, then the MP for Gugulethu and Ms Zoe Kota, MP for Langa, the idea was formalized.  And like true politicians, they quickly realised that without the necessary buy-in from the National Department of Housing, the project would not succeed.  My predecessor, Minister Brigitte Mabandla was roped into this and by all accounts, some rudimentary agreement was reached on the necessity to prioritise this site.  Thus, the power of women was harnessed. 

          Ms Mfeketo continued to nurture this threesome agreement until the essential energy of youth arrived.  Enters the dramatic personae of our former MEC for Housing and Local Government, Mr Marius Fransman.  He stopped at nothing to ensure that the concept bore fruit.  Between himself and Ms Mfeketo, I was cornered and threatened with the kind of threats that can only come from the Western Cape, to accept the project or else … 

          They did not need to hold the gun to my head for too long, because very quickly I was convinced of the correctness of their approach and together we managed to convince all the other MECs that this was a project worthy of all our patronage.  I will proceed to explain why we were all finally convinced and are still passionately obligated and tied to this project. 

          But before we proceed to that, we need to ensure that we have properly acknowledged those who have played a vital role to bringing us to this point: 

Nomatyala, Indi and Brigitte – Thank you for the idea, a noble concept.
Indi, Marius and Leonard Ramatlakane – Thank you for creating the conceptual framework for the N2 gateway.
Premier Rasool, Indi and Marius – Thank you for the political environment that made this possible.
Zoe Kota and Mcebisi Skwatsha – Thank you for your support of the N2 gateway.
Indi – Thank you for being the driving force of that which the people of Langa are now about to enjoy.  Today you stand vilified for taking the path less traveled, to ensure the poorest of us are provided for.  But your work here speaks for itself and none can erase it from our history.  Madiba taught us to acknowledge those contributions that has been made by others to get us where we are.  It does not take anything away from us, it only makes is so much better people. 

MEC Dyantyi and all my MECs – today South Africa knows that Housing has achieved its highest point on the long road we set ourselves when we adopted the new approach of Human settlements.
The Community of Langa – thank you for bearing with us, you will not regret your faith in us Sitembeni, Sithembekile soze sinilahlekise. 

And now, the rest of you who have been wondering why Cape Town, why the N2.

Historians and urban analysts agree that Cape Town was the first city in South Africa to bear the brunt of physical segregation of residential areas.  It ranks highest as the most segregated city in this country.  The dissimilarity index between black and white ten years ago was 95%.  I doubt that it has changed much.  Of all our cities, Cape Town still remains the most untransformed and inequitable city.

Our slums in the City are the starkest manifestation of our grotesquely divided and unequal society. Cape Town is said to a ‘world-class competitive’ city, but it is also known as the ‘Shack Capital of South Africa’. With a current housing backlog of over 245,000 – and 16,000 new households requiring housing each year – the delivery rate of only 11,000 per annum spells a bleak future for the city’s poor.

What carries on to render the situation and will carry on rendering the situation worse if not fixed in Cape Town is not only the City’s inability to articulate, champion and drive a coherent programme of action to address these problems and dilemmas, but its under-estimation of the depth of the crisis and the sheer magnitude of need.

Employing, the Census figures of 2001 of informally housed families, the backlog is estimated at 142,983. Assuming that 30% of the 16,000 new households will resort to living in informal settlements and factoring in the delivery targets, the number living in shacks by 2006/7 will roughly be 163,610. This paints a clear picture that without radical intervention, housing conditions are set to worsen in our city (a growing backlog) and informal settlements will balloon.

The capabilities and capacities of the City to cope with these challenges will further be rendered more dreadful given that local government is a poorly defined actor in the shelter sector. A further factor complicating an integrated inter-spherical resolution of Cape Town’s housing crisis is that our co-operative governance regime is well-developed as a set of political and financial relationships, but relatively under-developed in specific policy/programmatic areas. This insight holds true for local economic development, urban renewal, integrated development planning and housing.

It is in response to these realities that we, all of us here, were in total agreement; if we were to reverse apartheid spatial planning, we have to start here; here where the two worlds we had become must come together to symbolize how far we have come.    

Subsequent policy developments, refinement of programmes and instruments elevated the status of the informal settlements to a pilot project. N2 Gateway project, a lead project - ratified by Cabinet - to test the efficacy and appropriateness of the Department of Housing’s new shelter plan, came about, prioritizing the areas here in Cape Town, that suffer acute shelter and income poverty; very depressed income levels; extremely low education levels; unemployment that is three times higher than in the rest of the Western Cape; and poor access to adequate water, sanitation and energy, although slowly improving. 

In our attempts in the past to upgrade informal settlements, we inadvertently exacerbated spatial marginalisation.  For, informal settlements will always establish themselves in the most marginalized areas.  This site gave us the perfect opportunity, not only to upgrade informal settlements, but at once ensure that we can integrate communities. 

The N2 corridor provides us with the opportunity to address a whole range of injustices of the past, starting with the disinherited communities of District 6, now recently …; to the dislocated backyarders who have waited for years for an opportunity to own a house; to the informal settlers of this area who took the decision to clear the bush and put up their shacks; to the community of Netreg, who fought for the right to decent housing; right through New Rest, Boys Town and to Delft. 

An ambitious project by any account, but one which, when done, will have marked the first real reversal of apartheid spatial patterns in that city which has borne the scars of these deep divisions. 

It is with confidence that today we have come together, 15 months after the commencement of the project, to witness an official hand over of the completed units. For the first phase, a total of 705 rental units have been completed and ready for occupation whilst minor works relative to internal roads and paving are currently being undertaken. While allocation of these units has caught an eye, I must ashore our communities and stakeholders that the allocation of the units is being done in line with the independent database provided reviewed by independent auditors. The principles of allocation therefore remain in line with the original project business plan, i.e. 30% backyard renters and 70% from neighbouring communities.  

Phase two of the project will roll out as soon as possible. Accordingly, residents of the remainder of Joe Slovo are being accommodated in temporary relocation areas in order that we may continue building on the site. The intention is to construct 700 fully subsidised housing units and 300 bondable housing units. Infrastructure installation is in progress at Newrest where 16 show houses have been constructed already. Extensive work has been done in Delft where township establishment is in progress and land rehabilitation is completed at Delft Symphony. Infrastructure to 2200 stands is nearing completion on which the units will be constructed. The Delft Sewer is under construction. The total amount spent to date is R313,8 million with work in progress to the value of R112 million. 

As Booker, T. Washington once said

“… Success is to be measured not so much by the position that one has reached in life, but by the obstacles which one has overcome while trying to succeed” 

The successes we have achieved through the N2 Gateway project should be measured against these challenges and obstacles, worsened by the obstacle of an unfortunate political environment and, the even more unfortunate media coverage. Our success today should be measured by not where we are, but by the significance of where we are. The most important thing is that we have started and given hope to many.  They too will soon benefit.  This is just the beginning, happening on such an auspicious day! I can confirm that the implementation of the nine pilot projects including more especially the N2 Gateway project have developed tremendous lessons which we embrace and learn from as government towards scaling up delivery and sharpening our responses.  

I would like to acknowledge with regret therefore that maybe some of the beneficiaries might not be able to afford the minimal rental required for the units. In this regard, I need to affirm our commitment once again that our poorest of the poor are our priority, they are to benefit as part of phase two.  

Let me spend a minute dealing with the framework in which we have considered the rents that will be established, not only for this project, but for all projects which will be subsidised by government within the social housing policy.  Firstly we need to understand that for us to roll out the lessons of this pilot scheme, we have to find a model that is sustainable over the 55 000 units my department will support over the next few years.  That means we have to deal with the capital cost, the finance charges, maintenance costs, and the running costs.  Running costs include such things as caretakers, cleaning and security.  In addition, there would be costs imposed by the local authority related to water, electricity, sewerage and rates.  In principle my department, and indeed government as a whole, works on the basis that these actual costs need to be calculated.  Once they have, and a sustainable economic rent is established, then various subsidy schemes would kick in to support those in need.  These schemes operate on the basis that poor beneficiaries would get a higher proportion of the subsidy than their economically more fortunate neighbours.  Mixed income communities are indeed a feature of social housing, firstly so that the better off can subsidise poorer families, and secondly so that we do not create ghettos of poverty.  Government subsidies operate in relation to capital costs, and the various municipal services such as water and electricity.  Other costs are covered by the tenants themselves.  On balance however, the combination of government subsidies and the contribution of people themselves  will ensure that the poor can benefit from relatively expensive projects such as the N2.  

Having said this, the N2 Gateway project has presented an opportunity for us to learn more about the successes and the failures in the creation of the sustainable communities. It became a platform to create partners for the housing sector. In this connection I would like express my ultimate gratitude to the development partners from all sectors who have supported this development tirelessly throughout the way. I am still convinced that there is a commitment from all of us to work together towards achieving the set targets.  

It is, more especially that we still are able to expand our partnership and collaboration and attract new partners that bring various support to this enormous challenge. It is with pride and honour that our partnership with First National Bank has once again been cemented.  It is also with a great deal of gratitude that we accept our new partner, the “Priory for South Africa of the Order of St John”, under the leadership of the General Secretary of the All Africa Conference of Churches, Bishop Mvume Dandala. The “Most Vulnerable Order” is bringing in health facilities and services to the partnership.  

The response and support from South Africans to the call for collaboration has not only made me proud of being the Minster of Housing, but also being a South African. 

Our dear friend and philantropist, St Irishman Niall Mellon has once again come to our rescue.  He has responded to our challenge for him to come and help us build on the N2 Gateway.  He has started at Netreg, helping the residents there to build 195 houses and progress is now visible on that project.  He has further committed to donating 5 000 subsidy houses on the N2. 

We have even had the singular honour to be given pro bono legal councel by the Chief State Law Adviser, at his own spare time and at a very difficult time from him.  Apart from the legal services we contracted, our every decision has been scrutinised for its legal basis. 

The completion of the 705 Units presents the end product of commitment by the following partners that I am also deeply humbled to acknowledge. Without these stakeholders this work would not have been successful. These include: my colleagues in government; the private sector including the banks, the civil society and NGOs, and the community of Cape Town etc. 

Ladies and gentlemen, I invite you to join me as I officially handover the first phase development of the N2 Gateway project. 

I thank you.