Western Cape Government and Private Sector Collaborate To Provide Housing

STATEMENT BY MINISTERS BONGINKOSI MADIKIZELA AND ALAN WINDE
WESTERN CAPE MINISTRIES OF HUMAN SETTLEMENTS AND ECONOMIC OPPORTUNITIES
Date: 25 APRIL 2017

Release: immediate

Western Cape Government and Private Sector collaborate to provide housing opportunities for employees

The Western Cape Government and Private Sector will explore new partnerships to finance housing for workers in the GAP Market - those who earn too much to qualify for a free house, but too little to get a bond.

This was the outcome of a Partnership Summit in Stellenbosch yesterday, convened by the Western Cape Departments of Human Settlements Minister, Bonginkosi Madikizela and Economic Opportunities Minister, Alan Winde, together with key stakeholders in the private sector.

The summit promoted sustainable partnerships with a wide cross section of key stakeholders (private sector and financial institutions) in order to support and achieve the Human Settlements Mandate. This is in line with the provincial Human Settlements Department’s Partnership Strategy.

Human Settlements Minister Bonginkosi Madikizela thanked all partners who responded to the call to engage at the summit. He assured the partners that the summit was not just a “talk shop” and would lead to the creation of housing opportunities for the GAP market.

“We are facing serious challenges when it comes to Human Settlements in South Africa. The government has done a lot over the last 23 years, building homes for the most needy, but I think the challenge facing us now as a country is that a paradigm shift is needed. The government cannot continue to give houses for free,” said Minister Madikizela.

He added: “The national housing backlog is about 2,3 million households. We as government raised expectations that if you need a house, register and we will give you a free house. The Western Cape has a housing backlog of over 564 000 households. With a budget of about R2.2 billion in the last financial year, we were able to assist about 18 000 families. For us to address the current backlog, we would need about R80 to R100 billion. The economy cannot afford that.”

“Even before junk status, the situation in South Africa was indicating a very bleak future. We are spending 69% of our entire budget on three items in SA - servicing our debt, paying salaries and we are paying grants. This leaves us with 31% to do other things, including giving houses for free. Surely we cannot sustain that. This is why this partnership is so important. My Department has decided to adopt three strategic goals; prioritising the most needy, upgrading of informal settlements and building affordable houses.”

Minister Madikizela said that it was important for the government to deal with the plight of the people who earn slightly too much to qualify for a free house, and too little to qualify for a bond. He said the government was not creating a conducive environment for partners to come on board.

The summit placed a special emphasis on farmworker housing. “The reality is that the household of a farmworker no longer qualifies for a free house because the current threshold is R3 500.  These people can also not qualify for a bond and this leaves us with a massive challenge. We are saying as government, we can make land available and service that land. We are asking you (private sector) to assist us so that your employees have roofs over their heads,” said Minister Madikizela.

Alan Winde, Minister of Economic Opportunities, said the summit was a joint drive to ensure that residents living and working on farms had access to housing.

"Since 2014, 127 000 jobs were created in the Western Cape's agriculture and agri processing sectors, bringing the total number of residents who are employed in these sectors to 448 000. As these sectors drive an increase in job creation, particularly in rural areas, we need to find solutions to housing for residents working on farms. We know that many will not qualify for a free home, or be able to receive a bond,” said Minister Winde.

He added: "With the onset of the Fourth Industrial Revolution, we are focusing on new and innovative approaches to addressing challenges like these, and partnerships with the private sector will be key in this regard. The Department of Agriculture has completed a province-wide agriculture worker household survey which has valuable data to assist in developing these solutions. The men and women in agriculture play a major role in growing this sector. It's critical that we invest in improving their lives."