Budget makes room for more housing opportunities

2017-02-22 14:09 - Lameez Omarjee
A low cost house in Mfuleni is augmented by renewable energy. (Duncan Alfreds, News24) ~ News24

Pretoria – Government is to spend R29.8bn on housing, according to the National Budget.

Finance Minister Pravin Gordhan delivered Budget 2017 in parliament on Wednesday. He said it was important to have intergovernmental cooperation between the different spheres to improve delivery of services such as housing, water and sanitation and public transport, among others.

He explained that collaboration was pivotal in "reversing the spatial legacy of apartheid".

“This spatial transformation is a massive challenge involving land acquisition and development, infrastructure and transport services, housing and industrial and enterprise support. Much of this depends on collaboration between government and the private sector,” he said.

Housing opportunities are still a priority for the department of human settlements (DoHS) and over the next three years government plans to spend R114.8bn on subsidised public housing.

The DoHS has been allocated R30.7bn for 2016/17 and this will increase to R37.4bn by 2019/20. Over the next three years the department will start 25 projects to deliver more housing opportunities, according to the Budget.

The funding for housing transfers is part of the Housing Development Finance Programme (HDFP), which is at R29.8bn for the current fiscal year and will increase to R36.6bn by 2019/20, according to the Budget. The HDFP aims to improve access to housing finance, through collaborations with the private sector and other related entities.  

“The department expects to facilitate the delivery of 368 530 fully subsidised units, disburse 66 554 finance-linked individual subsidies and upgrade 623 635 houses in informal settlements by 2019,” the Budget read.

This will also be funded through the human settlements development grant, which is expected to increase from R18.3bn in 2016/17 to R22.3bn by 2019/20.

Further the urban settlements development grant for the eight metropolitan municipalities will focus on providing land, bulk infrastructure and basic services to poor households and upgrading households in informal settlements.

By 2019, a total of 55 171 social rental housing units will be delivered through primary funding by the Social Housing Regulatory Authority’s capital programme. This is expected to provide R3.2bn over the medium term.

The department will also focus on providing title deeds for subsidised housing beneficiaries through the title deeds restoration programme. This is funded through the provincial human settlements development grant. It is expected to deliver 701 646 title deeds related to the backlog before 1994, and 510 721 title deeds for new beneficiaries, the Budget read.

New housing legislation

The DoHS plans to release a new White Paper on human settlements by 2017/18. “Minister Sisulu will shortly release a White Paper on the reforms necessary to build more inclusive residential property markets, and accelerate the upgrading of informal settlements,” said Gordhan.

This is a new approach to provide housing in collaboration with the private sector, communities and individual households. When approved, this new legislation will result in a new Housing Act. The development of the White Paper will be funded by the Human Settlements Policy, Strategy and Planning programme (HSPSP).

Spend by the HSPSP is expected to increase from R88.1m in the current fiscal year to R95.7m in 2019/20.

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