Housing to drain state coffers

Jo-Maré Duddy – Government will have to pumps billions - compared to millions currently - into urban land reform if resolutions accepted at the second national land conference are realised.

One of the 169 resolutions adopted at the conclusion of the second national land conference on Saturday states that “government expenditure should be increased from the current level of 0.1% to at least 10% of GDP [gross domestic product]”. No further details are available.

To put the figure into perspective: According to the latest budget documents, Namibia’s estimated GDP for the current fiscal year will be nearly N$184.8 billion. Ten percent of this is nearly N$18.5 billion, while 0.1% equals around N$184.8 million.

Ten percent of GDP is slightly more than the entire income Namibia expects from the Southern African Customs Unions (SACU) in 2018/19. It overshadows the budget of education, arts and culture – at about N$13.5 billion the biggest allocation in the current budget. Ten percent of GDP represents nearly 29% of Namibia’s entire budget for 2018/19, and represents nearly a fifth of government’s total debt.

The Namibia Inter-censal Demograhic Survey (NIDS) 2016 released by the Namibia Statistics Agency (NSA) last year shows an estimated 440 000 people were living in shacks in urban Namibia, nearly double the number of people who had to survive in impoverished housing in 2011.

According to the NIDS, 39.7% of all households in urban areas in 2016 lived in shacks compared to 27.2% in 2011 and 17.6% in 2001.

Khomas recommendation

In the run-up to the conference, the 14 regions of Namibia submitted lengthy documents containing their suggestions on how the urban housing crisis should be addressed.

In its submission, Khomas said the 1991 Housing Policy recommended that the national investment on housing should not be less than 5% of the gross national product (GNP). This has not happened, the region said.

“Since Independence, government spending on housing has never exceeded 0.1% of GDP, which is far below what other governments internationally spend.

“There is thus a historical underinvestment in housing and urban development (including land servicing, health and educational facilities and other public amenities), which is a much more cost-effective way to improve people’s lives than the relatively large amounts spent on resettlement for a small number of beneficiaries,” Khomas said.

By 2050, Namibia’s rate of urbanisation could be 72%, Khomas pointed out. Government must therefore prioritise investment in land and housing in urban areas, including municipalities, towns, settlements and villages in the various regions, it emphasised.

“Due to rapid urbanisation in the country the government spending on the urban development should be increased to at least 10% of the GDP,” the region recommended.

Housing

Another resolution states that 300 000 “housing units/opportunities” should be provided over the next seven years. That equates to 42 857 houses on average every year.

“This is a national emergency,” according to this particular resolution.

Shack dwellers should be accorded land titles, another resolution states. Statutory minimum building values in the conditions of an establishment should be removed and incremental housing design lay-out and construction methods adopted.

The sale of partially serviced land – sewerage and water – should be allowed. Other services can be added at a later stage, the resolution adds.

The upgrading of large-scale informal settlements should be prioritised.

Standard for building materials should be revised to allow for more flexibility, including low-cost energy considerations for low-cost housing.

Financing

Government should create infrastructure financing funds. According to another resolution, government should fully subsidise ultra- or low-income housing and essential services through local authorities. Local authorities should enter into partnerships with first-time home buyers as part of a structured purchasing scheme.

A funding formula should be developed so that central government can fund housing and land development at regional council and local authority levels from national taxes.

In addition, the support of banks and other financial institutions should be secured to finance houses that are built with local or alternative building materials.

All resolutions adopted at the second national land conference are due for submission to Cabinet for further interrogation before approval, after which they will then be taken to Parliament, Nampa reported.