A drastic change in housing policy in South Africa is in the institutional pipeline. From a delivery model centered on subsidized homes, the state must focus on site and service programs. But there is very little clarity as to how this will work, and civil society is well placed to enter the debate.
In 2020, Minister Lindiwe Sisulu noted that the provision of subsidized housing is not fiscally sustainable and cannot meet growing demand. A shift to site and service related to self-build has been announced, with land to be made available through the government’s rapid land release scheme. This radical change has now spread to the provincial and municipal levels. Cape Town’s draft Integrated Human Settlements Sector Plan 2022 notes that for the vast majority of housing seekers, the current housing scheme “will not be the appropriate housing solution”. Instead, the National Department of Human Settlements issued a guideline for prioritizing serviced sites to eligible recipients with the Human Settlements Development Grant.
As usual with housing policy in South Africa, the devil is in the details. At present, it is not at all clear how a site and service approach will be implemented. The state itself, through the myriad of institutions that deal with human settlements, does not seem to have a clear idea of what site and service will and should entail. Therefore, civil society is well placed to make suggestions.
To make it clear from the start: for us, site and service is not just about providing people with municipal land and services. It is about the progressive development of housing and dignified neighborhoods. However, the purpose of this opinion piece is to present ideas loosely organized around three key categories: building support, funding and municipal capacity.
This covers a wide range of services that would enable the recipient of a serviced site to build a formal and dignified structure. Current land use management practices need to be modified to allow for rapid plan approval and construction. A plot with several options of pre-approved building plans, from which beneficiaries can choose, is one possible option (and can also be applied to subsidized housing to allow for future extensions).
The next point to consider is how to build. Materials and labor are required, and it must be assumed that large-scale contractors (such as ASLA and Mellon Housing) will not operate in this space. There is an opportunity for small builders and material suppliers, with quality control measures enforced by the municipality. This could be achieved through a local database of suppliers, an application process and monitoring of work during construction.
Title deeds must be provided with the formal transfer of the plot.
The ideal institutional ‘vehicle’ to provide such support, alongside other housing-related services, is a local housing support centre. This office would be staffed by the municipality and provide strategic housing support to people with serviced plots.
Without support, many who qualify for serviced sites will build shacks very similar to those currently found in informal settlements on the urban fringes. To avoid this, site and service delivery should rework existing top-tier grants and include mechanisms for grantees to access loan funding. Collective savings must also be considered as a source of financing.
History has shown that private sector banks are extremely reluctant to provide housing loans to the urban poor and it cannot be imagined that this will change overnight. The government will have to convince the banks to provide loans, to guarantee the financing of private banks, to create a specialized financial vehicle to provide construction loans.
Grants or loans can be of several types: for materials only when the recipients have construction skills; for partial structures with plans for future extensions; for construction costs only when the materials can be purchased privately; and for all materials and construction. As in the formal banking world, loan agreements should be signed and there should be clear rules in the event of default. This could be handled by the Housing Help Centers described earlier, but will be extremely tricky given the politicized nature of housing provision and South Africa’s history of free housing provision. However, the reworked grants could be managed by these centers.
From now on, time, effort and thought must be put into planning how loans can be made while maintaining sound economics of cost recovery. Without funding, a shift to site and service will only replicate (or exacerbate) the current state of growing informality at the periphery.
A state of direct antagonism, mistrust, violence and protest exists between many informal settlement communities and municipalities. A successful site and service process will require deep engagement of municipal officials in informal communities, which means repairing the social compact between informal communities and local government.
Second, current municipal capacity and skills are insufficient to provide the required support. Personal experience from municipalities paints a rather grim picture of understaffed, overworked and ill-equipped staff rushing to “fight fires” with little planning. Serious institutional capacity and skills development are needed.
Third, municipalities are rooted in existing practices in housing provision and have comfortable relationships with private service providers. Change will be resisted because it disrupts power. Provincial and national governments have yet to make the far-reaching institutional changes needed to implement a people-centred approach to site and service. A phased approach could be considered, targeting capable municipalities that become centers of learning for other officials and communities.
Finally, we must reflect on a legislative environment that encourages the innovation and risk-taking necessary for the success of this type of program at the local level. Bureaucracy and fear of failure will only serve to constrain municipal actions and decisions.
This is by no means an exhaustive list of issues. There are issues of access to land and how providing site plots and services on the urban periphery would address spatial inequalities. There is also the question of how communities will respond to a call for their own active participation and funding, after almost three decades of free housing.
Civil society has a key role to play – not only in lobbying the government for more details, but also in making suggestions about what a site and service policy should and could entail. The lack of detail presents an opportunity for civil society collaboration and advocacy. One example is the Housing Help Centers research conducted in partnership between the Isandla Institute, Peoples Environmental Planning and the Development Action Group, the findings of which will be shared in the second half of 2022.
South Africa is on the cusp of a new human settlements paradigm, but success or failure really lies in the details.
Noah Schermbrucker is Coordinator, Peoples Environmental Planning; Mirjam van Donk is director of the Isandla Institute; and Jens Horber is a researcher at the Isandla Institute. Opinions expressed are not necessarily those of GroundUp.
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