26 November 2013

Namibia: Mass Housing Absorbs Build Together

GOVERNMENT has incorporated the Build Together Programme into the mass housing project, which will officially be launched by President Hifikepunye Pohamba today.

Regional and Local Government, Housing and Rural Development permanent secretary Sirkka Ausiku, who confirmed the absorption of build together into the mass housing project, also said local authorities were instructed to divert all the funds allocated to the scrapped programme to the mass housing initiative.

Ausiku further said those who were on the Build Together Progremmes' waiting list will have their names listed as beneficiaries of the mass housing initiative.

"Build Together Programme and mass housing are the same issue. We cannot continue to have the other one while the same project is running," she told The Namibian yesterday.

Ausiku described the inclusion of the Build Together Programme as "revamping and realigning it" within the framework of the Medium Term Expenditure Framework (MTEF).

The Build Together Programme was a self-help programme initiated during the 1992/93 financial year to provide shelter to low and ultra-low income earners in the country. The project was decentralised to the regional councils and local authorities in the 1998/99 financial year.

It provided home loans to people whose monthly incomes are less than N$3 000 and also assisted middle-income earners who do not have access to credit from financial institutions or who are regarded as a credit risk. The maximum loan amount was N$40 000, and the interest rate varies from four to seven percent over 20 years.

According to the available Auditor General's report for 2005, several challenges - such as poor administration and payment capacity, poor understanding and commitment, low levels of serviced land and high number of beneficiaries, and slow progress, high cost and low quality of house construction - hampered the progress of the programme.

In Windhoek for example, the programme attracted controversy after a staff member amassed more than N$1million at the expense of the customers.

Ausiku said her ministry will demand an explanation on how the Build Together Programme funds were used, adding that so far most local authorities have indicated their readiness.

Voicing her dissatisfaction over the pace of the build together programme, Ausiku said most of the houses built under the scheme are still incomplete.

Government sources, however, told The Namibian that the reason why the build together programme has been incorporated into the mass housing initiative is because there is no money.

The mass housing initiative is targeting to construct about 9 000 houses at a cost of N$2,7 billion in the next 15 months to reduce the housing backlog of over 100 000 while N$2,5 billion would be made available for housing each year until 2030.

Government has allocated N$1,9 billion to the Ministry of Regional and Local Government and Housing this financial year for "among others, the servicing of land and improved sanitation standards in urban, peri-urban and rural areas".

In any case, the N$1,9 billion is far below the required N$2,7 billion for kick-starting the mass housing project. The sources indicated that government is even considering sourcing a loan to fund the mass housing project.

Minister of Finance, Saara Kuugongelwa-Amadhila, who is part of the Cabinet committee on mass housing, told The Namibian in September that her ministry has allocated "significant amounts under the MTEF to fund housing" although a report she presented in parliament in February this year shows that only N$5,8 billion has been budgeted over three years. A further N$320 million was allocated to the National Housing Enterprise (NHE) for the building of houses.

Kuugongelwa-Amadhila also told The Namibian that other sources of finance for the mass housing project are public-private partnerships, debt financing and household saving groups such as the Shack Dwellers Federation of Namibia.

The finance minister further said pension funds and regulator authorities are investigating the viability of pension-backed home loans for their members.

Ausiku denied roping in the Build Together programme because of lack of money for the mass housing project. "It is not true that government does not have the money," she said.

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