L Sisulu: Launch of N2 Gateway

18 July 2006

Premier Rasool,
Professor Adedeji and members of the African Peer Review Mechanism,
Ministers and Deputy Ministers,
Members of the Executive Council,
Distinguished guests,
Ladies and gentlemen,
All protocol observed:

I am sorry that the Deputy President is not here, here in her capacity as a
member of parliament that had been deployed in this area, because she forms
part of a team whose pioneering work gave rise to this project. I am glad,
however, that we have most of the others we would want to give tribute to the
Premier of the Western Cape, Mr Ebrahim Rasool, Deputy Minister of Provincial
and Local Government, Ms Nomatyala Hangana, MEC Marius Fransman, former Mayor
Nomaindia Mfeketo and Ms Zoe Kota, Chairperson of the Parliamentary Portfolio
Committee on Housing would share our sense of achievement today.

I am reliably informed that around the middle of 2003 both the former MEC
for Housing, Nomatyala Hangana and the former Mayor of Cape Town Nomaindia
Mfeketo seemed to have found a solution to a somewhat intractable problem of
what to do with the crisis situation of the informal settlements and in
particular this site which you will all agree did tend to thrust itself in your
face as you as you drive to and from the airport and where for some
inexplicable reason there will always be the highest number of fires. It cried
out for immediate intervention.

When the two politicians had put their heads together given the necessary
energy and support by the Deputy President, then the MP for Gugulethu and Ms
Zoe Kota, MP for Langa the idea was formalised. And like true politicians they
quickly realised that without the necessary buy-in from the national Department
of Housing the project would not succeed. My predecessor, Minister Brigitte
Mabandla, was roped into this and by all accounts some rudimentary agreement
was reached on the necessity to prioritise this site. Thus, the power of women
was harnessed.

Ms Mfeketo continued to nurture this threesome agreement until the essential
energy of youth arrived. Enters the dramatic personae of our former MEC for
Housing and Local Government, Mr Marius Fransman. He stopped at nothing to
ensure that the concept bore fruit. Between himself and Ms Mfeketo, I was
cornered and threatened with the kind of threats that can only come from the
Western Cape to accept the project or else.

They did not need to hold the gun to my head for too long because very
quickly I was convinced of the correctness of their approach and together we
managed to convince all the other MECs that this was a project worthy of all
our patronage. I will proceed to explain why we were all finally convinced and
are still passionately obligated and tied to this project.

But before we proceed to that we need to ensure that we have properly
acknowledged those who have played a vital role to bringing us to this point:
Nomatyala, Indi and Brigitte thank you for the idea, a noble concept.

Indi, Marius and Leonard Ramatlakane, thank you for creating the conceptual
framework for the N2 gateway.

Premier Rasool, Indi and Marius, thank you for the political environment
that made this possible.

Zoe Kota and Mcebisi Skwatsha, thank you for your support of the N2
gateway.

Indi, thank you for being the driving force of that which the people of
Langa are now about to enjoy. Today you stand vilified for taking the path less
travelled to ensure the poorest of us are provided for. But your work here
speaks for itself and none can erase it from our history. Madiba taught us to
acknowledge those contributions that have been made by others to get us where
we are. It does not take anything away from us, it only makes is so much better
people.

MEC Dyantyi and all my MECs, today South Africa knows that housing has
achieved its highest point on the long road we set ourselves when we adopted
the new approach of human settlements.

The community of Langa, thank you for bearing with us, you will not regret
your faith in us Sitembeni, sithembekile soze sinilahlekise.

And now the rest of you who have been wondering why Cape Town, why the
N2.

Historians and urban analysts agree that Cape Town was the first city in
South Africa to bear the brunt of physical segregation of residential areas. It
ranks highest as the most segregated city in this country. The dissimilarity
index between black and white 10 years ago was 95 percent. I doubt that it has
changed much. Of all our cities, Cape Town still remains the most untransformed
and inequitable city.

Our slums in the city are the starkest manifestation of our grotesquely
divided and unequal society. Cape Town is said to be a ‘world-class
competitive’ city, but it is also known as the ‘Shack Capital of South Africa’.
With a current housing backlog of over 245 000 and 16 000 new households
requiring housing each year the delivery rate of only 11 000 per annum spells a
bleak future for the city’s poor.

What carries on to render the situation and will carry on rendering the
situation worse if not fixed in Cape Town, is not only the city’s inability to
articulate, champion and drive a coherent programme of action to address these
problems and dilemmas but its under-estimation of the depth of the crisis and
the sheer magnitude of need.

Employing the census figures of 2001 of informally housed families the
backlog is estimated at 142 983. Assuming that 30 percent of the 16 000 new
households will resort to living in informal settlements, and factoring in the
delivery targets, the number living in shacks by 2006/07 will roughly be 163
610. This paints a clear picture that without radical intervention, housing
conditions are set to worsen in our city (a growing backlog) and informal
settlements will balloon.

The capabilities and capacities of the City to cope with these challenges
will further be rendered more dreadful given that local government is a poorly
defined actor in the shelter sector. A further factor complicating an
integrated inter-spherical resolution of Cape Town’s housing crisis is that our
co-operative governance regime is well developed as a set of political and
financial relationships but relatively under-developed in specific
policy/programmatic areas. This insight holds true for local economic
development, urban renewal, integrated development planning and housing.

It is in response to these realities that we all of us here were in total
agreement if we were to reverse apartheid spatial planning we have to start
here; here where the two worlds we had become must come together to symbolise
how far we have come.

Subsequent policy developments, refinement of programmes and instruments
elevated the status of the informal settlements to a pilot project. N2 Gateway
project, a lead project ratified by Cabinet to test the efficacy and
appropriateness of the Department of Housing’s new shelter plan came about
prioritising the areas here in Cape Town that suffer acute shelter and income
poverty; very depressed income levels; extremely low education levels;
unemployment that is three times higher than in the rest of the Western Cape
and poor access to adequate water, sanitation and energy although slowly
improving.

In our attempts in the past to upgrade informal settlements we inadvertently
exacerbated spatial marginalisation, for informal settlements will always
establish themselves in the most marginalised areas. This site gave us the
perfect opportunity not only to upgrade informal settlements but at once ensure
that we can integrate communities.

The N2 corridor provides us with the opportunity to address a whole range of
injustices of the past, starting with the disinherited communities of district
six now recently to the dislocated backyarders who have waited for years for an
opportunity to own a house; to the informal settlers of this area who took the
decision to clear the bush and put up their shacks; to the community of Netreg
who fought for the right to decent housing right through New Rest, Boys Town
and to Delft.

An ambitious project by any account but one which when done will have marked
the first real reversal of apartheid spatial patterns in that city which has
borne the scars of these deep divisions.

It is with confidence that today we have come together, 15 months after the
commencement of the project, to witness an official hand over of the completed
units. For the first phase a total of 705 rental units have been completed and
ready for occupation whilst minor works relative to internal roads and paving
are currently being undertaken. While allocation of these units has caught an
eye, I must ashore our communities and stakeholders that the allocation of the
units is being done in line with the independent database provided reviewed by
independent auditors. The principles of allocation therefore remain in line
with the original project business plan, i.e. 30 percent backyard renters and
70 percent from neighbouring communities.

Phase two of the project will roll out as soon as possible. Accordingly,
residents of the remainder of Joe Slovo are being accommodated in temporary
relocation areas in order that we may continue building on the site. The
intention is to construct 700 fully subsidised housing units and 300 bondable
housing units. Infrastructure installation is in progress at New Rest where 16
show houses have been constructed already. Extensive work has been done in
Delft where township establishment is in progress and land rehabilitation is
completed at Delft Symphony. Infrastructure to 2 200 stands is nearing
completion on which the units will be constructed. The Delft Sewer is under
construction. The total amount spent to date is R313,8 million with work in
progress to the value of R112 million.

As Booker T Washington once said, “Success is to be measured not so much by
the position that one has reached in life, but by the obstacles which one has
overcome while trying to succeed.”

The successes we have achieved through the N2 Gateway project should be
measured against these challenges and obstacles, worsened by the obstacle of an
unfortunate political environment and the even more unfortunate media coverage.
Our success today should be measured by not where we are but by the
significance of where we are. The most important thing is that we have started
and given hope to many. They too will soon benefit. This is just the beginning,
happening on such an auspicious day! I can confirm that the implementation of
the nine pilot projects including more especially the N2 Gateway project have
developed tremendous lessons which we embrace and learn from as government
towards scaling up delivery and sharpening our responses.

I would like to acknowledge with regret therefore that maybe some of the
beneficiaries might not be able to afford the minimal rental required for the
units. In this regard I need to affirm our commitment once again that our
poorest of the poor are our priority, they are to benefit as part of phase
two.

Let me spend a minute dealing with the framework in which we have considered
the rents that will be established not only for this project but for all
projects which will be subsidised by government within the social housing
policy. Firstly we need to understand that for us to roll out the lessons of
this pilot scheme, we have to find a model that is sustainable over the 55 000
units my Department will support over the next few years. That means we have to
deal with the capital cost, the finance charges, maintenance costs and the
running costs. Running costs include such things as caretakers, cleaning and
security. In addition there would be costs imposed by the local authority
related to water, electricity, sewerage and rates. In principle my Department
and indeed government as a whole works on the basis that these actual costs
need to be calculated. Once they have and a sustainable economic rent is
established then various subsidy schemes would kick in to support those in
need. These schemes operate on the basis that poor beneficiaries would get a
higher proportion of the subsidy than their economically more fortunate
neighbours. Mixed income communities are indeed a feature of social housing,
firstly so that the better off can subsidise poorer families and secondly so
that we do not create ghettos of poverty. Government subsidies operate in
relation to capital costs and the various municipal services such as water and
electricity. Other costs are covered by the tenants themselves. On balance
however, the combination of government subsidies and the contribution of people
themselves will ensure that the poor can benefit from relatively expensive
projects such as the N2.

Having said this N2 Gateway project has presented an opportunity for us to
learn more about the successes and the failures in the creation of the
sustainable communities. It became a platform to create partners for the
housing sector. In this connection I would like express my ultimate gratitude
to the development partners from all sectors that have supported this
development tirelessly throughout the way. I am still convinced that there is a
commitment from all of us to work together towards achieving the set
targets.

It is more especially that we still are able to expand our partnership and
collaboration and attract new partners that bring various supports to this
enormous challenge. It is with pride and honour that our partnership with First
National Bank (FNB) has once again been cemented. It is also with a great deal
of gratitude that we accept our new partner the “Priory for South Africa of the
Order of St John,” under the leadership of the General-Secretary of the All
Africa Conference of Churches, Bishop Mvume Dandala. The “Most Vulnerable
Order” is bringing in health facilities and services to the partnership.

The response and support from South Africans to the call for collaboration
has not only made me proud of being the Minster of Housing, but also being a
South African.

Our dear friend and philanthropist, St Irishman Niall Mellon, has once again
come to our rescue. He has responded to our challenge for him to come and help
us build on the N2 Gateway. He has started at Netreg helping the residents
there to build 195 houses and progress is now visible on that project. He has
further committed to donating 5 000 subsidy houses on the N2.

We have even had the singular honour to be given pro bono legal council by
the Chief State Law Adviser, in his own spare time and at a very difficult time
for him. Apart from the legal services we contracted, our every decision has
been scrutinised for its legal basis.

The completion of the 705 units presents the end product of commitment by
the following partners that I am also deeply humbled to acknowledge. Without
these stakeholders this work would not have been successful. These include my
colleagues in government; the private sector including the banks, the civil
society and non-governmental organisations (NGOs) and the community of Cape
Town etc.

Ladies and gentlemen, I invite you to join me as I officially hand over the
first phase development of the N2 Gateway project.

I thank you!

Issued by: Department of Housing
18 July 2006
Source: Department of Housing (http://www.housing.gov.za/)