by Standard Bank of the Hlanganani Development Village, Springs
16 October 2006
MEC Nomvula Mokonyane
The Executive Mayor, Duma Nkosi
The Chief Executive (Standard Bank � Personal and Business Banking), Mr Sim
Tshabalala
Invited guests
Ladies and gentlemen
In much of the discussion around housing and the effects of urbanisation, it
always amazes me how out of context we are, how a-historical we are. Because
urbanisation has become a crisis, we deal with it as though it were a new
phenomenon. Urbanisation in South Africa is as old as these white dumps that
surround places such as these. Significantly, it is these dumps that throw up a
very interesting history, that of the relationship between labour and capital.
In fact apartheid merely cemented this relationship that served a particular
and continued relationship that benefited capital. Apartheid became, as they
say, a useful idiot for capital. And we continuously blame apartheid for all
the ills of housing that we are faced with.
Today, many decades after the period of the initial wave of urbanisation, we
meet at Hlanganani, in a brave attempt to add our bit to normalising a
situation that had gone wrong for so long. I like the name, Hlanganani. It is
very apt and it has a ring of historical justice to it. The mining industry had
the potential to change the demographics of our country. But it resisted that,
relying instead on what Ruth First termed the 'permanent necessity' of migrant
labour.
At the incipient stage of this form of labour, in 1914, Sol Plaatjie had
described the results as follows:
"Two hundred thousand subterranean heroes who, by day and by night, for a
mere pittance lay down their lives to the familiar 'fall of rock' and who, at
deep levels, ranging from 1 000 to 3 000 feet in the bowels of the earth,
sacrifice their lungs to the rock dust which develops miners' phthisis and
pneumonia."
As historians record, the Witwatersrand, as Kimberley, was however
synonymous with money and wealth. William Beinart says in 1899 the Rand was
already producing 27 percent of the world's gold and by 1913, 40 percent. By
1910 it had employed over 200 000. Of this force he says:
"Black men became the core of its labour force at the heart of the economy
thousands of feet underground. Their subterranean and compound existence was
far removed from the leafy suburbs of South Africa's towns or the British Home
Counties where much of the financial wealth from the mines was deposited.
Perhaps, in a warped way, the stock exchange in the City of London recognised
this contribution by calling South African gold-mining shares 'Kaffirs'."
Imagine what it would have done to the lives of those miners if they had
been given the opportunity to own houses. Imagine their value today. A few days
ago I was made aware of an interesting thing too about Springs - that it is the
birth-place of one of the middle generation stalwarts of our movement � Steve
Tshwete. Steve was born in Springs to a father who worked on the mines and a
mother who was a domestic worker. He was brought up at his grandparent's home
in the Eastern Cape because working on the mines his father had no possibility
of owning a house here and therefore no possibility of raising a family.
During his life in politics, Steve had concerned himself with issues related
to the creation of stable communities where sporting facilities would draw our
youth to more productive pursuits than crime. He firmly believed that in order
for this country to deal with the issue of crime we had to address the living
conditions of our people. He would have been proud of this government today
Nomvula, to see that it is helping bring better living conditions to the people
of his birthplace. I would like to think that perhaps, Mayor, one of the
streets here will bear his name as a constant reminder of his contribution to
our understanding and solving the problems of our time.
Today we meet at Hlanganani, the private sector and government, and this
will go a long way towards indicating that in accordance with the preamble of
our Constitution, we:
* respect those who have worked to build and develop our country
* establish a society based on democratic values, social justice and
fundamental human rights
* improve the quality of life of all citizens and free the potential of each
person.
Standard Bank has risen to the challenge and enabled this for Springs. From
our past, however, we inherited a huge infrastructure backlog complicated by
high rates of unemployment and low income margins. The existence of informal
settlements is the greatest manifestation of the backlog signifying the need to
not only accelerate the delivery of housing, but also to make housing
affordable to all.
In this regard, together with the banks we have come a long way since the
start of our negotiations on the Financial Services Charter. We will recall the
concerns expressed initially about the availability of housing stock. The roads
we have traversed to date, clearly indicate important progress in that the
banks have all come on board and have projects on the ground to indicate their
commitment to the process.
We have had a successful engagement with all the other stakeholders too on
this understanding. For it is only through the active involvement of everyone
that we will be able to meet our housing needs. We therefore have adopted a
number of programmes aimed at stimulating the housing market, improving the
accessibility of housing to the poor and removing bottlenecks within government
that impact on rapid delivery. The co-operation we have is a strategic
partnership whose framework has been laid by the Breaking New Ground strategy.
Hence, the social contract for rapid housing delivery signed with stakeholders
in 2005.
The contract binds signatories towards working together to remove
bottlenecks in housing delivery, investing more resources in low-cost housing
and fast-tracking delivery. This has brought on board players from the
financial sector; construction sector and many other stakeholders. An
additional concern, of course, in this is the continuing rise in building costs
including house prices of 6,2 percent in the first half of 2006 and 12,5
percent by 2005, respectively.
Our country is compounded by inequalities. As property markets soar and
record great earnings for the middle to high income earners, there are still a
great number of our people who cannot access this market. Financial markets
remain discriminatory to the poor and this translates to a great number of
people remaining dependent on the state for housing provision. Banks, through
the Financial Sector Charter have pledged to review their lending practices to
include those who conventionally wouldn't access finance for housing.
They pledged R42 billion which can be disbursed in many different ways.
Given that we have given ourselves the target of achieving a shack-free society
by 2014, it would be needed that we have these measures in place to forestall
the development of new shacks. It would be needed that the banks increase their
lending and that we all co-operate to make that objective possible.
In line, therefore, with the integrated development of the Breaking New
Ground strategy, Standard Bank initiated this project in Hlanganani, in
Springs. This however is not the beginning of the venture of Standard Bank into
the low-cost housing realm. They began with the institutional formation of a
business unit called low-cost housing within the bank itself.
Property Finance and Advisory Services' principal role is to provide the
wholesale and development finance products (in conjunction with home loans).
Together with the Gauteng Partnership Fund, Standard Bank has also ventured
into social housing, following the acknowledgment that traditional
home-ownership is not the only way in which low-income earners can get access
to housing. Renting is often a more suitable option. It is in this regard that
the Standard Bank Low-Income Housing division and the Gauteng Partnership Fund
is offering finance to the residential property investor. Standard Bank's
investment in Hlanganani Village is again another aspect in which the bank has
acted out of the ordinary, and has extended its products to those less
fortunate and would not otherwise afford. This is a mixed income establishment
with mixed tenure, responding efficiently to the call for diversification of
housing stock. Located between traditional townships and a middle-income
settlement of Sharon extension this settlement integrates the Spring's
community.
The village is constructed with private security; clinic; recreational
parks; taxi drop offs; fuel station; retail centre and a school. Standard bank
has created affordable loans to go with each of the apartments or units in the
Hlanganani village; these will be accessible to those earning at least R6 000
per month (combined or single income). The Hlanganani Village initiative is
indicative of the results that can be achieved through co-operation and
innovativeness.
Though the houses will not be accessible to those at the lower end of the
market, it improves accessibility and affordability issues for those with
income who could acquire their own stock but had not had the opportunity to
access funds to acquire such stock. The development is an implementation of the
social contract and the Breaking New Ground strategy in general. It embraces
both integration and comprehensiveness.
There are of course concerns and drawbacks with developments of this nature
and these need to be addressed continuously to make lending sustainable to the
banks, but then also to the borrowers. Most banks, in lending to low income
earners, use wholesale financing, safe-guarding against defaults and losses to
the banks. This forces the price of lending to increase and this increase is
felt mostly by the end-users of these financial products.
In the same light, there is a need to make sure that banks continue to study
and understand the market they are venturing into as this market has
complexities that need to be taken into consideration when defining what can be
afforded and what cannot be. I applaud Standard Bank and its partners for the
great work done in this project, which took some of these concerns into
account. In making the development the bank emphatically shows that it shares
in the dream of our people to break with the patterns of the past. It affirms
that the collective riches of the country can be put to use to ensure that our
people do indeed afford their cost of living.
From our part as the Department, we will ensure that subsidies are accessed
by those members of the community who will need them for purposes of accessing
the loans being provided.
I thank you.
Issued by: Department of Housing
16 October 2006
Source: Department of Housing (http://www.housing.gov.za)
