L Sisulu: Hand over ceremony of Aliwal Gardens Housing Project

30 July 2007

Master of Ceremonies
Invited guests
Ladies and gentlemen

The generation of our time carries an immense burden, not only to correct
the imbalances and distortions of the past, but also to cement the foundation
that will provide a secure and a brighter future for all. Not only must we have
the necessary conscience to undertake this task, we must also be prepared to
expend the necessary resources for this. In reversing the legacy of the failed
and catastrophic policies of the past we must have the vision of a country able
to increase productivity through the retention and nourishment of critical
skills. We must bring citizens closer to their places of employment and of
social interaction. We must place the country on a sustainable growth path to
increase peace and stability. An honorous task where we need all the help we
can get.

Thus, I was particularly thrilled when in 2005 the Board of Communicare
asked to see me to give me a presentation on their programmes. They were
natural social partner for me faced with the enormous challenges as I have
outlined. In particular the challenge that rapid urbanisation has thrown up.
For any country experiencing the phenomenon we are experiencing and alarming
urbanisation combined with increased cross-border migration, greater efforts
should be put into work such as Communicare is doing; ensuring adequate
affordable shelter.

With the distortions and the displacements of our different communities
caused by political and spatial planning policies of the past, our generation
can achieve our collective vision of a better life for all our people. This it
can do if it is to prioritise the dominant issue of our historical backlog. In
addressing this particular care has to be taken to adequately respond to the
low levels of low-cost and affordable rental housing.

A 2002 StatsSA survey indicates that South Africa's rental housing comprises
of one third (29 percent) of the entire housing sector. This is far less than
in other developing countries at the same level as ourselves where rental
housing constitutes more than 50 percent. This, then, is an anomaly that needs
rectification, more so especially when account is taken that according to a
Social Housing Foundation study the estimated demand for rental housing was in
2001 for 1,8 units. Moreover, the study expected that by the end of a ten-year
period the demand for rental housing would reach 81 000 units per annum.

One of the major reasons why we lag so far behind in our provision of rental
housing are as you would know related to the fact that developers do not see
the development of new rental housing units for the low and the middle-income
sectors of our societies as an investment opportunity. They associate the
sector with risks related to the non-payment of rentals including the long-held
perception that the sector is not profitable.

Recent evidence indicates that they have only now begun to take an interest,
albeit tentatively, due to rising house prices in the upper market. What this
means is that even as they do, the low-income category where substantial demand
sits will still not be provided for. And to make matters worse only
Johannesburg and Cape Town seem to be on their radar screens where in taking
advantage of below market value property acquisition opportunities they focus
developments on conversions and the refurbishments of existing buildings.

Yet the huge and unmistakable present demand for rental housing is a loud
cry that this has to change quite rapidly. Together, therefore, both the public
and the private sector and communities need to find innovative ways in which to
address the demand for rental housing. This includes not only paying attention
to and providing solutions to concerns by the private sector about perceived
imbalances between risk and return but to paying attention to the needs for
empowerment of communities. In a sector whose possibilities are as unexplored
as these are social housing institutions have a vital role to play. If we are
prepared to commit the required resources and energy in this respect, I am
confident, that through rental housing we can achieve the outcomes we are
looking for.

However, we must confess from our side as government that the issue of
rental stock has not been given the priority it should have. Attempts have now
been to rectify this loophole. The Social Housing Foundation was established
and, by 2005 I was happy to note that thirty-nine institutions were established
to undertake and manage rental housing.

We have noted that whilst the limited social housing institutions had more
experience in terms of administrative systems and management structures, their
understanding of the requirements of the sector were severely limited and
lacked innovation to reach to the low-income groupings.

As government we view rental housing as an important alternative tenure
system that can help us meet the housing challenges we have. We therefore would
like to call on all stakeholders in housing to join in the battle to make
rental housing affordable and accessible to meet the demand of a growing
urbanised people.

On 11 August 2005 I was here at the sod-turning of this complex. The photo
taken at that occasion remains the most beautiful encapsulation of the best
moments of my time in housing. The photo enjoys pride of place in my office.
Returning today to this place can only be a fulfilment of the hope that glows
in that photo. The same hope that glows in the project, the Aliwal Gardens
project, which I learn will have within it seventeen rental units out of the
total of eighty-six.

I have been told that six of the rental units have been completed and that
three families are already occupying them whilst other families will be moving
in during the middle of August. I have been told too that in respect of the
sales units 24 families have moved in. In mixing rental units with the sales
units the project represents the kind of innovation we would like to see
replicated across and in all our provinces. It will raise the number of rental
units which we crucially need.

Communicare is an important social partner which has been in the field of
housing since 1926, after taking over from its predecessor, the Housing League.
It has always been involved and passionate about rental housing believing that
it was in this regard providing a service to the vulnerable such as the elderly
and the young.

Furthermore, the company has a long history in the provision of well located
and good quality rental housing for families, individuals and the elderly. It
is implementing this development to regenerate Ruyterwacht and has ensured that
in doing so the development does address not only provides different tenure
options but also addresses the circumstances of different income groupings. It
located the development close to a major transport infrastructure and to
amenities such as hospitals and schools as well as a commercial centre. All of
this meets the criteria we have set for quality social housing.

As social rental housing is a critical element of its core business,
Communicare has recognised too the need to develop housing and different tenure
options for people with incomes between R7 500 and R15 000. It has support
services that cater for not only the tenants of its developments but beyond. I
am impressed with the conceptualisation of the project as well as about the
decision the Board took recently to ensure that 'at least 20 percent of future
housing developments' by the company will henceforth be committed to social
rental housing.

The decision, which I read from the Chairman's statement, Mr Herman Fourie,
in last year's Annual Report is that the rental units that will be developed
will be for amounts that are as little as R1 500 per month. This, as he noted,
and I would like to agree with him, will be a remarkable achievement for a
non-profit company, particularly given the burgeoning costs of land acquisition
and continuing inflation of construction costs and allied services.
This is a company that long ago committed itself to serving those who are
disadvantaged and the poor. From its early days it adopted the aim of wanting
to create awareness about the plight of the poor and the homeless. In wanting
to construct, acquire, maintain and manage homes for the working classes and
others it set itself apart quite early on in its life. Thus, I am not surprised
that at the achievement it has made in managing and owning over 2 057 units for
the elderly.

It was quick to embrace the government's strategy on building through social
housing integrated communities. Hence, the explicit commitment made in its
Social Housing Strategy that the company will use and link its resources with
those of national, provincial and local government to ensure that rental stock
is for the elderly and poor families is increased. The company has in terms of
the strategy committed to building 2 000 social housing units over the next
five years focusing these on land being owned by itself.

We have a great deal to learn from this company, especially on how it
manages to continually educate the residents of their stock, creating a healthy
understanding of mutual responsibilities. This is an important element for me
because the biggest task we have to undertake is to create a culture of
responsibility among the people we serve. A culture of responsibility is
crucial for a country with such huge challenges as ours. The basis of
development is each citizen's responsibility to do their bit to build because
it is on the basis of this that further roll-out can be undertaken to benefit
more people.

Let me thank the Board of Directors of Communicare, the Chairman, Mr Herman
Fourie and all the companies committed staff for an excellent track record.
With their conscience they have moved ahead many companies or other partners in
housing. As I read through the companies history I kept imagining what a
different country we would be living in right now had such a conscience been
allowed to prosper and grow unimpeded by any concerns from government over the
desirability of residence of other races in certain locations. I keep wondering
about how different it would have been had companies such as Communicare been
provided with the support they needed by government to freely live their
conscience and realise their goals. On behalf of government I want to pledge
our support to this company. May it grow in its work and may its efforts take
root in many other areas.

I thank you.

Issued by: Department of Housing
30 July 2007
Source: Department of Housing (http://www.housing.gov.za)