Housing at forefront of govt's infrastructure investment plan

Wednesday, February 11, 2009

Parliament - Housing and the eradication of informal settlements remain at the forefront of government's infrastructure investment plans, according to the Minister of Finance Trevor Manuel.

Tabling his 2009 Budget Speech in Parliament on Wednesday, Minister Manuel said over the next three years, infrastructure grants to municipalities total R67 billion, and a further R45 billion will be spent on the Breaking New Ground housing programme.

"Together with investment in roads and public transport, these constitute one of the largest areas of expansion of public sector spending, and are rightly prioritised as part of our response to the current deterioration in employment and economic activity," said the minister.

An additional R3.7 billion has been allocated to low-housing projects and R4.1 billion is set aside for the second phase of the Expanded Public Works Programme (EPWP).

"I propose that participating departments, provinces and municipalities should be challenged to exceed their targets for creating EPWP jobs over the period ahead."

He added that the contingency reserve this year has been increased to allow for additional funding of employment projects in the 2009 Adjustments Appropriation.

Minister Manuel said there was also an expanding role for housing finance institutions, and for the agencies that support small enterprise development and economic empowerment transactions in the evolution of development finance architecture.

"These are the instrumentalities of our developmental state, not in isolation from the wider financial system, but sharing risk, co-financing investment and jointly engaging with the banking sector in constructing a vibrant growing economy," he said.

In his State of the Nation Address last week, President Kgalema Motlanthe explained that government's social programmes have improved the asset base of the poor, in the form of housing with 2.6-million subsidised houses provided since 1994.

Housing delivery had increased rapidly from 1994 to 1999 and more than 721 813 houses were built in the first five years and more than 892 699 units were built in the second five years.

To address the housing needs of certain households, particularly in rural areas, the Department of Housing facilitated the delivery of approximately 186 000 incremental housing opportunities between 2004 and 2008 through housing finance provided by the National Housing Finance Development Institutions.

During the period from 2004 to 2008, through Breaking New Ground, an estimated 311 600 direct job opportunities were created in addition to a further 290 750 indirect job opportunities, making a total of 602 350 job opportunities.