Chairperson, the building of sustainable human settlements will be more meaningful if apartheid patterns of city and town planning are reversed from urban sprawl to higher densities. Such a reversal would have economic benefits to the beneficiaries and maximise the use of existing infrastructure.
The development of human settlements, including the in situ upgrading of informal settlements, has to be informed by the economic development plans of the country. The mandate of the Housing Development Agency, HDA, to acquire suitably located land for human settlements is encouraging, especially where state-owned land is being prioritised. However, if government continues to allow the sale of state-owned land at market- related rates to the HDA, this programme too will fail.
The establishment of the credit guarantee insurance fund should be welcomed as it is likely to stimulate the housing market in South Africa. It is our view, however, that if our economic growth fails to create jobs, the default rate could remain high and thus produce distortions within the economy. There may be an oversupply of housing stock but the demand may be muted, thus creating reliance on social housing.
Similarly, the prioritisation of human settlement development projects ought to be informed by the economic development plans of the country and migration trends. It seems a waste of state resources to build houses in areas where there are no economic activities. In some rural areas or towns, houses have been built but remain empty and vandalised, while the potential beneficiaries have moved on to areas where there are prospects of employment.
These trends lead me to the issue of the appropriateness, or lack thereof, of the housing stock the country produces and some of the delivery forms used. It is all good and well for the government to argue that a shift from quantity to quality is the reason the quantum of housing stock being build is shrinking. But it should not be forgotten that R1,3 billion of this budget will be spent on repairing and rebuilding houses that are falling apart due to poor workmanship by contractors.
Secondly, it is evident from the business plans produced by the provinces that there is a misalignment between the national budget and the provincial plans, and, in turn, between the provincial plans and the municipal budget cycle. This can result in underspending, misappropriation in the allocation of funds, or fiscal dumping. This misalignment is caused by inadequate co- ordination between the national departments and provincial departments. For example, while the state of the nation address refers to the upgrading of 500 000 units by the year 2014, the provinces allocate only about 6% of their total budgets to this segment, instead of a possible 25% required to meet this target.
Furthermore, the construction of rental housing stock for the lower end of the market has become an absolute necessity. This will address the plight of those who have already benefited from the housing programme elsewhere but have migrated to cities in search of work. The state must also create instruments that will encourage citizens to participate directly in housing development initiatives, such as housing co-operatives and housing associations, to promote different forms of ownership.
This country is heading for a major crisis, because property is changing hands without the sellers and buyers following the necessary legal requirements of registering their transactions in the Deeds Office in order for the legitimate owner to have the title deed. If this situation is allowed to continue, it will defeat the intention of converting these houses into valuable assets which can be inherited by our children and our grandchildren.
Owning a house without a valid title deed is like driving a car without a driving licence. Sooner or later you are going to crash and lose value, because your asset is neither insured nor is it an asset you can use as surety once a problem arises. I urge the Minister to please pay attention to this urgently. With this in mind, we support this Budget Vote. [Applause.]