Isandla Institute Response to Minister Sisulu’s Budget Vote Speech

Isandla Institute has noted Minister Sisulu’s address pertaining to the Human Settlements Budget Vote (33) on 18 May 2021. As an organisation advocating for and contributing towards systems and
practices of urban governance that are democratic, inclusive, equitable, accountable and sustainable, we are particularly concerned about spatial transformation of South Africa’s cities and towns.

We welcome the substantial increase in funding for informal settlement upgrading. This is a significant development, and demonstrates recognition that urbanisation is inevitable and that informal settlements are here to stay. This demonstrates a clear break with earlier the approach attempting to ‘eradicate’ informal settlements and we welcome the more pragmatic stance taken by the Department of Human Settlements that focuses on improving the lives of people who live in informal settlements, both now and in the future.
However, there are still questions about how the process of upgrading will play out in reality. The budget positions the newly introduced Informal Settlements Upgrading Partnership Grant (ISUPG) as the key funding mechanism through which upgrading will take place, but little information is publicly available about how the grant will function. For instance, there has been no official communication about the conditionalities attached to the grant, which makes it difficult to understand exactly how it will be used by provinces and metropolitan municipalities.
Another concern, and one that is often raised in relation to government target setting, is that there is no evidence that the informal settlement upgrading targets contained in the budget are evidence-based. There are legitimate doubts about whether the targets are based on meaningful engagement with municipalities and provinces, and whether an analysis of the actual costs associated with upgrading specific settlements has taken place. Setting realistic targets that are based on sound evidence is important both for achieving outcomes and for accurately and appropriately measuring government performance.
Thirdly, and importantly, there is a sustained risk of equating informal settlement upgrading to ‘the provision of serviced sites’, a slippage even evident in the Minister’s speech. Yet, the policy on informal settlement upgrading is much more encompassing and includes planning for, and investing in, functional and dignified neighbourhoods – by providing social and economic amenities as well. This certainly brings into question what specifically the new grant will be used for and what measurements of informal settlement upgrading the Department (and other spheres of government) will use.
While much-needed emphasis has been placed on informal settlement upgrading, there is no mention of the informal backyard rental sector in either the budget vote or budget speech. This is worrying, especially considering that this is a rapidly growing housing sector that accommodates an increasing number of people year on year. Not only is it growing substantially, but it is also an increasingly insecure sector because of the impact of COVID-19 and the associated lockdowns. The increased financial pressure faced by many households living in backyard accommodation is directly related to the increase in land occupations across South Africa’s metropolitan municipalities. Occupations will increase and a growing number of people will face housing insecurity if the informal backyard housing sector does not get the attention and resources that it deserves, so it is disappointing to see that the sector is not mentioned explicitly in the budget.
We would have liked the Minister to have addressed the issue of ‘affordable housing’, and in particular offer a more nuanced perspective on the broad household income band of R3,501 - R22,000 that is being targeted by the Human Settlements Development Bank. We believe that this income band should be more clearly segmented to ensure that public money is spent on those who need it most. Many private developers are already catering to the R18,000 - R22,000 income market, which brings into question whether scarce public resources should be invested here - especially when the scale of our housing crisis is so large.
Finally, we expected Minister Sisulu to confirm that a new Human Settlements White Paper will be out for consultation this year. The White Paper has been forthcoming for several years, and will play an important role in clarifying how the various human settlements programmes will fit together to achieve socio-economic inclusion and spatial justice. The omission of the White Paper from the budget speech is curious, and we would like to understand why such an important policy document was not mentioned.
Isandla Institute remains committed to ensuring that all urban citizens have access to opportunities and resources that support dignity, agency and equality.

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Monday, 24 May 2021 08:05