Hon Chairperson, hon Minister, Deputy Minister, hon members and distinguished guests, in November 2010 I travelled with a lady on a flight to Durban. We discussed the process that her employee, Khanya, must follow in order to apply for an RDP house. Living conditions where she was residing were not good. Her young daughter was raped and one of her children could not live with her because there was no room for him.
After her attempts to see the councillor, unanswered phone calls in the Department of Human Settlements, and attempts to meet with the chairperson of the housing committee, the city manager and finally, in desperation, the Minister's office were all in vain, I had to apologise that none of us in our high-powered positions could assist Khanya to apply for an RDP house.
The following is the final e-mail I got from the lady I travelled with in 2010, which I received in November 2012, in which she says that the ward councillor had informed Khanya that in order to be considered she had to erect a shack of some sort. Khanya has been investigating opportunities which are not entirely suitable for her, nor cheap. However, I am happy to say that with our assistance, she has arranged for an area to be cleared where she currently dwells under a friend's roof. She has asked a neighbour to dig a hole for ablution, which he did yesterday and cost her R150. Tomorrow, if all goes according to plan, and hopefully it is not a scam, a "Zozo-type" hut will be erected on the cleared area and she will be the proud owner of the shack. I still pray every night that she will be picked out from the crowd and find herself going home at the end of a long working day.
Thousands of people like Khanya are desperate for a house - not an easy situation. However, it is not only the Khanyas at the bottom of the pile who struggle to get a house. I want to focus today on what is called the gap market, those people who earn too much to qualify for an RDP house and yet do not earn enough to qualify for a bond. The beneficiaries I am focusing on are our teachers, nurses, police, small business owners, and so on.
In his February 2012 state of the nation address President Jacob Zuma introduced the concept of a Finance-linked Individual Subsidy programme, known as Flisp, for people earning between R7 OOO and R15 000 per month - that was an adjusted figure - with a maximum subsidy of R87 000. Flisp assists people who can't afford monthly repayments on a full mortgage bond to make a deposit.
Let me use an example, because I hope I'm speaking to these people out there. A property is selling for R300 000, which is the maximum allowed under this scheme, and you meet the qualifying criteria for the full subsidy - let's say of R87 000, and that also varies. You take your R300 000 for your house minus the R87 000 subsidy leaving a bond of R213 000. The bond repayments now become affordable. So, Flisp is the department's way of bridging the gap. [Applause.] The scheme, as the Minister has already indicated, is available through the National Housing Finance Corporation, NHFC.
Owning a property makes you stand 10 feet tall. Come on, you've got to admit that! It also gives you dignity. For most people it will be their biggest investment. The latest research into the provision of affordable housing in the so-called gap market in South Africa shows that it is an important facilitator for opportunities and wealth creation.
The study found that those who obtain homes in this sector move beyond viewing them as a mere shelter. Instead, their homes become assets which they can then use as collateral to obtain loans. This empowers them for entrepreneurship, job creation and access to higher levels of education. Increasing entrepreneurship in South Africa will also lead to increased employment, a key contributor to job growth globally.
The Estate Agency Affairs Board also has a very important role to play in Flisp. During a presentation to the Human Settlements portfolio committee, we established that they will be working with the NHFC to promote this market. They are ideally placed as they include in their road shows a special focus on the gap market. The estate agents can identify properties falling within the R300 000 categories and compile a database of people in the gap market who qualify for this.
Currently, property investors are buying up these properties, but this is still an opportunity for the gap market to buy into the property market. Parliament will be working closely with the board to ensure that opportunities are opened up for this market. The best of all is that the structure is all in place and it will not cost the department anything.
I now want to move on very briefly to social housing. The Social Housing Regulatory Authority is producing excellent results in providing rental accommodation. It is estimated that one in five South African households lives in either formal or informal rental housing accommodation. The influx of people from rural areas is leading to an ever increasing demand for rental accommodation.
Madulammoho, meaning "living together", is a registered nonprofit section 21 social housing institution that was established in 2004 and operates seven housing projects in the Johannesburg inner city. [Applause.] It pioneered what is called the stepped approach to housing, providing people with alternative housing options at different rental levels. It demonstrates that as people are supported and their skills are developed, they are able to earn more and, as a result, their housing options improve. However, if incomes decline, tenants may need to seek a reduced alternative. It provides for simple shelters, transitional housing, communal housing and social housing - this is thinking out of the box.
This stepped approach provides for people with different earning incomes ranging between nothing and R7 500. The accommodation meets the needs of the people. The ANC congratulates Madulammoho on winning two Govan Mbeki Awards in 2013. [Applause.]
Corruption and maladministration is rampant in the housing sector and the ANC commends the Minister and his department for the steps taken to root it out. However, it is moving a little too slowly; of R4,2 billion only R30 million has been recovered. We need to do something about that.
Former President Nelson Mandela said during his acceptance of the Nobel Peace Prize in 1993:
We live with the hope that as she battles to remake herself, South Africa will be like a microcosm of the new world that is striving to be born. Let it never be said by future generations that indifference, cynicism or selfishness made us fail to live up to the ideals of humanism which the Nobel Peace Prize encapsulates.
Chairperson, may I address the Minister? Your department has been remaking itself. Can you assure this House that future generations will not blame you and us for failing them in the delivery of human settlements because of our indifference, cynicism or selfishness? The Khanyas, teachers and nurses are depending on you. They are depending on us. You dare not fail them and we, as Parliament, dare not fail them. Thank you. [Applause.]