Housing Pre-Finance in Gauteng and KwaZulu-Natal

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Focus Areas: Housing

This project has provided pre-finance loans in Gauteng and KwaZulu Natal. Over the course of the project in Gauteng 20 Top Structures were built in Doomkop, 20 Top Structures in Duduza, and 20 Top Structures in Orange Farm. As of 2012, 57 houses have been built and 96 toilets. Beneficiaries have acquired serviced sites and bulk infrastructure in terms of water and electricity has been installed. Roads have also been built from gravel and tar. National policy is that the government pays R54 650 per beneficiary as a housing subsidy. This amount could vary due to geo-tech conditions and/or special development expenses.46 new houses have been completed and are occupied. Each house has a kitchen, two bedrooms, a bathroom (with bath, hand basins and toilet), and a living room. It has two big windows in the front and a window for every room to allow sufficient lighting and ventilation

Households beneficiaries enjoy  improved living conditions – regarding social and hygienic aspects. Peoples’ Housing Process (PHP) is able to construct bigger units (50m2). This has seen a change (first initiated in the Free State) in Government instituting a policy that housing units must be 40m2 or more, resulting in the community beneficiaries in government projects benefitting from the original size of 36m2 to between 40m2 and 46m2. The project is represented by FEDUP at the National Joint Working Group level, a platform where strategy, challenges, and potential policy impacts are discussed. As of January 2012, the persistence of FEDUP pursuing outstanding claim payments has indirectly resulted in developing a closer working relationship with the local/provincial housing departments. Inspectors and project managers of the Department are now also doing more project site visits helping them obtain a clearer understanding of the FEDUP processes at work. The relationship with both the NHBRC and the Provincial Management Unit (PMU) has improved considerably. The officials engage the FEDUP and Community Construction Management Teams (CCMT) directly in resolving issues, instead of calling on uTshani to act as conduit. Challenges of material supply delays were overcome with the sourcing of a new service provider, and stagnation of progress due to heavy rainfall was overcome through additional labour with good weather conditions. There has been improvement in the turn-around payment period of government yet slow payment is still a challenge for reaching desired scale. Slow repayment has placed uTshani under financial strain.

Location: Gauteng and KwaZulu-Nata, South Africa
Bunita Kohler sdi@courc.co.za (+27) 21 689 9408 View Website
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Project information updated: 20 March 2014

Project in depth

Detailed Information

The project started in 2010.  The South African Alliance of Community Organisation Resource Centre (CORC), Informal Settlement Network (ISN), Federation of the Urban Poor (FEDUP) and uTshani, the national urban poor fund, embarked on a pre-financing project, allowing support to be secured from government in terms of plot and services.  Informal settlements addressed in this project were built as people moved from rural areas to be closer to economic opportunities. Pre-financing was created as an approach as government policy does not provide upfront payment. 
Financial sustainability depends on whether government repayment occurs within the stipulated timeframe. Payment of South African government subsidies means that pre-financing will have a recovery rate of 90-100%. Further sustainability of the project is ensured through skills learning. Throughout the course of the project Community Construction Management Teams (CCMT) have developed skills and become empowered such that they are able to train and transfer skills to other newly established CCMTs. Beneficiaries contribute labour and construction skills learnt include brick laying, plastering, roofing, and painting. Further skills include material procurement, labour and material management, community project management, storage, logistics, electrification, and bookkeeping. This means that maintenance can be done by Federation groups and CCMTs.


Funding Information



Implementing Partners

Sida (Swedish International Development Cooperation Agency)

Federation of the Urban Poor (FEDUP)

Community Organisation Resource Centre (CORC)

uTshani Fund