Government courts banks to house public servants

FREDERICK KEBADIRETSE
Staff Writer | Friday May 31, 2013 00:00

 

In his briefing on land governance issues to the Bankers Association at the Gaborone International Convention Centre (GICC) on wednesday, Permanent Secretary (PS) in the ministry Thato Raphaka requested financiers to make proposals to collaborate with government in providing quality affordable housing to the unserved market.Raphaka said housing provision remains a major challenge with the demand for housing outstripping supply. He said the un-served group is currently ineligible for low income housing programmes and mortgages from financial institutions.He said following the approval of the implementation of the public officers housing scheme, the government found a need to reserve money for facilitation of the construction of houses for public officers countrywide.

He said as a way of citizen empowerment, anyone, including public officers themselves will be open to bid to build houses that will then be rented out to public officers. He said the scheme targets 540 houses countrywide. He explained that the expectation will be that bidders do not have land, but can only be allocated a piece of land after their bid has been successful.He said this is when they expect financial institutions to chip in and assist those awarded tenders for the initiative. He said government would guarantee the loans through rentals for public officers who occupy the houses, or buy the houses outright if the owner is willing to sell. He said the houses would be built on an identical approved plan.

However, the private financial institutions raised several concerns over the issue. The banks wanted the ministry to qualify their guarantee, and wanted to know whether it would be on a short or long term basis. Currently government pays up to P3,000 for rentals while monthly mortgage payments may exceed that amount.Another issue raised by the institutions was affordability of the houses. The prices of the houses may end up escalating based on current property market fluctuations. They said it has been evident of late that houses are overvalued and the houses may end up being unaffordable to the unserved market. Financiers also questioned whether the ministry has liaised with utility providers to avoid problems where utilities are not provided after construction is completed.

The PS admitted that the ministry is aware of several challenges the scheme may face and that they still had unanswered questions. He urged the banks to come forward with proposals  to improve the initiative, as it has to be implemented one way or the other.