Home | News | Where's E1.5bn housing project?

Where's E1.5bn housing project?

Font size: Decrease font Enlarge font

MBABANE – Moves are afoot to get a loan of E1.5 billion for the national housing project announced by His Majesty the King two years ago.

However, the project is experiencing financial problems as it has taken government two years to get it started.

External financiers are willing to offer loans for this pro-poor project but government’s capacity to service the debt in the face of its cash-flow crisis comes to question. The project is almost similar to that of South Africa’s announced by Jacob Zuma, the country’s president.

Zuma announced last Thursday in his State of the Nation address that citizens earning between E3 500 and E15 000 would get loans for E84 000 to build decent homes.

In Swaziland, the project would have several components; building institutional houses and national houses in general.

Institutional houses relate to construction of accommodation units for public servants.

National housing will cater for low-income earners who find it difficult to get housing loans from the bank.

A bank usually demands a deposit or commitment fee of 10 per cent of the principal housing loan.

Pastor Lindiwe Dlamini, Minister of Housing and Urban Development, said economic problems disturbed government’s plans to undertake the project initiated by His Majesty King Mswati III two years ago.

She said there was a strong need to undertake the project this financial year.

She said preparations, in terms of source funding, were at an advanced stage.

The housing project is expected to have economic spin-offs that will create job opportunities.

"Many people will get jobs," said the minister.

She said certain institutions really wanted to assist but the capacity to pay back the loan was minimal at the time of discussions.

The minister believes there is a glimmer of hope that the financial situation will improve in the next financial year, beginning April 1, 2012.

The minister said there was no way they could not make the king’s dream a reality. Besides being his dream, the king said, the project was vital because it centred primarily on human investment.

His Majesty announced the project from the Throne in 2010 when he officially opened the second session of the nineth Parliament.

It can be said that the project, if finally implemented, would be one of the most expensive public works to be undertaken by government.

The under-construction Sikhuphe International Airport and the Mbabane-Manzini Highway connected to the Mbabane-bypass and Ngwenya-Mbabane Highway are some of the expensive projects the government had undertaken.

Sikhuphe, so far, has taken over one billion Emalangeni from the public purse while the highways also cost some billions of Emalangeni.

The Times SUNDAY was told that ministries involved in the project were still making broader consultations for the national housing project

The ministries involved in the project are Ministry of Housing and Urban Development; Ministry of Public Works and Transport; Ministry of Public Service and Ministry of Finance.

Sources said government had initially wanted to use Swaziland National Housing Board (SNHB)’s balance sheet to secure the funding. Government would have been a surety for the loan.

However, the SNHB said it was only to become an implementing partner.

Khulile Dlamini, Corporate Services Manager, said SNHB was never asked to secure external funding on behalf of government.

"SNHB is only an implementing agent, only the principal. That is, government would be in a position to know when the project will commence," she said.

Clifford Mamba, Principal Secretary (PS) in the Ministry of Housing and Urban Development, said ministries were still discussing the project. He said they were talking to potential funders and the project would definitely have to take off because it was announced from the Throne.

Mamba confirmed that funding had not yet been solicited. He said there were, however, concerted efforts to get it.

"The project has to start this year," he said.

Post your comment comment

Please enter the code you see in the image:

: Capital projects
Do you think the capital projects mentioned in the budget speech will come with quality jobs?