RENTAL SUBSIDY FOR MOBENI TENANTS

MBABANE – A huge relief is on the cards for Mobeni tenants. Chief Executive Officer (CEO) Mduduzi Dlamini has disclosed that the Swaziland National Housing Board (SNHB) has requested a rent subsidy from government every year to redress the disparity between the controlled rental imposed by government and the market related capital and operational expenses that the Board is exposed to in running the business.

He said the 1 034 SNHB units were, in effect, social housing and should therefore have been subsidised  from the very outset, such that government, as  the shareholder, funds the gap between the prescribed or controlled rental rates and the market rates to enable the organisation to run as a sustainable entity.
The request for a subsidy therefore seeks to correct this anomaly.

“We will continue to engage government on the issue of a rental subsidy so as to offer an affordable product to our Swazi tenants,” said Dlamini.
When asked how the subsidy, if approved, could help towards a reduction of the rental fees, Dlamini explained that a subsidy, in social housing, was derived by way of a ‘Means Test’ which determines the income levels of intended beneficiaries.

He said the rental is then set at a level that does not exceed 30 per cent of the gross salary of the target population (for example, if the gross salary for the target beneficiary is E6 000 per month and the rent for a unit in the private market is E4 500 per month, then the SNHB rental would be set by government at no more than E2 000).

Government would then pay SNHB a subsidy of E2 500 for this beneficiary to make up the shortfall between the regulated SNHB rental of E2 000 and the market rental of E4 500 per month. The subsidy enables the SNHB to cover market-driven costs such as security, salaries, insurance and maintenance materials among others.

Dlamini said SNHB units were intended to offer conveniently located accommodation for low to middle income earning Swazi citizens.
For this reason, he said their rental rates had traditionally been set well below market levels for similar units, and rent increases are controlled by Government through the Cabinet Sub-Committee on Public Enterprises (SCOPE).
The CEO said there had been prior years where SNHB had been compelled to not escalate the rentals or to increase them only by major which is the rate that is prescribed by Government.

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