Minister advocates public-private synergy to bridge housing gap

Minister of Power, Works and Housing, Mr. Babatunde Fashola, has advocated a synergy between the Public and Private Sectors in the country as imperative in addressing the nation’s housing deficit.

Addressing the gathering of professional builders, investors and other stakeholders in the Built Industry at the International Conference Centre on the Conference, venue of the 10^th Abuja Housing Show, with the theme, “Expanding Access to Affordable Housing”, Fashola said such partnership would provide quick solution to issues that could impede housing projects across the country.

Such issues, the Minister said, include those of exchange rate and issues of imports of building materials which, according to him, are some of the policies that government control, as well as access to land, which he noted, is a matter within the special domain of state governors, adding that unless the country has such partnership and a clear direction of where it should be going, solving its Housing problems would be difficult.

“I think the important thing here is to have a synergy between government and the private sector. Issues of exchange rate, issues of imports of building materials are some of the policies that government control. Access to land is a matter within the special domain of state governors, unless we have that partnership really and a clear direction of where we should be going, we would have difficulty”, he said.

He said in order to manage the expectations of Nigerians regarding the provision of houses for the citizenry, there was need for a change in the current mindset that government would provide houses for all Nigerians pointing out that it would not be possible to have a sustainable housing development if houses were bought on a cash-and-carry basis.

Fashola, who reiterated the need for a mortgage culture in an economy that is informal such that the size of the monies that citizens own should not be the incentive for having a mortgage culture, pointed out that the current problem in the sector was that the builder or developer wants to see from the bank account of a prospective tenant what his or her income stream is like before he could offer him or her a house, “because of the risk of failure, because of the risk of default and the difficulty of repossession”.

Stressing the need for a concise definition of and a common agreement to what is “Affordable Housing”, Fashola said the present open ended definition has left the expectations of Nigerians at large adding that there was also the need to distinguish home ownership from access to shelter as, according to him, “people can rent”.

“Perhaps we haven’t come to terms with the fact that not every country, in fact, no country, from the statistics from the Chairman of the House Committee, has achieved a hundred per cent home ownership. So a hundred per cent home ownership is a utopia”, the Minister said adding “It is the need that is important; therefore, some people’s salary will never be enough to own a home”.

The Minister also charged participants at the Housing Show to “as the leaders and shapers of opinion” frontally speak to members of the public, through resolutions that would come from the summit, about what is an affordable home adding that it would help in the management of expectations.

Fashola, who wondered about the realistic expectation of somebody who earns N18,000, asked, “Should he expect that he could move from N18,000 in a career ladder up to N100,000 and therefore reach a point where he could step on to the housing ladder?” He added that those were some of the things that distort the assessment of the country’s Housing deficit.

According to him, “Those deficits have been classified as some very large figures, and perhaps they may involve a concept of providing homes for everybody who is an adult. For example, I don’t know how those numbers came about, I don’t know how the parameters for defining them came  about, but no matter how big the deficit is, I think the most important thing first is to define what is a legitimate expectation, that if I have this, I’ll be able to get on the housing ladder”.

On the kind of home that should be built, Fashola, who noted that across the length and breadth of this country people are building houses, many of which are empty, noted also that across the length and breadth of the country, there is no credit, and landlords are “demanding rental income of 2-3 years from people who earn their salary in arrears”, adding, “We are asking them to pay it in multiple of advances, again, that leaves constraints to access to shelter by rental”.

The Minister debunked the argument by some people debating whether or not government should even get involved at all in Housing, asking, “The question I ask those who make that argument is that apart from government led initiatives which have not in any event been sustained, where is the sustained private sector’s affordable initiative that we can point to that have reached those vulnerable people?”

Fashola said even with the N35 billion provision in this year’s budget, the best that Government could hope to achieve with that was a proof of concept, that what it has started developing in the Ministry would work, pointing out that N35billion split across the 36 states and the Federal Capital Territory would only amount to about N900million plus which, according to him, would not even scratch the housing needs of the people “in the very first year”.

The Minister pointed out, however, that what the Ministry was seeking to do was to first develop housing designs that would fit the different cultural predispositions across the country adding that it was expedient to accommodate the cultural predispositions in order to get people to even accept what was being offered them.

He noted that some of the previous Housing initiatives had not had occupancy because the cultural dispositions in parts of the country had not been receptive to them pointing out that some parts of the country would rather live in flats than bungalows. He, however, asked, “But can their income support it?”

“Some of the surveys we’ve done interestingly show us that some parts of the country still reject the idea of a toilet inside the house, so we have to build for those class of people and put it in the courtyard. Some are as strange as suggesting that between in-laws, male and female should have separate toilets. Now every additional toilet is cost, can they afford what their culture dictates?” he asked.

Fashola, who said the Ministry was narrowing down to six the 12 designs already evolved, added that the Ministry intends to replicate the six designs in response to the nation’s cultural needs pointing out, however, that it would not solve the financial needs. “These are some of the issues we’re dealing with”, he said.

Thanking the organizers for the honour of their invitation, Fashola expressed optimism that if the opportunity offered by the forum was utilized appropriately by participants, it would help to put the problems of housing deficit in perspective adding, “And from what I have seen over the years, I don’t think there is any doubt at all that Nigerians can build houses. There’s no doubt about that, we build for ourselves and we build for corporations, and so on”.

The Minister, who described the theme of the conference – “Expanding Access to Affordable Housing” – as “the heart of the matter”, expressed confidence in the quality of the discussants adding, “I think they have sufficient experience to share the problems and realities of the industry with participants”.

“But I think the time has come as a people to first define and agree to what is affordable, before we begin to discuss the expansion of the access. What is an affordable home, and I think this is where some of the problems lie. It has helped to leave expectations at large”, he said.