Saturday, January 16, 2021

BHC finds reprieve as minister announces new interventions

The Botswana Housing Corporation was last week given a breather when Lands and Housing Minister, Nonofo Molefhi, announced a number of government interventions that will finally see the corporation containing its incessant problems of cost escalations and lack of land.

“We are alive to the problems that BHC is facing in its mandate of delivering affordable accommodation to Batswana, and, after consultations with the corporation and other stakeholders we have resolved to address them during NDP 10” said the minister.

BHC has been grappling with a number of problems in its operations, among them escalating costs in the face of stagnant rental and purchasing revenue. The corporation has for years been laboring under the heavy yoke of outstanding rental arrears a problem which it seems they have eventually managed to overcome.

However, shortage of land, escalating costs of building material, especially steel, and the increasing costs of retaining qualified personnel still give BHC management sleepless nights.
“I am informed that a project in Maun is lagging behind because the Corporation had to renegotiate with the contractor following an escalation in the prices of steel products, and in other projects in Gaborone, delays were encountered as a result of lack of bricklayers with experience in laying face bricks. Furthermore shortage of land, particularly serviced land, also impacts negatively in the Corporations endeavors” said Molefhi in Francistown last week.

The high cost of building materials directly escalates the cost of construction and is eventually passed on to the consumer, thereby making BHC products and services unaffordable for the masses.

Lack of land has also been a major problem for BHC. The corporation usually has to purchase land from government for their projects but it seems that the land authorities are not very proactive in providing the much needed land to the corporation.

BHC CEO Reginald Motswaiso said on Wednesday that the corporation has depleted all its land in Francistown and barring the intervention of land authorities they will not be able to augment the acute shortage of accommodation in the city.

At the same time BHC also has had problems of lack of serviced land and has in the past had to seek financing from independent financial institutions to service their land, thus escalating the costs of their products and services. The same costs would eventually be borne by the consumer.
It has also emerged that local authorities sometimes take too long to give the corporation the go ahead to start their projects on time resulting in some of their projects lagging behind.

The relationship between BHC and other utility providers like Water Utilities Corporation and Botswana Power Corporation also seems to be acrimonious. There have always been insinuations that the utility providers take too long to service BHC projects resulting in disgruntlement from customers most of whom would be expecting an immediate return on their investments.

“I am further informed that supply of electricity to BHC houses is a major source of delay in the delivery of such housing. I want to urge local authorities and other service providers to have a tit-a tat with BHC to find ways of overcoming these challenges” said Molefhi.

These problems have bred bad publicity and general discontent from Batswana who feel that BHC has lost sight of its mandate of providing affordable housing to citizens.

BHC CEO Reginald Motswaiso has in the past called for the amendment of the BHC Act to make the corporation more autonomous. He said at the time that because of lack of autonomy BHC is faced with impediments in the implementation of prudent management decisions that would benefit the corporation’s business. He said that they are restrained by having to report to the minister who reports to cabinet, a tedious process which hampers speedy commercial decisions. The amendment of the act would effectively shift power from the minister to the corporation’s board of directors and eventually enable the board to make independent decisions on issues like rental increments and loan acquisitions without having to seek approval from the minister.

But Molefhi last week came to the corporation’s rescue when he announced that government has taken a deliberate decision to make serviced land more available to BHC so that their production costs are greatly reduced.
At the same time government will enable BHC to access public funds so that the corporation desists from accessing funds from independent financial institutions which comes at a cost.

He also said that government is exploring avenues of accessing readily available land in villages surrounding urban areas for residential purposes. This, he said, will reduce the problem of shortage of land in urban areas and also assist in taking more developments top rural areas.

“Next year we will revisit the corporation’s mandate and harness it so that it enables the corporation to deliver more affordable housing to Batswana” said the minister.

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