COHRE Low Income Residents South Africa Pietermaritzburg 2007

Pushed to the periphery: Low-income residents in Pietermaritzburg, South Africa

France: A low-cost housing development on the outskirts of Pietermaritzburg

Introduction The Centre on Housing Rights and Evictions (COHRE) and the Centre for Applied Legal Studies (CALS) received reports of evictions from Municipal housing in Pietermaritzburg, which prompted a joint investigation during 2005 and 2006. While our primary focus was on the relatively small stock of Municipal social housing, our research points precisely to the much larger crisis faced by many more people in and around Pietermaritzburg given the woefully inadequate provision of public, affordable rental accommodation.

Nationally, South Africa has been one of the most inequitable societies in the world, and the gap between rich and poor has continued to widen in the post-apartheid era. These very broad trends obviously shape the housing market in a South African city, like Pietermaritzburg. They have

been sharpened by the city's relatively recent reinstatement as the administrative and legislative capital of the province of KwaZulu-Natal in 2004. This development has helped trigger a surge in economic 'development' in the area. The relocation of a number of government departments to the city saw an influx of government officials and their families, and others seeking new employment opportunities. The increased effective demand for accommodation resulted in an unprecedented surge in property prices.

Although this 'property boom' had the general effect of raising the costs of accommodation and increasing the demand for rental space, these segments of the property market that are responsive to the effective demand of middle and upper class purchasing power have never provided shelter for the poor majority. For the most part, the poor remain concentrated in the racialised townships, segregated more or less as they were under apartheid. Increasing numbers – as we discuss briefly later – live in shack settlements carved into spaces that are at least closer to the survivalist opportunities of the city centre, even if their tenure is precarious and their living conditions grossly inadequate.

Under these conditions, the provision of public rental accommodation for purposes of 'social housing' by local authorities becomes crucial. The demand for rental accommodation is growing as purchasing property is beyond the means of most Pietermaritzburg residents. However, the Municipality has done little to alleviate the shortage of affordable rental accommodation. In fact, the Msunduzi Municipality is facing a backlog of 15 000 housing applications, partly as a result of this.1 The housing department has confirmed that the housing application list has been closed since 2003.2

The Msunduzi Municipal Housing Stock The Msunduzi Municipal housing stock consists of 377 rental units. However, as of August 2005, 294 units out of the 377 were in arrears, and some 64 percent had been in arrears for more than six months.3 Outstanding arrears totalled approximately R3.4 million in August 2006.4 Due to their failure to pay rent, residents have been evicted or threatened with eviction. Following reports of evictions, COHRE and CALS were drawn to the situation at Willow Gardens to investigate. When interviewed, residents attributed the large number of rent defaulters to the Municipality's policy of imposing rental increases of 15 percent per annum since 20005 - a rate far greater than the rate of inflation. The Municipality's own documents state that, "rental for new lettings of State-funded and Council-owned housing escalates at a rate of 15% per annum as per Council Resolution, until 'break even' market rentals are reached."6 Willow Gardens Flats Built in the 1960s, the Willow Gardens complex contains 207 units and houses more than 1 000 people, within relatively close proximity to the city-centre and the central business district. The flats vary in size from single-bedroom to three-bedroom apartments. Originally for exclusive 1

Msunduzi Municipality, 'Status report on the update of council’s housing waiting list and to review income limits for council’s rental stocks' [28 Oct. 2005]; Msunduzi Municipality, 'Integrated Development Plan' [May 2002] 2 Councillor Glenn McArthur. 'Housing Fiasco' The Witness, [1 Oct. 2005] 3 Mark Steele, 'Msunduzi Municipality Housing Issues' The Witness, [Aug. 2005] 4 Mbongeni Zondi, 'Avoiding eviction and rent payments' Daily News [25 Aug. 2006] 5 Msunduzi Municipality, 'Tariffs & Charges'1 July 2005 to 30 June 2006'; Msunduzi Municipality, Written submission by Sound Governance and Human Resources Strategic Business unit (legal Division) for the Rental Tribunal, REF No 12.2.3.1 [18 Jul. 2005] 6 Ibid, Msunduzi Municipality, 'Tariffs & Chargest'.

2

occupation by poorer whites, the racial mix has changed in the post-apartheid period after racial segregation was abandoned as official policy. At this time, in 1994, flats were designated for lowincome tenants and applicants were required to earn a maximum salary of R1 200 in order to qualify for housing at Willow Gardens.7 However since 2000, the Msunduzi Municipality has effectively abolished this ceiling limit and instituted a minimum income level.8 As of 2006, the minimum income level necessary to qualify to be placed on the Municipality's waiting list was R3 500 per month. Furthermore, in order to qualify for a flat at Willow Gardens the minimum income level was between R4 525.60 for a bachelor flat and R7 240.86 for a three-bedroom flat, reflecting an increase of between 377 percent and 603.4 percent from the original maximum ceiling or an average annual increase of between 23 percent and 41.9 percent.9 These increases accommodated the rental increases of 15 percent per annum, as the Municipality's policy requires that the rent should not constitute more than 20 percent of an applicant’s gross income.10

Springbok flats: One block part of the Willow Gardens complex

Rent-related evictions As growing numbers of tenants were unable to make their payments, the Municipality began to issue eviction notices, and to carry out evictions. Once a unit becomes vacant, the Municipality provides the unit to relatively better-off applicants – people with salaries that meet the new minimum stipulations. Residents of Willow Gardens have concluded that the Municipality is implementing a clear and sustained strategy, calculated to force poorer tenants to vacate their homes. The Municipality's policy of escalating rental rates at 15 percent per annum to achieve 'break even' market rentals will effectively end the Msunduzi Municipality's provision of social housing in Pietermaritzburg.

7

C. Werner, Chairperson, Willow Gardens Residents Committee [personal communication] [22 Nov. 2006] Msunduzi Municipality, Written submission by Sound Governance and Human Resources Strategic Business unit (legal Division) for the Rental Tribunal, REF No 12.2.3.1 [18 Jul. 2005] 9 Msunduzi Municipality, 'Tariffs & Charges'1 July 2005 to 30 June 2006' 10 Msunduzi Municipality, 'Status report on the update of council’s housing waiting list and to review income limits for council’s rental stocks' [28 Oct. 2005] 8

3

“I got a call at work from my neighbour to say that the Municipality had evicted me. I was shocked and came home to find all my furniture and clothing outside on the grass. I have a disabled child and she was just left with the furniture in the hot sun. She was having a fit and I had to rush her to hospital.� - Willow Garden’s resident

As the resident above relates, the Municipality evicted her family without the legally required court order or sufficient notice and in her absence. Her child died two weeks later.

Socioeconomic status of the Willow Gardens Residents In 2005, the Willow Gardens Residents Committee conducted a random sample survey of 54 units at Willow Gardens to ascertain the socioeconomic status of residents and to better understand the crisis of rent affordability. The Residents Committee required an official pay slip from each participant and ensured that all information was confirmed before a commissioner of oaths. A brief synthesis of the survey information is detailed below and shows how arrears spiralled as the rents increased.

Income The average income per month for the residents of Willow Gardens was R1 773.76. Figure 1 shows the source of income for most tenants as employment (90 percent), with social grants (seven percent) and pensions (three percent) constituting the remainder. This shows that the majority of tenants are employed and obtaining regular salaries.

Figure 1: Source of income at Willow Gardens 100

90

80

% contribution

70

60

50

40

30

20

10

0

Employment

Social grants

Pensions

4

Rent Figure 2 shows the rent as stipulated on the lease agreement between the tenant and the Municipality against the rent currently required by the Municipality. The rent stipulated on the lease agreement averaged at R568.90 per month. In 2005, the average rent had increased to R1 023.25 per month. Figure 3 shows that on average, rent currently constitutes more than half (58 percent) of tenants’ incomes.

Figure 2: Rental increase at Willow Gardens 1200

1000

600

400

200

0

Rental stipulated on lease agreement (Average)

Current rental (Average in 2005)

Figure 3: Rent vs income at Willow Gardens 2000

1800

1600

1400

1200 ZAR

Average rent (ZAR)

800

1000

800

600

400

200

0

Average rent stipulated on lease agreement

Current rental (average in 2005)

Total income of tenants (average in 2005)

5

Municipal logic for rental increases In an attempt to justify the rental increases, the Msunduzi Municipality Housing and Community Services Committee reported to the Msunduzi Municipality Executive Committee (EXCO)11 that they were the result of: • The effects of the Prevention of Illegal Eviction from and Unlawful Occupation of Land (PIE) Act; • High unemployment levels; and • Abscondments.

None of these reasons stand up to logical scrutiny however. First, the rental increases cannot be attributed to the PIE Act as this Act, intended primarily to prevent evictions and protect illegal occupiers and residents from illegal eviction, only provides for carefully regulated legal eviction where property has been illegally occupied, which is not the case for Willow Gardens residents.

As a perverse result, however, the crisis created by the Municipality's actions (to increase the rents beyond levels of affordability) means that, in a certain sense, the PIE Act might apply because many of the residents have had their leases terminated as a result of being in contravention of their lease agreement - usually as a result of the non-payment of rent. Theoretically, these residents might now be considered 'illegal occupiers'. Even so, it must be noted that no legal action has been taken by the Municipality with reference to the PIE Act. The only dispute currently underway, in some legal form, is as a result of the Willow Gardens Residents Committee lodging a complaint with the KwaZulu-Natal Rental Housing Tribunal12 precisely to contest the unfair rental increases and notices to vacate. The second 'justification' offered is the reference to high levels of unemployment. Certainly unemployment is unacceptably high but logic does not stand that the appropriate response by the public authority responsible for providing accommodation for the poor would be to increase the rentals of the people affected. The final reason offered by the Committee was that rent increases were implemented due to abscondments (i.e. people abandoning their flats). This seems to be the least reasonable of all the justifications.

In a meeting with the Municipality’s senior legal advisor, Mr Kass Thaver, COHRE and CALS established that there is no rational basis in law for the rental increases. In that meeting, Thaver claimed that the rental increase was instituted in accordance with the National Housing Act 107 of 1997 (NHA). An EXCO meeting on 7 December 1999 resolved: “That the City Estates Department bring to the attention of the residents, the implications of the new Housing Act (107/97), which requires, inter-alia that fair market rentals be levied.”13 However, the Housing Act makes no mention of increasing rentals to achieve 'fair market' rates. In fact, it is COHRE and CALS' position that increasing the rent of Municipal housing at rates of 15 percent per annum, as a calculated policy to remove the lowest-income residents, is in direct contradiction of the purposes of the National Housing Act. Rather than ensuring that rentals did not constitute more than 20 percent of current residents’ incomes, the Municipality deliberately created the conditions for excluding poorer tenants by only offering accommodation to better-off applicants where the new, market-related rental did not constitute more than 20 percent of the applicant’s gross income (i.e. the applicant had to earn a minimum of R3 500). Predictably, residents who

11

Msunduzi Municipality, 'Report by Strategic Executive Manager Infrastructure Services and Facilities for Infrastructure Services and Facilities Committee' REF No 1/-/3(6) Housing Administration Division; 'Quarterly Report on Housing', Statistics for the period 1 January – 31 March 2006, [8 May 2006] 12 Discussed further below.

13 Msunduzi Municipality, Written submission by Sound Governance and Human Resources Strategic Business unit (legal Division) for the Rental Tribunal, REF No 12.2.3.1 [18 Jul. 2005]

6

signed lease agreements under the old rental regime could not meet the new requirements and fell into arrears.

I live in a bachelor flat at Willow Gardens. Presently I am unemployed but receive a social grant of 780 rand per month. My rent is 760 rand per month. So I have 20 rand to feed myself! – Willow Gardens Resident Although the legal basis and reasoning for these changes is highly suspect, the alignment of rentals with market-related pricing does at least provide a coherent explanation for the Municipality's actions – in a way that references to abscondment, unemployment, and legislation to prevent illegal evictions do not.

“We know that people can’t afford current rentals.” – Kass Thaver, Municipal Legal Advisor (19 October 2005) Alternatives on the table As a result of the rental increases, tenants have been forced to consider the alternative presented to them by the Municipality. In August 2005, the Municipality resolved that all tenants who are declared 'indigent' and who are residing in Municipal rental housing stock would be offered alternative accommodation. People who applied to be declared indigent (which means admitting that they are earning less than R1 956 per month), and who accept the offer of alternative accommodation, would be granted rental relief and a moratorium on rental arrears. Those who do not apply for indigent status and refuse alternative accommodation will be subject to normal credit control procedures - and eviction.

France The Municipality has offered alternative accommodation to 'indigent' residents in a low-cost housing development called France. This development is situated on the outskirts of Pietermaritzburg, some 15 km from the city centre. Residents of France complain that transport is a significant problem because it is expensive to commute. Additionally, the infrastructure at France is basic: a 30 sq. meter single room structure with a cold water tap and a toilet.

The alternative accommodation on offer at France

7

Accommodation at France is not at all comparable to residences at Willow Gardens. These are 100 sq. meter flats that are fitted with a hot water geyser, one, two, or three separate bedrooms, a fitted kitchen, and a bath in the bathroom. Clearly therefore, the accommodation on offer at France is not an equivalent or adequate alternative for Willow Gardens residents, particularly for those with families.

Selling the Willow Gardens flats “The Willow Gardens flats, at current property value, are worth tens of millions of Rand.”

– Mayesh Chetty CEO MHA, 13 October 2005.

In July 2001, the Municipality considered selling the Willow Gardens Complex. One option was to sell the complex to the Msunduzi Housing Association (MHA), a non-profit institution.14 The MHA already owns or manages other former Municipal housing stock in the city. In fact, 75 units of Municipal stock have been transferred to MHA management in recent years. The MHA continues to increase its asset base in order to expand its rental accommodation developments. In 2001, the MHA proposed to the Municipality an offer to purchase the flats at the then current value of rental arrears, of R700 000 per annum.15 However, the MHA was not willing to buy Willow Gardens unless it was a viable business. In light of this, the strategy of increasing the rentals also coincided with the Municipality's preparation for the sale of the flats.16 However, the Willow Gardens Residents Committee resisted the proposal that the flats be sold to, or administered by the MHA. The residents said that the units should rather be sold directly to them.17 Faced with the insecurity of ongoing threats of eviction and unaffordable rentals, it is perhaps not surprising that a subsidised route to private ownership (via the EEDBS - see below) currently looks like an attractive option to many current residents. Whether or not private ownership in the housing market would in fact turn out to be more secure for poor tenants remains an open question.

The Enhanced Extended Discount Benefit Scheme (EEDBS) In December 2005, the Enhanced Extended Discount Benefit Scheme (EEDBS) was enacted.

This is a national policy aimed at facilitating the transfer of public housing stock to occupants.18 It supersedes the previous 'Discount Benefit Scheme' and 'Phasing Out Programme'. Although the EEDBS took effect in December 2005, the Municipality has not implemented this policy for its rental housing stock.19 The sale of the Willow Gardens flats under the EEDBS would have to take the following into consideration: Willow Gardens comprises four schemes built between 1965 and 1971. Willow Gardens 1 (36 units), 2 (36 units) and 3 (105 units) were built with State funds and Willow Gardens 4 (30 units) was built with Municipality funds.20 The sale of these schemes is dependent on the authorisation of the funders. However, this is complicated by the fact that the 14

The MHA is discussed further below.

Chetty, M, 'Proposal: Transfer of Council Stock Willow Gardens Flats', Msunduzi Housing Association.

16 'Sale of Willow Gardens Complex', report by the city treasurer and the Willow Gardens Working Group, [20 Jul. 2001] 17 Sherlissa Peters, 'Residents to march over rents increase', Daily News [27 Jul. 2005] 18 'Policy Framework and Implementation Guidelines for the Enhanced Extended Discount Benefit Scheme', 2005.

19 Acting Director of Assets Management, personal correspondence to COHRE and CALS, [Mar. 2006] 20 'Sale of Willow Gardens Complex', report by the City Treasurer and the Willow Gardens Working Group, [20 Jul. 2001] 15

8

administration of all four schemes is managed by the Municipality. Any sale is therefore dependent on the Municipality’s ability and will to implement this.

The Municipality's approach to the question of selling the flats appears to be driven by its assessment of financial costs and benefits for the Council members. Presently, the substantial rental arrears have prohibited the privatisation of these flats. The Chief Executive Officer (CEO) of the MHA confirmed this to COHRE and CALS, saying that the MHA “would not consider owning these flats if residents were R2 million in rental arrears.”21 Tenants' resistance The rental increases and subsequent evictions have sparked deep anger within the Willow Gardens community. Consequently, residents have organised public actions to highlight these issues, including a series of street protests and the presentation of memoranda to the Municipality.22 When the Municipality largely ignored these actions, the Willow Gardens residents embarked on a rent boycott. The boycott action drew public attention to the turmoil in the flats – and it also escalated the cumulative scale of the rental arrears for the Willow Gardens flats.23 In October 2006, the boycott was halted as negotiations opened between the Municipality and the Willow Gardens Residents Committee. To date, the Residents Committee and the Municipality have not negotiated a process of debt recovery, but the Residents Committee has ended the rent boycott. Many residents have resumed paying the rental stipulated on their original lease agreements until such time as the rental dispute is resolved, although some residents continue to refuse to pay.

On 27 February 2006, the Willow Gardens Residents Committee met with Mr. Ahmed Osman, the Acting Director of Property Management for the KwaZulu-Natal Department of Housing and Mr. Grobler, representing the Msunduzi Municipality. One of the resolutions of the meeting was that the Municipality would consider the issue of selling Willow Gardens Flats to current residents under the EEDBS. The outcome of the meeting, as residents understood it, was a promise from Mr. Osman to write to the Msunduzi EXCO to suggest that the flats at Willow Gardens be sold at historical prices under the EEDBS. Additionally, residents understood that they had reached an agreement on the following: • • •

•

The municipal housing stock will not be transferred to the Msunduzi Housing Association.

A moratorium is placed on evictions, and threats of evictions, from the Willow Gardens Flats until the housing disputes have been settled.

People earning less than R3500 per month will be able to purchase the flats at historical prices and be able to access a first time home owner subsidy. All rental arrears will be pardoned for those earning less than R1956 per month. Those earning between R1956 and R3500 per month will be pardoned 50% of their arrears.

People earning more than R3500 per month will be able to purchase the flats at negotiated prices.

21

Chetty, M, personal communication, [13 Oct. 2005] Matt Saville, 'Residents demand debts be scrapped' The Witness [29 Jul. 2005] 23 Lindsay Barnes, 'Municipal billing scandal' The Witness, [22 Oct. 2005]; Sibusiso Mbotho, 'Willow Gardens – R1.5m upaid rent: Municipality at a loss to recover funds, Daily News, [18 May 2005] 22

9

•

Low cost housing, close to the central business district, will be made available for other residents who do not purchase flats. The area designated for this development is Napierville.

Following this meeting, COHRE and CALS sent a letter to Mr. Osman and Mr. Grobler on 10 March 2006 (please see Appendix 1). This letter summarised the outcomes of the meeting and set out the Msunduzi Municipality’s obligations under international human rights law and the South African Constitution, which prohibit the Municipality from evicting the residents of Willow Gardens without the provision of suitable alternative accommodation.

On 23 March 2006, COHRE and CALS received a response from Mr. Osman regarding the sale of the flats (please see Appendix 2). He confirmed that the Municipality had not considered the most recent changes in policy since the enactment of the EEDBS, but that the Municipality now requested time to study and propose a sales process in terms of the EEDBS. He reported that Mr. Grobler intended to make a proposal to EXCO by the end of March 2006. At the time of writing this report, COHRE and CALS had not received a response from Mr. Grobler or any other representative of the Msunduzi Municipality to our letters. Neither has there been any indication that the Municipality is implementing the resolutions adopted in the meeting with the Willow Gardens Residents Committee on 27 February 2006.

The KwaZulu-Natal Rental Housing Tribunal (KZNRHT) The KZNRHT is the provincial body responsible for resolving disputes in matters pertaining to rental housing, property management and housing development.24 The Willow Gardens Residents Committee lodged a complaint with the Tribunal in July 2005 concerning the unfair rental increases and the Municipality's failure to provide notices to vacate. The Tribunal's attempts to mediate between the Municipality and the Willow Gardens Residents Committee have failed to resolve the dispute. A subsequent process of arbitration has been running since the beginning of 2006 and the matter remains unresolved. This is a result of poor communication between parties concerning the dates set for hearings and the Municipality's delays through their in limine assertion that this matter was outside the jurisdiction of the KZNRHT competency. This in limine argument was eventually rejected by the KZNRHT but not without stalling the process for three months. Over a year later, a decision by the KZNRHT in the matter between Willow Gardens Residents and the Municipality is still pending, residents are living in an incredibly insecure situation without viable housing alternatives, and rental arrears continue to increase.

The toll of the rental dispute The unresolved dispute over rentals has taken its toll on the Willow Gardens community. A number of residents have moved out of their flats to find alternative accommodation in order to escape the threat of eviction.

The condition of the buildings of Willow Gardens has deteriorated as a result of the dispute. A stand-off between the Municipality and the residents was reached whereby the residents refused to pay rent and the Municipality refused to proceed with maintenance stating a lack of funds due to the growing number of rent defaulters.

24

Western Cape Provincial Department of Local Government and Housing, 'Annual Report: 1 April 2004 to 31 March 2005' http://www.capegateway.gov.za/Text/2006/5/rental_hous_trib_annual_report_04_05.pdf.

10

Willow Gardens in disrepair

Rental housing stock under the control of the Msunduzi Housing Association Mission of Msunduzi Housing Association “To develop the social housing agency to provide affordable, quality, integrated, well managed rental-housing units for the lower-middle income earners of the Msunduzi Metropolitan area through a transparent participative process.” – Resident’s Guide MHA, p6 The Msunduzi Housing Association (MHA) was formed by the Municipality to assist with the administration of the city’s rental housing stock in 1999. It was set up as a Section 21 non-profit Social Housing Institution. The Municipality transferred 75 units (of the Municipality's 377 units) to MHA management in 1999.25 The MHA also financed its own 300-unit complex called Acacia Park. Acacia Park cost R20.5 million to build and requires R300 000 in bond repayments every month. However, this bond is paid through rental payments and a R600 000 annual social housing subsidy from the Municipality.26 The MHA also has imposed rental increases on all rental stock under its management. At Acacia Park, in the period from July 2004 to July 2006, the MHA increased rental rates by 20 percent without consultation with the residents. In response, the residents filed a complaint with the KZNRHT, however the Tribunal decided that tenants should continue to pay the increased rentals.27 25

Chetty, M, personal communication, [13 Oct. 2005] Duma Pewa, 'Housing group is being ‘very naughty’' The Witness [13 Oct. 2006] 27 Sandile Ndawonde, Acacia Park resident, [personal communication]; KwaZulu-Natal Housing Tribunal, case number 1362/06

26

11

As low-income earners are being forced to pay rents that they cannot afford, the MHA seems to have shifted away from its mission of providing social housing. Mayesh Chetty, CEO of the MHA, states: “The 3 500 – 10 000 rand bracket is the most marginalized group. This is the bracket we want to target.”28 The MHA maintains that they will not cater for people earning less that R3 500 with their social housing scheme.

“If you earn less than 3 500 rand, there is only an RDP house for you.” – Mayesh Chetty CEO MHA The only alternative form of social housing available to low-income residents of Pietermaritzburg is through the Reconstruction and Development Programme, known as RDP housing, which, as indicated before, is poorly situated, grossly inadequate and over-subscribed. As a result, the number of poor people informally building and renting shacks continues to grow.

Ash Road Informal Settlement

Homes at Ash Road

Across the Masukwane River from the Willow Gardens Complex is the Ash Road shack settlement. Estimates vary as to how many people live here. A leading rent collector from the settlement suggests there are 500 residents (though this may be a deliberate undercount to hide the rental income being extracted). Others who work with community structures estimate that there are between 1 500 and 2 000 residents. It is situated on Municipal land that is currently zoned as an industrial area. The accommodation consists predominantly of mud and wattle dwellings that are rented by residents, who are otherwise unable to access housing close to the Pietermaritzburg city centre. There are just three taps supplying water; there is no electricity; and the Municipality does not provide regular services such as refuse removal to this community.

Rubbish heaps overflow for months before the Municipality eventually undertakes collection.

However, the attraction of Ash Road is that it is close to schools, public services and amenities.

“In 1994 we came from the Natal Midlands (Elandskop, Sweetwaters, Phumuza). We stayed in town under the trees or in backyards. The Municipality told us to live here [Ash Road], but in 1995 they told us to move to France.” – Ash Road resident (October 2005)

28

Chetty, M, personal communication, [13 Oct. 2005]

12

The overflowing refuse bins at Ash Road wait for months before collection

The majority of Ash Road residents derive a living through the informal sector. They sell food and merchandise, and are dependent on jobs as day labourers or other jobs within the informal sector, where they are vulnerable to what can only be described as exploitation. Living within walking distance of the city centre enables Ash Road residents to retain access to employment, as they may not otherwise be able to afford increasing transport costs.

“We have part time jobs, tins (recycling), selling fruit.” – Ash Road resident “Ngidayisa Imfino” (I sell blackjack stew) - Ash Road resident Evictions at Ash Road The Municipality has been attempting to evict residents at Ash Road for a number of years, but a majority of people there have resisted. In 2002, the people won a significant victory when the Pietermaritzburg Magistrate’s Court ruled against the Municipality’s application for an eviction order.29 The Municipality continues to seek justifications for their eviction from Ash Road – recently arguing that that the settlement is located on a dangerous flood-zone. There is, however, little substantial evidence to support this. COHRE and CALS uncovered a report by an engineering consultancy that had surveyed the Ash Road settlement in order to determine whether an in situ upgrade would be feasible. Their findings indicated that Ash Road was, in fact, a suitable site for a residential area. In the report, the cost of the provision of necessary infrastructure was estimated to be fairly low due to the flat nature of the site and its proximity to existing electricity and sewer mains.30 It is our concern that the real motivation for Municipality's continuing threat to evict people here is their intention to develop the land, which is now extremely valuable.

“They [the Municipality] telling us about the flood plain. They told us we can’t live here. The engineer came to check the flood plain, sewage and so on. They gave us a letter to say it is safe.” - Ash Road resident “There is a 100 year-old Catholic Church 100 metres from the river and there is no flood there.” - Ash Road resident 29 30

Residents of Ash Road Informal Settlement, focus group session, [18 Oct. 2005] Eyethu Engineers CC, 'Ash Road informal settlement area proposed infrastructure development' [29 Jun. 2000]

13

However, evictions have occurred in the past and residents were relocated to a low-cost housing development called France, where the Municipality allocated low-cost housing and provided access to Government housing grants.

France “We find it difficult to get to town from France. Here [Ash Road] the nearest school is in Sobantu – schooling is near to us, clinic everything.” – former France resident The Municipality has been applying pressure to the Ash Road settlement to take the option of formal, low-cost housing. The France accommodation (as described earlier) is situated 15 km from the city centre. Like many low-cost housing developments it has an electricity supply, street lighting and each house has running water and proper toilet facilities. However, France is without a clinic or schools.31 A number of Ash Road residents moved to France when they were threatened with eviction by the Municipality. Although some were apparently enthusiastic to be home owners, life at France placed an intolerable strain on resident’s resources. Commuting into the city in search of work or informal employment was costly. Transport costs consumed what little money was ever made through day labour or other work in the informal sector in the city. As a result of the economic hardships encountered at France, some people returned to the shacks at Ash Road, and other areas closer to the Pietermaritzburg central business district to take up residence there again.

“Some people have returned from France and built their houses close to the river. Others are at Sobantu village. They couldn’t cope with life at France.” – Ash Road resident

Conclusions The Municipality's Integrated Development Plan (IDP) of 2002 noted that "the Municipality is obliged to take reasonable steps to ensure that its residents have access to appropriate and adequate housing" as required by the Housing Act 107 of 1997. The IDP also estimated that the household income of the 116 540 households in the City was as follows32: Number of households 16 230 households 41 560 households 54 460 households 4 290 households

Income level per year No income R18000 18 000 - 131 000 R132 000+

Income level per month No income R1 500 up to R11 000 R11 000+

These statistics show that approximately 50 percent of households or 57 790 households had incomes of R1 500 per month or less in 2002. Thus, more than 50 percent of the population would be unable to qualify simply to be placed on the Municipality's waiting list for housing dedicated for low-income residents, as the minimum income level required is R3 500 per month.

31 32

Bongani Hans, 'Ash Road settlement ‘is home’' The Echo [9 Dec. 2004] Msunduzi Municipality, 'Integrated Development Plan' [May 2002]

14

In terms of the National Housing Code, households who earn R3 500 or less may qualify for housing subsidies. By requiring new residents to have an income of at least R3 500, the Municipality is ensuring that only residents who do not qualify for housing subsidies will be able to rent state-owned housing in Pietermaritzburg. To say the least, this is perverse. Municipal housing in Pietermartizburg is no longer a form of social security. The rent increases are clearly an attempt to increase the Municipality's income by squeezing its most vulnerable residents.

COHRE and CALS maintain that there is no rational basis for the Municipality to increase rent at such an extreme rate (at least 15 percent per annum since 2000), up to three times the rate of inflation. This policy creates an unreasonable burden for low-income residents, many of whom are unlikely to be able to re-accommodate themselves if evicted from Willow Gardens. The sale of the Willow Gardens flats to the MHA would only continue the current trend of rental increases instituted by the Municipality. The purchasing by tenants of their own rental units through the EEDBS does offer an alternative, but its long-term effects on the tenure security of residents is very much in doubt due to their low incomes and relatively high market rates. In any case, the affordability of this option remains to be determined and the Municipality has been resistant to this option. Institutions, such as the MHA, that manage housing stock under the banner of social housing must be supported to provide such housing, and it is the Government's responsibility to hold such institutions accountable in this service.

COHRE and CALS contend that the approach the Municipality has taken with regard to its housing stock may be in violation of Section 26, or any sub-section therein, of the South African Constitution.

Section 26 of the Constitution states: (1) Everyone has the right to have access to adequate housing.

(2) The State must take reasonable legislative and other measures, within its available resources, to achieve the progressive realisation of this right.

(3) No one may be evicted from their home, or have their home demolished, without an order of court made after considering all the relevant circumstances. No legislation may permit arbitrary evictions.

This is also in accordance with international law which holds that States must respect, protect, and fulfill the right to adequate housing. In order to respect and protect this right, there is an: "obligation placed upon the State and all other entities' and persons to desist from preventing or impairing the right of access to adequate housing."33 as stated in Government of the RSA v Grootboom 2001. However, the State must also progressively realise this right. A recent judgement by the Supreme Court of Appeals (SCA) further clarifies this constitutional obligation, stating that "government, at every level in varying degrees, is constitutionally obliged to realize the right of every person to have access to adequate housing" and "the enormity of meeting that commitment cannot excuse inaction on the part of government."34 In relation to Section 26 (3), the Constitutional Court has explained that a deprivation of property may be found to be "arbitrary" in two respects: it may be procedurally arbitrary, because the procedure is unfair; and it may be substantively arbitrary, in that there is not “sufficient reason� for it.35

33

Government of the RSA v Grootboom 2001 (1) SA 46 (CC), 2000(11) BCLR 1169 (CC) at [34] City of Johannesburg v Rand Properties (pty) Ltd 2007 SCA 25 (RSA) at [72] 35 First National Bank of SA Ltd t/a Wesbank v Commissioner, South African Revenue Service and Another 2002 (4) SA 768 (CC) at [100].

34

15

Furthermore, the constitutional injunction to consider “all the relevant circumstances” is an attempt to ensure that considerations counting for and against the execution of an eviction in a given context will be weighed carefully and judiciously before a person is deprived of access to their current home, or, indeed, to any permanent home.

In Port Elizabeth Municipality v Various Occupiers36 (“Port Elizabeth Municipality”) the Constitutional Court had this to say on the purpose of the provision: The judicial function [in adjudicating an eviction application] is not to establish a hierarchical arrangement between the different interests involved, privileging in an abstract and mechanical way the rights of ownership over the right not to be dispossessed of a home, or vice versa. Rather it is to balance out and reconcile the opposed claims in as just a manner as possible taking account of all the interests involved and the specific factors relevant in each particular case.

In the case of Willow Gardens, the Municipality has placed residents in desperate circumstances by evicting them. If evictions continue, the Municipality will certainly force many residents into homelessness. They will be deprived of access to any housing at all, let alone adequate housing.

The Municipality has failed to provide a sufficient reason for the compound rental increases of at least 15 percent per annum, and has thus failed to provide a sufficient reason for the evictions and threatened evictions. Rather than progressively realising the right to access adequate housing for the more than 57 790 households that cannot afford market rentals, it has instituted a regressive policy that will cause further homelessness.

Whilst adequate housing in the Pietermaritzburg area remains out of reach for the majority of people, it can be expected that informal tenure arrangements will continue to increase on vacant land. The Municipality should carefully consider possibilities for in situ upgrading for shack settlements in consultation with the affected residents. The Municipality should also involve lowincome residents in the overall process of dealing with the housing demand in the city. The Msunduzi Municipality should also consider undertaking informal settlement upgrading under the terms of the National Policy of Breaking New Ground.37 This policy was developed in response to the realisation that housing delivery and relocation is disruptive to people’s lives and does not curb the mushrooming of informal settlements. This plan details the new funding mechanism for informal settlement upgrading.

The Municipality has a responsibility to provide adequate housing to their constituents.

Discrimination against the poor violates people’s right to housing. The Housing Code (please see Appendix 3) highlights the responsibilities that municipalities have towards the provision of housing. Tenure security for both the formal Willow Gardens residents and the shack-dwellers of Ash Road remains distant as the Municipality’s current housing and land management practices continue to push the poor to the periphery.

36 37

Port Elizabeth Municipality v Various Occupiers 2004 BCLR 1280 (CC), E-F National Department of Housing 'Breaking New Ground: A Comprehensive Plan for Developing Sustainable Human Settlements' [Sept. 2004]

16

Appendix 1

10 March 2006 Mr Ahmed Osman Acting Director of Assets Management KwaZulu-Natal Department of Housing Fax: (031) 336 5240 Re: HOUSING IN PIETERMARITZBURG The Centre on Housing Rights and Evictions (COHRE) is an international nongovernmental organisation mandated to protect and promote housing rights throughout the world. COHRE has Consultative Status with the United Nations, as well as similar status with various inter-governmental organisations around the world, including the African Commission on Human and People’s Rights.

The Centre for Applied Legal Studies (CALS) is a human rights and public interest law organisation based at the University of the Witwatersrand, Johannesburg.

COHRE and CALS have been monitoring the situation of the Msunduzi Municipal Housing Stock in Pietermaritzburg in recent months, and have taken note of some disturbing reports of potential housing rights violations.

In particular, according to information at our disposal, the Municipality has evicted, and/or threatened with eviction, residents from Willow Gardens Flats in a manner which has violated South Africa’s legal obligations under international human rights law, as well as the South African Constitution. Residents have been evicted and/or threatened with eviction for their failure to pay rent. However, most tenants have been unable to keep up with the 15% compound annual increases introduced by the Municipality in 2002. The Municipality's actions in this regard have created a wellgrounded fear that it is systematically increasing rates of rental year on year in a manner calculated to encourage poorer tenants to vacate their homes. There is no rational basis for the Municipality to increase rent at such an extreme rate, up to three times the rate of inflation. This policy is unreasonably burdensome for lowincome residents, many of whom are unlikely to be able to re-accommodate themselves if evicted from Willow Gardens.

According to international human rights law, for evictions to be considered as lawful, they may only occur in very “exceptional circumstances” and “all feasible alternatives” must be explored in consultation with affected persons. However, in cases where eviction is considered justified, it must be carried out in strict complaince with the requirements of

17

General Comment No. 7 of the Committee on Economic, Social and Cultural Rights. These include, inter alia: • • •

• • • •

Genuine consultation with those affected; Adequate and reasonable notice for all affected persons prior to the scheduled date of eviction; Information on the proposed evictions, and where applicable, on the alternative purpose for which the land or housing is to be used, to be made available in reasonable time to all those affected; All persons carrying out the eviction to be properly identified; Evictions not to take place in particularly bad weather or at night unless the affected persons consent otherwise; Provision of legal remedies; and Provision, where possible, of legal aid to persons who are in need of it to seek redress from the courts.

COHRE and CALS have worked closely with residents of Willow Gardens and, of late, the residents have had some success with achieving an agreement with the authorities. Mr. Ahmed Osman, the Acting Director of Assets Management of the Department of Housing of KwaZuluNatal, provided clarity to the residents of Willow Gardens on their status during a meeting on 31 January 2006. The outcome of the meeting was a promise from Mr. Osman to write to the Msunduzi EXCO to suggest that the flats at Willow Gardens be sold at historical prices. Mr. Osman also promised to send the minutes from the 31 January meeting to the Willow Gardens Resident Committee. However, the residents have not yet received these minutes.

COHRE, CALS and the residents of Willow Gardens understand that “historical prices” will be calculated in order to ensure that they will be genuinely affordable to the current occupiers of each of the flats.

Additionally, we understand that the letter to be sent by Mr. Osman to the Msunduzi EXCO will record the following agreement between the Willow Gardens Residents Committee and Mr. Osman, reached at the meeting on 31 January 2006: • • •

• •

The municipal housing stock will not be transferred to the Msunduzi Housing Association.

A moratorium will be placed on evictions, and threats of evictions, from the Willow Gardens Flats until the housing disputes have been settled.

People earning less than R3500 per month will be able to purchase the flats at historical prices and be able to access a first time home owner subsidy. All rental arrears will be scrapped for those earning less than R1956. Those earning between R1956 and R3500 will be pardoned 50% of their arrears.

People earning more than R3500 per month will be able to purchase the flats at negotiated prices.

Low cost housing, close to the CBD, will be made available for other residents who do not purchase flats. The area designated for this development is Napierville.

COHRE and CALS are most encouraged by the action on the part of Government to amicably resolve the housing issues at Willow Gardens and urge the Msunduzi EXCO to prioritise the settlement of this case with the full participation of residents. Additionally, COHRE and CALS

18

urge the Municipality to take part in negotiations with residents involved in all other disputes over housing with the Msunduzi Municipality.

COHRE and CALS also understand that the Municipality would like to undertake an enumeration exercise to determine who of the Willow Gardens residents can afford to purchase flats, although the Municipality does not have the budget for this. We would like to offer to contract an independent party to conduct a survey of Willow Gardens residents through a methodology that is mutally agreed upon by residents and the Municipality. We look forward to your response and an ongoing dialogue with you on these matters. We will be contacting your office shortly to follow up.

Sincerely,

Jean du Plessis COHRE Deputy Director 83 Rue de Montbrillant 1202 Geneva Switzerland Tel: +41.22.7341028 RSA tel: +27.82.5575563 Email: jean@cohre.org

Professor Cathi Albertyn Director Centre for Applied Legal Studies University of the Witwatersrand Wits 2050 Johannesburg Tel: +27.11.7178600 Email: albertync@law.wits.ac.za

For: Scott Leckie COHRE Executive Director CC: Mr Sipho Gcabashe KZN Member of Parliament Fax: (031) 307 5400 Mr Grobler Housing Msunduzi Municipality Fax: (033) 3951706 Msunduzi Municipality Executive Committee (EXCO) Fax: (033) 3951501 Ms Z. Nyandu HoD for Housing Fax: (033) 8452085 Mr Michael Mabuyakhulu MEC for Local Government, Housing and Traditional Affairs Fax: (031) 3681725 Willow Gardens Residents Committee

19

Appendix 2

20

21

Appendix 3 The National Housing Code explains the National Housing Policy in South Africa. It consolidates all housing information into one document that is disseminated to every Provincial Government and municipality.38 It is the aim of this section to highlight the responsibilities of municipalities under the Housing Code.

1. Municipalities are under an obligation under the Housing Code in Chapter 12: Housing Assistance in Emergency Housing Circumstances to take a proactive approach to dealing with people in desperate need whose immediate housing needs cannot be met. Chapter 12 pertains to people who find themselves "in an emergency housing situation such as the fact that their shelter has been destroyed or damaged, their prevailing situation poses an immediate threat to their life, health and safety, or they have been evicted, or face the threat of imminent eviction."

2. Municipalities are under a further obligation under the Housing Code in Chapter 13: Upgrading of Informal Settlements to take proactive measures to secure the in situ upgrading of informal settlements where feasible.

3. Section 9 of the Housing Act and Paragraph 12.4.1 of Chapter 12 of the Housing Code requires municipalities to investigate and assess the need for emergency housing within their areas of jurisdiction and to plan proactively therefor. If the circumstances do merit the submission of such a plan for approval to the Provincial housing department, the municipality must submit one.

4. The guiding principle of Chapter 13 of the Housing Code is the minimization of disruption and preservation of community within informal settlements. Thus, it discourages the displacement of households and acknowledges that only in certain limited circumstances may it be necessary to permanently relocate households that are living in hazardous circumstances or in the way of essential engineering or municipal infrastructure. Legal processes for eviction should only be initiated as a last resort.

5. Under either Chapter 12 or 13 of the Housing Code, rather than eviction, a municipality must purchase the land on which an informal settlement is situated and upgrade the settlement in situ, alternatively, provide alternative accommodation for the inhabitants.

6. In his judgement in City of Johannesburg v Rand Properties (Pty) Ltd and Others 2006 (6) BCLR 728 (W) the judge summed up the housing policy as follows: "The Housing Act imposes specific obligations on local government in this regard. Section 9 requires every municipality to take all reasonable and necessary steps within the framework of national and provincial housing legislation and policy to: ensure that the inhabitants of its area of jurisdiction have access to adequate housing on a progressive basis; set housing delivery goals in respect of its area of jurisdiction; identify and designate land for housing development4 ensure that conditions not conducive to the health and safety of the inhabitants of its area of jurisdiction are prevented or removed; create and maintain a public environment conducive to housing development which is financially and socially viable; promote the resolution of conflicts arising in the housing development process; and initiate, plan, coordinate, facilitate, promote and enable appropriate housing development in its area of jurisdiction.

In terms of section 2 of the Housing Act, municipalities must perform the above functions in a manner which: gives priority to the needs of the poor in respect of housing development, involves meaningful consultation with individuals 38

The National Housing Code, http://www.housing.gov.za/content/The%20Housing%20Code/Introduction.htm

22

and communities affected by housing development; ensures that housing development is economically, fiscally, socially and financially affordable and sustainable; and ensures that housing development is administered in a transparent, accountable and equitable manner and upholds the practice of good governance.”

THE EMERGENCY HOUSING PROGRAMME The National Housing Code’s "Programme for Housing Assistance in Emergency Housing Circumstances," was adopted in terms of the Housing Act, ("the Emergency Housing Programme") and was a direct response to Grootboom's ruling that the State's positive obligations in terms of section 26 of the Constitution include an obligation to provide temporary relief for persons in crisis or in a desperate situation "The Grootboom judgment furthermore suggested that a reasonable part of the national budget be devoted to providing relief for those in desperate need….Consequently, this Programme is instituted in terms of section 3(4)(g) of the Housing Act, 9997, and will be referred to as the National Housing Programme for Housing Assistance in Emergency Housing Circumstances. Essentially, the objective is to provide temporary relief to people in urban and rural areas who find themselves in emergencies as defined and described in this Chapter.”

Clause 12.3.1 of the Emergency Housing Programme defines an emergency as, inter alia, a situation where "the affected persons"…owing to circumstances beyond their control … are evicted or threatened with imminent eviction from land or unsafe buildings, or situations where pro-active steps ought to be taken to forestall such consequences or whose homes are demolished or threatened with imminent demolition, or situations where pro-active steps ought to be taken to forestall such consequences."

The Programme makes funding available from the Provincial Departments of Housing for emergency housing assistance.

The Programme requires municipalities to investigate and assess the emergency housing need in their areas of jurisdiction and to "plan proactively" therefor. Where an emergency housing need is foreseen municipalities must apply to the relevant Provincial Department of Housing for funding for the necessary assistance. After approval by the MEC of the relevant Provincial Department of Housing, the funding is made available to the municipality for direct implementation of the assistance. In terms of the Programme the Provincial Department of Housing may provide support to ensure the successful implementation of the assistance.

While the Programme is flexible in order to cater for diverse situations, it does lay down certain minimum standards. It requires that water and sanitation be provided and that the floor area of a temporary shelter be at least 24 metres squared. Notably an amount of R23 892.00, including VAT, may be made available to municipalities, per grant."39

39

Taken from COHRE’s submission to the National Department of Housing on General Notice 1851 of 2006: Prevention of Illegal Eviction from and Unlawful Occupation of Land Amendment Bill, 2006 as published in the Government Gazette No 29501 dated 22 December 2006.

23