Section 26 of the Constitution of South Africa, 1996, stipulates that ‘everyone has the right of access to
adequate housing’, and it is the State’s obligation to implement ‘reasonable measures, within its available
resources, to achieve the progressive realisation of this right’ (Republic of South Africa [RSA],
1996:chap2,s26). The Housing Act of 1997 expands on the Constitution and has established a legislative
framework specifying roles and responsibilities of the three tiers of government (national, provincial and
local), and the National Housing Code (2000 and 2009) establishes housing programmes to be
implemented at the provincial and local level, in order give effect to this legislation. However, despite
these seemingly reasonable and appropriate measures (legislative and policy), the realisation of the right
of access to adequate housing is still beyond the reach of many low-income earning South African
households.
Housing is both a product and a process (Housing Act, No. 107 of 1997, 1997). The process of providing
low-income housing in post-apartheid South Africa has been financed through capital subsidies under two
policy frameworks: the Housing White Paper of 1994 and the Comprehensive Plan: Breaking New
Ground of 2004. Since 1994 nearly 3 million state-subsidised houses, of various types, have been
delivered across the country. The delivery of these houses has brought with it many plaudits and critics,
and indeed there have been notable successes but also failures in the delivery of these houses.
Successes of state-subsidised housing delivery
 The state-subsidised housing intervention is one of the few government programmes to place a
tangible asset in the hands of the poor (Gilbert, 2004).
 The standardized housing product represents a considerable improvement for beneficiaries
relative to their prior material conditions (Huchzermeyer, 2005).
 The housing delivery numbers have been significant. Since 1994 nearly 3 million completed
houses have been delivered, which is ‘unparalleled internationally’ (National Treasury, 2007:68),
to the relative size and wealth of the country. For example, in countries who have adopted the
targeted capital subsidy programme, such as Chile and Colombia, 91 130 and 46 366 subsidies
8
were approved per annum between 1990 and 2000, respectively. While South Africa, approved
196 030 subsidies1
per annum between 1994 and 2000 (Gilbert, 2004:25)
 The funding model (i.e. capital subsidy system) has permitted governments to limit its spending,
keeping budgets in check (Gilbert, 2004:33). It has performed better than other important social
areas, such as: education, health, and employment (Gilbert, 2004:33) and has established a great
deal of legitimacy among the poor (Charlton and Kihato, 2006:254).
Failures of state-subsidised housing delivery
Those who regard state-subsidised housing delivery in a negative light generally emphasise three facets:
 Lack of end-user finance,
 Lack of settlement integration into the urban built environment, and
 The poor quality of the houses built.
Lack of end-user finance
Finance has not been sufficiently made available to the beneficiaries of state-subsidised housing. The
main reason for this is that the attempts to incentivise private sector financial institutions to lend to lowincome
households has failed. Specifically, the 1994 Record of Understanding sought to ‘normalise’ the
township housing market, due to the rent and bond boycotts of the early 1990s, rather than actively
promote lending to the township housing market (Tomlinson, 1998b:3), (Khan & Thurman, 2001:11). As
a result of the lack of available end-user finance beneficiaries of state-subsidised houses have been unable
to incrementally upgrade their houses and the houses have failed to become ‘valuable assets’, as intended
in the Housing White Paper of 1994 (Department of Housing [DoH], 1994); (Charlton & Kihato,
2006:255) (Huchzermeyer, 2003).
Lack of settlement integration into the urban built environment
The vast majority of state-subsidised houses have been located on the urban periphery. This lack of
settlement integration into the urban built environment combined with the low-incomes and wealth of the
beneficiaries has resulted in ‘ghettos’, or ‘indigent neighborhoods’ (Gilbert, 2004:31); (Gardner, 2003:21-
22). The predominant reason cited for this lack of settlement integration is the low subsidy levels
(Tomlinson (1999:290); Thurman (1999:4); Council for Scientific and Industrial Research [CSIR]
(1999:64)).