Graphic Business News

Finance Minister outlines measures to address housing deficit

By: Kester Aburam Korankye
A slum under development in Accra
A slum under development in Accra

WITH a widening housing deficit in excess of two million units up from 1.7 million in 2016, the government has established a national mortgage and housing finance scheme to provide cheaper local currency mortgages and residential housing finance across the country as a measure to curb the rising deficit.

The government will also initiate the legislative processes towards the establishment of the Ghana Housing Authority to spearhead the implementation of the National Housing Policy, with respect to affordable housing.

The initiative, according to the Minister of Finance, Mr Ken Ofori-Atta, who dropped the hints when he presented the mid-year fiscal policy review of the 2018 budget statement to Parliament on July 19, would promote social equity and stimulate the economy.

He said to achieve the successes of the initiative, the government had set up a management board to work with some banks and pension fund managers to understand the constraints of ef

“We have observed that to effectively support housing delivery, we must address both the demand and supply side of the housing market and develop a scheme that creates an effective ecosystem for home buyers, developers and financial institutions,” he said.

Current state of housing
Housing remains one of the critical development challenges in the country as either demand for houses outstrips supply or the price of housing are over and above the wage of the average worker. In either situation, individuals and households resort to officially unapproved means to secure housing, leading to the development of slums, especially in large cities and towns.

Presently, Accra alone has about 265 slums in different stages of development. A recent research conducted by the People’s Dialogue on Human Settlements (PD) Ghana, a non-governmental organisation (NGO), said about 116 of the slums were still in their infantile stages, with the rest already fully developed slums.

However, a United Nations Habitat 2016 World Cities report suggested that there had been a decline in the number of urban slum dwellers in the country.

The proportion of slum dwellers among the total urban population, which was 65.5 per cent in 1990, fell to 52.1 per cent in 2000 and 40.1 per cent in 2010, before falling further to 37.9 per cent in 2014.

Development of new settlements
Mr Ofori-Atta, however, indicated that the government, in the last quarter of the year, would roll out a rent-a-bed scheme for the socially marginalised manual workers, mostly female porters, in urban centres where there were no official shelters.

He said the proposed intervention was to provide them with hostel facilities to give them the peace of mind to plan and work towards moving up the economic ladder.

The government, according to the  minister, would also embark on an accelerated affordable housing scheme through the development of 600 acres of serviced plots near Dawa in the Greater Accra Region, in partnership with real estate developers on a pilot basis, and replicate similar schemes in all regions.

The project is aimed to fit into the government’s plan to develop new settlements along the new road and rail transport corridors to facilitate easy access into major cities and also accelerate its programme to set up a National Housing and Mortgage Fund to provide construction and mortgage financing for the project. — GB