Lessons in
Policy and Practice dealing with
Displaced People Living and
Working in the Streets of Johannesburg
Presentation to Commonwealth
Local Government Forum
10th June, 2010
Homelessness in Jozi: Contents
What homelessness and informal existence can
and does mean on the streets of Johannesburg
Policy response at City Level
Practical experience of policy roll-out
The Siyasizana programme and the Registered
Social Landlord (RSL) Programme.
Concluding considerations
2
Homelessness and Informality : Problematizing
• The population of those living on the streets of Johannesburg
(and in informal circumstances with inadequate services closely linked
to the streets) involves a range of different groups, the majority of
whom are in some way economically active.
• The socially disconnected individuals with very high personal
barriers to self-sufficiency are a presence (particularly over-35
males), but in operational experience constitute no more than a third to
a half of those who spend their nights on the street
• The remainder are linked to the informal economy, with some
form of residence on weekends, but during the week sleep rough
and/or are tied in deeply with the slumlord-centred microeconomies in the City’s ‘bad’ buildings .
• In all cases the constituency of documented and undocumented
migrants is a significant one.
3
Homelessness and Informality : The statistical picture
• Joburg has 182 formally categorised informal settlements, home to
approximately 200,000 households (estimated at between 500,000 and
one million individuals).
• 2007 community survey (CoJ sample size 40k) shows at least 1 in 4
CoJ residents live informally (across range of possible circumstances)
• The OECD estimates the informal sector as 15% of total economic
activity in RSA, but all evidence suggests it is the largest and in many
cases only economic activity informal settlements, and is highly
concentrated in Johannesburg’s inner city (case study on informal
recyclers forthcoming).
• Active night counts of the homeless only show a few thousand at a time
actually sleeping in the open – remainder are less visibly shelter-less
• Transport costs and the transaction costs of managing informal
business, promote week-night homelessness as a rational choice
for informal economic actors
4
Draft Deprivation
heat map of Joburg
SAIMD CS 2007 at
datazone level
(draft model) by
CASASP, Oxford
[ note : this model is
still being finalised at
time of presentation
– presented here for
discussion only ]
5
Homelessness /Informality : link to ‘slum economy’
• Invaded buildings in Inner City Johannesburg are strongly linked
to the informal economy, specifically to actors such as street traders
and informal recyclers, who constitute their rental base.
• The slumlords have set up an obnoxious market offering
facilitation to these groups, but income instability and non-security
of rental arrangements result in individuals connected to the slum
economy sleeping rough, sometimes as ‘overflow’ from invaded
spaces, but also as an economic choice (particularly as slumlords
drive up black market price of shelter – now as high as R1200 per
month). This adds to the working poor living on the street, rather than
the destitute.
• Initial evidence suggests these informal actors earn in the same
bounds as entry level service sector professionals, but have no formal
rental options.
6
Virtuous Property Cycle (Courtesy Dr Tanya Zak)
Payment of rates and
services charges
Landlord
Financial
institutions
Municipality
Receives
market-related
accommodation
Investment &
maintenance in /
of infrastructure
and services
Public
Infrastructure
& Services
Improved / good
quality urban
environment
Repays mortgage
plans to financial
institution
Pays for rent
and services
costs
Fund new
accommodation
development
New Rental
Stock
Increased supply
of accommodation
Tenant
Vicious Property Cycle (Courtesy Dr Tanya Zak)
Reduced or nonpayment of rates &
service charges
Unable / unwilling
to repay debts
Landlord
Financial
institutions
Municipality
Poor
accommodation
& high rents
Reduced funds for
investment &
maintenance in /
of infrastructure
and services
Public
Infrastructure
& Services
Deteriorating /
poor urban
environment
Non-payment of
rents & services
costs
New Rental
Stock
X
Tenant
X
No commercial
funding available /
redlining
No new supply of quality
accommodation
Slumlords /
Hijacked
Buildings
Case study : Informal recyclers
[ Courtesy Dr T Zak and Sarah Charlton, Wits University]
• Informal recyclers collect waste material (mainly
cardboard and paper) for onward sale to bulk recyclers
• Can earn as much as R3000-R4000 per month
(comparable to minimum wage service sector work)
• Wide variety of shelter-less living circumstances during
weeknights especially. Significant proportion have “once a
week” homes or homes in rural zones outside city.
• Earnings do not enable them to afford basic formal
accommodation and storage space for goods is a major
consideration. Informal support markets have developed to
meet these needs.
• Share space in basements of abandoned buildings during
the week , otherwise resort to the streets.
9
Homelessness in Jozi: Contents
What homelessness and informal existence can
and does mean on the streets of Johannesburg
Policy response at City Level
Practical experience of policy roll-out
The Siyasizana Programme and the Registered
Social Landlord (RSL) policy
Concluding considerations
10
Crafting a policy response : Displaced Persons policy
Displaced persons policy (adopted in April/ May 2010) specifically
addresses itself to those living and working on the streets. It
commits the city to creating and promoting a layer of services for
homeless populations, specifically:
• Overnight shelter for weeknight sleepers
• Programmatic shelter for those trapped in destitute circumstances
due to complex personal issues
• Intake shelters that can receive individuals cleared from the streets in
the course of enforcement activities and can screen and profile them for
appropriate interventions.
• The Registered Social Landlord (RSL) policy is a companion
instrument designed to promote formal affordable rental for those who
are otherwise trapped in the slumlord economy (more to follow)
11
Homelessness in Jozi: Contents
What homelessness and informal existence can
and does mean on the streets of Johannesburg
Policy response at City Level
Practical experience of policy roll-out
The Siyasizana programme and the Registered
Social Landlord (RSL) Programme.
Concluding considerations
12
Crafting a Policy Response : Rollout
• Dedicated Displaced Persons unit (DPU) has been set
up with a focus on outreach, enforcement against
obnoxious markets in begging and the development of the
3 classes of shelter intervention.
• 2 pilot intake shelters in inner city already functioning
one focussed on adults, the other on minors
• Adult services complex , including overnight and
programmatic shelter (as well as space for an RSL) is
being developed at a large site in Hillbrow. This could be a
700-1000 bed facility and will be the first integrated
programmatic attempt to institutionalise best practice
developed by key social housing actors such as MHA
• RSL policy approved and promulgated for piloting
13
Homelessness in Jozi: Contents
What homelessness and informal existence can
and does mean on the streets of Johannesburg
Policy response at City Level
Practical experience of policy roll-out
The Siyasizana programme and the Registered
Social Landlord (RSL) Programme.
Concluding considerations
14
RSL The Expanded Social Package: What is it ?
• Siyasizana : the Expanded Social Package is a
basket of benefits which the City allocates to citizens
based on their level of poverty.
• It replaces the old City of Johannesburg indigent
subsidy system.
• From 1st July 2009 an entirely new system of
benefits was rolled out targeting poor individuals and
the households in which they live
• It is different from the old subsidy system because
people do not need to be account-holders to
apply, so – for example those who live as tenants in
apartments and backyard shacks are eligible.
15
The Expanded Social Package: Who should register ?
• System targets individuals not just properties
• Anyone with an income less than R3,660 per month
should register.
• Property dwellers with utility connections declare their
address using the City account of the property on
which they live (whether they own it or not)
• Also supply pre-paid meter numbers for Joburg
Water, City Power and Eskom, as well as Eskom
account numbers
• This allows the system to distribute across all formats
16
The Expanded Social Package: Poverty Definition
• Band 1 - Is the lowest level of subsidy, aimed at
helping those on the borderline of poverty.
• Band 2 – is the middle level of subsidy, aimed at
those who earn some formal income but whose
earnings fall below the survival level defined by the
poverty index (R2,440 per month)
• Band 3 – is the highest level of subsidy, aimed at
those with no formal income living in the most
deprived circumstances.
17
The Expanded Social Package: Registration
• Personal circumstances verified using ID number
against national databases, so people only need
ID number and city account number (pilot for the
National Integrated Social Information System).
• System uses fingerprints for identification, so people
can be given up to six months to get a new ID book if
theirs is lost, provided ID number is known (can
verify application from home affairs database). Those
who have never had ID referred to Home Affairs
• Critically - People can also register with no address
or as homeless, but then obviously have no benefits
applied to a property
18
Proposed ESP Service Level : Electricity
Score
on
Prevailing
Poverty Index
COJ Allocation
Monthly allocation cap
of
of free electricity per
additional household in which at
free
least 50% of registered
electricity social package
per
recipients qualify for the
person
band in question
per month (Kilowatt hours)
(kilowatt
hours)
Band 1
1-34
10 (R5)
50kw/h (R25)
Band 2
35-69
20 (R10)
100kw/h (R50)
Band 3
70-100
30 (R15)
150kw/h (R75)
19
Proposed ESP Service Level : Water
Score
on
Prevailing
Poverty Index
COJ Allocation
of
additional
free water
per
person
per
day
(litres)
Monthly allocation cap of
free water per household
in which at least 50% of
registered social package
recipients qualify for the
band in question (Kilolitres)
Band 1
1-34
25l.
(R5.89)
10kl.
(R15.24)
Band 2
35-69
35l.
(R6.23)
12kl.
(R24.56)
Band 3
70-100
50l.
(R9.47)
15kl
(R38.54)
20
ESP Service Level: Rates, Sanitation and Refuse
• Rebate on owner-charged rates and services for
Band 1 : 70%
• Rebate on owner-charged rates and services for
Band 2 and 3 : 100%
21
ESP Service Offering - Summary
Water/ Electricity : Per person allocation based on each
person’s band
Rates/ Sanitation : Percentage rebate to indigent owners,
/ Refuse
varying by the owner’s band
Rental subsidy:
private
Transport
ESP benefits will now flow as a rentrebate to those living in COJ / JOSHCO
rental stock. RSL proposed as
sector subsidy model
To be linked to new Rea-Vaya fares
22
Next Phase : Registered Social Landlord Programme
Objective : To provide targeted affordable rental as benefit to ESP recipients
Key Points of departure :
- Utilities and Service Charges constitute one of the main component of rental
charges, and rapid inflation thereof will impact both affordability for citizens
and collection rates for both landlords and the City . More stable collection
rates are a desirable outcome for the city, landlords and renters alike.
- Current national policy context has very limited instruments for promotion of
rental
- Historic tariffs provide no way of singling out affordable or social
housing for special treatment, and there is no capital subsidy for private
sector, for-profit providers.
- The ESP systems can provide a targeted, verified and fully auditable way
of incentivising both the private and the non-profit sector to rent much
more affordably extensively to those earning under R3660 per month.
23
Next Phase : Registered Social Landlord Programme
Strategic considerations
• POMA have alleged commercial landlords are constrained in
servicing tenants with incomes less than R7500/pm (ESP cuts of at
R3660) . Capital costs and cost of services are the key drivers.
• The current supply of tenure to the ESP income category in the inner
city is arguably hijacked/ slumlord accommodation charging R800R1000 per month
• Single room occupancy accommodation is not currently cost-effective
due to tariff treatment (eg Europa House)
• The RSL will either (a) find a way to convert or formalise hijacked
buildings, (b) make it possible for the commercial market to meet the
state halfway or (c ) both.
• Entirely Convergent and complimentary with Inner City Property
Scheme
24
Proposal : Registered Social Landlord Programme
• Tier 1: Rates to recognise 40% rebate on commercial
properties converted to residential, plus 100% rebate to
non-profits in line with existing processes BUT RSL status
is the verification tool for qualifying properties
• Tarrifs to recognise dwelling unit definition (see next
slide) to facilitate communal living units
• City Power to install pre-paid metering at non upfront cost
with capital cost recovery through rates account
• Tier 2 : Properties to be provided at no or lower cost on a
developmental lease basis to fulfill portion of ICPS Social
Housing quota BUT also allow RSL to function as decant
from hijacked buildings
25
Next Phase : RSL Programme Process
DEFINITION OF A DWELLING UNIT for REGISTERED
SOCIAL LANDLORD PURPOSES
Any dwelling unit that includes space for cooking and
toilet and ablution facilities would be regarded as a unit.
And/Or
The minimum of 10m2 room undivided room built with
formal materials functioning as a self standing residential
space subject of a single tenancy agreement accessing a
common corridor with shared kitchen and bathroom
facilities.
70% of residents must be ESP registered
26
Homelessness in Jozi: Contents
What homelessness and informal existence can
and does mean on the streets of Johannesburg
Policy response at City Level
Practical experience of policy roll-out
The Siyasizana programme and the Registered
Social Landlord (RSL) Programme.
Concluding considerations
27