The Duterte administration intends to jump-start a 10-year plan that will solve the country’s 6.5-million housing backlog entailing at least P2.72 trillion in funding, according to the new head of the Housing and Urban Development Coordinating Council (HUDCC).
HUDCC Chairman Eduardo D. del Rosario told the BusinessMirror the government will need to allocate an average of P42 billion annually to end the decades-old problem on illegal settlers, and at least P229.5 billion a year for socialized-housing loans under the Home Development Mutual Fund (Pag-Ibig) and other private financial institutions.
Del Rosario said this is something the administration wants to start during President Duterte’s term, so the next administration will have something to start with.
“When a new administration takes over, they don’t have a starting point because the program of the previous administration was limited to their stint only. So now, we are targeting 10 years, so the next administration can use this as a launching pad for their housing programs,” del Rosario added.
Del Rosario said the planned P420-billion 10-year funding for informal-settler families (ISFs) will allow the construction of housing units worth P300,000 each, with some 1.4 million ISFs benefiting.
Addressing the remainder of the backlog, pegged at 5.1 million, will require at least P2.3 trillion for 10 years, or P229.5 billion a year.
This is assuming that each unit to be built will cost P450,000 each, the top level of socialized housing projects. The limit of Pag-Ibig housing loans, P6 million, is already considered as a high-end housing unit. If a P450,000 unit is loaned with Pag-Ibig at an interest rate of 3 percent, the borrower will only pay around P1,897 a month, or P22,764 a year.
Del Rosario said this remains affordable since most of those non-ISFs that are seen to purchase the 5.1-million housing backlog are regular employees who are gainfully employed and have regular incomes, but do not have access to housing facilities.
This is the reason del Rosario said the HUDCC and the six key shelter agencies are keen on forging partnerships with the private sector to address this portion of the housing deficit.
Del Rosario said HUDCC and the key shelter agencies (KSAs) are open to undertaking public private partnerships (PPPs) with interested firms doing construction projects and real-estate developments, among others.
“The private sector has a big role to play in closing the housing backlog; the government can’t do it alone,” he said.
However, del Rosario lamented that the Department of Budget and Management (DBM) only approved a budget of P4.7 billion for HUDCC and its six KSAs for 2018.
Del Rosario said they initially proposed a budget of P68.7 billion. This includes all the budget needed to address ISF requirements, disaster-relocation needs and other pertinent items that the housing sector will need.
In 2016 the housing agencies were granted a collective budget of P33.38 billion. However, due to low absorptive capacity, the government only used P16.38 billion.
With this, the housing agencies had a carryover of P17-billion budget, which was added to the approved housing allocation of P15.3 billion this year. This means the total budget for 2017 of HUDCC and the KSAs is pegged at P32.3 billion.
“We requested P68.7 billion, but the housing sector was allocated P4.7 billion. Hopefully, during the budget deliberations, we can still haggle and come up with a bigger amount so that we can address the housing needs,” del Rosario said.
Addressing Filipinos’ housing needs is important, not only because of Filipinos, but also due to the Philippines’s international commitments. The Philippines is among the 189 countries that committed to the Global Agenda 2030, or the 17 Sustainable Development Goals (SDGs) in September 2015.
The Global Goals aim to end poverty and hunger, promote universal health, education for all and lifelong learning, achieve gender equality, sustainable water management, ensure sustainable energy for all, decent work for all, resilient infrastructure and reduce income inequality between and among countries.
The goals also include creating sustainable cities, ensuring sustainable consumption and production, taking action against climate change, conserving and sustainably using oceans and marine resources, reducing biodiversity loss, achieving peaceful and inclusive societies and revitalizing global partnership for development.
The first target under SDG 11 that seeks to make cities inclusive, safe, resilient and sustainable is ensuring access for all to adequate, safe and affordable housing and basic services, as well as the upgrade of slums. This is also part of the New Urban Agenda adopted by world leaders in Quito, Ecuador, in 2016. The Philippines, represented by former HUDCC Chairman and Vice President Maria Leonor G. Robredo, signed the declaration.
Image credits: Nonie Reyes
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