Will housing department help address backlog?

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housing NHA
The housing backlog is expected to hit 6.8 million units by 2022. -- HTTP://WWW.NHA.GOV.PH/

By Vincent Mariel P. Galang

HOUSING, particularly for low-income households, remains a big problem in the Philippines.

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Data from the National Economic and Development Authority (NEDA) showed the housing backlog will reach 6.80 million units by 2022, including the backlog of 2 million units as of Dec. 31, 2016.

A 2016 study by the University of Asia and the Pacific showed the Philippines would need 12.3 million housing units by 2030, from an estimated backlog of 6.7 million from 2001 to 2015 plus a projected housing demand of 5.6 million from 2016 to 2030.

For legislators, the solution to the housing backlog is the creation of the Department of Human Settlements and Urban Development (DHSUD), which will “shall act as the primary national government entity responsible for the management of housing, human settlement, and urban development.”

Congress approved the measure creating the new department, which would merge the Housing and Urban Development Coordinating Council (HUDCC) and the Housing and Land Use Regulatory Board (HLURB), and take over the two agencies’ functions.

After being approved by both chambers last November, the bicameral report on the DHSUD was forwarded to Malacañang last Jan. 16 for President Rodrigo R. Duterte’s signature.

Senator Joseph Victor G. Ejercito, chairman of the Senate committee on urban planning, housing and resettlement, said the new department addresses the problem having divided agencies under the HUDCC.

In an email interview last Nov. 15, Mr. Ejercito said the HUDCC “lacks the mandate and organizational setup to manage a National Urban and Shelter Policy and administrative and technical supervision of the attached housing agencies, as well as to solve the current mass of housing and urban development issues.” He noted the HUDCC only takes note of the activities done by key shelter agencies (KSA).

“We need one housing department and working towards one direction, creating the roadmap for housing and urban development, leading its implementation, setting the general direction for everyone, and able to follow through each and every project with clear functions, policies, budget and financing,” Mr. Ejercito said.

Angelito F. Aguila, HUDCC director for policy development, legislation, and special projects group, said through the department, the government will be able to control and supervise all programs and projects for housing.

“Before, the HUDCC only coordinates. It monitors (the projects), but we have no direct control and supervision,” he said in an interview on December 3.

Mr. Aguila also said being a council, the HUDCC still has to coordinate their actions with different relevant departments, which slows down the delivery of the housing units.

As for the HLURB, he said it only determines the general guidelines for land use planning of the different local government units and ensures the compliance of the different subdivision and condominium developers.

“The supervisory and the control over the KSAs is weak, just coordinating and monitoring. Not controlling and supervision, which will now be the role of the new department,” Mr. Aguila added.

Mr. Ejercito also noted that having a single housing department will eliminate red tape.

“The separation of HUDCC and HLURB can be considered a layer of red tape. Not only do we eliminate this through the DHSUD, merging the coordinating function of HUDCC with the land use planning and regulation of HLURB we are finally integrating into one body the concepts of housing and urban development, eliminating the conceptual disconnect that adversely affects government housing projects,” the senator said.

For Bayan Muna Representative Carlos Isagani T. Zarate, there is no need for the establishment of a new housing department, saying it will only worsen the problem it is supposed to address.

In an email interview on Nov. 8, Mr. Zarate said the measure “prescribes the privatization of housing services, relegating the role of the government to provide adequate, decent, affordable, public mass housing to the business sector” leading the socialized service to commercialization, profiteering, and racketeering.

“Private sector housing costs are way beyond what the low-salaried can afford, how much more for the poor?… The proposal to resurrect the creation of the Department of Human Settlements and Urban Development will only worsen the housing crisis,” Mr. Zarate said.

Under the measure creating the DHSUD, the department will facilitate participation of local government partnerships, civil society organizations, non-government organizations, and private groups. The DHSUD will also enter into public-private partnerships and memoranda of agreement or understanding with foreign or domestic groups.

Mr. Zarate also expressed concern with the decreasing budget for housing, noting this is an effect of the government’s increasing partnerships with private developers.

He cited data from HUDCC that showed the national budget for housing plunged to P4.7 billion this year from P15.31-billion in 2017.

To support this, Mr. Zarate cited a comparative analysis done by Ibon Foundation, Inc. of the 2018 National Expenditure Program (NEP) and the 2017 national budget. Ibon Foundation’s analysis showed the combined budget of the six key shelter agencies, which include HUDCC, HLURB, Home Guaranty Corp. (HGC), National Housing Authority (NHA), National Home Mortgage Finance Corporation (NHMFC), and Social Housing Finance Corp. (SHFC), plunged by 70.2% to P4.4 billion in 2018 from P14.8 billion in 2017.

When asked about the dwindling budget for housing, HUDCC’s Mr. Aguila said the new department will have bigger budget allocations next year.

“In terms of budget… because of the bigger mandates, we will have bigger budget allocations. Not just combined, but there are additional mandates also…. Which would entitle us to claim for bigger budget,” he said.

An additional mandate for the DHSUD, Mr. Aguila said, is that the department will acquire land or properties that will be needed for housing projects.

Mr. Aguila also noted the department is aiming to increase annual housing production from 170,000 units to 250,000 units to reach a total of 1.5-million housing units by 2022.

“The usual average house production of the government is about 170,000 per year. We are increasing that to at least 250,000 a year, so that by 2022 (we will have) 1.5 million housing units… The other side of it, the private sector, will be the one to produce also. The duty of the government is to provide a good environment, regulatory environment to encourage them to produce more houses,” he said.

“(The housing backlog) cannot be answered by 2022, but for now, the task of the government is really to increase our production,” he added.

The Subdivision and Housing Developers Association, Inc. (SHDA), an organization of private housing developers, is supportive of the creation of the DHSUD.

“The moment the Department of Human Settlements and Urban Development Act of 2017 is signed into law, this country needs to kick off a massive program of the urban renewal and as the largest organization of residential developers, we will be ready to work hand in hand with the government,” Jeffrey T. Ng, national president of SHDA and president of Cathay Land, said in a statement.

“If we now have a department that is responsible for housing and urban development, we could now begin urban renewal and slum upgrading programs, which will be a key strategy to encourage housing delivery and improve living condition of Filipinos,” SHDA Chairman and 8990 Holdings President and Chief Executive Officer Willibaldo J. Uy said in the same statement.

For Mr. Zarate, to solve the housing problem the government should address the roots of the issue.

“Government must then perform its role to provide its people of their social and economic rights. Ensure decent wages, free distribution of land to the tillers, work towards national industrialization, social protection for the marginalized, among others,” the Bayan Muna representative said.

The government must also prioritize funding for affordable, decent, public mass housing for the poor.

“Even on the issue of budget prioritization alone, we can readily see that the solution to our mass housing problem is mere illusory. The proposed collective budget for the KSAs does not meet even 1% of the annual budget needed to address the current housing backlog,” Mr. Zarate said.