Communicare, South Africa’s oldest Social Housing Institution (SHI), has come under scrutiny for its exorbitant rental fees which are unaffordable to poor pensioners.
The housing crisis in Cape Town has reached a precipice which threatens to marginalise the poor even further. As rentals in and around the city continue to rise, poor residents find themselves battling the ever-looming reality of homelessness.
Communicare, in theory, specialises in affordable housing which aims to lighten the load carried by these low-income earners. Yet, the organisation’s insatiable appetite for rent hikes, compounded by dubious payment policies, have left the city’s vulnerable residents fearful of the future.
Communicare: A wealthy non-profit organisation
Although Communicare operates as a non-profit organisation (NPO), the title is somewhat of a misnomer. The organisation’s business model is founded on the principle of market-related rental subsidies. This means that ‘expensive’ housing units managed and owned by Communicare help carry the costs of its affordable housing structure.
However, annual financial reports released by Communicare, in conjunction with recent court verdicts, prove that the non-profit organisation is indeed making heaps of money at the expense of their poor tenants. This is usually by way of exorbitant rental increases, as demonstrated by a recent victory afforded to elderly social housing tenant John Adams, who had been renting from Communicare since 1998.
As reported by IOL, Adams challenged Communicare’s rental increases attached to his Ruyterwacht residence after continuous threats of eviction relating to maintenance issues. The eight-year-long battle eventually reached a climax when the Western Cape Housing Tribunal ruled the increases unreasonable.
In 2011, the rental for Adams’ George Street house increased by 47%. In 2012 it was hiked by another 27%, in 2013, 17%, and for the last four years, Communicare increased the rent by 10% annually. This meant that Adams’ rent had doubled in less than eight years.
The Western Cape Housing Tribunal ruled that the increases be backdated and adjusted according to the consumer price index inflation rate from 2010 onward.
This case cannot be viewed as an isolated incident. Recently, more than more than 500 complaints had been lodged with the Rental Tribunal regarding Communicare’s unscrupulous rental policies. The MEC of Human Settlements, Bonginkosi Madikizela, confirmed that the Communicare was under the spotlight, saying:
“Communicare came on our radar when we found out they were handling the Salt River Market development. We started raising questions about them because of these complaints.”
In 2017, Communicare released its annual financial report which put its gross profit at R135 million.
The organisation’s executive director’s salary of R1 253 210, along with the non-executive directors earning from R67 607 to R270 427, has also been flagged by concerned citizens and civil rights groups alike.
Communicare corruption scandal
The political drama unfolding in the Cape, as a result of embattled former mayor Patricia de Lille’s protracted ‘personal’ battle with the Democratic Alliance (DA), has unearthed some social housing skeletons.
In a show of solidarity, many DA councillors abandoned the party along with de Lille – their exits nothing short of scandalous. Brett Herron left his position as Cape Town’s mayoral committee member for transport and housing, citing flawed party policy that was inherently ‘anti-poor’.
During his resignation speech, Herron pointed specifically to the DA’s failure to implement planned affordable housing projects close to the city centre, in particular, a residential complex which was due to be built on city land in Salt River.
The Salt River market site was due to be sold to Communicare for R11.4 million – just 10% of its actual market value. So, while the social housing organisation has vehemently denied that it receives government subsidies – the mooted sale of the Salt River market site is proof that, in one way or another, the DA and Communicare were hoping to strike a financially beneficial deal. Communicare’s CEO Anthea Houston commented on the now-halted housing project, saying:
“The City engaged us on the project for four years. The brief was for a mixed income, high density development with at least 30% social housing.”
While Herron has defended his position, the reality regarding Communicare’s sordid Salt River involvement has sought to vindicate the DA. According to a report by GroundUp, Cape Town’s mayoral committee member for safety and security, JP Smith, and DA councillor Angus McKenzie, point to corruption within the ranks of Communicare as the main cause for apprehension. McKenzie said:
“Eight staff members from Communicare were fired for corruption and maladministration.”
Houston confirmed that the organisation was battling corruption within the organisation, saying:
“We are investigating corruption involving our employees in the maintenance and leasing departments.”
It has since been revealed that one maintenance manager, two portfolio managers, one housing assistant, two building supervisors, one community liaison officer and one portfolio assistant faced internal disciplinary action relating to fraud.
The DA has stated that while it is committed to providing affordable housing close to the city centre, it will not do so at the risk of enabling corruption.
Poor pensioners pay a heavy price for housing
How does all of this relate to Cape Town’s poor pensioners – most of whom rely on a meagre state grant of around R1600 a month? The harsh reality is that the elderly, who are unable to gain employment and are attempting to live out their autumn years in peace, have been embattled by Communicare’s social housing sleight of hand.
Pensioners are left with nowhere else to go. Old age homes are full to capacity and a state pension cannot cover rental costs.
Many pensioners who currently reside in Communicare’s units have been living there for many years, meaning that, as in Adams’ case, rent was paid while gainfully employed. Unfortunately, recent cash incentive ‘eviction notices’ point to a heartlessness which has seen many elderly citizens put out on the streets.
A recent notice sent to Communicare tenants, offering a meagre cash incentive to vacate stated:
“They [tenants] will have the option to find alternative accommodation, perhaps with family or friends to help save money.”
These cash incentives ranged from R1 500 to R3 500.
Houston explained that the cash incentive strategy was “to make sure that the subsidies we are offering are reaching the right people.”
The question which must be asked then, is why are residents on a meagre state pension not the “right people”?
Already, pensioners are unable to cope with Communicare’s exorbitant rental increases. Most units cost far more than R1 600 a month, which leaves pensioners seeking part-time work or house share options to make ends meet.
As a City, as a country – as humanity – how can we allow the elderly to be marginalised by an organisation that is entrusted and subsidised to provide an affordable place to live? When the old and vulnerable are pushed further to the borders of destitution due to greed, we need to take a serious look at our values and the practices of company’s which masquerade as defenders of the poor.
This article forms part of an ongoing series on the social housing crisis in Cape Town