As the British are preparing to have a general election anytime soon, Labour Party leader Ed Miliband has just published a simple but comprehensive contract with his people. The contract is more or less his manifesto. In a way, it reminds observers of American erstwhile House of Representatives Speaker Newt Gingrich’s Contract With America published in the 1990s. But whereas Gingrich’s is a rightwing agenda, Miliband’s is an attempt to recreate Britain in such a way that the economy will work for the overwhelming majority of the people, rather than a handful of highly privileged and wealthy people. In other words, the Labour Party seeks to return to its historical base or constituency. Britain may well be on the way back to ideological electoral politics.
Miliband’s Contract contains a 10-point agenda, but two-related issues in the agenda strike me in a distinct manner as a Nigerian because of the close parallel with the second-term performance of the Lagos State governor, Babatunde Fashola, in respect of housing. The two issues are Miliband’s pledge to save tenants from the Shylock practices of landlords and assist them plan for long-term tenancies as well as the promise to build 200,000 homes yearly in the United Kingdom by 2020.
Governor Fashola had on August 24, 2011, signed into law the Tenancy Bill. The law bars landlords from collecting more than six months rents from a sitting tenant and also prohibits landlords from taking more than a year’s rent from a new tenant. This law is, indeed, a milestone in Nigeria’s commercial nerve centre with a population of some 18million with a housing deficit of one million, a situation which makes it easy for landlords to demand two years’ rents in advance from sitting tenants and three years’ from prospective ones. Interestingly, rents in places like Lagos, Abuja and Port Harcourt are so high that it is difficult for most families who depend on their legitimate income to live in good houses in decent neighbourhoods. The housing crisis is worsened by the near total absence of mortgage facilities across the country.
And this now brings us to the second issue, that is, Fashola’s home ownership scheme, which could well be regarded as the precursor to Miliband’s vision of an annual 200,000 homes in the United Kingdom by 2020. Last February 3, the Lagos State government launched an ambitious scheme to make over 4,000 Lagosians landlords within the next one year. Under the scheme, at least 200 homes are given out every month. All a person need do to qualify is fourfold: demonstrate an ability to make 30% down payment of the monetary value of the property he or she wants; provide evidence that he or she does not have a home in any part of the state; provide evidence of having lived in Lagos for at least six months; and produce evidence of prompt and appropriate tax payment in the last three years.
When the programme was launched, some people thought it was the usual political promise by another Nigerian politician, a phenomenon Nigerians derisively refer to as “earmarked”, rather than “eyemarked,” for projects and programmes. But a month later, clusters of state-of-the-art homes in different parts of the state were unveiled. The first set of at least 200 monthly winners emerged in a process which both ordinary and highly placed individuals described as transparent. To shield the process from undue influence, application forms are filled only online unless where absolutely necessary that it be done manually. The interest rate on each home is 9.5% in a country where the rate is at least 12% for a mere four year tenor; the minimum period for mortgage for the Lagos State Home Ownership Mortgage Scheme, better known as Lagos HOMS, is 10 years. There is a 25% discount on every property so as to make it more affordable.
Unknown to quite a number of people, when a government anywhere decides on a massive housing scheme the mere provision of shelter to the people at an affordable cost is not the sole consideration. It has been demonstrated right from the time of President F.D. Roosevelt, who heroically steered the American economy away from the course of the Great Depression, that the provision of social services and infrastructure has a huge multiplier effect on every economy, thus helping to keep millions of people in both direct and direct employment. Fashola, for instance, has provided useful data on the beneficial economic impact of the construction of the first 1,104 homes. 134 construction companies and 459 sub-contracting firms employing 1,168 persons were involved, as well as seven consultancies and 5,442 suppliers of food, sand, woods, gravel, cement, etc. With over 3,000 new houses at various completion stages, more individuals have since been gainfully employed.
There is an important point about the Lagos HOMS which should attract the attention of policymakers and analysts. Not even a kobo has been borrowed from any source, as all the money has come from internally generated revenue and what the governor has described as prudent financial management. The government started with saving N200m monthly for this purpose but later increased it to N500m. Since the programme is planned to outlast the present state administration, it is likely that the number of homes delivered every month could increase from 200 to 800 if beneficiaries do not default in their mortgage payments. Not to be overlooked also is the government’s strong resolve not to compromise the integrity of distribution of the homes. Preference is not given to supporters of the ruling party in the state or to Lagos indigenes. This is a significant development in a country notorious for both cronyism and strong primordial sentiments.
Whereas the Lagos Tenancy Law of 2011 is a moral intervention on the part of the state government in the perennial acute accommodation crisis in Lagos, Fashola’s home ownership mortgage scheme represents a decisive leadership intervention, likely to be far more successful than the immensely popular mass housing programme of the Lateef Jakande administration in the state between 1979 and 1983. The designers of the new scheme did a thorough study of the Jakande programme and the Lee Kuan Yew globally acclaimed mass housing project in Singapore. The knowledge acquired in these studies and others is well reflected in the planning of Lagos HOMS.
Shelter is one of the basic needs of every human being, alongside food and clothing as well as good health. But it is in short supply everywhere. Ed Miliband, who is campaigning vigorously to become the next British prime minister, recognizes this critical gap, and so has made housing alone occupy two of the 10-point agenda which constitutes his contract with the people of the United Kingdom. The overall objective of the contract is a drastic reduction in the cost of living and the consequent empowerment of a large majority of the people. What Miliband seeks to do in the housing sector is already what Governor Fashola has gone far in accomplishing in Lagos State. For once, a government in Nigeria has displayed global leadership. Well, not quite surprising. Fashola was on January 1, 2014, voted one of the 100 global thought leaders by a highly prestigious think tank in Europe, alongside personages like Pope Francis.
If Fashola cannot deliver as many as 200,000 homes annually, as Miliband promises British voters in 2020, it is understandable: the UK is one of the seven richest nations in the world while Lagos is just one state in Nigeria, which is itself a developing country. In any case, it has to be borne in mind that Miliband’s pledge is still a mere promise which may or may not be fulfilled if Miliband becomes elected the next British prime minister.
The whole of Nigeria is suffering a grand housing crisis. Most state governments cannot, on account of scarce financial resources, afford to build at least 200 homes monthly, as Lagos is currently doing, but they can afford a minimum of 20 monthly if the will is there. A minimum of 20 new homes monthly in each of the country’s 36 states plus the Federal Capital Territory will be more than a dent on the accommodation crisis in our country of over 170million. As for the Federal Government, it can far surpass Fashola’s record if only the will to do the right thing is there.
For setting the pace in the housing sector, Gov Fashola has eloquently demonstrated that Nigeria has the human resources to take our people to the promised land sooner than many of us expect. In the words of former Vice President Alex Ekwueme, Nigeria is a miracle waiting to happen. One cannot agree more.
Dr Ifedi sent this piece from Manchester, England.
