Govt targets pension funds to finance housing projects

Published: 14 June 2014

GOVERNMENT is targeting pension funds to help finance housing projects as it seeks to reduce the housing backlog, it has been leant.

Information obtained by this newspaper indicates that Finance Minister and Economic Development Patrick Chinamasa has pledged to help pension funds or pension administrators seeking to embark on housing projects in securing land they require.

"Following this year's conference held on May 14-17, the Minister of Finance Patrick Chinamasa would like to assist pension funds or pension administrators who wish to embark on housing projects in securing the land they require," said ZAPF

Interested members were advised to indicate areas of interests, whether low, medium or high density.

Zimbabwe is faced with a significant housing backlog.

The housing shortage is estimated at 1,25 million units which translates to a national backlog of five million citizens or more than 40 percent of total population. Housing finance schemes, which are currently available have little incremental effect on the national housing stock as these are either exclusively packaged for a few targeted groups or are priced beyond the reach of the poor.

Under Zim-Asset, the Government intends to reduce housing backlog through the provision of serviced land, strengthen public private partnerships and adoption of new building technology.

Recently, Minister Chinamasa said the Government would give prescribed asset status to funds which will be channelled towards infrastructure development and not consumption.

Speaking at the official ground-breaking ceremony of Fidelity Life Southview Park Development, the minister said he would give prescribed asset status to any housing project that is being undertaken in the country.

"Any housing project which comes my way, I will give it prescribed asset status just as what happened with Fidelity Life."

He reiterated that insurance companies and pension funds were a huge source of resource mobilisation.

"Through this project, it has been demonstrated that insurance companies and pension funds possess the ability to harness funds for critical infrastructure development.

As we go forward I want those resources to go towards infrastructure development such as housing and small hydro projects and not consumption. I therefore urge other insurance companies and pension funds such as the National Social Security Authority and Old Mutual to emulate such developments."

Assets for pension funds grew to $1,8 billion last year from $1,5 billion a year earlier, according to IPEC.
- The Herald

Tags: Housing,