The Upgrading of Informal Settlements Programme (UISP) forms part of the ambitious National Housing Code of the Department of Human Settlements (DoHS). The programme offers an intergovernmental approach aimed at improving the living conditions of people in informal settlements by providing efficient service delivery, security of tenure and community empowerment and involvement.

The UISP is divided into four major phases: project preparation, interim services, full services and registered tenure. Phases 1 to 3 focus on service delivery through the involvement of municipal, provincial and national government. The 4th phase relates to the allocation of funds for the development of individual houses in line with the eligibility of households, essentially securing tenure. The responsibility of facilitating the implementation of this programme falls upon the municipality, with a 10% contribution being made to the budget by the municipality. This contribution can be sourced from the Municipal Infrastructure Grant or, in the case of metropolitan municipalities, the Urban Settlements Development Grant (USDG).

Picking out the core aspects of the programme and looking at what parts work well and what parts don’t we can begin to paint a picture of the UISP as a tool for informal settlement upgrading. This Insight will briefly review the programme’s policy intent and how this gets implemented (or not) into practice. It will conclude with some observations on institutional obligations and the role of different stakeholders, including communities, in the upgrading process.

A major strength of the UISP is the clear definition and understanding that informal settlements are here to stay and the only way to address them is through in situ upgrading. Embracing informality in the urban context is a massive step forward in changing the attitude and thinking around informal settlements.

Tenure security, health and security and empowerment are identified as core pillars of the UISP. One of the policy principles is to provide serviced stands, which then can be developed through the various housing programmes. However, as housing programmes are burdened with backlogs and delays, the transition from serviced sites or settlements to fully developed neighbourhoods with top structures often does not materialise. In addition, the housing subsidy regime hampers the implementation of Phase 3 of the UISP in that not all residents of an informal settlement are eligible for a state-sponsored house. As a result, municipalities are not inclined to formalise, or invest in the development of, a settlement that cannot be fully developed in accordance with the phased approach outlined in the UISP.

The provision of suitable land for the relocation of communities is definitely a major strength of the programme. However, the challenge becomes apparent when municipalities can only find suitable land on the periphery of metropolitan areas, in essence replicating the apartheid spatial structure. There needs to be a stricter provision for centrally located land within metropolitan areas.
Another strength is in the adoption of service standards, pertaining to the installation of interim and permanent municipal engineering services. This phased approach enables the urgent needs of communities to be addressed while creating a framework for the implementation of permanent installations. As noted before, this unfortunately is then undercut by the manner in which housing consolidation is envisaged. There is an urgent need to rethink the housing subsidy system and create a supportive infrastructure (including financial resources) for self-build opportunities to emerge.
In terms of intended beneficiaries, the housing subsidy scheme specifies that eligible households must earn a monthly income between R 3501 to R 7000. The eligibility criteria has not changed over time to keep pace with inflation. It basically does not take into account the contextual reality of households.
In terms of the phased implementation of the programme, the strengths lie in the fact that there is a strong set of targets for all stakeholders and it is set out in detail. There is a clear road map to the process of the UISP. However, one aspect that affects the efficiency of implementation is that the submission of the final business plan in Phase 3 is rather late as this is the implementation phase. It should rather be part of Phase 2 so that funds and plans can be approved at an earlier stage.
There are clear provisions for municipalities and other spheres of government to access funds for informal settlement upgrading. A key challenge in this respect is that funding is based on eligibility of households, which is related to income levels. As it is difficult to get accurate data on eligibility, access to adequate funding becomes problematic. It would be better to base the funding rules on the size of an informal settlement as opposed to the income level of households within it.

The role of implementing institutions is clearly set out in the UISP. Most of the responsibility of implementing the programme falls on municipalities, including the initiation, planning and formulation of upgrading projects. This is a strength because municipalities are best suited to respond to the contextual needs of the settlements. The Planning for Informality web tool clearly displays this, by looking at how many municipalities have informal settlement upgrading strategies. All eight cities show evidence of having such strategies in place.

It is therefore concerning that the National Department of Human Settlements seemingly expects to be actively involved in project conceptualisation and participation, in collaboration with Provincial Departments as well as municipalities. To expect the Department to get involved on such a micro level overburdens the Department, and undermines the role of municipalities as main agents in informal settlement upgrading.

A major strength of the UISP is that community participation lies at the core of informal settlement upgrading. This creates the potential for local communities to shape their environment, build on existing social networks and develop a cohesive community. The community has deep-rooted knowledge of what their needs are, what risks and challenges they face, and what social capital they can bring to bear on an upgrading process. Tasks of surveying, facilitation and conceptualisation are more intuitive and will serve the community more effectively and efficiently. In practice, the role of communities in upgrading processes leaves a lot to be desired. There is significant scope to make this more meaningful, which will undoubtedly lead to more appropriate, contextually-relevant and inclusive development interventions.