With 87 percent of its household population living in rented apartments amid widening housing demand-supply gap, what the government in Nigeria needs to do is to learn a few lessons from Ghana’s rent assistance scheme.
There is also lesson for Nigeria to learn from the smaller West African country on land administration. Whereas the rent assistance scheme can help Nigeria to begin to address its housing challenge in a more sustainable manner, the land administration can help in tackling infrastructure deficit.
Like Nigeria, Ghana is having accommodation problems caused by rising urbanization. The country also has a very active rental market where rents are paid in advance. But unlike Nigeria where housing deficit is estimated at 20 million units, Ghana has 5.7 million units.
Unlike Nigeria too, Ghana is doing much to tackle its housing problem. Right now, the government in the country, in partnership with the private sector, is set to provide GH¢100 million seed money to start a National Rental Assistance Scheme.
The scheme will use additional investment from the private sector to provide low-interest loans to eligible Ghanaians to enable them to pay rent advance and ease the accommodation challenges in the country.
Osei Kyei Mensah- Bonsu, the country’s Minister for Parliamentary Affairs, who disclosed this at 2021 budget presentation recently, explained that the initiative was part of government’s new reforms to enhance the quality of life of Ghanaians, support domestic entrepreneurs and businesses, and deepen access to public services.
This contrasts with what obtains in Nigeria where, rather than encouraging private developers by way of providing enabling environment for them to deliver housing, government and its agencies seem to be in competition with the private operators, delivering houses that are, in most cases, more expensive.
Government agencies like the federal mortgage bank of Nigeria (FMBN), the country’s apex mortgage bank, is into housing development. Ditto for the Federal Housing Authority (FHA) which, instead of promoting social housing for the less privileged, is into commercial housing.
Babatunde Fashola, Nigeria’s minister for Works and Housing, explains to whoever asks him that government cannot deliver affordable or low cost housing because there is no low cost cement or rods anywhere for the government.
The minister seems to have forgotten that the power to bring down the high price of cement or rods rests with the government. He seems to have forgotten too that land and infrastructure constitute over 40 percent of total construction cost. Government can change all these if it wants.
Other initiatives that have the potential to change lives which the government is coming up with are the National Equipment Leasing Policy, the Transport Sector Recapitalization Project and the Enhanced Student Loan Scheme.
The minister explained that the leasing policy would cover medical equipment, vehicles, photocopiers, printers, and scanners, among others as part of measures to efficiently manage the capital expenditure budget.