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Minister tackles mandatory procurement transformation in community schemes

MAIN IMAGE: Minister of Human Settlements, Mmamoloko Kubayi

Staff Writer

The first CSOS Indaba (Community Schemes Ombud Service) convened last week to educate stakeholders on community scheme governance, administration, and management, as well as to outline common challenges and solutions, and best practices in community scheme management.

Minister of Human Settlements, Mmamoloko Kubayi, spoke at the event. While the Minister has been at pains to reassure the real estate industry that the call for transformation was centred on making the pie bigger by including informal markets into the industry, as opposed to increasing the number of agents fighting for the same market share, she seems to have taken a slightly more traditional stance when it comes to transformation with regards to community schemes.

A call for economic transformation

According to a press release by CSOS, the Minister said that economic transformation has to take place in the multi-trillion Rand community schemes economy, which includes sectional title complexes, homeowners’ associations, retirement housing schemes, share block companies, and housing cooperatives.

“South Africa has an estimated 70,000 community schemes and has also seen a growth trend in gated communities. 27% of the total value of residential property in South Africa is from organised communities, which means that community schemes are a significant economic sector,” she said.

A focus on transforming service delivery

“The services these schemes solicit – such as security and garden services – make the sector a huge contributor to job creation, mainly because many of the services are sourced from small and medium enterprises. We, therefore, need to put measures in place to ensure that a procurement approach that gives opportunities to emerging SMMEs, especially those from previously disadvantaged communities, becomes mandatory.”

Managing agents also a focus area

“An estimated R800 billion in assets is managed by community scheme managers, therefore the transformation of the managing agents in this sector remains critical. Last year in an effort to transform the managing agents industry, CSOS signed a memorandum of understanding with Pretor, MidCity, and Trafalgar to collaborate on the development of emerging black managing agents so that they can also play a meaningful role in the sector. The collaboration must yield tangible results and CSOS has to ensure that these emerging black managing agents are integrated into the sector,” the Minister said.

Minister Kubayi added: “Transparency is important, so it is expected that part of community schemes’ responsibility is to be able to be transparent in the manner that we do things, but also understand consciously that we have a role to play to ensure that the economic participation is broadly opened for all to participate.”

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