Abstract
South Africa faces the triple challenges of poverty, unemployment and inequality, as
articulated by the National Development Plan. Communities in rural areas are severely
affected by poverty due to limited employment and economic opportunities. These
challenges have been a consequence of colonial spatial planning, which promoted a
segregated approach through race towards planning, resource allocation and economic
opportunities. Thus, urban areas occupied by whites were provided with better services and
economic opportunities in contrast to rural areas occupied by black people. These
challenges forced poor communities from rural parts of the country to migrate to urban
areas in search of jobs and economic opportunities. As they arrive in the urban areas,
they have no place to stay and cannot afford rental accommodation. The government
has also been unable to provide the urban poor with adequate housing as demand
has spiralled out of control. The challenges are further exacerbated by rampant
corruption and the government’s slow delivery of housing projects. The demand for
housing in urban areas thus continues to grow in parallel with the growth of informal
settlements. Informal settlements provide affordable housing opportunities for the
urban poor and the homeless, including foreign nationals wo are refugees and asylum
seekers.
Government officials’ perceptions about informal settlements are not encouraging.
They perceive them as a breeding ground for crime, environmental nuisance,
unhealthy living conditions and illegal activities. Therefore, it is no surprise that there
are backlogs and delays concerning permanent infrastructure provision, formalisation
of informal settlements, and provision of social facilities. Some informal settlements,
such as Boitumelo in Midvaal Local Municipality, have existed for over 20 years with
no permanent infrastructure. Yet it cannot be disputed that informal settlements play
a significant role in providing much-needed accommodation in urban areas. In
addition, informal settlements can uplift the poor and vulnerable from abject poverty
by bringing labour closer to employment.
Thus, informal settlement residents suffer exclusion and marginalisation by the
municipalities and government since there is no legislation or by-laws and regulations
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that permit and manage developments in informal settlements. As a result, it is
currently prohibited to practice business in informal settlements. Moreover, by-laws
cannot be enforced, informal settlement entrepreneurs cannot obtain permits and
licences to practice business, properties cannot be rezoned, building plans cannot be
approved, and municipal inspectors cannot inspect buildings for structural
acceptability and quality.
The technical research report investigated why informal settlement entrepreneurs are
excluded and marginalised from practicing businesses. These entrepreneurs cannot
meet the minimum requirements as prescribed by legislation to start a business.
Informal settlement residents also cannot obtain copies of title deeds required with
licence or permit applications, cannot submit plans for their business structures, and
cannot build structurally sound buildings. However, the informal settlement residents
require goods and services daily from informal settlement entrepreneurs as they
cannot buy in bulk due to a lack of electricity. Therefore, a cordial demand and supply
relationship exists between informal settlement residents and entrepreneurs.
The technical research report further probed the challenges affecting informal
settlement residents and the possible interventions to improve their socio-economic
conditions. The report concludes with recommendations for municipal and government
officials to change the socio-economic conditions of informal settlement residents and
create opportunities for informal settlement entrepreneurs to practice businesses
legally and contribute towards job creation and economic growth.