To subsidise or not to subsidise?

Bricks drying in the sun in on of Lilongwe's poor settlements

Bricks drying in the sun in one of Lilongwe’s poor settlements

Heated debate over an upcoming subsidy for cement and iron sheets is raging in Malawi. Put forward in the new government’s 2014-2015 budget, the MK7billion ($18.4million) programme is, according to the government, aimed at supporting low income Malawians achieve decent and affordable housing. Critics, of which there are many, are not convinced. They have argued that it’s poverty, not availability of materials that is the problem, adding that other subsidy programmes, such as the Farm Input Subsidy Program (FISP), have not been properly managed and therefore have not always benefited the most needy. Furthermore, the low number of intended beneficiaries, around 15,000 families or 80 houses per constituency in Malawi, has been faulted for being a drop in the ocean in a country where 80% of residents are estimated to live in sub-standard housing, as well as a drain on public funds.

There’s no doubt that something needs to be done on the housing front in Malawi. And while the quality of housing certainly is an issue – homes built using sun-burnt bricks are known to collapse during the rainy season – my own research (forthcoming) in Lilongwe’s poor settlements suggests this is considered less of a problem than some of the other features of what is defined as adequate housing. Specifically, at least residents in Lilongwe’s urban areas seem to consider their lack of access to key public services such as potable water, education, and health care as far bigger challenges than the quality of their housing.

Bricks are made on-site even in some of the most dense settlements in Lilongwe

Bricks are made on-site even in some of the most dense settlements in Lilongwe

So should the government subsidise cement and iron sheets? They will, no matter what, but I definitely don’t think they should. The (now ruling) DPP party’s election promise to put subsidies in place was all about gaining votes, while implementation of the subsidy reveals a populism that betrays a lack of appreciation of the real situation. Sure, the majority of Malawians live in sub-standard housing. Sure, that’s a problem. Are cement and iron subsidies for 15,000 families – one percent of the population by a generous estimate – the solution? No.

Much more forward-thinking solutions would include reverting to developing sites-and-services schemes in the country’s urban areas, promoting better techniques for making durable sun-burnt bricks, improving access to finance among the poor, and strengthening tenure security to give people the confidence to invest in their homes.

And all of the above does not even touch upon how hot and loud roofs made from iron sheets can be, and the multitude of environmental concerns associated with cement.


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