By NEIL HARTNELL
Tribune Business Editor
A Cabinet minister has pledged to deliver “better value for money” from the Government’s housing programme, and acknowledged that “it cannot all” be financed through the cash-strapped Bahamas Mortgage Corporation (BMC).
Kenred Dorsette, minister of the environment and housing, told Tribune Business that while he believed his goal of constructing another 1,300 government homes over the Christie administration’s five-year term was achievable, it would have to be achieved through “non-traditional means”.
Promising that lessons would be learned from the Crown Agents’ Value for Money report, which noted that “objective financial decisions were being overridden by political imperatives” during the 2002-2007 housing programme, Mr Dorsette said the Government wants to partner with private developers and mortgage lenders in the development of lower-cost subdivisions.
In an effort to develop smarter, and ensure the taxpayer was not burdened with “millions and millions” of dollars sunk into the ground for little return, Mr Dorsette said the Government would only build to match housing demand and the number of persons qualifying for mortgages.
And, to reduce infrastructure costs further, he indicated the Government would either look to extend existing subdivisions or build new ones in close proximity to existing public roads and utilities. Reducing construction and housing costs was also being explored.
“I’m still optimistic that we should be able to meet that particular challenge,” Mr Dorsette told Tribune Business, when asked about his previously stated goal of building 1,300 new government homes during the next five years.
Acknowledging that the Bahamas Mortgage Corporation’s (BMC) sinking fund was already stretched when it came to meeting its bond repayment obligations, the critical period set to come in the next decade, Mr Dorsette admitted the situation “impairs its ability to raise additional funds through borrowing”.
“You are correct that there are some legacy challenges in relation to the Bahamas Mortgage Corporation,” the minister added.
“We are exploring a private-public partnership to advance the housing agenda. Not only are we going to look at conventional and traditional means to achieve our housing agenda.
“I’m still confident we can address the issues at the Bahamas Mortgage Corporation, and still find the means to pursue an aggressive housing agenda. It cannot all be done through the BMC and traditional means.”
Mr Dorsette said the Government was looking for private developers to partner with the BMC, and for banks and private sector lenders to provide mortgages for low-cost government homes. Both recommendations were contained in the Value for Money report.
“What we also want to do is ensure when we advocate new infrastructure for housing developments, it is informed decision-making where it is based on real data,” he added.
The Government, the minister explained, wanted to avoid “putting millions and millions into the ground when no real demand for lots and inventory” exists, a situation that had occurred all too often in the past. It also wanted to ensure home buyers were qualified for mortgages so it was “
not spending money unnecessarily”.
Pointing out that “significant demand” remained for lower cost housing, Mr Dorsette said the Government was looking
“for another way” to roll it out and give better value for money.
“What we’re trying to do is find better value for money,” he told Tribune Business. “The objective still remains the same, but the means by which we achieve the objectives should be better strategically planned and thought out.”