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Re: Opposition protests latest withdrawal from bauxite fund
Another dubious so-called Developement Fund!
<span style="color: #FF0000">After 30 years, only 125,000 benefit from NHT</span>
by Patrick Foster Business Observer writer
Wednesday, January 17, 2007
Egbert Lee has been employed and contributing to the National Housing Trust (NHT) since 1976. In 2006, at 55 years old, he gained approval for a modest house lot loan from the NHT. However, because of his age, he has only 10 years to complete repayments at approximately $13,000 per month.
Lee assured the Business Observer that he was meeting the payments, but it was obvious in the tone of his response that he was struggling.
Lee, surprisingly, is one of only 125,000 contributors who have benefited from the NHT since it was established in 1976, despite the fact that a total of 755,779 Jamaicans contribute to the trust.
The NHT office in New Kingston
The 125,000 beneficiaries means that approximately 4,100 per year, or only one out of every seven people who have contributed to the NHT, were able to receive loans to purchase land or a house.
All Jamaicans earning minimum wage and over are required by law to contribute one per cent of their salary to the NHT with employers matching that amount with two per cent of the monthly payroll.
However, some employees have contributed to the NHT since its inception and have never received a benefit, or are too close to retirement when they have qualified for a loan.
Trade unionists and financial analysts have now charged that the one-in-seven recipient ratio is too low and a vast chunk of the contributing workforce will never be able to receive an NHT benefit because of qualification stipulations.
"Over 60,000 in the public sector will never qualify for a NHT loan," Bustamante Industrial Trade Union (BITU) vice president Dwight Nelson told the Business Observer.
Analyst John Jackson sees the NHT as a manifestation that the economy has been off track for a very long time, arguing that interest rates should be brought to international standards where anybody would be able to get a low interest mortgage loan.
"If we did not fool around, all because of poor judgement on the part of government, we would be like Trinidad, being able to offer interest rates to anyone at seven per cent," Jackson said.
However, Hugh Reid, NHT senior director of finance, sought to explain the one-in-seven ratio, saying that every contributor to the NHT is entitled to a benefit. However, he agreed that many were hindered because of affordability.
"You need to put the 125,000 in its proper perspective," said Reid. "In fact, all NHT contributors are eligible for a benefit.(but) if you are in an economy where income levels are not where they ought to be, it will affect the ability of persons to access the benefits.
"They may not be eligible for the maximum $3 million, based on affordability, but they can get a benefit. Even the person who is a minimum wage earner can access about $1 million," he added.
Last year April, the NHT doubled its maximum benefit from $1.5 million per contributor to $3 million, allowing two contributors to join for a possible $6 million loan.
However, in order to qualify for a $3 million NHT loan, a contributor has to be earning a minimum of $15,800 per week.
Reid said that many persons had a perception that was not immediately compatible with their circumstances. "Many people, for example, will say they will not live in Portmore, when it is a Portmore house that they can afford."
He added that in other instances the NHT was willing to disburse funds but contributors could not find land they considered appropriate, or a house in a suitable location.
"It is not really a mark against the NHT. You cannot blame us," Reid insisted.
He advocated that contributors instead work within their means to acquire property, saying that it was in fact possible to construct a house for as low as $1 million.
Reid added, however, that a major problem faced by the NHT was the unavailability of suitable land for the construction of affordable houses.
"Aside from location issues, the land must have a certain topography," he said. "We would prefer flat land because it's easier to build."
Many landowners, he said, sought to increase prices whenever the NHT showed interest in a property.
Notwithstanding, Reid said that the lowest interest rates, between two and eight per cent, were available from the NHT.
But even with Reid's explanation, trade unionist Nelson contends that the majority of public sector workers will never be able to meet the NHT requirements.
"We have always had a problem with workers meeting the NHT qualification. The number of workers who cannot meet the requirements is significantly high," Nelson said.
"A minimum wage earner will never qualify for a loan from NHT. It is not possible," the BITU vice president told the Business Observer.
Danny Roberts, an NHT board member and National Workers Union (NWU) vice president, said that the NHT was doing its best "under the circumstances" to acquire land and provide affordable solutions.
"We understand the limitations. It's not just land, but suitable land," said Roberts, referring to topography, location and price.
At the upcoming board retreat, the provision of houses to professionals will be a significant item for discussion, Roberts said, while reminding of the mandate of the NHT when it was established.
"I shudder to think what the situation would be if the NHT had not existed," said Roberts.
https://<a href="http://www.jamaicao...m_nht_.asp</a>
Another dubious so-called Developement Fund!
<span style="color: #FF0000">After 30 years, only 125,000 benefit from NHT</span>
by Patrick Foster Business Observer writer
Wednesday, January 17, 2007
Egbert Lee has been employed and contributing to the National Housing Trust (NHT) since 1976. In 2006, at 55 years old, he gained approval for a modest house lot loan from the NHT. However, because of his age, he has only 10 years to complete repayments at approximately $13,000 per month.
Lee assured the Business Observer that he was meeting the payments, but it was obvious in the tone of his response that he was struggling.
Lee, surprisingly, is one of only 125,000 contributors who have benefited from the NHT since it was established in 1976, despite the fact that a total of 755,779 Jamaicans contribute to the trust.
The NHT office in New Kingston
The 125,000 beneficiaries means that approximately 4,100 per year, or only one out of every seven people who have contributed to the NHT, were able to receive loans to purchase land or a house.
All Jamaicans earning minimum wage and over are required by law to contribute one per cent of their salary to the NHT with employers matching that amount with two per cent of the monthly payroll.
However, some employees have contributed to the NHT since its inception and have never received a benefit, or are too close to retirement when they have qualified for a loan.
Trade unionists and financial analysts have now charged that the one-in-seven recipient ratio is too low and a vast chunk of the contributing workforce will never be able to receive an NHT benefit because of qualification stipulations.
"Over 60,000 in the public sector will never qualify for a NHT loan," Bustamante Industrial Trade Union (BITU) vice president Dwight Nelson told the Business Observer.
Analyst John Jackson sees the NHT as a manifestation that the economy has been off track for a very long time, arguing that interest rates should be brought to international standards where anybody would be able to get a low interest mortgage loan.
"If we did not fool around, all because of poor judgement on the part of government, we would be like Trinidad, being able to offer interest rates to anyone at seven per cent," Jackson said.
However, Hugh Reid, NHT senior director of finance, sought to explain the one-in-seven ratio, saying that every contributor to the NHT is entitled to a benefit. However, he agreed that many were hindered because of affordability.
"You need to put the 125,000 in its proper perspective," said Reid. "In fact, all NHT contributors are eligible for a benefit.(but) if you are in an economy where income levels are not where they ought to be, it will affect the ability of persons to access the benefits.
"They may not be eligible for the maximum $3 million, based on affordability, but they can get a benefit. Even the person who is a minimum wage earner can access about $1 million," he added.
Last year April, the NHT doubled its maximum benefit from $1.5 million per contributor to $3 million, allowing two contributors to join for a possible $6 million loan.
However, in order to qualify for a $3 million NHT loan, a contributor has to be earning a minimum of $15,800 per week.
Reid said that many persons had a perception that was not immediately compatible with their circumstances. "Many people, for example, will say they will not live in Portmore, when it is a Portmore house that they can afford."
He added that in other instances the NHT was willing to disburse funds but contributors could not find land they considered appropriate, or a house in a suitable location.
"It is not really a mark against the NHT. You cannot blame us," Reid insisted.
He advocated that contributors instead work within their means to acquire property, saying that it was in fact possible to construct a house for as low as $1 million.
Reid added, however, that a major problem faced by the NHT was the unavailability of suitable land for the construction of affordable houses.
"Aside from location issues, the land must have a certain topography," he said. "We would prefer flat land because it's easier to build."
Many landowners, he said, sought to increase prices whenever the NHT showed interest in a property.
Notwithstanding, Reid said that the lowest interest rates, between two and eight per cent, were available from the NHT.
But even with Reid's explanation, trade unionist Nelson contends that the majority of public sector workers will never be able to meet the NHT requirements.
"We have always had a problem with workers meeting the NHT qualification. The number of workers who cannot meet the requirements is significantly high," Nelson said.
"A minimum wage earner will never qualify for a loan from NHT. It is not possible," the BITU vice president told the Business Observer.
Danny Roberts, an NHT board member and National Workers Union (NWU) vice president, said that the NHT was doing its best "under the circumstances" to acquire land and provide affordable solutions.
"We understand the limitations. It's not just land, but suitable land," said Roberts, referring to topography, location and price.
At the upcoming board retreat, the provision of houses to professionals will be a significant item for discussion, Roberts said, while reminding of the mandate of the NHT when it was established.
"I shudder to think what the situation would be if the NHT had not existed," said Roberts.
https://<a href="http://www.jamaicao...m_nht_.asp</a>
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