Government is determined to lift the ‘rent advance’ burden on workers, especially fresh graduates, with the establishment of the National Rental Assistance Scheme, if Nana Akufo-Addo is re-elected in the December general elections.
The scheme would have a seed capital of 100 million Ghana cedis.
Vice President Dr. Mahamudu Bawumia made the declaration at the manifesto launch of the New Patriotic Party for the 2020 elections on Saturday in Cape Coast.
Highlighting details of the NPP’s 2020 manifesto, he said the housing sector would be one of the areas the government would focus more on if the NPP is given the mandate to govern Ghana for another four years.
The Vice President first conceded that landlords are not obeying the Rent Control Act which forbids them from taking more than six months rent advance.
The “huge demand” for rent advance at times extending to two years has put a lot of “problem” on school leavers without enough savings to meet such demands, he pointed out.
“So, there is a market failure between what the tenants want and what the landlords want,” he observed.
“And this is why the government has decided to come in and bridge this market failure by setting up a National Rental Assistance Scheme,” Dr. Bawumia announced.
He noted that the scheme will give “loan to pay your rent advance” once one is able to demonstrate that he or she is having a paid-job where the loan can regularly be deducted from.
“So, we are bridging this, you need to have a formal employment which will allow us or someone who will guarantee so that you will pay,” he said, stressing, “It is very, very important that we address this.”
The amount, the Vice President noted, would be paid directly to the landlord and not to the tenant. Deduction would also be based on how much the tenant is supposed to pay monthly.
“We are going to be putting in place a 100 million Ghana cedis for the National Rental Assistance Scheme and work with the private sector to crowd in more so that we can get this done to release a lot of people, who are renting, of the burden.”
The National Rent Control Board would be digitalized as well as a new Rent Control Act for the housing sector.
Government attention would also be focused on “low-income housing” by building housing estates for persons who cannot buy the affordable homes being built by government, Dr. Bawumia said.