(Position paper on Balikatan’s take-over of mass housing)
The Kalipunay ng Damayang Mahihirap (Kadamay) commiserates with the thousands of housing creditors in the city whose housing units are now subject to demand letters and foreclosure by the Balikatan Housing Finance Inc.
There is no one to blame but the Arroyo government for having allowed this mess to occur. It has used, invested and wasted precious taxpayers money intended for a sustainable low-cost, low-interest housing program and sold so-called delinquent housing assets to the foreign-funded private sector.
Upon the behest of the Asian Development Bank, the Arroyo government, through the National Home Mortgage Finance Corporation has instigated the sale of its 52,000 subprime mortgage loans to Balikatan Housing Finance Inc. (BHFI)–a company jointly owned by the government (49 percent) and the Deutsch Bank Global Opportunities (51 percent) with a funding of 1.6 billion pesos from the ADB.
In this scheme, homeowners are now at the mercy of Balikatan as thousands of families face the imminent threat of massive foreclosures, eviction and displacement.
Kadamay believes that the plight of these homeowners reflect the plight of the millions of urban poor in the country whose basic right to housing is denied to them because of state neglect and anti-people and elite, pro-foreign, pro-globalization policies. Indeed, from previous administrations until the present, the government has failed to solve the worsening housing crisis.
While the government data reveals that by 2010, housing needs would reach more than 3 million, the general appropriations for housing remains at 0.4% while unproductive allocations such as debt servicing and AFP modernization got 683 billion pesos and 5 billion pesos respectively.
Despite the crisis, the Arroyo government has made its housing program not a much-needed social service but rather as a milking cow for business.
The Arroyo government adopted its Medium Term Philippine Development Plan, as the World Bank’ condition for a recent 10 million dollar loan availment. In this policy framework, the government changed its role in housing by using public pension funds in GSIS, SSS and Pag-ibig as a capital /investment to earn as much as 20 billion pesos in 5 years at “market-based interest rates.” Other than that, it hoped to enhance collection efficiency by about 80 percent from the current 70 percent through outsourcing.
The government has resorted to fullscale privatization of housing service and removed housing subsidies. Thus, housing has now become the source of profit by the foreign and local investors in housing, services, real estates and construction.
Worse, the Balikatan transaction is also patently anomalous and concluded surreptitiously, in the intent to blind the public of the impact of the privatization of housing.
The mega-sale of almost 53,000 housing units to Balikatan was made without the borrowers’ knowledge and approval. The homeowners were denied of their basic right to information, most especially because it was not merely a change of loaning party, but also a change of interest rate from 9 to 14 percent.
Kadamay condemns the wholesale privatization of housing service. The Balikatan fiasco is a portent of things to come, as more and more socialized or low-cost, or mass housing unit owners will be subjected to the whims and caprices of profit-driven capitalists. The hapless homeowners will eventually join the hundreds of thousands of homeless workers and professionals in the cities.
Kadamay calls for the cancellation of Balikatan contract and for the Arroyo government to assume the housing loans. To call for a mere moratorium or temporary relief is a band-aid solution to an otherwise, festering problem of homelessness and poverty. To accuse homeowners that they will only use the issue to get away with not paying their loans is a blatant attempt to actually blame the victims and not the culprit.
Housing is a state responsibility, and there is deep housing crisis in our country. Therefore, mass housing should serve the interest of the workers, professionals and other urban poor.
Homeowners and other associations should consolidate its strength, link with organizations of workers and other urban poor, to collectively advance the right for decent housing, jobs and social services and actively resisist all anti-people and anti-poor policies and programs.
Stop privatization of housing and other social services!