[Photo: FILE]

The cost of affordable housing in Fiji could rise as the Housing Authority faces a $7 million bill for an electricity substation required for a major development in Davuilevu, Nakasi.

Permanent Secretary for Housing Manasa Lesuma warns that without government financial support, the cost of essential power and water infrastructure could be passed on to homebuyers.

Lesuma says that while the Davuilevu site could accommodate between 7,000 and 8,000 homes, proceeding without state aid will push up property prices, defeating the purpose of providing low-cost housing.

The Ministry warns that passing the cost on to buyers could push up house prices, making homes less affordable for low- and middle-income earners.

“Now, if we don’t get assistance from the government to help us pay for that substation, the Housing Authority will take on the cost, and that cost will be added to the cost of the property at the end of the development. So, if we continue with that, it will definitely defeat the purpose of providing homes for low- and middle-income earners because the cost of the property will increase due to the infrastructure costs of the development. So, there is a submission from the Ministry to the Ministry of Finance to look at these areas, and to consider whether the government can cover the infrastructure costs of any subdivisions.”

Standing Committee member Aliki Bia says limited funding remains a major challenge in delivering affordable homes to the public.

“What are some of the barriers that are somehow preventing the Ministry of Housing from delivering affordable housing to the people of Fiji? This is when you talk about what is required in terms of legislation, resources and other avenues that will assist the Ministry of Housing in delivering affordable housing.”

In response, Lesuma says the Ministry has submitted a proposal to the Ministry of Finance, seeking government support for infrastructure costs in housing subdivisions.

Cabinet has established a housing subcommittee to help resolve infrastructure issues and speed up housing development.