This dissertation investigates how the upgrading of informal settlements impacts home-based
enterprises (HBEs). De Soto’s ‘Mystery of Capital Theory’ suggests that the
formalisation of tenure rights, through informal settlement upgrading, can result in poor
households gaining access to capital using their houses as collateral against loans.
Furthermore, these households can then use this capital to finance the operations of their
HBEs. Rust’s conceptualisation of the ‘Housing Asset Triangle’ explains the importance of
HBEs in the lives informal settlement households as an economic asset. Thus, the lack of
support for HBEs in the implementation of informal settlement upgrading, by municipal
officials, impacts negatively on HBEs, and demonstrates Huntington’s ‘Clash of Civilisations’
Theory. Huntington states that when state officials implement informal settlement
upgrading, disagreements arise between the officials and the beneficiaries of upgrading, in
terms of the objectives and the results of upgrading, stemming mainly from the fact that the
state officials and the beneficiaries belong to different civilisations.
The researcher uses Cato Crest located in eThekwini Municipality as the case study area,
where interviews were conducted with the municipal housing officials that implemented the
in-situ upgrade in Cato Crest, using the Informal Settlement Upgrading Programme (ISUP) of
the Breaking New Ground (BNG): Housing Policy. Household surveys were also conducted
with the Cato Crest households that operated HBEs in the upgraded settlement, who had
also done so in the informal settlement prior to the upgrade. The researcher found that
HBEs in Cato Crest informal settlements are heavily dependent foot paths, for customers,
used by people walking through the settlement. However, the upgraded settlement has
lower housing densities than the informal settlement and the foot paths are replaced by
road-side pavements. Only the businesses trading from containers located on the road-side
survive, as customers using the roads and pavements stop easily to purchase goods. As a
result, HBEs suffer and are unable to attract customers anymore and re-establishing HBEs in
the upgraded settlement becomes a useless task as only businesses trading from the roadside
are successful in the Cato Crest upgraded settlement. Trading from the road-side
requires moving the HBE out of the house and into a road-side container, where the latter
needs to be purchased by the household in order to take advantage of customers using the
roads and pavements. This process proved to be too expensive for poor households
operating HBEs in Cato Crest. HBEs are an important income generation strategy for Cato
Crest households, and the upgrading of their informal settlement creates a better living
environment for these households. However, the inability to continue generating an income
using the house in the upgraded settlement creates a harsh environment for households
that depend on HBEs for survival. Based on the findings of this study, the recommendations
for the future implementation of informal settlement upgrading are that there is a need for
a more collaborative effort between municipal housing officials, the Business Support Unit of
the eThekwini Municipality, the Local Economic Development Offices, as well as households
operating HBEs. More research of the phenomenon of HBEs in informal settlements of any
particular area to be upgraded should be conducted. Thereafter, the implementation of HBE
accommodating and fitting upgrading plans to each settlement, needs to be carried out by
the upgrading officials, so that the upgraded settlement does not only give people access to
housing and infrastructure, but creates an environment where they can continue using their
houses for income generation in the upgraded settlement. / Thesis (M.Housing)-University of KwaZulu-Natal, Durban, 2011.
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:ukzn/oai:http://researchspace.ukzn.ac.za:10413/8617 |
| Date | January 2011 |
| Creators | Mnguni, Ziphozonke. |
| Contributors | Adebayo, Pauline Wambui. |
| Source Sets | South African National ETD Portal |
| Language | en_ZA |
| Detected Language | English |
| Type | Thesis |
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