Recently, the Lagos State government increased the building plan assessment rate in the state. This, however, did not go down well with players in the real estate industry as many of them have been condemning the action of the government as inconsiderate.
Before delving further, let’s shed a little light on the building plan assessment rate.
Before any meaningful housing construction project is carried out in any organized society, there are procedures to be followed.
One of these procedures is obtaining a building plan permit after the contractor/client has submitted the building plan to the office in charge of issuing the permit. In Lagos, the Lagos State Physical Planning and Development Authority (LASPPDA) is responsible for the issuance of building plan permits. However, the commissioner in charge of the Ministry of Physical Planning and Urban Development signs the permit plan.
However, before the permit is granted, part of the fees to be paid is the assessment rate, which will empower the officials of the issuing authority to embark on regular site visits at different stages of the construction to ensure compliance.
In other words, without the payment of the assessment rate, housing construction cannot begin on any site. This is why the recent increment in the rate irked some practitioners in the sector.
To be precise, the Lagos chapter of the Nigerian Institute of Town Planners (NIOTP) during its recently held Annual General Meeting (AGM) and 40th anniversary celebration stated thus:
“The recent increment in building plan assessment rates across the board in the state has been generating a lot of rancor and heated reactions in the sector.
“This is because the increment was carried out outside the purview of the operating planning regulations; it is prohibitive and retroactive in implementation.
“The state chapter noted the likely negative effects on urban development across the state. It will lead to an increase in the cost of procuring development permits and hence construction costs.
“In the long run, it will lead to further proliferation of illegal developments and the growth of slums, which will cost more to fix in the future.”
It will be noted that one of the roles of the NITP as a professional body, is to advise policymakers from time to time on issues germane to the development of human settlements and the environment.
To this end, they have sent a position paper on the increment to the Lagos State Ministry of Physical Planning and Urban Development.
Ladi Lewis, former Lagos State chapter chairman of the Nigerian Institute of Architects (NIA) explained to PropertyPrice that the increment is bound to affect the cost of development and eventual value of properties in the market.
Also, Fayomi Ogun, former Ogun State chapter chairman of the Nigerian Institute of Building (NIB), pointed out that it will undoubtedly cause an increase in house rent to the detriment of residential and commercial real estate subscribers and tenants.
In addition, he said: “It will also make participants in the building procurement delivery sector resort to bribing the agency collecting the rates in a bid to avoid the rate altogether.
“More developers will end up cutting corners and engaging in shady deals. It is also likely to lead to reduced investment in the building industry which in turn will increase the housing deficit.”
Some experts even went down memory lane to dig out the history of planning and the reason why attaching a price to the assessment exercise is a disservice to society.
According to Lekwa Ezutah, former president of the NITP, Town Planning originally was concerned with public health and was therefore seen as dealing with the peoples’ welfare and never a revenue-generating affair. Governments all over the world, he noted, subvent town planning agencies.
Town planning, Ezutah recalled, owes its origin to the Industrial Revolution in Europe when many workers moved to the cities, giving rise to a high demand for housing.
Capitalists or shylock landlords, he remarked, capitalized on the high demand for residential accommodation to build substandard houses within congested neighborhoods.
“Due to the inhuman nature of such settlements, humanitarian organizations sprang up to canvas for more humane housing accommodation for the factory workers. Town Planning therefore has its origin in agitation for public health concern.”
He however narrated that in recent years, Nigeria has made a 360-degree turnaround from the original law guiding town planning. They now see it as a cash cow, he lamented.
According to him, to meet the revenue targets, town planning authorities/agencies are compelled to shift their focus from public health concerns/public welfare to revenue generation, thereby compromising standards.
“Besides compromising standards to the detriment of the people’s welfare, the high fees charged developers are transferred to the people in the form of exorbitant rents; the people then suffer the double jeopardy of high rents for substandard housing.
