ATC140711: Report of the Portfolio Committee on Human Settlements on Budget Vote 31: Human Settlements and on the strategic plan 2014/19 and annual performance plan 2014/ 2015, dated 8 July 2014
Human Settlements, Water and Sanitation
Report of the Portfolio Committee on Human
Settlements on Budget Vote 31: Human Settlements and on the strategic plan
2014/19 and annual performance plan 2014/ 2015, dated 8 July 2014
The Portfolio Committee on Human Settlements,
having considered Budget Vote 31: Human Settlements, and the strategic plan and
the annual performance plan of the Department of Human Settlements and its
entities, referred to it, reports as follows:
1.
Introduction
The Constitution places an obligation on the State
to provide access to adequate housing to its citizens. As the custodian of the
housing sector, the Department of Human Settlements later referred to it as
(the Department) has developed strategies, policies and programmes to ensure
the progressive realisation of this right. The comprehensive plan for the
development of sustainable human settlement, approved in 2004 and the revised
housing code, published in 2009, mark a conceptual shift away from the mandate
of providing shelter to supporting the residential property market.
Furthermore, in the 2009 State-of-the-nation address, the name change of the
Department of Housing to Human Settlements was pronounced that required
collaboration from other departments to make it a success. The Housing Code
allows for access to housing, services for low-income families, and ensures
greater choice in quality, location and ownership.
Owning to time
constraints, the Committee only received a briefing from the Department of
Human Settlements and Human Settlements entities on the budget and on annual
performance plan.
2.
Department
of Human Settlements
2.1
Aim
and mandate of the Department
The mandate of the Department is to determine,
finance, promote, co-ordinate, communicate and monitor the implementation of
housing policy and human settlements. Since the formulation of the
Comprehensive Housing Plan in 2004, the department has conducted various
initiatives to enhance the creation of comprehensive, integrated, coordinated
and sustainable human settlements and quality housing. These initiatives
include the review of the National Housing Code, which determines national
norms and standards in respect of housing development, as well as the provision
of the Farm Worker/Occupier Housing Assistance Programme and the establishment
of the Housing Development Agency.
Subsequent to that and during the course of January
2010, the Cabinet approved an outcomes-based performance approach to the
mandate of the department with the adoption of Outcome 8 Sustainable Human
Settlements and Improved Quality of Household Life.
The Outcome 8 has sub-outcomes that the
department has to adhere to that are the adequate housing and improved quality
living environments; a functionally equitable residential property market and
enhanced institutional capabilities for effective coordination and spatial
investment decisions.
2.2
Summary
of the strategic plan
The Department reported that its strategic plan
2014-2019 was approved by Cabinet in June 2014.
The Department further reported various stakeholders were consulted in
the process.
The strategic plan is
informed by the Manifesto of the ruling party; National Development Plan and
the Medium Term Strategic Framework.
The following are the delivery priorities that the
department is expected to deal with for the period ahead in responding to the
government manifesto:
Ensure all South Africans live in decent conditions
in suitable human settlements.
Implement integrated human settlement residential
programmes to provide all inclusive amenities and public transport, and
overcome apartheid spatial development.
Provide one million housing opportunities for
qualifying households in urban and rural settlements over the next five years.
Accelerate the provision of basic services and
infrastructure in all existing informal settlements.
Increase the supply of affordable housing through
mobilization of housing allowances for teachers, nurses, police officers,
office workers and many others in the gap market.
Eliminate the backlog of title deeds.
Issuing of title deeds for households in the
subsidy market on occupation.
Work with financial institutions, private sector
organizations, co-operatives and social partners to increase the provision of
capital for housing. (This will include the establishment of a mortgage
insurance scheme).
Increase the number of housing units in
better-located mixed income projects (Especially in social, co-operative and
rental housing, to revitalize inner cities, mining towns and developing cities).
Use Catalytic projects, such as integrated
residential programmes, to direct investment and overcome apartheid spatial
geography.
Promote integrated public transport systems in the
new human settlements, including provision of passenger rail and buses.
Connect additional 1.6 million homes to electricity
grid over the next five years.
Continue to work towards universal access to
running water by providing access to those who still dont have it.
2.3
State-of-the-nation
address (SONA) and the budget speech
The 2014 SONA highlighted the following key
strategic objectives pertaining to the Department of Human Settlements:
The following key issues have been
highlighted and are relating to the Human Settlements sector:
Building housing and other services to revitalize
mining towns, as part of the October 2012 agreement between business,
government and labour.
Upgrading or conversion of hostels into family
units.
Developing a sustainable energy mix that comprises
coal, solar, wind, hydro, gas, and nuclear energy.
Providing support to Moqhaka Local Municipality in
the Free State with the eradication of the bucket system and open toilet
challenges.
2.4
Political
Overview by the Minister of Human Settlement, Ms LN Sisulu
The Minister gave a political overview on the
strategic direction of Department.
She
indicated that the National Development Plan (NDP) adopted by the government
will be the basis for the work of the Department. It was essential that the
promises made to the people of our country through Manifesto of the ruling
party are fulfilled. She noted that all indications were that the Department
would go back to the Breaking New Ground (BNG) and amplify it to ensure that
the Department would deliver the 1.4 million houses it had set to build in the
next five years. She also indicated the Medium Term Strategic Framework (MTSF)
was tabled at Cabinet Lekgotla.
She
further reported that the Department of Human Settlements was in a process of
aligning its work to the documents mentioned.
She reported that she engaged with entities wanting to understand what
was happening in the sector and she continues to do so as she has not met all
the entities.
She noted that after
consultation with stakeholders, legislation would be developed and some cases
will be preceded by the green and white papers on Human Settlements.
The Minister informed the Committee that according
to 2007, statistic the Department has managed to deliver and provide houses to
3,6 million beneficiaries since 1994 while the backlog is still huge at 2,3
million.
She committed that the
Department would be expected to deliver 270 000 per year that would yield
results of 1,4 million houses in the next five years.
The Statistician General was concerned that
houses were built in a manner that still follows the apartheid spatial
patterns.
The Minister and the
Department would need to develop legislation that talks to the creation of
human settlements, as the Department is still using the old Housing Act.
She noted that urbanisation was very high and
government needs to join hands and reverse this by creating work opportunities
in rural areas.
The Minister indicated that one of her priorities
would be to clean the database of people in the waiting list using the services
of the State Information Technology Services (SITA). The Minister also
undertook to conduct an occupancy audit on the houses that have been built thus
far, i.e. the verification of owners.
She indicated that the Department has been leading an Inter-Ministerial
Committee on Sanitation (Bucket eradication) comprising of the Departments of
Water and Sanitation and Cooperative Governance. Discussions will be held with
the newly formed department, Water and Sanitation to ensure that this function
as it relates to houses provided by government (reticulation) remains with
Human Settlements.
She informed members
that the strategic plan tabled on 27 June was concluded before she joined Human
Settlements and it was possible that it would be amended. She invited members
to make inputs to the plan and once she has finalised consultation with Human
Settlement stakeholders shoe would table a revised plan.
3.
Budget analysis and programmes
|
2014/15
|
2015/16
|
2016/17
|
% to total allocation
|
Final Allocations.
|
R' 000
|
R' 000
|
R' 000
|
|
National Department Operational Budget
|
828 464
|
863 382
|
914 398
|
3%
|
Grants and transfer payments
|
29 692 928
|
31 978 980
|
33 538 194
|
97%
|
Total
|
30 521 392
|
32 842 362
|
34 452 592
|
|
Source: Department of Human Settlements - 2014
3.1
Budget
allocations per programme
Programmes
|
2014/15
R`000
|
2015/16
R`000
|
2016/17
R`000
|
Administration
|
425 905
|
445 612
|
472 038
|
Human Settlements Policy, Strategy and Planning
|
89 396
|
94 299
|
100 332
|
Programme Delivery Support
|
298 475
|
307 715
|
325 404
|
Housing Development Finance
|
29
707 616
|
31 994 736
|
33 554 818
|
Total
|
30
521 392
|
32 842 362
|
34 452 592
|
Source: Department of Human Settlements
3.1.1
Programme
1: Administration
Administration aims to provide strategic leadership
and administrative and management support services to the Department.
During the 2014/15 financial year this
Programme receives an allocation of R425.9 million. This allocation reflects a 0.83
per cent increase in nominal terms and 5.06 per cent decline in real terms.
Expenditure is dominated by both the Departmental Management and Corporate
Services sub-programmes, which constitute 72.5 per cent of the overall
programme allocation.
3.1.2
Programme
2: Human Settlement Policy, Strategy and Planning
The purpose of the programme is to manage the
development and compliance with human settlements sector delivery frameworks
and oversee integrated Human Settlements strategic planning services.
Expenditure in Programme 2 increased from
R84.1 million the previous year to R89.4 million the current financial year,
resulting in a 6.30 per cent nominal increase and 0.10 per cent real increase.
The sub-programme Human Settlements Strategy
and Planning dominates expenditure in Programme 2, with a budget of R53.7
million, representing an increase of 6.55 per cent in nominal terms or 0.33 per
cent in real terms. This is mainly due to the strengthening of the planning
process in the provinces and municipalities to develop a programmatic approach
to human settlements development planning.
3.1.3
Programme
3: Programme Delivery Support
This programme oversees and supports the execution
of human settlements programmes and projects.
Compared to the previous financial year, budget allocation for Programme
3 increased from R 261.7 million in 2013/14 to R298.5 million.
There has been an increase in the utilisation
of consultants who were sought during the implementation of strategic
programmes such as National Upgrading Support Programme; also rolling out of
sanitation facilities through the RHIG programme.
This also includes providing technical
support to 53 municipalities through the national upgrading support programme.
Expenditure on consultants and professional services increase from R107.1
million the previous financial year to R131.1 million in 2014/15, resulting in
a nominal increase of 22.4 per cent (real 15.26 per cent).
3.1.4
Programme
4: Housing Development Finance
The purpose is to manage and support Human
Settlements Grant Management services, mobilise sectoral resources and identify
possible discriminating lending patterns by financial institutions.
For 2014/15, Programme 4 received an
allocation of about R29.7 billion compared to R27.4 billion in the 2012/13
financial year. This reflects an increase of 8.08 per cent in nominal terms and
1.77 per cent increase in real terms.
The bulk of expenditure in Programme 4 is in the form of transfers, i.e.
96.7 per cent of the budget is transferred to provinces, municipalities
(through four conditional grants), as well as to the departmental entities.
·
Human Settlements Development Grant (R17.9 billion)
·
Urban Settlements Development Grant (R10.2 billion)
·
Rural Household Infrastructure Grant (R113.1
million)
·
Municipal Human Settlements Capacity Grant (R300
million)
The four types of grants located in Programme 4 are
critical for giving effect to the commitments articulated both in the 2014
State of the Nation Address, as well as Outcome 8.
4.
Delivery
agreements for Outcome 8 for 2014/15 to 2015/2016 (planned targets)
Source: National Department of Human Settlements -
2014
4.1
Targets
for 2014/2015
The programmes and targets are indicated below:
·
Slum upgrading - targeted to upgrade 22 882
sites and develop 40 691 units as per the allocated budget as indicated
above.
There was no sites allocated for
Northern Cape province and there were no units allocated for the Limpopo
province.
·
Affordable rental housing targeted to provide 887
sites and 7 946 units.
Out of nine province
only three provinces (Limpopo, Northern Cape and Western Cape) has set aside
sites for the provision of affordable rental.
·
Rectification - targeted to rectify 514 sites in
the Eastern Cape and 8 929 units other provinces besides the Gauteng and Mpumalanga
provinces.
·
Rural programme targeted to provide 4 522
sites and 34 168 units.
·
Peoples Housing Process there are no targeted
site in all the provinces while there is a target to provide 8 415 units.
·
Mining town targeted to provide 5, 648 sites and
10 919 units.
4.2
Planned targets for 2014/15 to 2015/2016
bucket eradication programme utilizing Human Settlements Development Grant
Province
|
Bucket backlog
|
2014/15
|
2015/16
|
Number of Units
2014/15
|
Number of Units 2014/15
|
|
Number
|
% of total
|
Number
|
Number
|
|||
Eastern Cape
|
43 550
|
15.95%
|
143 442 755
|
155 602 214
|
7 550
|
8 190
|
Free State
|
101 810
|
37.29%
|
335 336 553
|
363 762 604
|
17 649
|
19 145
|
Gauteng
|
30 031
|
11.00%
|
98 914 567
|
107 299 428
|
5 206
|
5 647
|
KwaZulu-Natal
|
10 956
|
4.01%
|
36 086 311
|
39 145 301
|
1 899
|
2 060
|
Limpopo
|
562
|
0.21%
|
1 851 087
|
2 008 001
|
97
|
106
|
Mpumalanga
|
4 205
|
1.54%
|
13 850 213
|
15 024 278
|
729
|
791
|
North West
|
38 041
|
13.93%
|
125 297 493
|
135 918 802
|
6 595
|
7 154
|
Northern Cape
|
11 764
|
4.31%
|
38 747 659
|
42 032 249
|
2 039
|
2 212
|
Western Cape
|
32 076
|
11.75%
|
105 650 283
|
114 606 122
|
5 561
|
6 032
|
TOTAL
|
272 995
|
100.00%
|
899 176 920
|
975 399 000
|
47 325
|
51 337
|
Source:
Department of Human Settlements - 2014
The Bucket Eradication Programme (BEP) grant was
attained to slicing 5% of the Human Settlements Development Grant over two
years to fund the programme.
The BEP
grant for 2014/2015 year (April 2014 to March 2015) amounted to
R899 177 000, and the BEP grant for the 2015/2016 (April to March
2016) amounted to R975 399 000.
Grant funds were divided among provinces in proportion to the number of
households that reported using the bucket system.
This grant is allocated for two years and
will end in March 2016.
The Department reported that service level
agreements were entered into for the eradication of bucket toilets with the
following public entities:
·
NURCHA (National Urban and Reconstruction Agency)
Eastern Cape.
·
HDA (Housing Development Agency) Western Cape.
·
Bloem Water Free State.
·
MISA (Municipal Infrastructure Support Agent)
Northern Cape.
·
Sedibeng Water Northern Cape.
·
Umgeni Water Kwazulu Natal.
·
Umhlathuze Water Kwazulu Natal.
·
Rand Water Mpumalanga and Gauteng.
·
Magalies Water North West.
·
Lepelle Northern Water Limpopo.
5.
Transfer
payments
|
2014/15
|
2015/16
|
2016/17
|
Final Allocations.
|
R' 000
|
R' 000
|
R' 000
|
|
|
|
|
Direct Grants
|
27
716 677
|
29
538 349
|
32
066 027
|
Human Settlements Development Grant
|
17
084 369
|
18
532 576
|
20
409 567
|
Urban Settlements Development Grant
|
10
284 684
|
10
654 773
|
11
231 861
|
Municipal Human Settlements Capacity Grant
|
300 000
|
300 000
|
300 000
|
Rural Households Infrastructure Development:
Direct Grant
|
47 624
|
51 000
|
124 599
|
|
|
|
|
Indirect Grants
|
964 677
|
1 042 727
|
-
|
Human Settlements Development Grant: Indirect
|
899 177
|
975 399
|
-
|
Rural Households Infrastructure Development:
Indirect Grant
|
65 500
|
67 328
|
-
|
|
|
|
|
Entities
|
1 002 070
|
1 388 035
|
1 461 601
|
Social
Housing Regulatory Authority: Operational
|
33 480
|
34 560
|
36 392
|
Social
Housing Regulatory Authority: Capital Restructuring Grant
|
827 543
|
1 195 860
|
1 287 049
|
Housing
Development Agency
|
101 047
|
104 615
|
110 160
|
Community Schemes Ombud Services
|
40 000
|
53 000
|
28 000
|
|
|
|
|
Departmental Transfers
|
9 504
|
9 869
|
10 566
|
Bursaries Scheme
|
4 485
|
4 642
|
4 888
|
Nelson Mandela University
|
3 906
|
4 077
|
4 467
|
UnHabitat
|
1 113
|
1 150
|
1 211
|
|
|
|
|
Total
|
29
692 928
|
31
978 980
|
33
538 194
|
Source: Department of Human Settlements -2014
6.
Grant
allocation to provinces
6.1
Human
Settlements Development Grant (HSDG) Provincial Allocations
Provinces
R`000
|
2014/15
|
2015/16
|
2016/17
|
EASTERN CAPE
|
2 159 218
|
1 929 157
|
2 147 265
|
FREE STATE
|
1 061 756
|
1 131 794
|
1 252 868
|
GAUTENG
|
4 417 641
|
5 065 766
|
5 631 437
|
KWAZULU-NATAL
|
3 273 045
|
3 313 983
|
3 547 298
|
LIMPOPO
|
1 219 115
|
1 201 733
|
1 329 147
|
MPUMALANGA
|
1 146 690
|
1 316 401
|
1 450 045
|
NORTHERN CAPE
|
374 832
|
376 006
|
416 487
|
NORTH WEST
|
1 517 136
|
2 153 545
|
2 363 612
|
WESTERN CAPE
|
1 914 935
|
2 044 191
|
2 271 408
|
Total
|
17 084 369
|
18 532 576
|
20 409 567
|
Source: Department of Human Settlements
The national Department of Human Settlements
reported that the purpose of the HSDG is to provide funding for the creation of
sustainable human settlements.
The goal
was the creation of sustainable human settlements that enable and improved
quality of household life.
The Outcome 8
programme would facilitate and provide access to basic infrastructure, top
structure and basic socio-economic amenities that contributes to the creation
of sustainable human settlements.
This
will improve the rate of employment and skill development in the delivery of
the infrastructure.
The Departments
target for 2014/15 was to provide 58 064 sites and 126 352
units.
7.
Urban
Settlements Development Grant (USDG) provincial allocation of the grant for 2014/2015
to 2016/2017
Provinces
|
Metros
|
2014/15
R`000
|
2015/16
R`000
|
2016/17
R`000
|
EASTERN CAPE
|
Buffalo City
|
673 290
|
700 458
|
743 775
|
|
Nelson Mandela
|
828 863
|
858 144
|
903 625
|
Sub Total
|
|
1
502 152
|
1
558 602
|
1
647 400
|
FREE STATE
|
Mangaung
|
654 406
|
680 907
|
723 188
|
GAUTENG
|
Ekurhuleni
|
1 804 532
|
1 868 280
|
1 967 298
|
|
Jo'burg
|
1 695 189
|
1 755 074
|
1 848 093
|
|
Tshwane
|
1 469 450
|
1 521 361
|
1 601 993
|
Sub Total
|
|
4
969 171
|
5
144 715
|
5
417 384
|
KWAZULU-NATAL
|
eThekwini
|
1 800 076
|
1 863 667
|
1 962 441
|
WESTERN CAPE
|
Cape Town
|
1 358 879
|
1 406 883
|
1 481 448
|
Grant Total
|
|
10
284 684
|
10
654 773
|
11
231 861
|
Source: Department of Human Settlements 2014
The USDG was introduced in the 2011/12 financial year,
parallel to the accreditation (delegation of housing responsibilities) of
metropolitan municipalities. The aim of this grant as contained in the Division
of Revenue Act is to assist metropolitan municipalities to improve urban land
production to the benefit of the poor households by supplementing the revenue
of the Metros.
This grant is line with the
agreed 12 outcomes by Cabinet within which to frame public-service delivery
priorities and targets. Outcome 8 refers to sustainable human settlements and
is aimed at achieving an improved quality of household life. In this regard,
four major outputs are spelled out:
·
Accelerate housing delivery.
·
Improve access to basic services.
·
Improve property market.
·
More efficient land utilisation and release of
state-owned land.
The
grant is allocated R10.2 billion for the 2014/15 financial year. The grant is
targeting about 8 metropolitan areas (Buffalo City, Nelson Mandela, Mangaung,
Ekurhuleni, City of Johannesburg, City of Tshwane, eThekwini, City of Cape
Town).
The performance of the grant for the past three
years is as follows:
In 2011/12 the grant was allocated R6.2 billion,
and 88 per cent was spent in that particular year.
In 2012/13 the allocation increased to R7.3
billion and only R6.8 billion or 93 per cent was spent in that particular year,
In 2013/14 the allocation increased to R9 billion and the expenditure
information was not available at the time when the analysis was done.
8.
Rural
Household Infrastructure Grant (RHIG)
The grant was initiated as a schedule 7 grant in
the 2010/11 financial year. In 2013/14 the schedule of the grant was changed
from schedule 7 to schedule 5 with effect from 2013. The Rural Household
Infrastructure Grant (RHIG) is divided into two components, there is schedule
5B which is a direct grant to municipalities and schedule 6B which is an
indirect grant or grant in kind allocation to municipalities.
The
intention of the grant is to provide specific capital funding for the
eradication of rural sanitation backlogs and to target existing households
where bulk dependent services are not viable. Its primary purpose is to improve
basic sanitation in rural areas. For the indirect grant component an amount of
R66 million has been allocated while for the direct grant component only R48
million has been allocated for 2014/15. The performance of the past three
financial years is as follows:
·
In 2011/12 an amount of R258 million was allocated
for this grant, but only R77.8 million or 31 per cent was spent at the end of
that financial year.
·
In 2012/13 an amount of R340.6 million was
allocated for this grant, but only R135 million or 60 per cent was spent.
·
In 2013/14 an amount of R106.7 million was
allocated for this grant; the expenditure for the third quarter was not
available during the time of the analysis.
9.
Municipal Human Settlement Capacity Grant
This is a new indirect grant introduced by the 2014/15
Division of Revenue Bill. To improve coordination of urban programmes and
establish clearer lines of accountability, the National Development Plan
recommends that the responsibility for housing should shift to municipal level,
where human settlement planning takes place. In support of this government is
developing planning and implementation capacity in municipal government through
the introduction of the new R300 million municipal human settlements capacity
grant for metropolitan municipalities from 2014/15. The intention of the grant
is to build capacity in municipalities to deliver and subsidise the operational
cost of administering the human settlement programme. The human settlements
function is due to be assigned to the six metropolitan municipalities in 2014,
however the 2013 Division of Revenue Act suggests that the process of assigning
the housing function to municipalities was going to unfold at the beginning of
the municipal financial year, July 2013. The different allocations to the six
metros were made by the 2013 Division of Revenue Act and these have since
increased in the 2014/15.
10.
Human
Settlements entities annual performance plan and budget
10.1
Housing Development Agency (HDA)
Mr Adler, Chief Executive Officer, reported that
The HDA was established in 2009 as a public development agency to address the
land acquisition and assembly process so as to accelerate housing delivery and
human settlement development.
The two
main objectives of the Agency are to identify, acquire, hold, develop and
release well-located land and buildings; provide project management support and
housing development services. The HDA collaborates with provinces and
municipalities to provide the following services: Land identification, assembly
and planning; Project Pipeline development; Project management; Informal
settlement upgrade; IGR support; and Geo-spatial information. The HDA has
offices in six of the nine provinces.
In
its five years of operation the entity had unqualified audit.
10.2
Social
Housing Regulatory Authority (SHRA)
Ms Z Ebrahim, Chairperson of the SHRA board,
reported that the entity was established in terms of the Social Housing Act
(2008). The functions of SHRA are to regulate the social housing sector and to
support the restructuring of urban spaces through investments in social
housing. It is responsible for the disbursement of restructuring capital grants
to social housing institutions.
Investment Programme
·
Targeted number of units to be approved in 2014/15:
5668 Units (depending on budget allocation).
·
Grant Quantum increase to be submitted to MINMEC by
DHS Policy Unit.
·
An increased grant quantum should yield more
financially viable projects on the pipeline and in terms of approvals.
·
RCG grant quantum will be applied on a sliding
scale based on project needs and typology.
New funding methodology will ensure there is a maximum quantum per
project and a minimum debt portion to ensure each project is co-funded between
SHI and the State.
·
Pipeline planning (pro-active approach) approach to
be adopted and within two / three years replace the Call for Proposals process.
The
SHRA has anticipated delivery of projects on the pipeline of 2113 units for the
financial year.
The entity reported that
the targeted investment areas would be the urban renewal and capacitating of provinces
and municipalities into pipeline planning and project assessment tools. The
long-term financing strategy would be developed.
Regulatory
Programme
SHRA
reported on the number of Social Housing Institutions that applied for accreditation
(process completed April 2014):
·
Fully accredited:
5
·
Conditionally accredited:
13
·
Pre- accredited:
29
·
Declined:
7
·
Withdrew:
6
SHRA
reported that total applications received for accreditation were 60 and the
entity anticipated that a 15% growth in accredited institutions within this
financial year.
There would be a development
of legal enforcement function (hijacked buildings, protecting state investment).
It was reported that retrospective regulation
of stock constructed prior to SHRA establishment and long term accreditation
system to be developed and maintenance model to be developed.
Institutional Investment Programme
It was reported that 30 institutional investment
grants would be awarded in 2013/14; gear up grants - 6; project acquisition and
feasibility grants - 10; pre-accreditation grants - 10;
general capacity building grants 2; and remedial
action grants - 2.
The Provincial Rental
Strategies to be developed in partnership with Provinces such as Gauteng, KwaZulu-Natal
and Eastern Cape.
Agreements would be
signed with Metropolitan Municipalities, that is City of Cape Town and City of
Johannesburg, and SHRA would also assist with the implementation of
densification strategy for Johannesburg Inner City.
10.3
Rural Housing Loan Fund (RHLF)
Mr J Fakazi, Chief Executive Officer, informed the
Committee that the entitys mandate is to provide access to housing credit to
low income rural households in order to enable them to improve their housing
and living conditions:
The loan is used on a new house, an extension,
fixed improvement to a house, connecting to utilities, water harvesting,
fencing, productive housing; purchasing of land by individuals or groups for
residential purposes.
·
Rural areas: tribal/communal land, farm areas,
small towns.
·
Low income currently set at maximum of R15 000 per month.
(60% of loans to those under R3 500 per month).
·
To support the implementation of the governments
rural development programme - currently the Comprehensive Rural Development
Programme (CRDP).
The RHLF
is a Wholesale Development Finance institution that:
·
Provides funds to commercial intermediary lenders.
·
Has branch network in targeted areas.
·
Partners with building merchants as loans
distributing channels.
·
Has field agents operating in villages in rural
areas.
·
Ring-fences facilities for community-based
organisations to lend to members only and self employed people.
·
Plans to target member based organisations such as
unions to facilitate housing credit for members (Work with their Special
Purpose Vehicles).
The
Chief Financial Officer further reported that RHLF achieved its mandate within
the constraint of its funding resources and will contribute about 160 000
housing opportunities during MTEF period.
The target market is huge and more needs to be done to significantly increase
market coverage.
Tough market conditions
and high level of indebtedness pose a challenging outlook.
RHLF business model resonates with active
citizenry advocated in the NDP people drive their building process and
improvement of their living conditions.
10.4
National
Housing Finance Corporation (NHFC)
Mr S Moroba, Chief Executive Officer, reported that
NHFC was established in 1996.
The NHFC
is a Development Finance Institution (DFI) that is a State-Owned Company, 100%
SA government.
The total assets are at R
3,114 billion (31 Mar 2014 group).
Its
total liabilities are at R767 million (31 Mar 2014 group).
The entity is self sustaining and pays income
tax.
The entitys main mandate is to
broaden and deepen access to affordable housing finance for the low to middle-income
SA households
.
The NHFC developmental impact 2015-2017, the entity
envisaged to create 1 817 housing private rental, social housing
3 028, home ownership 764 and 1 999 incremental loans.
10.5
Estate Agency Affairs Board (EAAB)
Mr B Chaplog, Chief Financial Officer, reported
that the Estate Agency Affairs Board (EAAB) was established in 1976 in terms of
the Estate Agency Affairs Act, 112 of 1976 (the Act), with the mandate to
regulate and control certain activities of estate agents in the public
interest.
The EAAB regulates the estate agency profession
through ensuring that all persons carrying out the activities of an estate
agent as a service to the public are registered with the EAAB. A Fidelity Fund
Certificate, which is to be renewed each year, is issued as evidence of such
registration and confirmation that such person is legally entitled to carry out
the activities of an estate agent.
The Estate Agency Affairs Board (EAAB), which has
been reporting to the Minister of Trade and industry since 1976, was
transferred to the Department of Human Settlements on 17 May 2012 by
Proclamation of the President of the Republic of South Africa.
The EAAB is in the process of rolling-out the One
Learner - One Estate Agency Programme that will introduce approximately 10 000
new Interns over a three year period.
Funding
will be received from both public and private sector partners.
The aim of the project is to increase the transformation
target group licences.
The
entity targeted to investigate and resolve 1 200 complaints, to register new 8 715
Estate Agents, to renew 52 500
Estate
Agent licences and to inspect 1 452 Estate Agents.
10.6
National
Home Builders Registration Council (NHBRC)
Mr M Monyani, Chief Executive Officer, reported
that the NHBRC programme for Administration consists of:
·
Governance and leadership;
·
Well-functioning organization;
·
Efficient Information Technology system;
·
Satisfied and skilled staff compliment (Human
Resources); and
·
Internal control (Supply Chain Management, Finance
and Audit).
The
programme for Regulation consists of homebuilders registration; home builders
de-registration; home builders reinstatement; compliance of home builders to
set norms and standards; enforcement of home builders to set norms and
standards; and training of homebuilders.
The NHBRC reported its targets for 2014/15
financial year as follows:
·
to register 2,885 homebuilders; renew 12, 195
registration of homebuilders and enroll 45, 963 non-subsidy houses;
·
to enroll 2, 298 late enrolments of houses; enroll
33,150 home subsidy and enroll 160, 377 non-subsidy inspection of homes;
·
to enroll 45, 100 subsidy projects and 160,377
non-subsidy inspections of homes; and
·
to inspect 201,300 subsidy homes; to train 1, 200
homebuilders and to train 2, 000 youth.
10.7
National Urban Reconstruction and
Housing Agency (Nurcha)
Mr V Gqwetha, Chief
Executive Officer, briefly presented the mandate of NURCHA stating that it
ensures the availability of bridging finance to small, medium and established
contractors, building low and moderate income housing and related community
facilities and infrastructure.
The Nurchas key
performance areas and targets for 2013/2014 to 2016/17
10.8
Community Schemes Ombud Services
Mr V Mehana,
Chairperson of the Board, briefly reported the Community Schemes Ombud Services
Act (Act No 9 OF 2011) [CSOS ACT] was promulgated on the 11 June 2011 and
provides for the establishment of the Community Schemes Ombud Services (CSOS)
as a public entity. The CSOS has been classified as a Schedule 3A Public Entity
in terms of the Public Finance Management Act (Act No 1 of 1999) [PFMA].
The key mandate of the entity is to develop
and provide a dispute resolution service in terms of the Act; to provide
training for Conciliators, Adjudicators and other employees of the Service; to
regulate, monitor and control the quality of all Sectional Title Schemes
governance documentation and such other scheme governance documentation as may
be determined by the Minister; to take custody of, preserve and provide access
electronically or by other means to Sectional Title Schemes governance
documentation and such other Scheme governance documents as may be determined
by the Minister and to manage the Sectional Titles Management Act as provided
by the relevant Act.
11.
Committee deliberations and observations
The Committee, having
been briefed by the Department on its strategic plan, annual performance plan
and budget, deliberated as follows:
The Committee
welcomed the presentation and appreciated that the Minister and the Deputy
Minister of Human Settlements attended its first meeting.
The Committee applauded the Minister and the
Department for the emphasis on the issuing of title deeds and also in dealing
with the backlog. This challenge has deprived beneficiaries ownership for quite
some time. The Committee sought clarity on what would happen to the Rural
Household Infrastructure Grant (RHIG) and its funding seeing that there is a
fully fledged department that is mandated to deal with sanitation. Clarity was
sought on the rationale to split the RHIG funding into direct and indirect
while not sure whether the function was going to be transferred to the newly-established
department or not.
The timeframes for the
eradication of the bucket system (toilets) was questioned with the view that
two years was not adequate to eradicate the system.
Clarity was further sought on whether the
Department had any mechanisms in place to curb the development of new informal
settlements as well as policies to regulate the invasion of land and buildings.
The Committee was
concerned that only six provinces submitted their business plans and wondered
how the Department allocated money without proper plans. The Committee wanted
to know the Departments plan to complete the incomplete houses in provinces
and timeframes to handover those houses.
The Committee requested the Housing Development Agency (HDA) to unpack
the land that has been acquired and whether the land was suitable for human
settlements developments. Clarity was sought on why the HDA was operating in
only six provinces and how other provinces were being assisted. The National
Home Builders Registration Council was requested to collaborate and to align its
inspection function with provincial and municipal inspectors to save time for
the developers.
The Committee was
concerned about the accreditation of one housing cooperative by the Social
Housing Regulatory Authority and the entity was requested to explain the
reasons.
The Committee requested the
Department to assist the municipalities in the upgrading and redevelopment of
dilapidating hostels (Community Residential Units).
The Department was requested to explain how the
institutional subsidy was being utilised.
In addition, the Committee enquired how far the Department was with
regard to the contracting horizontally or vertically with other core department
in an attempt to achieve its set targets.
The Minister stated
that she would be passionate with the issue of title deeds and the Department
would prioritise the issuing of title deeds.
She reported that there was a process of separating functions and she
was not sure what will happen to RHIG.
However, she was negotiating with the Minister of Water and Sanitation
to continue implementing the sanitation function (the internal reticulation)
while that Department of Water and Sanitation would remain with the bulk
infrastructure.
The Department reported
that the 2009 target for the eradication of the bucket system was missed,
however significant achievements were made where the buckets were replaced by
Ventilated Improve Pit (VIP) toilet of which its life span was approximately
three years if not maintained.
There
were approximately 280 000 bucket toilets in the country that should be
eradicated.
The RHIG was split into two
grants that is the direct and the indirect grants. The indirect grant would be
implemented and monitored by the Department and the indirect would be
implemented by the municipalities.
With regards to
incomplete houses the Minister informed the Committee that in some instances
the developer gone broke and could not finalise the project or in some instance
there would be challenges within the municipality.
However the Department would verify those and
complete them and handover.
The
contracting with other core departments would be ongoing as she was going to
meet with the Minister of Rural Development and Land Reform.
She stressed that it is illegally to occupy
land; she made reference to Lwandle case in Strand stating that the Department
has requested land owners not to evict people in winter.
She reported that the Prevention of Illegal
Evictions from and Unlawful Occupants of Land Act, No 19 of 1998, needs to be
reviewed as it was not implemented optimally.
The Department would prioritise it.
The SHRA reported
that there was a challenge with the legislation of the housing cooperatives by
the Department of Trade and Industry.
However, the Department would prioritise the housing cooperative and
SHRA would be able to accredit more cooperatives.
The institutional subsidy is the subsidy that
is administered by provinces as a top-up funding.
It is a mixed funding that included rent to
buy project.
12.
Committee
recommendations
The Committee, having
considered the strategic plan and budget vote of the Department of Human
Settlements, recommends that the Minister of Human Settlements should:
1.
Keep
it abreast of the negotiations between herself and the Minister of Water and
Sanitation on the proposal to retain the Rural Housing Infrastructure Grant;
2.
Provide
clarity on the scope of work with regard to the rolling out of sanitation at
household level, as to how far the hand of the Department of Human Settlements stretches
in the rolling out sanitation at household level;
3.
Present
the revised strategic plan and the annual performance plan to the Committee.
The
Committee further recommends that the Minister should ensure that the national
department:
1.
Prioritise
the amendments of the Prevention of Illegal Eviction from and Unlawful
Occupation of Land Act, No 19 of 1998;
2.
Fast-track
the drafting of a policy that would curb the development of new informal
settlements and the illegal invasion of land, houses and buildings;
3.
Prioritise
the contracting either horizontally or vertically with other core departments
in the realisation of human settlements;
4.
Fast-track
the issuing of title deeds and ensure that in future each state subsidy house
is handed over together with a title deed to curb the backlog;
5.
Ensure
that the Housing Development Agency unpacks the land that it had acquired for
human settlements development;
6.
Ensure
that the National Home Builders Registration Council collaborates and aligns
its inspection with the provincial and municipal inspectors.
7.
Assist
municipalities in the upgrading of hostels as most of them are dilapidated;
8.
Fast-track
the development of the policy that would regulate housing cooperatives;
9.
Ensure
that incomplete houses are completed and handed over to the rightful
beneficiaries.
Report
to be considered.
Documents
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