DEPARTMENT OF HOUSING PRESENTATION TO THE PORTFOLIO COMMITTEE OCTOBER 2006 ANNUAL REPORT 2005/6

DEPARTMENT OF HOUSING

PRESENTATION TO THE

PORTFOLIO COMMITTEE

OCTOBER 2006

ANNUAL REPORT 2005/6

STRUCTURE OF THE PRESENTATION

1. Aim, Vision and Mission of the Department

2. Our Values

3. Our Mandates

4. Housing Legislation and Regulations

5. Our Policy Framework

6. Trends and challenges

7. Specific priorities within the National Housing Programme

8. Budget Overview 2005/06

9. Planned activities and achievements per programme – 2005/06

10. Provincial transfers and financial performance

DEPARTMENT OF HOUSING

AIM

The aim of the Department of Housing is to determine, finance, promote, coordinate, communicate and monitor policy in respect of housing and human settlement.

Vision

A nation housed in sustainable human settlements

Mission

To establish and facilitate a sustainable process that provides equitable access to adequate housing within the context of affordability of housing, services, and access to amenities and economic opportunities

OUR VALUES

• Our values, based on the constitution, are:

– Human dignity, equality, advancement of human rights and freedoms;

– Non-racialism and non-sexism;

– Supremacy of the constitution and the rule of law;

– Accountability, responsiveness and openness

• SA CONSTITUTION

– Section 26: Access to adequate housing a basic human right; Govt. to ensure environment conducive to the progressive realisation of the right

– Schedule 4: National and Provincial Governments have concurrent legislative competence

– Botshabelo Housing Accord (1994) Signed by all housing stakeholders and subsequent white paper of 1994

– Reconstruction and Development Programme (RDP) – set out framework and principles for sustainable development

OUR MANDATE

HOUSING LEGISLATION AND REGULATIONS

• Housing Act 107 of 1997 (as amended);

• Prevention of Illegal Eviction from and Unlawful Occupation

of Land Act No. 19 of 1998;

• Housing Consumers Protection Measures Act 95 of 1998;

• Rental Housing Act 50 of 1999;

• Home Loan Mortgage Disclosure Act 63 of 2000.

Housing development programme continues to operate in the following legislative framework:

REGULATIONS AND GUIDELINES

• National Housing Code

• National Norms and Standards For Permanent Residential Structures

• Guidelines For Human Settlement Planning And Design (“Red Book”).

• Guidelines For Environmentally Efficient Low Cost Housing

OUR POLICY FRAMEWORK

• Our overall policy framework continues to be as determined by the White Paper on a new housing policy and strategy for South Africa, 1994; and

• The Comprehensive Plan for the creation of sustainable Human Settlements (September 2004)

TRENDS AND CHALLENGES

• Economic Developments

– Unemployment remained high at 26,7% thereby forcing unemployed individuals to rely on government for assistance including housing;

– The oil price continued an upward trend during 2005/06 putting pressure on petrol price during the times of weaker Rand

• As a result, petrol price increased to the highest level of R6,03 per litre fueling inflation in the 2005/06 financial year.

• Increased inflation required the subsidy adjustments annually to ensure that the quality of houses is not affected.

TRENDS AND CHALLENGES (CONTINUED)

• Economic Developments

– Interest rates continued to decline in 2005/06 thereby increasing hopes of more affordability in the bonded market

– Increased affordability in the bonded market due to low interest rates has unintentionally, rendered housing unaffordable in the lower to middle income level


• The impact on government and delivery of government subsidised houses is to increase the price of tendering so as to attract the best skilled contractors and employees in the market.

• The increase in input prices may result in contractors passing

these increases to the client rather than compromise on their profits.

• Alternatively, the contractors could compromise the rate of

delivery in the government subsidised market in the sense that contractors may employ at half capacity than it is required or compromise the quality of construction to cut on costs.


• Annual growth in the real construction sector output accelerated from 8% in 2004 to 14% in 2005. This growth is supported by the following construction industry indicators:

• The level of building plans passed and completed indicates the intensity of building activity in the residential sector. Building plans passed recorded 56.7% in 2005 as compared to 35.4% in 2004. Building plans completed increased from -12.4 in 2004 to 30.4% in 2005.

• Business confidence in the building industry increased to 23.5% in 2005 as compared to 19.25% in 2004.

• Haylett Formula shows the building contracts price adjustment provisions and is compiled from indices of labour, materials, plant and fuel prices but does not include profit margins of contractors, it has showed an increase of 6.9% recorded in 2005 as compared to 5.1% in 2004.

SPECIFIC PRIORITIES WITHIN THE NATIONAL HOUSING PROGRAMME

– Accelerating the delivery of housing as a key strategy for poverty alleviation

– Utilizing provision of housing as a major job creation strategy

– Ensuring property can be accessed by all as an asset for wealth creation and empowerment.

– Leveraging growth in the economy

– Promoting social cohesion and improving quality of life for the poor.

– Support the functioning of the entire residential property market to reduce duality within the sector by breaking the barriers between the first economy residential property boom and the second economy slump.

– Utilizing housing as an instrument for the development of sustainable human settlements in support to spatial re-structuring.

SPECIFIC PRIORITIES

• The Social Contract for Rapid Housing Delivery which is the Minister’s special programmes. The Social Contract is a partnership between government and key stakeholders in the building and construction sector for the purpose of speedy delivery of houses to the nation.

SPECIFIC PRIORITIES

• Youth Training Programme in Construction. This Programme came about as the department’s response to the President’s call to see at least 10 000 young people participating in the National Youth Service Programme. The Minister of Housing made available an amount of R 7 million in which designated young people will have an opportunity to acquire skills and training in a national project to construct houses.

• This initiative is the outcome of the partnership between theNational Department of Housing, National Youth Commission, Umsobomvu Youth Fund, NHBRC and Provincial Housing Departments. The NYS through the National Youth Commission (NYC) has been identified as the appropriate Programme to ensure comprehensive skill development and application, youth participation to inculcate the spirit of nation building among the learners involved in the project.

BUDGET OVERVIEW: ENE 2005

Programme 2005/06 2006/07 2007/08

1 Administration 83,737 92,246 97,948

2 Policy Planning and Research 24,634 26,112 27,418

3 Program Management 95,061 69,893 96,887

4 Housing Sector Performance 130,607 190,258 211,620

5 Housing Equity 5,949 6,306 6,621

6 Housing Development Funding 4,851,724 5,668,648 6,927,081

Total 5,191,712 6,053,463 7,367,575

Net Increase to baseline 19,629 569,535 1,609,451


• Additional funding:

– R50 million in 2005/06 for institutional reform , capacity building and accreditation activities

– Decrease of R28,8m as a result of transfer of Loans for the previous Housing Boards

– R600 million in 2006/07 (R500 million for various aspects of the new plan, R50 million for institutional reform and capacity building and R50 million for finalising the portfolio of Servcon Housing Solutions)

– R1,6 billion 2007/08 (R1,5 billion for various aspects of the new plan, R80 million for institutional reform , capacity building and accreditation activities, and R60 million for Servcon).


BUDGET ALLOCATION FOR 2005/06 FINANCIAL YEAR

1.61%0.47%

1.83%

2.52%

0.11%93.45%

6.55%

1 Administration 2 Policy Planning and Research

3 Programme Management 4 Housing Sector Performance

5 Housing Equity 6 Housing Development Funding

BUDGET OVERVIEW

Transfer Payment allocation for 2005/06

0.00%

0.09%2.49%

0.00% 0.80%

0.33%

0.00%96.29% 3.71%

Habitat Foundation First-time home buyer interest subsidy scheme

Human Settlement Redevelopment Grant NHFC

SERVCON Social Housing Foundation

People Housing partnership Trust Integrated Housing and human Settlement Development Grant

Allocation of funds in respect of Strategic Priorities / Measurable objectives

• Programme 2: Policy Planning and Research - (R24,634,000)

– Adequate housing for all South Africans by 2024, through policy, legislation and research that enables housing delivery in sustainable human settlements.

• Programme 3: Programme Management - (R95,061,000)

– Increase access to and improve the delivery of adequate housing in sustainable human settlements by effectively providing officials with systems, knowledge, skills, guidance and funding.

• Programme 4: Housing Sector Performance - (R130,607,000)

– Effective monitoring of policy implementation by using an effective data bank and housing and human settlement information systems that provide accurate, strategic and statistically sound data to allow for regular evaluation of the impact of housing policy, and to support decision-making on improvements to housing policy and programmes.

Allocation of funds in respect of Strategic Priorities / Measurable objectives

• Programme 5: Housing Equity - (R5,949,000)

– Increase the level of private sector finance for affordable housing by R20 billion by 2010, through monitoring and analysing lending practices, and by supporting the development of appropriate instruments by lending institutions and appropriate partnerships between lending institutions, government, housing support institutions and other lenders.

• Programme 6: Housing Development Funding - (R4,843,481,000)

– Disburse and monitor funds for housing delivery in compliance with the Public Finance Management Act (1999) and Division of Revenue Act requirements, to ensure that expenditure matches annual delivery commitments.

EXPENDITURE AS AT 31 MARCH 2006

PROGRAMMEBUDGET

R`000

Exp. as at 31 Mar 2006

R`000

UNSPENT

R`000

% SPENTR`000

P1: Administration 97,799 94,892 2,907 97%

P2: Policy Planning and Research 22,734 20,116 2,618 88%

P3: Programme Management 87,461 76,781 10,680 88%

P4: Housing Sector Performance 205,594 198,645 6,949 97%

P5: Housing Equity 2,360 2,182 178 92%

P6: SA Housing Fund 4,849,724 4,849,300 424 100%

TOTAL 5,265,672 5,241,916 23,756 99.55%

INTERNATIONAL RELATIONS ACHIEVEMENTS

Presenter: Mr. P. Chauke

– Lead Ministry for UN Habitat (UN Agency for Human Settlements)

• Presented RSA Human Settlements policy to the UN Habitat 20th Governing Council session in April 2005, Nairobi

• Led the G77 consolidated position highlighting development challenges facing the countries of the South (developing and HIPC) during GC20

• Canvassed positions favourable to poor countries of Africa, Asia and Latin America

– UN Council for Sustainable Development (CSD)

• Presented RSA Human Settlements policy and challenges to achieving the MDGs to the CSD 13 session in April 2005, New York.

– Cities Alliance

• Department joined the Cities Alliance in January 2006• The Cities without slums initiative is aimed helping our cities to eradicate informal

settlements• Several cities are already enjoying the benefits, eg Johannesburg, Ekurhuleni.


INTERNATIONAL RELATIONS ACHIEVEMENTS – NEPAD Programme

• Department participate in all NEPAD activities regarding sustainable human settlement development in the African region is concerned

– Agreement with Brazil

• Agreement signed with Brazil within IBSA Tri-Lateral Cooperation on 13 September 2005

– Two Seminars held in Cape Town (Research, June ‘06) and New York (MDGs financing, September ‘05)

– Staff (DOH, PHDs and Municipality – Cape Town & eThekwini) and Wits academics sent to Brazil on information sharing trip

– Agreement with the DRC

• Agreement signed with the Democratic Republic of Congo (DRC) in 2006

– DRC Implementation Plan (on housing and human settlements) developed and approved by Presidents Mbeki and Kabila during the 3rd BNC Review on 16/03/06 in Kinshasa

– RSA developers will be mobilized to assist with the reconstruction of DRC– DOH to assist DRC in setting up a Housing Bank and a Housing Company


- Agreement signed with India in April 2006

- India to assist in creating models for viable Government Construction companies

- Agreement with Cuba

- Phase one of Cuban architectures deployed in South African rural municipalities expired (36 months: 2003 – 2006)

- New Cuban architectures recruited to replace old ones- Cuban technical advisors are involved in more than 228 PHP projects

in 8 provinces. - 36 614 housing units completed with Cuban assistance- 885 communities and 324 NGO’s members trained in technical and

building skills by Cuban experts

POLICY PLANNING AND RESEARCH

Presenter: Mr. D. von Broembsen

PROGRAMME 2

POLICY PLANNING AND RESEARCH

PURPOSE

To develop sound national human settlement and housing policies, supported by research and underpinned by an appropriate legislative framework.

MEASURABLE OBJECTIVE

Adequate housing for all South Africans by 2014, through policy, legislation and research that enables housing delivery in sustainable human settlements.

OBJECTIVES POLICY PLANNING

• Develop and manage sustainable human settlement policy and promote and maintain human settlement integration

• Establish effective national housing policy and strategy

• Develop, coordinate and monitor the implementation of housing framework legislation

HUMAN SETTLEMENT POLICY AND INTEGRATION:

• Housing land policy

• Policy for farm-worker & dweller housing

• Programme for aligning IDPs and housing sector plans

• Energy efficient housing: Pilot Project (with DANIDA)

• Substantive inputs to multi-lateral processes:

– Governing Council 21, CSD13;

– MoU: Democratic Republic of the Congo

PLANNED ACTIVITIES FOR 2005/06

NATIONAL HOUSING POLICY AND STRATEGY:

• Special Housing needs assistance policy (HIV/AIDS)

• A new Variation manual

• Higher density housing policy investigation

• Developing guidelines for sustainable housing development – by revising the National Housing Code

• Revisit the Rural Subsidy Programme

• Back yard rental policy intervention

• New housing typologies and designs

• A multi year planning dispensation


FRAMEWORK LEGISLATION :

• Social Housing Act

• Regulations to the Social Housing Act

• Review of national, provincial and local legislation impacting

on the Comprehensive Plan, with specific reference to the

Sectional Titles Act and the Estate Agency Affairs Act.


• Amendments to various acts administered by the Department in accordance with need Including:-

- An efficient and implementable Housing Act that complies with DORA and PFMA - An equitable PIE Act that is constitutional and unambiguous and allows for the orderly eviction of unlawful occupiers

- An efficient Housing Consumers Protection Measures Act that is unambiguous and serves the interests of housing consumers - An efficient and implementable Rental Housing Act that gives Rental Housing Tribunals the power to enforce their rulings

- An efficient and implementable Less Formal Township Establishment Act.


CHIEF DIRECTORATE RESEARCHPresenter: Dr. Sokopo

The Chief Directorate Research initiates, undertakes and manages research on human settlements and housing.

STRATEGIC OBJECTIVE RESEARCH

• To establish internal and external research networks and foster a research culture within the Department to progressively improve the relevance, alignment, quality, and usefulness of research activities so that the Department is able to maintain a leading role in national, and international, debates around human settlements and influence practice to more efficiently and effectively fulfil the housing mandate.

RESEARCH

• Research on informal settlement upgrading and support

• Promoting alternative technologies and improved housing design

• Level of socio-economic and ethnic integration in SA

• International experience in densification and integration

• Study on housing ex servicemen

• International research seminar


ACHIEVEMENTS 2005/06

• A policy to upgrade informal settlements:

– In phases– Involving the community as a whole– Starting with a socio-economic survey, community facilitation and

participation in the planning stages– Through installation of emergency and basic services– Securing tenure arrangements – With ownership and/or rental options

The policy and guidelines have been approved by MINMEC and are being implemented through a number of provincial pilot projects which will inform policy and programme enhancements.

The key policy developments embedded in the Comprehensive Plan include:

• A housing land acquisition and release strategy will serve to prioritise the release of public land and the acquisition of private land for low cost housing projects. A special dispensation is currently being designed for this purpose. Servcon Housing Solutions (Pty) Limited will acquire a new mandate as special purpose vehicle for land acquisition. This project may vest in another programme.

• A policy and programme to assist farm workers and occupiers in accessing adequate housing has been completed and it is envisaged that provinces will commence with a number of pilot projects to test the programme and refine the policy.

• New improved housing typologies have been developed and will be introduced as soon as the necessary approval processes have been completed.

ACHIEVEMENTS 2005/06 (CONTINUED)

• A policy and programme to provide primary social and economic infrastructure in low Income housing developments has been approved and will contribute towards enhancing the quality of the living environments by providing for community needs.

• A comprehensive manual was developed for the adjustment of the housing subsidy amount to cater for extraordinary development conditions.

• A comprehensive new coordinated multi year housing development planning dispensation was developed and launched.

• A higher density housing development programme was developed and completed but the approval and introduction thereof was put on hold pending the findings of a broad rental market evaluation project.

• The Housing Subsidy Scheme Project Linked Subsidies was adjusted to provide for alignment with the Labour Tenants Strategy and to provide houses and services to projects undertaken through the said programme. Programme approval is awaited.


PROGRAMME MANAGEMENTPresenter: Mr. J. Wallis

PROGRAMME 3

PROGRAMME MANAGEMENT

Purpose

Manage National Housing and Human Settlement Programs to enable, support and promote the implementation of projects

Measurable Objectives

Increase access to and improve the delivery of adequate housing in sustainable Human Settlements by effectively providing officials, structures and systems with knowledge, skills, guidance and funding

- HIV Guidelines

- Public Sector Hostels

- Medium Density Housing

- Farm Worker Housing

- Impact of Subsidy Dispensation on Women

- Enhance subsidy qualification criteria

- Child headed households

PLANNED ACTIVITIES : 2005/06

- Recurrent Service Costs

- Shared Accommodation guidelines

- Tenure Options

- Amended National Norms and Standards

- Phasing Out Programme

- NHBRC Warranty Cover

- EPWP


- Rectification of houses : 1994-2002

- Accreditation Framework

- Deregistration of Missing Beneficiaries

- Repetitive use of names of dependents

- Enhanced Extended DBS

- Finance Linked Individual Subsidy Scheme

- Operational Capital Budget


- Fast Tracking Housing in areas of stress

- Human Settlement Redevelopment Programme

- Presidential Pilot Project on Housing

- Housing Consumer Education

- Seminars/Workshops on policy


- Skills Audit in Municipalities

- Framework for Professionalisation

- Cuban Programme

- Scholarship Programme


– Enhanced Phasing Out Program

– First Time Home Buyers Interest Subsidy Scheme

– NHBRC Warranty Cover

– Human Settlement Redevelopment Program

– Presidential Pilot Project on Rental Housing

– Deregistration on missing beneficiaries

– Prevention of repetitative use of dependants names

– Enhanced Extended DBS

ACHIEVEMENTS : 2005/06

- New Procurement Regime

- Rural Housing enhancement

- Guidelines for new subsidy bands and increase of quantum

- Accreditation : Framework and Promotion

- EPWP : Regulating Framework

- Rectification of houses : post 1994

- Impact of subsidy dispensation on women

- Guidelines for unblocking

- Credit linked individual subsidy



- New Hostels Program

- New PHP guidelines

- Guidelines for a phased development approach

- Framework for social/econ amenities

- Alignment of infrastructure policy

- Operational expenditure budget

- Payment of Top Structure prior to registration

- Fast Tracking in areas of stress

– Housing Professional Body

– Consumer Education

– Housing Policy Workshops/seminars (3455/31)

- Emergency Housing

- Sanitation, Health and Hygiene

- Call Centre Training

– Housing Education and Training Standards (NQF6)

– Housing Scholarship

– Cuban Programme


PROVINCIAL ALLOCATION (HSRDP)

PROVINCE 2005/06

R`000

EASTERN CAPE

FREE STATE 9,475

GAUTENG 4,129

KWAZULU-NATAL

LIMPOPO 1,418

MPUMALANGA

NORTHERN CAPE

NORTH WESTWESTERN CAPE 9,373

TOTAL 24,395

HOUSING SECTOR PERFORMANCE

Dr. V. Khabo

PROGRAMME 4

HOUSING SECTOR PERFORMANCE

Purpose

Monitor the implementation and performance of national housing Policy and programmes, and evaluate and assess their impact on beneficiaries, the environment and on the role of the three spheres of government.

Measurable Objective

To undertake effective monitoring of policy implementation processes by using an effective data bank and housing and human settlement information systems to provide accurate, strategic and statistically sound data to allow for regular evaluation of the implementation of housing policy and to support decision making on enhancements to housing policy and programmes.

– Develop monitoring, evaluation and impact assessment system based on the BNG Housing Plan;

– Create and develop publications to advise management and stakeholders;

– Establish effective and efficient communication channel between three tiers of Government


– Develop, manage and maintain housing information systems (HSS, HUIMS, NHSDB);

– ensure an effective library and resource service;

– Manage the provision and maintenance of the Housing Subsidy System to accredited Local Governments; and

– Manage the level of quality of data continuously to ensure accurate and reliable data.

PLANNED ACTIVITIES FOR 2005/06:


– Effective monitoring of the construction sector, quality of houses, alternative building technologies and capacity;

– Monitor and evaluate the housing finance sector, effectiveness of housing finance products and the impact of the economy on the housing sector;

– Monitor the performance of Housing Support Institutions against the BNG Housing Plan, founding mandates and products offered


– Produced an inception report on a Monitoring, Evaluation and Impact assessment Framework and System based on the BNG Housing Plan;

– Produced reports on the impact of the Housing Subsidy Scheme on the beneficiary, the township establishment process and participation of beneficiaries in the planning processes of housing projects;

– Published quarterly reports regarding the progress and performance of the housing delivery process.


• Completed development of the new Allocation Formula for the division of the IHHSD grant (provincial allocations) – approved by MINMEC on 06 Dec 2005

• Compiled and published updated Housing Investment Potential Atlas

• Compiled and published Housing management Information Handbook

• Published Housing Fact Sheets

• Compiled and distributed the NDOH Spatial Viewer

• Published Study Report on Urbanisation.


• Designed and launched a New-look AMCHUD website

• Redeveloped the housing website (www.housing.gov.za) & launched a new website for International Housing research Network (IHRN)

• Re-designed HUiMS portal with access to updated reports

• Developed a database for the Waiting List project in the City of Cape Town

http://www.housing.gov.za/


• Roll out of upgrade of Housing Subsidy System aligned with policy

• 80% improvement in the verified alignment of financial and non-financial reporting

• Developed and made available an analytical tool for online and off-line data analysis and mining


– Successfully organised a Housing Indaba Conference for the Social Contract for Rapid Housing Delivery during September 2005 in Cape Town.

– In conjunction with the Research Unit, successfully organised the International Research Seminar during June in Cape Town.

– A Housing and Economy Publication was produced, advising management on activities within the Construction, Economics and Finance Sector and how they have impact on the Delivery of Government Subsidised Housing.


• 8 analytical reports on performance as well as financial reports were completed in all 8 Housing Support Institutions

• Business plans in all 8 institutions were evaluated and recommendations for approvals were submitted to the Minister

• A framework document for the revision of institution’s mandate in line with BNG and DPSA framework was developed.

• A review of Housing Support Institutions’ role in supporting the implementation of the Comprehensive plan was also undertaken. As a result of this review the Minister has approved the disestablishment of Servcon Housing Solutions at the end of its mandate in March 2006, the extension of NURCHA and the Rural Housing Loan Fund, a review of the mandate of Thubelisha Homes to provide technical assistance in housing delivery, and the establishment of a new Social Housing Regulatory Authority to replace the Social Housing Foundation


HOUSING EQUITY

Mr. A. Osman

PROGRAMME 5

HOUSING EQUITY

Purpose

Eradicate discrimination and unfair practices to do with access to housing finance, by implementing and administering the Home Loan and Mortgage Disclosure Act 63 (2000) and its regulations.


Increase the level of private sector finance for affordable housing by 42 billion by 2008, ensuring that this will be achieved through monitoring and analysing lending practices and supporting the development of appropriate instruments by lending institutions and development of appropriate partnerships between lending institutions, government, housing support institutions and other lenders.

STRATEGIC OBJECTIVES

• To promote transformation in financial services associated with housing finance to low to medium income households;

• To facilitate and ensure the availability and accessibility of affordable housing finance instruments/products and savings schemes to low to medium income households.

STRATEGIC OBJECTIVES (CONTINUED)

• To identify possible discriminatory lending patterns in housing finance to low to medium income households by implementing the Home Loan and Mortgage Disclosure Act.

• To monitor that financial institutions meet the targets they set in terms of the financial services sector charter.


• Engage with financial institutions to :

– ensure that they transform the way in which they engage with the target market (immediate and on-going)

– develop affordable housing finance instruments (31st December 2005)

– Explore risk sharing mechanisms to enable mobilising credit at scale (31st December 2005)

– Identify and resolve impediments to a properly functioning property market (immediate and on-going)

– ensure appropriate consumer education programs (31st December 2005)

– ensure expanding points of representation (31st December 2005)


• finalise and gazette regulations to implement the Home Loan and Mortgage Disclosure Act (30th June 2005);

• receive, capture & analyse information disclosed by financial institutions (31st December 2005);

• submit annual reports to Minister and other stakeholders. (31st March 2006 )


• The draft Regulations are developed and referred for consultative process with the Governor of South African Reserve Back and the Minister of Finance as per legislation.

• Setting up the infrastructure required for the monitoring task

• Managed the negotiations on the FSC and MOU

• Finalise and gazette regulations

• Receive, capture and analyse information disclosed, information from Financial Institutions

HOUSING DEVELOPMENT FUNDINGChief Financial Officer

PROGRAMME 6

HOUSING DEVELOPMENT FUNDING

Purpose

To fund National Housing and human settlement programmes in terms of the housing Act (1997).


Disburse and Monitor funds for housing delivery in compliance with the Public Finance Management Act of 1999 and Division of revenue Act (DORA) 2005 requirements to ensure that expenditure matches annual delivery commitments.


• The Integrated Housing and Human Settlement Development Grant is the amalgamation of aspects of the Human Settlement Redevelopment (which previously fell under Programme Management) the previous Housing Subsidy conditional grants;

• To accommodate the funding required for implementing the new comprehensive plan for the development of sustainable human settlements;

• Will in the first year fund the current business and new pilot projects across the country;

• National Department assisting provinces in finalising plans and targets in line with Comprehensive plan for 31 March 2005 target date for submission of these plans.


• Transfer of funds according to payment schedule to provinces

• Monitoring of expenditure on provincial level ;

• Amending Housing subsidy grant framework;

• To provide a effective and efficient debtor system.````

PROVINCIAL ALLOCATIONS (IHHSDG)

PROVINCE 2005/06 2006/07 2007/08

R`000 R`000 R`000

EASTERN CAPE 581,218 761,994 952,554

FREE STATE 398,618 522,601 653,293

GAUTENG 1,340,676 1,757,666 2,197,223

KWAZULU-NATAL 799,659 1,048,376 1,310,555

LIMPOPO 397,650 521,331 651,705

MPUMALANGA 321,123 421,002 526,286

NORTHERN CAPE 79,917 104,774 130,976

NORTH WEST 467,880 613,405 766,806

WESTERN CAPE 456,740 598,800 748,548

TOTAL 4,843,481 6,349,949 7,937,946

TRANSFERS OF PROVINCES

Human Settlement Redevelopment Programme 2005/06 2006/07 2007/08

New Baseline Allocation

based on the 2001 Census





R`000 R`000 R`000EASTERN CAPE - - - FREE STATE 9,475 -Phased out by

31/03/06 -

GAUTENG 4,129 - - KWAZULU-NATAL - - - LIMPOPO 1,418 - - MPUMALANGA - - - NORTHERN CAPE - - - NORTH WEST - - - WESTERN CAPE 9,373 - - TOTAL 24,395 - - Additional amount - - -

PROVINCE

SUMMARY OF THE HOUSING DELIVERY TARGETS AND FUNDING ALLOCATIONS FOR

THE NINE PROVINCIAL HOUSING DEPARTMENTS

Chief Financial Officer

NUMBER OF SERVICED SITES AND HOUSING UNITS COMPLETED

Prov Number of sitescompleted 2005/06

Number of unitscompleted 2005/06

EC 2 951 16 874

FS 2 901 17 635

GP 35 901 23 409

KZN 14 721 21 601

LP 24 840 21 973

MP 597 14 389

NC 3 374 5 293

NW 21 070 14 445

WC 9 270 2 040

Total 115 175 137 659

NUMBER OF HOUSING PROJECTS APPROVED

PROV Total number

approved02/03

Total number

approved03/04

Total number

approved04/05

Total numberapproved94/95 to

04/05

Total number

approved05/06

EC 20 26 33 457 3

FS 141 31 47 609 26

GP 231 38 366 1 048 74

KZN 36 47 83 552 14

LP 58 63 103 479 98

MP 122 54 9 335 41

NC 15 36 4 250 7

NW 4 18 31 221 36

WC 70 19 104 555 22

Total 697 332 780 4 506 321

NO OF SUBSIDIES REPRESENTED BY APPROVED PROJECTS

PROV Total number

approved02/03

Total number

approved03/04

Total number

approved04/05

Total number approved

94/95 to 04/05

Total number approved

05/06

EC 16 849 20 811 13 882 278 008 2 189

FS 17 510 15 039 14 089 131 133 8 770

GP 404 432 39 086 54 045 1 082 147 56 373

KZN 23 437 43 397 42 776 351 625 13 766

LP 18 223 32 681 17 503 178 487 27 456

MP 7 861 2 341 340 156 174 1 153

NC 4 161 7 452 1 763 48 466 812

NW 1 790 7 570 23 543 177 831 14 778

WC 32 952 8 143 77 354 306 543 12 449

Total 527 215 176 520 245 295 2 710 414 137 746

EXPENDITURE AS AT 31 MARCH 2006

PROGRAMMEBUDGET

R`000

Exp. as at 31 Mar 2006

R`000

UNSPENT

R`000

% SPENTR`000

P1: Administration 97,799 94,892 2,907 97%

P2: Policy Planning and Research 22,734 20,116 2,618 88%

P3: Programme Management 87,461 76,781 10,680 88%

P4: Housing Sector Performance 205,594 198,645 6,949 97%

P5: Housing Equity 2,360 2,182 178 92%

P6: SA Housing Fund 4,849,724 4,849,300 424 100%

TOTAL 5,265,672 5,241,916 23,756 99.55%

INTEGRATED HOUSING AND HUMAN SETTLEMENT DEVELOPMENT GRANT

EXPENDITURE AT 31 MARCH 2006

Spent by

Provinces

R'000 R'000 R'000 R'000 R'000

Eastern Cape 581,218 26,057 607,275 607,275 - 100% 0%Free State 398,618 72,843 471,461 355,475 115,986 75% 25%Gauteng 1,340,675 9,025 1,349,700 1,349,352 348 100% 0%KwaZulu-Natal 799,659 - 799,659 815,603 -15,944 102% -2%Limpopo 397,650 59,265 456,915 372,776 84,139 82% 18%Mpumalanga 321,123 17 321,140 262,071 59,069 82% 18%Northern Cape 79,917 - 79,917 102,576 -22,659 128% -28%North West 467,880 141,915 609,795 615,411 -5,616 101% -1%Western Cape 456,740 76,509 533,249 533,249 - 100% 0%Total 4,843,480 385,631 5,229,111 5,013,788 215,323 96% 4%

Provinces

Voted Provincial Roll over

Total Available Spent as %

of Total Available

Unspent as % of Total

Available

2005/06

Year to date (1 April 2005 - 31 March 2006)

Unspent Funds

I THANK YOU

Documents

DEPARTMENT OF HOUSING PRESENTATION TO THE PORTFOLIO COMMITTEE OCTOBER 2006 ANNUAL REPORT 2005/6