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DEPARTMENT OF HUMAN SETTLEMENTS ANNUAL PERFORMANCE REPORT FOR
THE PORTFOLIO COMMITTEE FINANCIAL YEAR 2013/14
DIRECTOR-GENERAL: T ZULU
STRUCTURE OF THE PRESENTATION1. Overview of Departmental Performance (April 2013 – March 2014
2. Performance of the National Department as per Approved Annual Performance Plans 2013/14
3. Departmental Expenditure vs Performance (Targets/Outcomes)
4. HS Sector Performance
4.1 Communication and Outreach key4.2 Delivery Agreement (Outcome 8)4.3 Job Creation4.4 Accreditation of Municipalities
5. Financial issues
4. Responses to Audited Outcomes / Action Plan
2
Overview of Departmental Performance (April 2013 – March 2014)
• The 2013/14 financial year marks the coming of age of the South African Democracy. While on the other hand it marks the ongoing process of government’s efforts to provide shelter as a socio-economic right.
• Provinces as guided by the National Department, embraced principles of integrated planning, project implementation and synergy in deploying funding. Through collaboration and coordination, Provinces as delivery agents were brought in the outcomes based approach as they discharge their responsibilities to change the Human Settlements space.
• The department has also revised the finance linked individual subsidy programme to improve the ability of households in the income category R3 501-R15 000 to access mortgage finance for housing thus increasing access to housing finance and the provision of shelter and basic services
Overview of Departmental Performance (April 2013 – March 2014)
• Engagements were held with the private sectors such as Pathfinder Development Company as well as employers such as Harmony Golden to encourage investments and encourage access to affordable housing finance.
• The NSPU planned to monitor 144 Municipal Infrastructure Grant (MIG) projects and a total number of 152 MIG projects were monitored across 9 Provinces
• The RHIG Business Plans were received from 24 benefitting municipalities and funds were transferred to municipalities to implement RHIG.
• The management of the Urban Settlement Grant continued to receive attention in the devolution of powers to the local sphere of government.
• South Africa is a prominent member of UN HABITAT and continues to advocate and play an instrumental role for the support of human settlements programmes in Africa.
Overview of Departmental Performance (April 2013 – March 2014)
• The Department of Human Settlements hosted a delegation from Angola’s Ministry of Construction in March 2014.South African and Angola signed a Memorandum of Understanding (MoU) on Co-operation in the field of Human Settlements
• The Rental Housing Amendment Bill, 2014 has been formally introduced into Parliament on the 20th November 2013, and subsequently referred to the Portfolio Committee on Human Settlements for deliberations
• New Policy for Backyard Rental Programme was developed and approved by Task Team
• The CRU policy was adjusted in regard to the grant quantum levels.
• The Department embarked on filling all the vacant positions to address the challenge of skills. The strengthening of inward and capacity development initiatives is aimed to achieve the mandate of the department of human settlements.
Performance of the National Department as per Approved Annual Performance Plans
2013/14
• The overall achievement by the National Department of Human Settlements during the financial year 2013/14 is seventy nine (79%).
• Out of one hundred and twenty-six (126) targets which were planned for the period under review, ninety nine (99) targets were achieved whilst twenty seven (27) targets were not achieved.
DEPARTMENTAL EXPENDITURE VS. PERFORMANCE (TARGETS / OUTCOMES)
7
Branch Final Allocation(Operational) Expenditure Variance
% Spent Planned
TargetsAchievedTargets
Variance/ Targets
Not achieved
% Achieved Targets
1: Administration 346 922 000 247 710 959 99 211 041 71% 25 24 1 96%
2: Human Settlements Delivery Frameworks 37 070 395 36 253 742 816 653 98% 24 13 11 54%
3: Human Settlements Strategy And Planning 55 645 605 42 156 537 13 489 068 76% 17 8 9 47%
4: Programme Management Unit 192 945 056 79 867 291 113 077 765 41% 17 12 5 71%
5: Office Of The Chief Financial Officer 198 230 344 168 862 385 29 367 959 85% 30 29 1 97%
6: Office Of The Chief Operations Officer 52 629 600 41 959 659 10 669 941 80% 13 13 0 100%
Total 883 443 000 616 810 573 266 632 427 70% 126 99 27 79%
HS SECTOR PERFORMANCE
COMMUNICATION AND OUTREACH
9
The Chief Directorate participated in all Ministerial outreach programmes and face to face communication was done with communities with the help desk was set up and individuals queries were logged in for further investigation or solved on site.
This was done in collaboration with Municipalities and Provincial Departments of Human Settlements.
Public engagements included exhibiting during the annual Rand Show, Pretoria Show, South African Housing Foundation, BRICS Conference.
About 4500 generic publications were distributed to GCIS library in Parliament and Thusong Service Centres in Mpumalanga and Limpopo in their regional languages.
COMMUNICATION AND OUTREACH CONT
10
Door to door campaigns were done and publications were handed over to members of the communities during the campaign like on 06 August in Oudtshoorn and 02 October in Lerato Park in Kimberley.
Community Imbizos hosted by the Minister and Deputy Minister were held across the country.
Other outreach programmes were done by officials during Youth And Women Builds.
COMMUNICATION AND OUTREACH CONT
11
Sanitation Week held in Ward 5 at Makhaza in Khayelitsha - 25 April 2013
Launched Walmer Link FLISP project - 09 May 2013
Community engagements on the Budget Vote in Du-Noon – 22 May 2013
STRATEGY
• Draft Terms of Reference for the Green Paper developed
• Rental Housing Strategy Framework developed; the discussion paper about the
affordability of rental housing and discussion paper about object subsidies in
rental housing
• Draft sector wide reporting indicators developed
• Consultation on Draft 2014-2019 Strategic Plan across the sector
• Draft evaluation report submitted to the Technical Working Group for comments
PLANNING
• Draft ToR for the review of the Programme for Human
Settlements Chapter of Municipal IDPs developed
• Progress report on the support rendered to municipalities on
the assessment of the Housing Chapters of the IDPs drafted.
ENHANCED PEOPLE HOUSING PROCESSFinalisation of the Human Settlements Policy on community based housing Cooperatives •Engaged the Service Provider developing the Policy •Engaged SEDA to explore possible collaborations and funding mechanisms for Human Settlements Cooperatives•Participates in the DTI Inter-governmental Coordination Committee on Cooperatives to provide an update on Human Settlements Cooperatives
Advancement of the self-built methodology Oversight visits conducted in the Western Cape, KZN and North West Provinces to evaluate the implementation of the programme and deliver the required PHP capacity development workshops
Support to Provinces in the upgrading of informal settlements through PHP•KZN Province and eThekwini Metro to evaluate progress regarding the upgrading of informal settlements through PHP•Assessing the M&E assignment of evaluating the impact of the UISP•Engaged the CPUT to discuss Human Settlements Summit with focus on alternative building technology
INTERNATIONAL RELATIONS PROGRAMME
• The Department led a team of South African government officials and academics to the
7th World Urban Forum (WUF 7) in Medellin, Colombia. Outcomes from WUF 7 will
support the concept of the long-term planning approach to urban policy and
implementation and management thereof. i.e. National Development Plan (NDP) –
Vision 2030, as well as respective city visions, which can look as far ahead as 2055
• Leading the country preparations for the Third United Nations Conference on Human
Settlements and Sustainable Urban Development (Habitat III) in 2016
• Finalising the National Report on achievements in the last 20 years, what our
remaining challenges are and what we hope to have included in the New Urban Agenda
to be adopted at Habitat III
STAKEHOLDER AND IGR PROGRAMME
• The Department successfully launched the Cornubia Integrated Project in April 2014.
• The Graskop Project was successfully handed over from the China Government to the
South African Government
• A Memorandum of Understanding was signed with Council of Science and Research.
• Preparations for the National Govan Mbeki Awards well underway with several
successful provincial awards already hosted.
STAKEHOLDER AND IGR PROGRAMMEThe following Stakeholders were engaged-:
• Sector engagements through a national workshop on 26 June and have further solicited
written inputs to be included in the report before it is submitted to Cabinet for approval
in Q2.
• Held the 4th Quarter Provincial, Municipal and Entity Performance Review Sessions at
the end of May and have followed up on the matters arising from the reviews with the
relevant provinces, metros and entities
STAKEHOLDER AND IGR PROGRAMME• On the Each one settle one campaign the Department has secured a total
amount of R105 000.00 for the Youth Build Special Project including the
following items:
- 250 construction work-suits, 50 protective shoes, 150 T-shirts, 200 blankets, a
course for the Youth volunteer on skills, enterprise and cooperate training, a
business management course, training on plumbing, electrical, general
construction, geo-technical and mentorship program, as well as a one week
catering for the volunteers.
• The sponsorship benefited the elderly, the destitute and child headed
households.
• The secured funds paid for furniture, tools and other building materials through
the Departmental NHBRC’s sponsorship special account
OUTCOME 8 – CREATE SUSTAINABLE HUMAN
SETTLEMENTS AND IMPROVED QUALITY OF HOUSEHOLD LIFE
19
UPGRADING OF INFORMAL SETTLEMENTS
20
• Upgrading of 400 000 households in informal settlements with access to secure tenure rights and basic services:
o Target for 2014 achievedo 2013/14: Total number of households assisted: 87 064o Total number of households assisted to date: 447 780 householdso Represents 111,9% of 2014 target
NATIONAL UPGRADING SUPPORT PROGRAMME
21
• National Upgrading Support Programme:– Performance 2013/14 : Progress from 35 Municipalities to 50
Municipalities;– Achieved 96% of the 2014 target -Technical assistance in place in 47 of 49
NUSP Municipalities plus additional 3 Municipalities that requested support;
– The 50 Municipalities represents more than 700 informal settlements;
INCREASED PROVISION OF WELL-LOCATED RENTAL ACCOMMODATION
22
PROVINCE TOTAL DELIVERY (1 April 2013 To 31 March
2014)
TARGET FOR 2015/2016
% OF 2015TARGET
EC 74 2636 2.8
FS 574 1745 38.9
GP 1 083 1200 90.2
KZN 660 865 76.3
LP 61 683 8.9
MP 206 79 260.7
NC 332 0 0
NW 0 0 0
WC 2 714 1139 238.3
Total 5 704 8347 68.3
ACTIONS TAKEN TO ADDRESS CHALLENGES
23
• Revision of current Social and Rental Housing Policies in process;
• Development of back yard rental policy receiving attention;
• Declaration of additional restructuring zones being attended to;
• Monitoring tool for private rental to be put in place;
• National Department will also undertake the design and costing of higher density housing typologies;
ACCREDITATION AND ASSIGNMENT OF MUNICIPALITIES
• The annual target of undertaking 6 Workshops to capacitate the municipalities about the Accreditation Implementation Protocol was achieved.
• The annual target of conducting 6 workshops to capacitate provinces and municipalities on the assignment of human settlements functions to municipalities was achieved.
• The annual target of assessing 6 municipalities for accreditation at level 2 was not achieved, instead an assessment for the readiness of the 6 Metro municipalities to receive level 3 accreditation was conducted namely : City of Johannesburg, City of Tshwane, Ekurhuleni Metro, City of Cape Town, City of Tshwane and eThekwini Metro.
24
ACCREDITATION AND ASSIGNMENT OF MUNICIPALITIES
• To assist the 6 Metros with capacity and subsidisation of the operational costs at the conclusion of the assignment of housing functions, the Municipal Human settlements Capacity Grant to the tune of R900 million was introduced over an MTEF period starting at the 2014/2015 financial year.
• 74% of 2014 target achieved with:– Level 1: 8 District/ Local Municipalities; and – Level 2: 20 Metros/ District Municipalities/ Local Municipalities;
• 4 implementation protocols still outstanding, namely Mangaung Metro, Nelson Mandela Metro, Tlokwe and Rustenburg;
• No Metro was assigned. National Treasury in the process to resolve the funding procedures and transferring of assets and projects.
25
OUTPUT 3: EFFICIENT UTILISATION OF LAND FOR HUMAN SETTLEMENTS
DEVELOPMENT• An additional 3 831.2 hectares of land was released by the HDA for
future human settlements development.
• Over the four year period of Outcome 8, a total number of 11 308.7 ha (both donated and acquired) of land was released representing 180,9% of the 2014 target.
• Land Assembly Strategy developed and will be submitted to Human Settlements MINMEC - land pipelines with selected Provinces have been developed to facilitate forward planning and budgeting.
• HDA commenced with discussions with relevant Provinces and Municipalities to assist with packaging of released land for development
26
OUTPUT 4: IMPROVED PROPERTY MARKET• Mortgage Default Insurance Scheme:
– Although various discussions were held between the National Department, National Treasury and the Reserve Bank an agreement could not be reached and approval of MDI is still outstanding.
• Finance Linked Individual Subsidy:
– Revised Policy implemented in April 2012 – need for additional amendments identified and are receiving attention;
– An additional 24 projects and 1 372 subsidies were approved in the 2013/14 financial year;
• Long term fixed interest rate instrument
• In view of the low interest rate environment and without immediate steep inflationary expectations at the time, the instrument will not benefit households and will therefore be reconsidered when the market environment has changed
• 3
27
PERFORMANCE : DEVELOPMENT FINANCE INSTITUTIONS: LOANS GRANTED
28
INSTITUTION TOTAL DELIVERY(1 APRIL 2013 TO 31
MARCH 2014
2015 TARGET
NHFC (Mortgage Loans) 0 149
NHFC (Incremental Loans)
4 000 4 761
NHFC (Value of approvals: Strategic Investment)
72 000 96 499
NHFC (Leverage) 85 439 11 478
RHLF 44 610 49 667
NURCHA 1983 2 800
IMPROVED PROPERTY MARKET
29
• During the same period the total number of loans made available by Banks to the GAP market was 68 028.
• Total contribution by the DFIs and Banks towards the 2014 target:• 134 907 loans by the NHFC (mortgage loans,
incremental loans, wholesale funding and leveraging);• 176 754 loans by RHLF;• Construction of 10 093 units financed through 54
loans granted by NURCHA; and • 162 800 loans to the affordable market by the Banks;
and
CONSOLIDATION OF DFIS
30
• Phase 2 of the rationalisation process commenced. Phase 2 makes provision for the development of a business case and draft enabling legislation for a consolidated Entity.
JOB CREATIONThe delivery of,48,193 serviced cites and 105,936 houses during the 2013/2014 financial created 53,278 employment opportunities.
31
National TOTAL EMPLOYMENT CREATED
Direct Indirect Induced Total
Serviced Stand 6,010 603 2,796 9,408
Top Structure 22,492 3,746 17,632 43,869
Total 28,502 4,349 20,427 53,278
ENHANCING SERVICE DELIVERY VIA PROFESSIONALISATION
• Fledgling Scholarship programme benefiting some 347 beneficiaries since inception. Annual investment by Department is at R 9 million p.a.
• Bachelor of Human Settlements Development Degree (BHSD) offered via Nelson Mandela Metropolitan University (NMMU).
• Chair for Human Settlements Development and Management hosted by Nelson Mandela Metropolitan University (NMMU) to develop the body of knowledge in the sector.
• Cabinet Approval for the Degree and the Chair.
SELECTED PERFORMANCE INDICATORS AS PER 2013/2014 STRATEGIC PLAN: PROGRESS STATUS BY PPMU BRANCH
• The Klarinet Project, located in the Mpumalanga Province, within the jurisdiction of the Emalahleni Local Municipality, has to date, delivered 1788 housing units while 62 foundations, 67 wall plates and 186 roofs are in the process of being constructed.
• 5500 units in the first phase of the Khutsong Project, 3 434 are complete, 4976 foundations have been laid and 4428 wall plates constructed.
• In the Sweetwaters Project in the City of Johannesburg, 1000 units have been completed and occupied in the adjacent Tulamtwana project.
• In the Drommedaris Project in the Drakenstein Municipality, 974 housing units have been completed and handed over while in the Duncan Village Project in the Buffalo City Municipality, 5354 housing units have been completed in this project.
• On the N2 Gateway project, situated, within the jurisdiction of the City of Cape Town, a total of 11,400 units have been completed of the planned 16 083 units that were planned in Phase 1 of the project.
33
SELECTED PERFORMANCE INDICATORS AS PER 2013/2014 STRATEGIC PLAN: PROGRESS STATUS BY PPMU BRANCH • Construction of houses in the Zanemvula Project, situated in the
Eastern Cape, within the jurisdiction of the Nelson Mandela Bay Metropolitan Municipality, is ongoing and to date, 6181 new units have been completed and 1970 units rectified
• Lerato Park Project, situated in the Sol Plaatje Local Municipality, 491 units have been completed.
• In so far as the mining towns was concerned, it was firstly necessary to request funding from National Treasury and R1,1billion was subsequently approved for informal settlement upgrading in the identified mining towns
• In so far as the mining towns was concerned, it was firstly necessary to request funding from National Treasury and R1,1billion was subsequently approved for informal settlement upgrading in the identified mining towns
• The donation of land (with 850 serviced sites) by the Lonmin mining company will assist in providing subsidized housing for the mining community in Rustenburg.
34
MTEF Allocation
36
Rand thousand
Medium term estimates
2013/14 2014/15 2015/16Indicative
2016/17Indicative
Administration 422,399 425 905 445 612 472 038
Human Settlements Policy, Strategy and Planning 84,055 89 396 94 299 100 332
Programme Delivery Support 226,922 298 475 307 715 325 404
Housing Development Finance 27,377,087 29 707 616 31 994 736 33 554 818
Total 28,110,463 30 521 392 32 842 362 34 452 592
Grants and transfers to entities constitute 97% of the total allocation.
Allocation MTEF: Transfer payments
Transfer Payments R`000 2013/14 2014/15 2015/16
Indicative2016/17
Indicative
Conditional Grants
Human Settlements Development Grant 16 983 872 17 084 369 18 532 576 20 409 567
Urban Settlements Development Grant 9 076 906 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 106 721 47 624 51 000 124 599
Human Settlements Development Grant: Indirect Grant 899 177 975 399
Rural Households Infrastructure Development: Indirect Grant 100 539 65 500 67 328
Sub Total 26 268 038 28 681 354 30 581 076 32 066 027
Entities
Social Housing Regulatory Authority: Operational 32 151 33 480 34 560 36 392
Social Housing Regulatory Authority: Capital Restructuring Grant 904 103 827 543 1 195 860 1 287 049
Housing Development Agency 97 497 101 047 104 615 110 160
Community Schemes Ombuds Services 20 000 40 000 53 000 28 000
Sub Total 1 053 751 1 002 070 1 388 035 1 461 601
Total 27 301 789 29 683 424 31 969 111 33 527 628
Summary of Adjustment Budget
ProgrammeOriginal BudgetR`000
Roll-overs Approved
R`000
OtherAdjustment
Disaster ReliefR`000
Declared Unspent
FundsR`000
Adjusted Allocation
R`000
1. Administration 422 399 422 399
2. Human Settlements Policy, Strategy and Planning
84 055 84 055
3. Programme Delivery Support 226 922 -20 000 206 922
4. Housing Development Finance 27 377 087 120 539 44 454
27 542 080
Total 28 110 463 120 539 44 454 -20 000 28 255 456
Adjustment Estimate
• Rollover approved– R100.5 million Rural Household Infrastructure
Grant– R20 million for Community Schemes Ombud
Service startup funding.
Adjustment Estimate
• Other adjustments– R44 million to the Human Settlements
Development Grant for Disaster relief
• Declared Unspent Funds– R20 million National Upgrading Support
Programme
Virements after adjustment estimate
ProgrammeAdjusted
AllocationR`000
VirementsR`000
Revised Allocation
R`000
1. Administration 422 399 (17 800) 404 599
2. Housing Policy, Research and Monitoring 84 055 2 190 86 245
3. Housing Planning and Delivery Support 205 702 (12 500) 193 202
4. Housing Development Finance 27 543 300 28 110 27 571 410
Total 28 255 456 - 28 255 456
Virements after adjustment estimate
• Virements– A virement of R28.1 million from other
programmes to programme 4: Housing Development Finance was approved to fund the prepayments of the Rural Household Infrastructure grant amounting to R33 million.
– A virement of R2.1 million from Programme 1: Administration to Programme 2: Housing Policy, Research and Monitoring was approved to partially fund the Govan Mbeki awards.
Annual Expenditure per Programme as at 31 March 2014
43
Programmes Final AllocationR`000
ExpenditureR`000
Variance R`000 %
Spent
1. Administration 404 599 299 448 105 151 74%
2. Human Settlements Policy, Strategy and Planning 86 245 73 327 12 918 85%
3. Programme Delivery Support 193 202 90 797 102 405 47%
4. Housing Development Finance 27 571 410 27 239 416 331 994 99%
Total 28 255 456 27 702 988 552 468 98%
Reasons for underspending
• Funds provided for the Special Investigation Unit (SIU) were not fully utilized.
– Under spending is due to the SIU not invoicing the Department or not providing the department with supporting documentation on work performed and invoiced.
– The Department held various meetings but could not resolve the matter. • Funds provided for the leasing of additional office accommodation
have not been fully utilised. – The unspent portion of the Property Management portfolio is in respect of leasing of
both 240 and 260 Justice Mahomed Street buildings. – The Department of Public Works (DPW) entered into a seven year lease agreement on
behalf of the Department for these buildings, effective from 01 January 2011 to 31 December 2018.
– A dispute arose between the DPW and the landlord that led to a delay in planned building refurbishment and tenant installation as well as the subsequent occupation of the additional office accommodation. i.e. (260 Justice Mohamed Street building)
• Delay in the implementation of the National Upgrading Support Programme (NUSP).
44
Reasons for under spending cont.
• Other major contributing factor applicable throughout the Department is under spending on compensation of employees which amounted to R38.4 million and can be attributed to the following:– Delays experienced in qualification verification by the South
African Qualifications Authority (SAQA) for candidates who have been recommended. A meeting was arranged between the Department and SAQA in the 3rd Quarter and improvement has since been seen.
– Posts that had to be re-advertised due to the fact that no suitable candidates could be found.
– Problems were experienced with non-disclosure of criminal records on applications disqualifying selected candidates
45
Transfer payments as at 31 March 2014
Transfer Payments Total Allocation
R`000 Expenditure
R`000 Variance
R`000 % Spent
Human Settlements Development Grant
16 983 872 16 983 872 - 100%
Urban Settlements Development Grant 9 076 906 9 076 906 - 100%
Disaster Relief Grant 44 454 44 454 - 100% Rural Households Infrastructure Development
240 370 215 310 25 060 90%
Social Housing Regulatory Authority: Operational
32 151 32 151 - 100%
Social Housing Regulatory Authority: Capital Restructuring Grant
904 103 585 849 318 254 65%
Housing Development Agency 97 497 97 497 - 100% National Urban Reconstruction and Housing Agency
100 000 100 000 - 100%
Nelson Mandela University 3 949 3 949 - 100%
Bursaries Scheme 4 220 4 553 (333) 108%
UNHABITAT 1 100 1 075 26 98% Community Schemes Ombud Service 17 000 17 000 - 100%
Total 27 505 622 27 162 615 343 007 99%
Human Settlements Development Grant (HSDG)Expenditure: 31 March 2014
47
Provinces
DoRA Allocation
2013/14
Additional / Disaster
relief
Reallocation/ (Stopped)
Total Available
Actual Transfer
Amount Received by
Province
Amount Spent by Province %
Spent
R'000 R'000 R'000 R'000 R'000 R'000 R'000
Eastern Cape 2,523,803 - - 2,523,803 2,523,803 2,523,803 2,523,803 100%
Free State 1,120,936 - 230,000 1,350,936 1,350,936 1,350,936 1,350,936 100%
Gauteng 4,108,399 - - 4,108,399 4,108,399 4,108,399 4,095,445 100%
KwaZulu-Natal 3,235,428 40,156 57,000 3,332,584 3,332,584 3,332,584 3,333,979 100%
Limpopo 1,324,742 1,368 (644,000) 682,110 682,110 682,110 303,449 44%
Mpumalanga 1,124,332 1,764 - 1,126,096 1,126,096 1,126,096 1,014,826 90%
Northern Cape 395,724 - 207,900 603,624 603,624 603,624 577,450 96%
North West 1,224,537 - 117,000 1,256,637 1,256,637 1,256,637 1,341,523 107%
Western Cape 1,925,971 1,166 32,100 2,044,137 2,044,137 2,044,137 1,959,237 96%
Total 16,983,872 44,454 - 17,028,326 17,028,326 17,028,326 16,500,648 97%
Delivery Performance of HSDG as at 31 March 2014
48
Province
Annual Delivery Targets Delivery Performance as at 31 March 2014
Variance Delivery
sites
Variance Delivery
Top Structur
e
Total Variance DeliverySites
(units)
Top Structure
(units)
Total Delivery Targets
Sites (units)
Top Structure
(units)
Total Delivery
Performance
Eastern Cape 15,316 20,341 35,657 11,720 12,646 24,366 3,596 7,695 11,291
Free State 5,028 8,341 13,369 7,203 6,920 14,123 -2,175 1,421 -754
Gauteng 13,173 30,351 43,524 8,959 22,352 31,311 4,214 7,999 12,213
KwaZulu-Natal 3,362 25,377 28,739 2,790 29,151 31,941 572 -3,774 -3,202
Limpopo 493 7,382 7,875 68 3,080 3,148 425 4,302 4,727
Mpumalanga 3,319 16,404 19,723 7,578 8,126 15,704 -4,259 8,278 4,019
Northern Cape 4,734 1,735 6,469 2,875 2,464 5,339 1,859 -729 1,130
North West 2,110 14,092 16,202 305 9,362 9,667 1,805 4,730 6,535
Western Cape 6,629 13,414 20,043 6,695 11,835 18,530 -66 1,579 1,513
Total 54,164 137,437 191,601 48,193 105,936 154,129 5,971 31,501 37,472
Performance of the USDG as at31 March 2014
49
YEAR TO DATE (01 JULY - 31 MARCH 2014) EXPENDITURE
Municipality
Allocated Funds
NationalRollovers Total
Available
Transferred Funds
Spent by Municipality
Variance Spent vs
Transferred
Variance Spent vs Total
Available
Spent as % of Total
Available
Unspent as % of Total Available
R'000
Buffalo City 613,305 176,875 790,180 613,305 409,323 203,982 380,857 51.8% 48.2%
Nelson Mandela Bay 727,986 - 727,986 727,986 341,504 386,482 386,482 46.9% 53.1%
Mangaung 596,719 129,450 726,169 596,719 333,054 263,665 393,115 45.9% 54.1%
Ekurhuleni 1,584,912 69,509 1,654,421 1,584,912 906,707 678,205 747,714 54.8% 45.2%
City of JHB 1,488,877 70,347 1,559,224 1,488,877 607,204 881,673 952,020 38.9% 61.1%
City of Tshwane 1,290,611 - 1,290,611 1,290,611 791,087 499,524 499,524 61.3% 38.7%
eThekwini 1,580,999 - 1,580,999 1,580,999 1,007,292 573,707 573,707 63.7% 36.3%
City of Cape Town 1,193,497 66,276 1,259,773 1,193,497 486,797 706,700 772,976 38.6% 61.4%
Total 9,076,906 512,457 9,589,363 9,076,906 4,882,968 4,193,938 4,706,395 50.9% 49.1%
Urban Settlements Development Grant (USDG) Expenditure as at 30 June 2014
50
YEAR TO DATE (01 JULY - 31 MARCH 2014) EXPENDITURE
Municipality
Allocated Funds
NationalRollovers Total
Available
Transferred Funds
Spent by Municipality
Variance Spent vs
Transferred
Variance Spent vs Total
Available
Spent as % of Total
Available
Unspent as % of Total Available
R'000
Buffalo City 613 305 176 875 790 180 613 305 789 503 677 100% 99.9% 0.1%
Nelson Mandela Bay 727 986 -
727 986 727 986 727 986 - 100% 100.0% 0.0%
Mangaung 596 719 129 450 726 169 596 719 651 137 75 032 100% 89.7% 10.3%
Ekurhuleni 1 584 912 69 509 1 654 421 1 584 912 1 444 715 209 706 100% 87.3% 12.7%
City of JHB 1 488 877 70 347 1 559 224 1 488 877 1 435 796 123 428 100% 92.1% 7.9%
City of Tshwane 1 290 611 - 1 290 611 1 290 611 1 245 781 44 830 100% 96.5% 3.5%
eThekwini 1 580 999 - 1 580 999 1 580 999 1 580 999 - 100% 100.0% 0%
City of Cape Town 1 193 497 66 276 1 259 773 1 193 497 973 226 286 547 100% 77.3% 22.7%
Total 9 076 906 512 457 9 589 363 9 076 906 8 849 143 740 220 100% 92.3% 7.7%
What USDG was used for as at 30 June 2014
Description
Total Available Funds
Expenditure on Total Available
Funds
Variance on Total
Available Funds
% Spent on Total
AvailableR'000
Spatial Development and the Built Environment 2 198 306 1 972 799 225 507 89.7%
Transport 2 027 440 1 808 658 218 782 89.2%
Water 1 679 533 1 548 862 130 671 92.2%
Sewerage 1 878 893 2 067 819 (188 926) 110.1%
Solid Waste Management 163 374 147 130 16 244 90.1%
Electricity 917 898 748 206 169 692 81.5%
Socio-Economic Amenities 405 867 365 275 40 592 90%
Local Economic Development and Job Creation 228 650 100 992 127 658 44.2%
Vat 89 402 89 402 - 100%
Total 9 589 363 8 849 143 740 220 92.3%
Financial Performance - BCMBuffalo City
Services
2013/14 Adjusted budget
YTD Expenditure %
Water 78,537,212 78,537,213 100%Sanitation (waste water) 190,031, 698 190,031,698 100%
Electricity 38,667,450 38,667,450 100%Roads & Storm Water 314,288,283 314,156,492 100%
Human settlements programme
141,031,375 140,430,865 100%
Transport 23,999,295 23,999,294 100%
Solid Waste Management 3,684,205 3,680,008 100%
TOTAL 790,179,608 789,503,174 100%
Non-financial Performance - BCMThe 100% expenditure of the Metro was on the following:•1 729 serviced sites•3,7 ha of land procured•56 km of roads resealed•406 km roads rehabilitated•56 km storm water drainage installed•8 km pedestrian walkways constructed•143 water service points (taps) installed for informal settlements dwellers•622 households (RDP) have been provided with access to free basic level of potable water connections•1 082 new households (RDP) with sewer connections•448 sanitation service points installed•64 178 connections for backlog in the provision of basic sanitation services
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Non-financial Performance - BCM• The 100% expenditure of the Metro was on the following:• 281 090 households have been provided with kerb-side waste
removal services in formal areas• 1 500 street lights installed• 517 households(RDP) provided with electricity connections• 7 project of waste minimization projects have been initiated • 10 community halls have been developed• 6 sports fields developed• 8 parks developed• 13 cemeteries developed• 1 fire safety and emergency facility developed• 669 jobs created through EPWP and other municipal programmes
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Financial Performance - NMBM
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Nelson Mandela Bay
Services2013/2014
Adjusted Budget YTD
Expenditure %Servicing of sites
171,261,100
171,758,447
100%
Upgrading of gravel roads and provision of stormwater
64,227,488
64,227,469
100%
Provision of bulk sanitation services
224,698,222 224,262,039 100%
Provision of bulk water services
178,397,400
178,397,334 100%
TOTAL 727,986,000
727,986,000 100%
Non-financial Performance - NMBM• The 100% expenditure of the Metro was on the following:• 43.73 ha of land procured for Greenfields development• 4 012 sites serviced • 10 informal settlements upgraded (in-situ)• 1 informal settlements upgraded - relocation• 3.31 km graveled roads• 20.45 km tarred roads rehabilitated• 1.46 km storm water drain installed• 3.58 km pedestrian walkways constructed• 773 households (RDP) connected to water• 773 households (RDP) connected to sanitation• 2 459 households (RDP) connected to electricity• 77 new street lights• 366 high mast lights installed• 1 sport field developed• 11 886 jobs created through EPWP
Financial Performance - MangaungMangaung
Services 2013/2014 Adjusted Budget
YTDExpenditure
%
Engineering Services (Sanitation, Roads and Waste)
343,686,390 326,112,472 95%
Water Services 199,223,636 180,577,383 91%
CENTLEC (Electricity) 52,631,580 31,383,501 60%
Planning 44,189,512 53,416,081 97%
Social Services 35,129,154 28,029,606 80%
Corporate Services 28,806,892 27,017,899 94%
Human Settlements and Housing
11,502,078 4,599,615 40%
TOTAL 726,169,242 651,136,557 90%
Non-financial Performance Mangaung
• The 90% expenditure of the Metro was on the following:• 2 181 title deeds transferred to eligible beneficiaries• 3 informal settlements upgraded - relocation• 1 km of paved road• 55 km of roads resurfaced• 1 km of storm water drainage installed• 18 km pedestrian walkways constructed• 1 475 formal domestic consumers receiving water services• 1 500 water service points (taps) installed for informal settlements• 500 households (RDP) provided with water connection• 3 625 units provided with access to free basic water• 1 550 formal domestic consumers receiving sewerage services• 450 households (RDP) provided with sewer connection
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Non-financial Performance Mangaung
• The 90% expenditure of the Metro was on the following:– 165 464 households with weekly-kerb waste removal services– 23 130 households in informal settlements with access to waste
removal– 26 high mast lights installed in informal settlements– 552 households (RDP) were connected to electricity– 17 862 households provided with access to free basic electricity– 1 community hall constructed– 3 sports fields constructed– 2 parks developed– 1 swimming pool developed– 6 cemeteries developed– 1 687 jobs created through EPWP
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Financial Performance - EkurhuleniEkurhuleni
Services2013/2014 Adjusted Budget
YTD Expenditure
%
Disaster & Emergency 27,054,350 26,194,227 97%EMPD 13,650,000 7,407,380 55%Energy 214,300,000 208,774,774 97%Environmental Resources Management
1,110,000 1,106,922 99%
Human Settlements 64,066,538 29,333,380 46%Roads and Storm water 573,721,860 502 814 613 87%Health and Social Development
66,860,000 65,849,994 98%
Economic Development 35,650,000 33,872,192 95%SRAC 127,975,000 123,394,311 96%Transport Planning and Provision
35,700,000 29,257,363 81%
Financial Performance - EkurhuleniEkurhuleni
Services
2013/2014 Adjusted Budget
YTD Expenditure %
Water & Sanitation 182,200,000 151, 837,290 83%Erwat- Wastewater treatment
50,000,000 50,000,000 100%
Interim sanitation services (Chemical toilets)
160,916,650 154,349,245 96%
Waste Management (land fill sites)
31,700 000 29,217,417 92%
Real Estate 37,600,000 31,306,050 83%Human Settlement USDG (Opex)
31,566,282 - 0%
TOTAL 1,654,420,680 1,444,715,157 87%
Non-financial Performance - Ekurhuleni
• The 87% expenditure of the Metro was on the following: – 48 serviced sites– 1 486 title deeds transferred– 283 KMs of roads paved– 374 KMs of graveled roads – 350 KMs of roads surfaced/ rehabilitated– 107 KMs of storm water drainage installed– 64 KMs of pedestrian walkways constructed– 1 bus terminal constructed– 7 bus stops constructed– 2 148 formal domestic costumer receiving water and sanitation
services– 154 water services points (taps) installed for informal
settlements dwellers
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Non-financial Performance - Ekurhuleni
• The 87% expenditure of the Metro was on the following:– 597 288 households in informal settlements with access to
refuse removal– 222 300 households (RDP) with access to refuse removal – 12 waste minimization projects initiated– 55 high mast lights installed in informal settlements– 7 647 households (RDP) provided with electricity
connections– 1 sports field and stadia developed– 5 clinics developed– 1 fire safety and emergency facilities developed– 11 242 jobs created using the EPWP
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Financial Performance – City Of Johannesburg
USDG Projects – FY 13/14
2013/2014 Adjusted Budget
YTDExpenditure
% ExpenditureR’000 R’000
Formalisation of Informal Settlements
254,524 303,873 119.4%
Bulk , Link and Internal Infrastructure(water, sewer, Electricity; Roads & Storm-water)
899,162 796,075 85.3%
Electrical (Substations & Streetlights)
125,715 117,341 93.3%
Mixed Rental / Hostel Upgrade
96,138 85,657 89.1%
Land Acquisition 20,000 19,654 98.3%Upgrade of Community Centres & Sport fields
50,090 49,306 98.4%
Financial Performance – City Of Johannesburg
USDG Projects – FY 13/14
USDG BudgetQuarter 4
Expenditure% Expenditure
R’000 R’000
Upgrade Of Clinics 30,730 23,247 75.6%
Upgrade Of Landfills 46,865 34,143 72.9%
Upgrade Of Parks & Cemeteries
36,000 35,726 99.2%
Total 1,559,224 1,465,022 94%
Non-financial Performance – City Of Johannesburg
• The 94% expenditure of the Metro was on the following:– 20 ha of land procured for greenfield development– 35 ha procured for brownfield development– 1 440 km of roads graveled – 242 km of roads resurfaced– 18 km of roads resealed – 750 000 formal domestic consumers receiving water and
sewerage services– 3 069 households (RDP) provided with water connections– 967 households provided with access to potable water– 783 sanitation services points (toilets) installed for informal
settlements dwellers
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Non-financial Performance – City Of Johannesburg
• The 94% expenditure of the Metro was on the following:– 789 982 households with weekly-kerb waste removal in formal areas– 185 738 households in informal settlements with access to refuse
removal– 4 waste minimization projects initiated– 415 412 formal households with access to basic electricity– 1 610 high mast lights installed in informal settlements– 1 562 households (RDP) connected to electricity– 3 846 households provided with access to free basic electricity– 1 Parks and 1 Garden constructed– 2 clinics constructed – 1 cemetery completed– 34 markets developed– 7 Fire and safety emergency facilities developed– 55 082 jobs created through EPWP
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City of Tshwane Municipality
Services2013/2014 Adjusted Budget
YTD Expenditure
%
Agriculture and Environmental Management
24,000, 000 7,604,390 31.68%
Housing & Sustainable Human Settlements
469, 824, 650 445,971,291 94.92%
Water and Sewer 491,735,544 489,558,668 99.56%Electricity 56,150,000 55,157,133 98.23%Sports and Recreation(SRAC) 10,000,000 9,700,270 97.00%
Transport 198,190,806 198,611,555 99.85%Project management and design (technical assistance)
40,000,000 39,177,936 97.94%
Total 1, 290,611, 000 1,245,781,243 97%
Financial Performance – City Of Tshwane
Non-financial Performance – City Of Tshwane
• The Metro has spent 97% on the following:– 221 ha. of land procured for human settlements development– 160 ha. of land proclaimed (township establishment completed)– 2 176 KMs roads paved– 1 555 KMSs of storm water drainage installed– 6 905 water service points (taps) installed for informal
settlement– 463 782 households (RDP) provided with water connections – 434 924 of formal domestic customers receiving sewerage
services– 541 612 households with weekly kerb-side waste removal
services in formal areas– 158 households in informal settlements with access to refuse
removal – 150 000 households (RDP) with access to refuse removal
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Non-financial Performance – City Of Tshwane
• The Metro has spent 97% on the following:– 686 659 formal households with access to basic
electricity– 45 high mast lights installed – 15 963 households provided with access to Free
Basic Electricity– 14 libraries developed – 1 480 fire safety and emergency facilities
developed– 30 000 jobs created using the EPWP
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Financial Performance – EthekwiniEthekwini
ServiceBudget 2013/14 R’000
ExpenditureR’000
%
Built Environment 1,388 1 510 109%Fully Subsidies Housing 150 179 119%Ablution Blocks, Interim Services
293 558 190%
Sanitation 198 135 68%Water 411 223381 93%Roads and Storm water Control
117 116 99%
Electricity 247 141 65%Social facilities 2 0 0%LED and Job Creation 157 71 37%Zone Plans 90 64 7%Township Renewal 103 64 71%TOTAL 1,581 1, 581 100%
Non-financial Performance – Ethekwini
• The 100% expenditure of the Metro was on the following:– 25 509 ha. of land acquired for human settlements
development– 715 ha. of land procured for green field development– 16 471 ha. of land procured for brown field development– 21 informal settlements with upgrading plans– 16 269 sites serviced– 904 title deeds transferred – 119 pedestrian walkways constructed – 26 KMs of paved roads– 1 bus terminals constructed
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Non-financial Performance – Ethekwini
• The 100% expenditure of the Metro was on the following:– 1 129 water services points (taps) installed for informal settlements
dwellers– 16 269 households (RDP) provided with water connections– 7 348 consumers provided with access to a free basic level of potable
water– 1 129 sanitation service points (toilets) installed for informal
settlement dwellers– 16 269 households (RDP) provided with sewer connections– 1 270 452 households in informal settlements with access to refuse
removal – 16 317 households (RDP) provided with access to refuse removal– 37 483 formal households with access to basic electricity– 16 269 households (RDP) provided with electricity connections– 342 932 households provided with access to free-basic electricity– 36 752 jobs created using the EPWP
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Financial Performance – City Of Cape Town
City of Cape Town
Service Budget 2013/14 Expenditure %
Electricity Services 233 484 000 193 388 822 82.8%
Solid Waste services 24 975 000 24 974 920 100%
Water services 191 369 300 149 711 655 78.2%
Parks 45 742 240 38 929 514 85%
Sport, Recreation and Amenities
51, 268, 300 34 011 396 66%
Library services 11 427 903 8 795 169 77%
Infrastructure and maintenance
212 540 331 187 606 064 88.3%
City of Cape Town Transport
23 844 023 23 516 602 98.6%
Health Services 6 148 626 2 957 397 48.1%
Financial Performance – City Of Cape Town
City of Cape TownService Budget 2013/14 Expenditure %Existing Settlements 31,914,023 15,560,693 48.8%New Settlements 190,053,601 132,733,507 69.8%HS Strategy & Planning 60,000,000 53,828,338 89.7%Urbanisation (incl. in-situ upgrades)
95,476,811 49,031,433 51.4%
Urban Regeneration 5,000,000 0 0%Spatial Planning and Urban Design
354,209 354,209 100%
Project Pre-Planning 38,536,344 20,188,339 52.4%Project management Fees
17,714,963 17,714,963 100%
Province Allocation (Metro Projects)
19,923,120 19,923,120 100%
Total 1,259,772,794 973,226,147 77.3%
Non-financial Performance – City Of Cape Town
• The 77% expenditure of the Metro was on the following:
• 8 120 sites serviced• 6 151 title deeds of sale agreements signed with identified
beneficiaries • 12 KMs roads resealed• 123 roads rehabilitated• 10 KMs pedestrian walkways constructed• 1 bus terminal constructed• 80 bus stops constructed• 610 533 formal domestic customers receiving water services• 4 827 service points (taps) installed in informal settlements• 21 716 toilets installed in informal settlements
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Non-financial Performance – City Of Cape Town
• The 77% expenditure of the Metro was on the following:
• 1 068 572 consumer units provided with access to free basic water
• 596 155 formal domestic consumers receiving sewerage services
• 837 533 households provided with solid waste removal• 837 533 households provided with access to basic
electricity• 38 303 job opportunities created through EPWP
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RESPONSE TO AUDITED OUTCOMES 2013-14
AUDITOR’S OPINION
• Unqualified opinion with emphasis of matters
EMPHASIS OF MATTERS IN THE AUDIT REPORT
Material underspending of the vote•The department has materially underspent the budget on programme 2 , spent R12 433 000 of its allocation of R 87 773 000 in respect of Programme Implementation Facility.
•The department spent R108 589 000 of its allocation of R133 649 000 pertaining to implementation of the RHIG. The department was also allocated an amount of R106 721 000 to be transferred to municipalities; however these transfers were only transferred in March 2014 and a significant portion of these grants were unspent at 31 March 2014.
EMPHASIS OF MATTERS IN THE AUDIT REPORT CONT.
Predetermined objectives - Programme 2, 3 and 4Changes to objectives, indicators and targets not approved•Material changes were made to indicators and targets reported in the annual performance report without these changes being approved by the Minister
Consistency of indicators and targets•Reported indicators and targets were not consistent with those in the approved annual performance plan.
EMPHASIS OF MATTERS IN THE AUDIT REPORT CONT.
Measurability of indicators targets•Departmental target were not specific.•Auditor General could not measure the required performance.
Reliability of reported performance information•Significantly important targets were not reliable when compared to the source information or evidence provided.
EMPHASIS OF MATTERS IN THE AUDIT REPORT CONT.
Non-Compliance with laws and regulationStrategic planning and performance management•Effective, efficient and transparent systems of risk management and internal control with respect to performance information and management was not in maintained as required by section 38(1)(a)(i) of the PFMA.Annual financial statements, performance and annual reports•The financial statements submitted for auditing were not prepared in accordance with the prescribed financial reporting framework as required by section 40(1) (b) of the Public Finance Management Act.
EMPHASIS OF MATTERS IN THE AUDIT REPORT CONT.
Human resource management and compensation•Funded vacant posts were not filled within 12 months as required by Public Service Regulation 1/VII/C.1A.2.•A human resource plan was not in place as required by Public Service Regulation 1/III/B.2(d).
Asset management and liability management•Proper control systems to safeguard and maintain assets were not implemented, as required by section 38(1)(d) of the Public Finance Management Act and Treasury Regulation 10.1.1(a).
MANAGEMENT’S REPONSE REGARDING AUDIT OUTCOME
• An action plan has been developed as a tool to address all the findings raised by the Auditor General.
• An action plan was populated with all the findings and circulated to responsible Deputy Director Generals and the Chief Directors for planed actions that are aiming at addressing the findings and mitigating/eliminating the risk of the similar audit finding being raised again in future.
MANAGEMENT’S REPONSE REGARDING AUDIT OUTCOME CONT.
• Planned actions are monitored on a monthly basis by the CFO branch, whereby managers are required to provide progress and evidence to support what has been done. The progress is reported to the Auditor General, Audit Committee and EMT.
• Auditor General provides a feedback on a quarterly basis in a form of a Dashboard Report whereby the Director General is expected to come up with commitments that will address discrepancies identified during the assessment.
THANK YOU
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