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DEPARTMENT OF HUMAN SETTLEMENTS
FREE STATE PROVINCE
VOTE NO. 13
ANNUAL REPORT
2014/2015 FINANCIAL YEAR
PR311/2015
ISBN 978-0-621-44021-8
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CONTENT PAGE No
PART A: GENERAL INFORMATION .................................................................................. 4
1. DEPARTMENT GENERAL INFORMATION ................................................................... 5
2. LIST OF ABBREVIATIONS/ACRONYMS ....................................................................... 6
3. FOREWORD BY THE MEC ........................................................................................... 7
4. REPORT OF THE ACCOUNTING OFFICER ................................................................. 9
5. STATEMENT OF RESPONSIBILITY AND CONFIRMATION OF ACCURACY FOR THE ANNUAL REPORT ....................................................................................................... 17
6. STRATEGIC OVERVIEW ............................................................................................. 18
6.1. Vision ................................................................................................................ 18
6.2. Mission .............................................................................................................. 18
6.3. Values ............................................................................................................... 18
7. LEGISLATIVE AND OTHER MANDATES .................................................................... 19
8. ORGANISATIONAL STRUCTURE ............................................................................... 26
PART B: PERFORMANCE INFORMATION ....................................................................... 27
AUDITOR GENERAL’S REPORT: PREDETERMINED OBJECTIVES .............................. 28
2. OVERVIEW OF DEPARTMENTAL PERFORMANCE .................................................. 29
2.1. Service Delivery Environment ............................................................................ 29
2.2. Service Delivery Improvement Plan ................................................................... 30
2.3. Organisational environment ............................................................................... 31
2.4. Key policy developments and legislative changes ............................................. 32
3. STRATEGIC OUTCOME ORIENTED GOALS ............................................................. 32
4. PERFORMANCE INFORMATION BY PROGRAMME .................................................. 32
4.1. Programme 1: .................................................................................................. 32
4.2. Programme 2: ................................................................................................... 45
4.3. Programme 3: ................................................................................................... 46
4.4. Programme 4: .................................................................................................. 53
5. TRANSFER PAYMENTS.............................................................................................. 55
5.1. Transfer payments to public entities .................................................................. 55
5.2. Transfer payments to all organisations other than public entities ....................... 55
6. CONDITIONAL GRANTS ............................................................................................. 55
6.1. Conditional grants and earmarked funds paid ................................................... 55
6.2. Conditional grants and earmarked funds received ............................................. 56
7. DONOR FUNDS ........................................................................................................... 57
7.1. Donor Funds Received ...................................................................................... 57
8. CAPITAL INVESTMENT............................................................................................... 57
8.1. Capital investment, maintenance and asset management plan ......................... 57
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PART C: GOVERNANCE ................................................................................................... 58
1. INTRODUCTION .......................................................................................................... 59
2. RISK MANAGEMENT .................................................................................................. 59
3. FRAUD AND CORRUPTION ........................................................................................ 59
4. MINIMISING CONFLICT OF INTEREST ...................................................................... 60
5. CODE OF CONDUCT .................................................................................................. 60
6. HEALTH SAFETY AND ENVIRONMENTAL ISSUES ................................................... 60
7. PORTFOLIO COMMITTEES ........................................................................................ 61
8. PROPAC RESOLUTIONS ............................................................................................ 61
9. PRIOR MODIFICATIONS TO AUDIT REPORTS ......................................................... 63
10. INTERNAL CONTROL UNIT ...................................................................................... 63
11. INTERNAL AUDIT AND AUDIT COMMITTEES ................................................. 63
12. AUDIT COMMITTEE REPORT .................................................................................. 65
PART D: HUMAN RESOURCE MANAGEMENT ............................................................... 72
1. INTRODUCTION .......................................................................................................... 73
2. OVERVIEW OF HUMAN RESOURCES ....................................................................... 73
3. HUMAN RESOURCES OVERSIGHT STATISTICS ...................................................... 75
PART E: FINANCIAL INFORMATION.............................................................................. 116
1. REPORT OF THE AUDITOR GENERAL .................................................................... 117
2. ANNUAL FINANCIAL STATEMENTS......................................................................... 128
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PART A: GENERAL INFORMATION
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1. DEPARTMENT GENERAL INFORMATION
PHYSICAL ADDRESS: 7th Floor, OR Tambo House
Cnr. Markgraaff and St Andrews streets
Bloemfontein
9301
POSTAL ADDRESS: P O Box 211
Bloemfontein
9300
TELEPHONE NUMBER/S: 051 403 5391
FAX NUMBER: 051 403 3699
E-Mail Address
Head of Department: [email protected]
Chief Financial Officer: [email protected]/[email protected]
Chief Director: Corporate Services: [email protected]
Website Address www.freestateonline.fs.gov.za http://www.humansettlements.fs.gov.za
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2. LIST OF ABBREVIATIONS/ACRONYMS
AG Auditor-General
AGSA Auditor General of South Africa
AO Accounting Officer
BNG Breaking New Ground
CRU Community Rental Units
DPSA Department of Public Service and Administration
FLISP Financed Linked Individual Subsidy Programme
FSGDS Free State Growth and Development Strategy
GSRB Gender Sensitive Rights Based
HOD Head of Department
HDA Housing Development Agency
HSDG Human Settlements Development Grant
ICT Information Communication Technology
IDP Integrated Development Plan
IGR Inter-Governmental Relations
KPI Key Performance Indicator
M&E Monitoring and Evaluation
MEC Member of Executive Council
MPAT Management Performance Assessment Tool
MTEF Medium Term Expenditure Framework
NDP National Development Plan
NHBRC National Home Builders Registration Council
NUSP National Upgrading Support Programme
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3. FOREWORD BY THE EXECUTIVE AUTHORITY
One of the basic elements of a stable and progressive
society is steady homes and communities, which in
return nurture well-adjusted and productive people who
contribute to the wellbeing and progression of their
society. These ideal homes, in a democratic society, are
established in human settlements that conform to basic
human rights. The standard that was set by the Freedom
Charter that “all people shall have the right to live
where they choose, be decently housed, and bring
up their families in comfort and security” is relevant in
this context.
The cornerstone of our responsibility is to provide
integrated and sustainable human settlements in the
province, towards ensuring a better life for all as
stipulated in Outcome 8: Sustainable human
settlements and improved quality of household life.
We have in the past 20 years evolved in our provision of
human settlements; from providing housing as a unit to
building human settlements that include infrastructure
and basic services. Working in an integrated manner
together with other government sectors, we included
other amenities that make up complete human
settlements with clinics, schools, roads, multi- purpose
community halls etc. Our houses have also changed
from smaller units to the current 50m² as a standard basic size with various designs that
express individuality. In our quest to provide our people with homes, we have also acquired
land for human settlement in which our people have been decently housed and many
settlements today bear a testimony that we have not diverged from our vision and have
indeed restored the dignity of many of our people who today live in their own homes with
pride.
The Free State government remains committed to the provision of decent shelter and
settlements wherein people have access to clean water and proper sanitation. As a
collective, we remain committed to accelerating the delivery of housing as a key strategy for
poverty alleviation and utilizing the provision of housing as one of the major job creation
strategies and economic development. We have also successfully used human settlements
development to address other socio economic and sustainability issues such as skills
development, economic development, women and youth empowerment as well as overall
redressing of the imbalances of the past.
Despite numerous challenges, the department continued to work steadily on its quest to
provide decent housing to deserving Free State citizens. To mention some of our successes:
Low-income affordable housing units were constructed.
MEC SM MLAMLELI
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Deeds of transfer were registered in favour of the qualifying beneficiaries.
Erven were planned and surveyed for human settlements development purposes.
Municipalities were supported for level 1 accreditation, while the Mangaung Metro
was supported for level 3 accreditation.
Households in newly formalized areas were provided with access to basic water and
sanitation.
Former mining hostels that served the migrant labour system and deprived our
people of dignity, resulting in segregated families, were reconstructed into family
units of up to three bedrooms.
We have also successfully built Social Housing and Rental Units, as well as
Community Residential Units that offer affordable alternative accommodation for low-
income earners who would rather rent than buy houses or cannot afford to buy.
These are well located within reach of places of employment, schools and hospitals
and other services.
Our journey has been long and challenging, but with each year our vision, shaped by the
needs of our people and the country‟s National Development Plan Vision 2030 for providing
decent human settlements has grown sharper and more focused resulting in improved
homes each time. Our people are happy and proud owners of decent homes, and we have
indeed ensured that these live in comfort and security.
Our commitment: we will continue to work hard to improve our performance for the benefit of
our people for together we can do more, and, together we move South Africa forward!
-------------------------------------
SM MLAMLELI (MPL)
MEC: COOPERATIVE GOVERNANCE, TRADITIONAL AFFAIRS AND HUMAN
SETTLEMENTS
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4. REPORT OF THE ACCOUNTING OFFICER
4.1 Overview of the operations of the department
The department as a champion for implementation of Outcome 8: Sustainable Human Settlements and Improved Quality of Household Life has made significant achievements in the 2014/2015 in respect of the three outcomes namely: 1. Accelerated delivery of housing opportunities 2. Improved access to sanitation in newly-formalised areas 3. Mobilisation of well-located public land for low-income
and affordable housing
Below are milestones achieved in each of the outcomes despite the many challenges facing the department during the year under review.
There were 14 212 houses enrolled with NHBRC (424 Community Residential Units and 284 Social Housing)
1154 Deeds of transfer were registered in favour of qualifying beneficiaries:
8 parcels of land were identified and transferred to municipalities for development purposes o 5615 erven planned and surveyed
1.9 Km of roads constructed in newly-formalized areas o 6 municipalities supported towards accreditation
In the current financial year, 5 313 new housing units (including social and rental housing) were completed in the province across all housing programmes
1920 new sites have been connected to basic water and sanitation services as part of the Integrated Residential Development Programme while
In addition, 3 774 households have been connected to basic services as part of the Informal Settlements Upgrading Programme.
In this financial year, the department created 1646 job opportunities through resettlement and housing construction projects.
The department developed the following MTEF targets for 2014-2017 as part of its strategic
objectives in alignment with the three outcomes as stated.
Alignment of human settlement plans
A multi-year housing development plan
Enrolment of housing projects with the National Home Builders Registration Council
(NHBRC)
HOD N MOKHESI
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Different types of housing designs
Different types of housing designs/models have been piloted in Thandanani, Welkom. This project will
yield 1 424 houses. New designs have been implemented in Zastron and Thaba Phatswa.
Mining towns support programme: planning and survey projects
Planning and survey projects (Township establishment) in Matjhabeng Local Municipality for 6 700
sites which aim at addressing informal settlements upgrading in areas such as Nyakallong, Thabong,
Bronville, Mmamahabane, Phomolong, and Kutlwanong.
The installation of basic services is practically completed at Thandanani Informal Settlement
(Matjhabeng) and the construction of top structures has commenced.
Water and Sewer networks
Water and sewer networks will be implemented in Phahameng: Bultfontein, Wesselsbron, Refengkgotso, Themba Khubeka, Excelsior and in Caleb Motshabi as part of the big turnkey development. The total number of sites to be serviced in these projects is 11 511.
Free State informal settlements rapid assessments and categorisation
The Rapid Assessment and Categorization reports of 143 informal settlements in all 19 Free State
local municipalities and 1 metro are completed.
Free State NUSP municipalities’ settlements enumerations
The enumeration of informal settlement in all 6 Free State NUSP municipalities has also been
completed.
The overall objective of the enumerations is to encourage participatory planning process for
production of settlement upgrading plans and to conduct detailed household enumerations (socio-
economic surveys) in the informal settlements in order to establish the actual number of structures,
the actual population, the community special needs and livelihoods, and to develop a programme
based on accurate information. This would help ascertain the appropriate development intervention
and settlement management needs in the development of appropriate upgrading plans for each
settlement.
Mangaung Metro Informal Settlements Upgrading Strategy
The Mangaung Metro Informal Settlements Upgrading Strategy has been completed and the strategy
is being implemented. This strategy is a developmental strategy which seeks to bring about more
rapid, equitable and broad based responses to the challenge of informal settlements in the Metro
The Department is currently working with the Housing Development Agency to assist the Metro with a
Resettlement plan and Enumerations of 9 settlements earmarked for relocation.
Acquisition of 3 Sasolburg properties
Acquisition of three Sasolburg properties situated in Metsimaholo Local Municipality consisting of approximately 252 4645ha in extent which could yield approximately 1900 mixed residential opportunities. Transfer of these properties to Metsimaholo Municipality is in process. The urban design on the subject properties has commenced and the development planning to commence thereafter. These properties are situated on prime land which could, if developed, link the Sasolburg
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and the Vanderbijlpark Towns, and have been earmarked as the human settlements catalytic project of the Free State Province.
Acquisition of 49 Estoire properties
Acquisition of 49 Estoire properties situated in Mangaung Metro consisting of approximately 191. 9665 ha in extent which could yield approximately 3 500 mixed residential opportunities. Transfer of these properties to Mangaung Metro is in the final stage. The development planning is to commence upon transfer. These properties are ideally and strategically located along the N8 development corridor.
Prioritizing of youth and women empowerment
The Department has allocated 20% of its projects to women and youth thus ensuring women and youth empowerment. It is envisaged that the province will increase the percentage to achieve the 60% target set by National.
Key plans and upcoming programmes
Caleb Motshabi, in Mangaung Metro is a mixed development project yielding 7 554 mixed housing units
Alternative Building Technology has been piloted in Vrede and the project will yield 1 000 houses. To date 26 houses have been completed
4358 Breaking New Ground (BNG) housing units have been planned for construction in the 2014-2015 financial year and to date 422 of these have been completed. The new house designs that are more energy efficient and aesthetically pleasing on BNG units will be constructed throughout the province.
The department will also be entering into a new project to provide housing for military veterans.
Challenges
Labour and community unrests at project sites resulting in project completion delays
Capacity constraints
Prolonged procurement processes
Difficulty in acquisition of sites for military veterans
Change in priorities where expenditure had to be fast tracked
Insufficient capacity
Slow construction progress due adverse weather
Failed mortgage approvals at the banks because of over indebtedness of prospective applicants
Financial Management
The Annual Appropriated Budget for the department during the year under review decreased by 17% compared to the previous year. This has been due to the overall decrease in the funds allocated under HSDG nationally. Furthermore the provincial allocation of equitable share has also seen shrinkage due to declining population on the province affecting departmental appropriated amounts.
The effect of the declining appropriations has put a lot of pressure on the department in discharging its mandate with fewer funds. This called for reprioritisation of projects.
Despite the budgetary constraints, the department has made an enormous impact on driving service delivery mandate in each of its current programmes.
The overall financial performance stood at 98.3% for 2014-2015 as compared to 99.8% of the previous year. The decline in budget utilisation is attributable to R14. 8 million that was received late in the financial year by the department for the Military Veterans project. This money has been
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requested for roll over as the department will be commencing with the project in the 2015/2016 financial year. There was also an element of savings due to the implementation of the cost containment measures.
The department has prepared the Annual Financial Statements in accordance with the Modified Cash Standard as prescribed by National Treasury and the PFMA. The department has summarised the critical aspects on financial performance for the year ended 31 March 2015. The aim is to bring to the attention those matters that the department believes are critical in the assessment and reading of the department‟s Annual Financial Statements.
---------------------------------------------
N MOKHESI HEAD OF DEPARTMENT OF HUMAN SETTLEMENTS
24 August 2015
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4.2 Overview of the financial results of the department
Departmental receipts
Departmental
receipts
2014/2015 2013/2014
Estimate Actual Amount
Collected
(Over)/Under Collection
Estimate
Actual Amount
Collected
(Over)/Under Collection
R’000 R’000 R’000 R’000 R’000 R’000
Tax Receipts
Sale of goods and services other than capital assets
96
425
(329)
60
284
(224)
Interest, dividends and rent on land
8
7
1
10
14
(4)
Financial transactions in assets and liabilities
768
724
44
150
357
(207)
Total 872 1 156 (284) 220 655 (435)
The department does not generate revenue, however the revenue that it collects comprises of
payment for tender documentation, the selling of redundant assets and the recovery of receivables.
The department does not have a tariff policy and it applies the standard Provincial Treasury tariffs as
prescribed.
The department exceeded the collection requirements due to the vast interest by the public to
participate in its tenders in the current financial year.
Programme Expenditure
The table below provides a summary of the actual expenditure in comparison to the adjusted
appropriation for both the current year and previous year at programme level.
Programme
Name
2014/2015 2013/2014
Final Appropriatio
n
Actual Expenditure
(Over)/ Under Expenditure
Final Appropriation
Actual Expenditure
(Over)/Under Expenditure
R’000 R’000 R’000 R’000 R’000 R’000
Administration 80 485 77 314 3 171 68 672 68 257 415
Housing needs, research and planning
18 553
17 607
946
13 194
12 829
365
Housing Development
1 128 216
1 111 861
16 355
1 401 294
1 400 500
794
Housing assets management and property management
964
770
194
1 007
175
832
Total 1 228 218 1 207 552 20 666 1 484 167 1 481 761 2 406
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Programme 1: Administration The programme recorded actual expenditure of R 77 314 million or 96.06 per cent in the 2014/15 financial year compared to 99.40 per cent in the previous financial year. The expenditure has depicts decrease of approximately 3.34 per cent in 2014/15 financial year. The late submission of invoices to the department by the suppliers is the main reason for under spending. Programme 2: Housing Needs, Research & Planning The programme spent R 17 606 or 94.90 per cent in the current financial year compared to 97.23 per cent in the 2013/14 financial year. The more spending on this programme is on compensation of employees as the programme spent 99 per cent on compensation. Programme 3: Housing Development The programme spent 98.60 per cent in the 2014/15 financial year which indicates a decrease of approximately 1.40 per cent compared to 99.90 per cent spent in the 2013/14 financial year. The decrease of expenditure is as results of special adjustment budget amounting to R 14 886 million that was received on January 2015. Programme 4: Housing Assets Management & Property Management The programme spent R 0.769 million or 79.90 per cent in the 2014/15 financial year compared to R 0.175 million or 17.38 per cent in the 2013/14 financial year. The expenditure has increased mainly on compensation on this programme. Virements /roll overs
For the current financial year the roll overs, the Department applied, however no formal
feedback was received from Provincial Treasury. The following reasons are applicable to virement:
Programme 1: Administration The programme identified savings on compensation amounting to R 2.103 million and R 0.922 million on goods and services; as a result the programme effected a virement amounting to R 3.021 million to the following programmes: 2, 3 and 4. Programme 1 also received R4 000 from Programme 2 to avoid over expenditure on current households. Programme 2: Housing Needs, Research & Planning The programme received R 0.876 million to avoid the over expenditure on compensation of employees. Programme 3: Housing Development The programme also received an amount of R 2.075 million to avoid excess expenditure on compensation, goods & services and current households. Programme 4: Housing Assets Management & Property Management The programme received an amount of R 0.070 million to supplement the compensation budget as it was indicating over expenditure.
Unauthorised, fruitless and wasteful and irregular expenditure
The department did not incur any unauthorised expenditure for the financial year and managed to spend 98% of its budget.
Fruitless and wasteful expenditure to the amount of R 190 000 was identified in the financial year and this related to payments of overdue accounts that incurred interest. The Department is implementing processes to ensure payments take place with-in 30 days as per the requirements.
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There has been irregular expenditure identified in the financial year to the amount of R 980 965 million. The majority of this was due to the incorrect processes being followed for the procurement and allocation of the housing grant. The department has applied to Provincial Treasury for condonation of the said amount, including previous year. The department has performed investigations and been able to write-off irregular expenditure to the amount of R 1637 940 million. o Systems in place to prevent irregular expenditure, fruitless and wasteful o expenditure
- The contractors database has been established to ensure that housing contracts fully complies with due SCM processes
- A register of all deviation from SCM processes is maintained - The register has been developed to ensure that all irregular expenditure are duly recorded
and disclosed in the Annual Financial Statements - A checklist has been developed and maintained for each payment to identify and detect
irregular expenditure. o Challenges experienced in SCM and how they were resolved
- Due to high vacancy rate within the SCM unit key critical factors are not performed at optimal level and thereby compromising proper segregation of duties. The posts are funded in the 2015/2016 financial year to ensure that the unit is fully functional.
o The Department did not conclude any unsolicited bid during the year under review Public Private Partnerships The department did not pursue any public private partnerships in the financial year under review. Discontinued activities / activities to be discontinued The department did not have any discontinued activities for the financial year under review. New or proposed activities The department does not have intentions for any new activities for the next financial year. Supply Chain Management o The department did not conclude any unsolicited bid during the year under review. o The department has the following systems in place to prevent irregular and fruitless and wasteful
expenditure: - Contractors‟ database has been established to assist the department in complying with the
prescripts. - A register of deviation from SCM processes has been developed and is maintained.
- The register has been developed to ensure that all irregular expenditure are duly recorded and disclosed in the Annual Financial Statements. This register is monitored on a regular basis and investigations are performed to determine the underlying reasons and accountability.
- A checklist has been developed and maintained for each payment to identify and detect irregular expenditure
Gifts and Donations received in kind from non-related parties
Received in cash: - E‟tsho Civils Govan Mbeki Awards R 150 000 - Ernst and Young Govan Mbeki Awards R 50 000 - Mafuri Infrastructure Africa Govan Mbeki Awards R 115 000 - Mafuri Turnkey Africa Govan Mbeki Awards R 150 000
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Received in kind for Freedom day celebrations - E‟tsho Civils – Accommodation R 45 000 - Mafuri Infrastructure Africa – Transport and catering R 35 000
Exemptions and deviations received from the National Treasury
- The department did not apply or received any exemption from PFMA or TR or deviations from the financial reporting requirements for the current or previous financial years.
Events after the reporting date
- No significant events occurred after the reporting date.
Other Related party relationships The housing fund falls under the administration of the Department of Human Settlements and shares the same Accounting Officer. Once the fund ceases to operate, the bank balance will be surrendered to the department. The Department of Cooperative Governance and Traditional Affairs rendered a shared service on the following directorates within Programme 1 to the Department of Human Settlements: Anti-corruption and security, Information technology and Communication services.
Acknowledgement and Appreciation
Approval and sign off The Annual Financial Statements set out on pages 129 to 217 have been approved.
_________________ N Mokhesi HoD: Human Settlements Date: 24 August 2015
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5. STATEMENT OF RESPONSIBILITY AND CONFIRMATION OF ACCURACY
FOR THE ANNUAL REPORT
To the best of my knowledge and belief, I confirm that:
All information and amounts disclosed throughout the annual report are consistent. The annual report
is complete, accurate and is free from any omissions.
a) The annual report has been prepared in accordance with the guidelines on the annual report as
issued by National Treasury.
b) The Annual Financial Statements (Part E) have been prepared in accordance with the modified
cash standard and the relevant frameworks and guidelines issued by the National Treasury.
c) The Accounting Officer is responsible for the preparation of the annual financial statements and
for the judgements made in this information.
d) The Accounting Officer is responsible for establishing, and implementing a system of internal
control that has been designed to provide reasonable assurance as to the integrity and reliability
of the performance information, the human resources information and the annual financial
statements.
e) The external auditors are engaged to express an independent opinion on the annual financial
statements.
In my opinion, the annual report fairly reflects the operations, the performance information, the human
resources information and the financial affairs of the department for the financial year ended 31 March
2015.
___________________
N Mokhesi
HoD: Human Settlements
Date: 24 August 2015
18
6. STRATEGIC OVERVIEW
6.1 Vision
Integrated and sustainable human settlements
6.2 Mission
The department will develop cohesive, sustainable and integrated human settlements in the Free
State
6.3 Values
The department‟s inherent values as informed by, amongst others, Batho Pele Principles are:
Professionalism, Integrity and Leadership
Value for money and Accountability
Partnership
Compassion and Empathy
Restoration of Dignity and Resilience
Environment Friendly
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7. LEGISLATIVE AND OTHER MANDATES
7.1 Legislative and Other Mandates
7.1.1 Constitutional Mandate
Section 26(1) of the Constitution of the Republic of South Africa (Act No 108 of 1996) provides that everyone has the right to have access to adequate housing and subsection (2) obligates and enjoins the state through the Department of Human Settlements to use legislative and other measures to ensure the progressive realisation of this right.
7.2 Legislative Mandates 7.2.1 Public Finance Management Amended Act, 1999 (Act 29 of 1999)
To regulate financial management in the national and provincial governments; to ensure that all revenue, expenditure, assets and liabilities of those governments are managed efficiently and effectively; to provide for the responsibility of persons entrusted with financial management in those governments; and provide for matters connected therewith.
7.2.2 Public Service Act, 1994 (Act 103 of 1994)
To provide for the organisation and administration of the public service of the Republic, the regulation of the conditions of employment, terms of office, discipline, retirement and discharge of members of the public service, and matters connected therewith.
7.2.3 Public Service Laws Amendment Act, 1997 (Act 47 of 1997 and 86 of 1998)
To amend the Public Service Act, 1994, so as to further define, to substitute or to delete certain expressions; to further regulate the application of the said Act; to provide for the readjustment of the functions of the Public Service Commission and the circumscription of the functions of the Minister for the Public Service and Administration and an executing authority; to make other provision in connection with the management, administration and functions of the South African Management and Development Institute and the administration of the Training Fund; to make further provision in connection with the implementation or limitation of actions affecting the public service or its members; to enable the said Minister to have access to certain documents and information; to make further provision in connection with the power of the President to amend Schedules 1 and 2 to the said Act; to make other provision in connection with the inclusion of posts in, or the exclusion of posts from, the A or B division; to make further provision in connection with appointments, promotions and transfers; to make further provision in connection with the discharge of officers; to further regulate inefficiency and misconduct; to further regulate the receipt of unauthorised remuneration; to make other provision in connection with the reduction of salaries of officers; to make further provision in connection with grievances of officers and employees; to empower the said Minister to make regulations; and to empower the said Minister to assign certain functions to officers or employees of his or her department; and to repeal or to amend other laws relating to the public service so as to remove obsolete provisions or to effect certain consequential amendments arising from the readjustment of the functions of the said Commission; and to provide for incidental matters.
7.2.4 Skills Development Act, 1998 (Act 97 of 1998)
To provide an institutional framework to devise and implement national, sector and workplace strategies to develop and improve the skills of the South African work force; to integrate those strategies within the National Qualifications Framework contemplated in the South African Qualifications Authority Act, 1995; to provide for Iearnerships that lead to recognised occupational qualifications; to provide for the „financing of skills development by means of a levy-grant scheme and a National Skills Fund; to provide for and regulate employment services; and to provide for matters connected therewith.
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7.2.5 Labour Relations Act, 1995 (Act 66 of 1995) The Labour Relations Act and collective agreements shall regulate matters of mutual interest between employees and the State as employer. 7.2.6 Preferential Procurement Policy Framework Act, 2000 (Act 5 of 2000) To regulate procurement of goods and services for the Department in compliance with section 217 of the Constitution by ensuring that all procurement processes are fair, transparent, equitable, competitive and cost effective.
7.2.7 Division of Revenue Act 2014/15 To provide for the equitable division of revenue raised nationally among the national, provincial and local spheres of government for the 2014/15 financial year; to provide for reporting requirements for allocations pursuant to such divisions; to provide for the withholding and the delaying of payments; to provide for liability for cost incurred in litigation in violation of the principles of co-operative governance and intergovernmental relations; and to provide for matters connected therewith.
7.2.8 Conversion of Certain Rights into Leaseholds or Ownership Act, 1998 (Act 81 of 1988 This Act provides for the conversion of certain rights of occupation issued to a holder of a site situated in a township whether such township has been formalized or not- established under the now revoked Black Communities Act 4 of 1984, into leasehold or ownership. The Act therefore makes provision for the determination of affected sites or persons; an inquiry into affected sites; grievance (appeal) procedures; and the issuing of leaseholds or transfer of ownership.
7.2.9 Black Communities Development Act, 1994 (Act 4 of 1984) The Act was repealed save for Chapter 6 and the Regulations thereto. As will appear from the above paragraph, this Act is the principal Act 81 of 1988 and makes provision for the designation of certain areas as development areas and makes provision for township establishment.
7.2.10 Upgrading of Land Tenure Rights Act, 1991 (Act 112 of 1991) This Act makes provision for the upgrading of informal rights, viz., and the deeds of grant, leaseholds and quitrent title permission to occupy.
7.2.11 Interim Protection of Informal Land Rights Act, 1996 (Act 31 of 1996) This Act recognizes certain informal rights to land. One of the functions of the section is to resettle people who are unlawfully occupying land. In the process, it is incumbent on the section to ensure that the informal rights to land are recognized in the process of such resettlement.
7.2.12 The Housing Act, 1997 (Act 107 of 1997) Through this legislation, existing and future, and the Housing Code, the Department of Housing is carrying out its legislative imperative as set out in the Housing Act, 1997. Section 2 of the Housing Act, 1997 (Act No. 107 of 1997) compels all three spheres of government to give priority to the needs of the poor in respect of housing development (section 2(1)(a)). In addition all 3 spheres of government must ensure that housing development provides as wide a choice of housing and tenure options as is reasonably possible:
(ii) is economically, fiscally, socially and financially affordable and sustainable (iii) is based on integrated development planning
(iv) is administered in a transparent, accountable and equitable manner, and upholds the practice of good governance (Section 2(1)(c)).
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7.2.13 Prevention of Illegal Eviction from and Unlawful Occupation of Land Act, 1998 (Act 19 of 1998) The Prevention of Illegal Eviction from and Unlawful Occupation of Land Act was promulgated in 1998. The Act repeals the Prevention of Illegal Squatting Act No. 52 of 1951 and makes provision for a fair and equitable process to be followed when evicting people who have unlawfully invaded land, from their homes. The Act also makes it an offence to evict legally without due process of law.
7.2.14 The Housing Consumers Protection Measures Act, 1998 (Act 95 of 1998) The Act provides for the establishment of a statutory regulating body for homebuilders. The National Home Builders Registration Council will register every builder and regulate the home building industry by formulating and enforcing a code of conduct. The implementation of the Act is monitored continuously.
7.2.15 The Rental Housing Act, 1999 (Act 50 of 1999) This Act repeals the Rent Control Act of 1976 and defines Government‟s responsibility for rental housing property. It creates mechanisms to promote the provision of rental housing and the proper functioning of the rental housing market. To facilitate sound relations between tenants and landlords, it lays down general requirements for leases and principles for conflict resolution in the rental-housing sector. It also makes provision for the establishment of Rental Housing Tribunals and defines the functions, powers and duties of such Tribunals. Provincial housing departments are establishing Rental Housing Tribunals.
7.2.16 Home Loan and Mortgage Disclosure Act, 2000 (Act 63 of 2000) The Act provides for the establishment of the Office of Disclosure and the monitoring of financial institutions serving the housing credit needs of communities. It requires financial institutions to disclose information and identities discriminatory lending patterns. The act will come into operation during 2003.
7.2.17 Subdivision of Agricultural Land Act, 1970 (Act 70 of 1970) This Act is used for Town Planning advice to the Department of Land Affairs on the subdivision of agricultural land.
7.2.18 The Development Facilitation Act, 1995 (Act 67 of 1995) This Act provides directive principles to guide the drafting, adoption and implementation of all policies and legislation for all spheres of government regulating spatial planning, land use management and land development. 7.2.19 The Townships Ordinance No. 9 of 1969 This Ordinance is used for the establishment of towns, subdivision and consolidation, amendment of the general plan and the amendment of town-planning schemes. The townships board is also instituted in terms of this ordinance.
7.2.20 Disestablishment of South African Trust Limited Act, 2002 (Act 26 of 2002) The winding down of the South African Housing Trust and the transfer of functions relating to financial obligations were completed during the end of 2002 and the beginning of 2003 in terms of Act 2002: Disestablishment of SA trust Limited Act, 2002.
7.2.21 The Removal of Restrictions Act, 1967 (Act 84 of 1967) In terms of this act land use is changed either by means of title conditions or rezoning.
22
7.2.22 The Less Formal Township Establishment Act, 1991 (Act 113 of 1991) This Act is specifically for guiding rapid township establishment where housing is in dire need.
7.2.23 The Physical Planning Act, 1991 (Act 125 of 1991) This Act governs secondarily deals with land uses on farmland that is not agriculture related by way of permits and it also enables the amendment of guide plans and the evaluation of consistency regarding land development.
7.2.24 Public Audit Act, 2004 (Act 25 of 2004) Regulates the audit of Government Departments and State Owned Enterprises.
7.2.25 Social Housing Act, 2008 (Act 16 of 2008) Regulates the Social Housing Market
7.2.26 Spatial Planning and Land Use Management Act, 2013 (Act 16 of 2013)
This Act provides a framework for the monitoring, coordination and review of the spatial planning and
land use management system. It also provides for the establishment, functions and operation of
Municipal Planning Tribunals.
7.2.27 Housing Development Agency Act, 2008 (Act 23 of 2008)
The Act establishes the Housing Development Agency; provides for its functions and powers; and
provides for matters connected therewith.
The objects of the Housing Development Agency are to: o Identify, acquire, hold, develop and release state, communal and privately owned land for
residential and community purposes and for the creation of sustainable human settlements
o Project manage housing development services for the purposes of the creation of sustainable human settlements
o Ensure and monitor that there is centrally coordinated planning and budgeting of all infrastructure required for housing development, and
o Monitor the provision of all infrastructures required for housing development.
Implication
The Free State Department of Human Settlements has concluded a Development Agreement with the HDA, and any future agreements should be aligned to the objects of the Agency. 7.2.28 National Environmental Management Act, 1998 (Act 107 of 1998) The National Environmental Management Act (Act No. 107 of 1998) (NEMA) provides for co-operative environmental governance by establishing principles for decision-making on matters affecting the environment, institutions that will promote cooperative governance and procedures for co-ordinating environmental functions exercised by organs of state; for certain aspects of the administration and enforcement of other environmental management laws; and for matters connected therewith. Section 24 of NEMA prohibits the undertaking of activities (including housing development) without the assessment of the impact of these activities on the environment, and subsequent authorisation from the designated competent authorities.
23
Implication All housing developments require an environmental authorization before the development or any
construction activities may proceed, which may include an environmental impact assessment process.
7.3 Policy Mandates 7.3.1 National Development Plan Chapter nine of the NDP (Transforming Human Settlements) addresses the various housing/settlement issues South Africa is currently facing. In terms of transforming human settlements, the NDP states the following objectives:
Strong and efficient spatial planning system, well integrated across the spheres of government.
Upgrade all informal settlements on suitable, well-located land by 2030.
More people living closer to their places of work.
Better quality public transport.
More jobs in or close to dense, urban townships.
7.3.2 National Spatial Development Perspective The National Spatial Development Perspective (NSDP) became national policy in 2002 and was revised 2006. The key objectives of the NSDP are to:
Provide a framework for discussing the space economy taking deprivation, resources, infrastructure and potential economic activity into account;
Establish a common reference point for national, provincial and local government to analyse and debate the development potential of different places in the country;
Identify key areas of tension and/or priority in achieving positive spatial outcomes with government infrastructure investment and development spending; and
Provide national government‟s strategic response to the above for a given timeframe. 7.3.3 The Housing Code, 2009 Government has introduced a variety of programmes which provide the poor households access to adequate housing in terms of the Housing Act, 1997 (Act No 107 of 1997). The policy principles set out in the White Paper on Housing aim to provide poor households with houses as well as basic services such as potable water and sanitation on an equitable basis. The National Housing Code; 2000 was substantially revised and consequently the new National Housing Code, 2009 was introduced. The 2009 Code is aimed at simplifying the implementation of housing projects by being less prescriptive while providing clear guidelines. The National Housing Code, 2009 further sets the underlying policy principles, guidelines, norms and standards that apply to Government‟s various housing assistance programmes introduced since 1994 and subsequently updated. 7.3.4 Comprehensive Plan for Sustainable Human Settlements (BNG) Ten years after the introduction of the housing programme in 1994, a comprehensive review was undertaken of the outcomes of the programme and the changes in the socio-economic context in the country. This lead to the approval of the Comprehensive Plan for Sustainable Human Settlements commonly referred to as “Breaking New Ground” or “BNG”, by Cabinet in September 2004. While retaining the basic principles of the Housing White Paper, the Comprehensive Plan shifts the focus to improving the quality of housing and housing environments by integrating communities and Settlements.
24
It also sets new minimum standards for housing products improving privacy and sustainability by providing for the development of a range of social and economic facilities in housing projects
The Comprehensive Plan also focuses on Informal Settlement Upgrading to meet the Millennium Goals of the United Nations to improve the lives of slum dwellers.
7.3.5 2014-2019 Medium Term Strategic Framework The national Department of Human Settlements has developed a Draft Framework to Achieve Outcome 8 and the National Development Plan (NDP) Vision 2030. The Strategic Framework covers the medium term from 2014-2019. The draft 2014-2019 Medium Term Strategic Framework will focus on policy and funding reforms to achieve the following:
a) Better spatial planning to better target resource allocation b) Ensuring that poor households have adequate housing in better living environments c) Supporting the development of a functionally and equitable residential property market
d) Improving institutional capacity and coordination.
7.3.6 Free State Growth and Development Strategy The revised Free State Growth and Development Strategy (FSGDS) recognises the value of creating the environment, institutions, processes and mechanisms crucial for inclusive growth and development and produced Free State Vision 2030, aligned with the National Development Plan. Driver 9: Facilitate sustainable human settlements of the FSGDS states that the status of human settlements is mostly extremely low densities, low levels of efficiency and long distances between places of employment and places of work. In order to improve economic efficiency, the FSGDS proposes that efficient resource use should be prioritised 7.3.7 Provincial Spatial Development Framework The Free State Provincial Spatial Development Framework (PSDF) is a provincial spatial and strategic planning policy that responds to and complies with the relevant legislation and policy. SPLUMA provides for all spheres of government to compile and publish a spatial development framework. The NDP encourages all spheres of government to prepare SDFs that promote a developmental state in accordance with the principles of global sustainability. 7.3.8 State of the Nation Address (SONA) During the SONA, The honourable State President announces the National commitments of the Government in service delivery for that particular performance/ financial year.
7.3.9 State of the Province Address (SOPA) During the State of the Province Address, the honourable Premier of the Free State Province announces the Provincial government priorities on service delivery which are aligned to the State of The Nation Address.
7.3.10 Human Settlements Strategy for the Free State Province The purpose of the Free State Human Settlements Strategy is to guide a longer term spatial and investments perspective that will inform the programming of human settlements projects in the Province.
25
7.3.11 Intergovernmetal strcutures
(a) President‟s Coordinating Council
The Forum provides for the engagement at National level of relevant stakeholders to ensure that the national government objectives are realised.
(b) Premier‟s Coordinating Forum
The Forum provides for the engagement at Provincial level of relevant stakeholders to ensure that the provincial government objectives are realised.
7.3.12 Provincial Specific Programme
(a) Operation Hlasela This is a specific provincial programme focusing on intergrated service delivery. All the Departments activities are coordinated to ensure intergrated human settlements.
26
OFFICE OF THE MEC
SEC MAN & ANTI-CORRUPTION OFFICE OF THE HoD
INTERNAL AUDIT
LEGAL AND CONTRACT SERVICES
HUMAN SETTLEMENT DELIVERY PLANNINGAND PERFORMANCE MONITORING
STAKEHOLDER ENGAGEMENTPLANNING AND MOBILIZATION
INFORMAL SETTLEMENTS AND LAND TENURE
HS DEVELOPMENT PLANNINGAND DEVELOPMENT
PROGRAMME DESIGNINGAND ALLOCATION MANAGEMENT
PRIORITY AND INTERVENTIONPROGRAMMES
AFFORDABLE HOUSING PROGRAMMES
DISTRICT OFFICE DC 16 MANGAUNG OFFICE DISTRICT OFFICE DC 18 DISTRICT OFFICE DC 19 DISTRICT OFFICE DC 20
HS PROGRAMME IMPLEMENTATIONINSTRACTURE DELIVERY
HUMAN SETTLEMENT INFRASTRUCTUREDEVELOPMENT AND -MANAGEMENT
HOUSING PROJECTPLANNING AND - MANAGEMENT
TECHNICAL SERVICES
HS PROJECT MANAGEMENTAND ADMINISTRATION
HUMAN SETTLEMENT PLANNINGAND -DEILVERY
Deputy Direkctor-General
FINANCIAL AND MANAGEMENT ACCOUNTING
HUMAN SETTLEMENTS GRANT MANAGEMENT
SUPPLY CHAIN- AND ASSET MANAGEMENT
FINANCIAL AND -SUPPLY CHAIN MANAGEMENT
DEPARATMENTAL PLANNING ANDPERFORMANCE MANAGEMENT
HUMAN RESOURCES MANAGEMENTAND - DEVELOPMENT
INFORMATION ANDCOMMUNICATION TECHNOLOGY
RISK MANAGEMENT
CORPORATE SERVCIES
DEPARTMENT OF HUMAN SETTLEMENTS
Head of Department
MEMBER OF THE EXECUTIVE COUNCIL:COOPERATIVE GOVERNANCE, TRADITIONAL
AFFAIRS AND HUMAN SETTLEMENTS
8 ORGANISATIONAL STRUCTURE
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PART B: PERFORMANCE INFORMATION
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1. AUDITOR GENERAL’S REPORT: PREDETERMINED OBJECTIVES
Predetermined objectives
I performed procedures to obtain evidence about the usefulness and reliability of the reported performance information for the following selected programmes presented in the annual performance report of the department for the year ended 31 March 2015:
Programme 2: Housing needs, research and planning on pages 45 to 46
Programme 3: Housing development on pages 46 to 53
I evaluated the reported performance information against the overall criteria of usefulness and reliability.
I evaluated the usefulness of the reported performance information to determine whether it was presented in accordance with the National Treasury‟s annual reporting principles and whether the reported performance was consistent with the planned programmes. I further performed tests to determine whether indicators and targets were well defined, verifiable, specific, measurable, time bound and relevant, as required by the National Treasury’s Framework for managing programme performance information (FMPPI).
I assessed the reliability of the reported performance information to determine whether it was valid, accurate and complete.
The material findings in respect of the selected programmes are as follows:
Programme 2: Housing needs, research and planning
Reliability of reported performance information
The FMPPI requires auditees to have appropriate systems to collect, collate, verify and store performance information to ensure valid, accurate and complete reporting of actual achievements against planned objectives, indicators and targets. I was unable to obtain the information and explanations I considered necessary to satisfy myself as to the reliability of the reported performance information. This was due to the completeness of source documentation in support of actual achievements not being monitored and the validity of reported achievements not being frequently reviewed against source documentation.
Programme 3: Housing development
Reliability of reported performance information
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The FMPPI requires auditees to have appropriate systems to collect, collate, verify and store performance information to ensure valid, accurate and complete reporting of actual achievements against planned objectives, indicators and targets. Adequate and reliable corroborating evidence could not be provided for 29% of the targets to assess the reliability of the reported performance information. The auditee‟s records did not permit the application of alternative audit procedures. This was due to the completeness of source documentation in support of actual. Achievements not being monitored and the validity of reported achievements not being frequently reviewed against source documentation.
Additional matters
I draw attention to the following matters:
Achievement of planned targets
Refer to the annual performance report on pages 45 to 47 and 47 to 53 for information on the achievement of planned targets for the year. This information should be considered in the context of the material findings on the reliability of the reported performance information for the selected programmes reported in paragraphs 23 and 24 of this report.
Compliance with legislation
I performed procedures to obtain evidence that the department had complied with applicable legislation regarding financial matters, financial management and other related matters. My material findings on compliance with specific matters in key legislation, as set out in the general notice issued in terms of the PAA, are as follows:
Strategic planning and performance management
Effective, efficient and transparent systems of internal control with respect to performance information and management was not maintained as required by section 38(1)(a)(i) of the PFMA.
2. OVERVIEW OF DEPARTMENTAL PERFORMANCE
2.1. Service Delivery Environment
Main services Beneficiaries Current/actual standard of
service
Desired standard of service
Actual achievement
Subsidy Administration
Municipalities
Housing beneficiaries
Contractors
Housing institutions (e.g. NHBRC)
Same as actual customers
Number of beneficiaries allocated housing subsidies
3642 Complied with the standard
Affordable Housing
Tenants
Municipalities
Housing institutions
Same as actual customers
Provision of social housing and rental housing
Social Housing 246
Rental Housing 414 Complied with the standard
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(e.g. NHBRC)
Consumer awareness on government programmes
Housing beneficiaries
Municipalities
Community Development Workers (CDW‟s)
Same as actual customers
Number of municipalities earmarked for accreditations from level 1 to 3
6 Municipalities Complied with the standard
2.2. Service Delivery Improvement Plan
Type of arrangement
Actual customers Potential customers Actual achievements
Road shows Formal meetings Makgotla Informal meetings
Rural communities Homeless people All that qualify in terms of the housing scheme All municipalities
Rural communities Homeless people All that qualify in terms of the housing scheme All municipalities
More consultation with customers
Service delivery access strategy
Access strategy Actual achievement
The department commits itself to share information with its clients in line with the provisions of the Promotion of Access to Information Act of 2000 (Act of No. 2 of 2000). Furthermore, the department also shares information by means of the following:
Easier accessibility
Telephonically and per facsimile as available per telephone directory
Switchboard receives call from Monday to Friday from 07H30 – 16H00
Annual Performance Plan and Annual Report The two documents in question are publish annually for transparency and accountability purpose in order for the public to know how each cent was spend and for what purpose
Physically at government offices All buildings are accessible to customers and people living with disabilities
Internet as per web site www.fscogtahs.gov.za
Help desk 7th
Floor, OR Tambo House, Cnr. St Andrews and Makgraaff Str
Service information tool
TYPES OF INFORMATION TOOLS ACTUAL ACHIEVEMENT
Telephonically and per facsimile as available per telephone directory
Switchboard receives call from Monday to Friday from 07H30 – 16H00
Annual Performance Plan and Annual Report The two documents in question are publish annually for transparency and accountability purpose in order for the public to know how each cent was spend and for what purpose
Physically at government offices All buildings are accessible to customers and people living with disabilities
Internet as per web site www.fscogtahs.gov.za
Help desk 7th
Floor, OR Tambo House, Cnr St Andrews and Makgraaff Str
Complaints mechanism
Complaints mechanism Actual achievement
Help Desk Addressed complaints
Telephonically/facsimile as per telephone directory Switchboard available with operating hours from 07H30 – 16H00, Monday to Friday
Electronically via Provincial Website/Intranet/E-mail
Website available at www.fscogtahs.gov.za
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MEC‟s community outreach programmes Monthly visits to the sites to evaluate service delivery
Media briefings The MEC regularly brief the media on service delivery issues, policies and achievements
General complaints The office of the HOD speedily responds to any complaints that has a potential to impact negatively on service delivery.
2.3. Organisational environment
The developments of 2014/2015 are as follows:
2.3.1 Programme 1
The department was assessed by the Department of Planning Monitoring and Evaluation and scored 32%
against all standards set in the Management Performance Assessment Tool (MPAT). The controls and
systems were enhanced in order to ensure improvement during the 1.4 MPAT assessment period.
The communication unit continued to support both the administration and political office in marketing,
responding to issues raised by the media in the endeavour to uphold the departmental good image despite
shortage of personnel.
The office space for the departmental personnel is still a challenge and the department has been in
constant contact with the Department of Public Works and Infrastructure address the matter in question.
2.3.2 Programme 2
The drafting of national framework is the competence of the National Department of Human Settlements within which the
provincial departments craft their province specific policy or legislation. The national department established a Human
Settlement Policy and Strategy Development Task Team that focuses on the process of identifying the gaps, identifying
research needs, projects and conducting research to inform future planning and drafting of relevant pieces of legislation.
2.3.3 Programme 3
The following performance was recorded in the 2014/2015 financial year against key performance areas:
5313 new housing units (including social and rental housing) are completed in the province across all housing programmes being utilised by the province
1154 Deeds of transfer registered in favour of qualifying beneficiaries
1920 New sites connected to basic water and sanitation services as part of the Integrated Residential Development Programme
3774 Households connected to basic services as part of the Informal Settlements Upgrading Programme
3791 New applications approved on HSS
5 township registers opened
5615 erven planned and surveyed 1646 job opportunities created through resettlement and housing construction projects
Challenges
Capacity constraints
Prolonged procurement processes
Difficulty in acquisition of sites for military veterans
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Change in priorities where expenditure had to be fast tracked
Insufficient capacity
Slow construction progress due adverse weather,
Failed mortgage approvals at the banks because of over indebtedness of prospective applicants 2.3.4 Programme 4
The department has transferred 28 houses to qualifying beneficiaries and as a result reduced the departmental debt related to the maintenance of those houses. A process of transferring the remaining houses is at an advanced stage.
2.4. Key policy developments and legislative changes
None
3. STRATEGIC OUTCOME ORIENTED GOALS
Strategic Goal 1: Creation of a department geared towards service excellence
Strategic Goal 2: Management of Housing Interventions
Strategic Goal 3: Improved housing delivery planning
Strategic Goal 4: Management of housing assets and the Extended Enhanced Discount
Benefit Scheme (EEDBS)
4. PERFORMANCE INFORMATION BY PROGRAMME
4.1. Programme 1: Administration
Purpose: To provide overall management in the department in accordance with all applicable acts and
policies
Office of the MEC
Corporate Services
Strategic Objective
To provide corporate services that are non-core to the department
Strategic objectives, performance indicators, planned targets and actual achievements
PROGRAMME 1 ADMINISTRATION
Programme / Sub-programme: Office of the MEC
Strategic Objective: To provide the functioning of the office of the MEC
Performance Indicator Actual
Achievement
2013/2014
Planned
Target
2014/2015
Actual
Achievement
2014/2015
Deviation
from
planned
target
Comment on
deviations
Functionality of Management Structures: Management structures with formal terms of reference in
Level 1
1
1
-
-
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place
Meetings scheduled and held: Management decisions documented and clear, responsibility allocated and followed through
1
1
-
-
Senior Management Meetings agenda focuses on strategic objectives and priorities of the Department as per the Strategic plan and APP
1 1 -
-
1. Good governance and accountability practices in place in the department:
1 1 -
-
Delegations: Approved Executive Authority & Head of Department.
(i) Delegations approved in compliance with the PSA & PSR
1
1
-
-
(ii) Delegations from Executive Authority & Head of Department and all relevant levels appropriate
1 1
- -
Strategic plans Strategic plans compliant with Treasury Regulations and planning guidelines in respect of submission dates and format
Level 4 1
1 - -
Link between Strategic Plan, Outcome 8; MTSF / FSGDS clear and follows a logic progression
Performance of the Department against the strategic plan is revised during the 2014-2019 period
Annual Performance Plans Annual Performance Plan complies with Treasury Regulations and planning guidelines in respect of format and submission dates
Level 2
1
1
-
-
Quarterly Performance Reports submitted to EA and Treasury on time
1 1 -
-
Annual Performance Plan contains updated analysis on information relevant to external and internal factors, strategic objectives and performance indicators which conform to SMART principles
1
1
-
-
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Management meets towards exploring quarterly performance information
1
1
-
-
Performance targets substantially met and expressed in Annual Report
1 1
- -
Monitoring and Evaluation: Integration of monitoring and evaluation in performance and strategic management M&E Policy Framework approved / updated
Level 2
1
1
-
-
Standardized mechanisms and/or processes and procedures in place to collect, manage and store data that enable the monitoring of progress made towards achieving departmental goals, targets and core objectives
1
1
-
-
Service Delivery Improvement Mechanisms: Service Delivery Charter, service standards and SDIP approved and displayed
Level 1
1
1
-
-
Stakeholders / service recipients on service standards and SDIP consulted
1
-
-1
Was awaiting the inputs from DPSA regarding the plan to enable its implementation.
Compliance to service delivery standards and implementation of the approved SDIP monitored
1
-
-1
Awaiting inputs from DPSA regarding the plan that was submitted to enable implementation
MPAT Implementation: MPAT Self-Assessment for current cycle
completed and signed-off by Head of Department
- 1
1
-
-
MPAT results discussed by Senior Management
1
1
-
-
MPAT Improvement Plan developed for current cycle
1
1
-
-
MPAT Improvement Plan for previous cycle monitored quarterly
1 1 - -
Management of Performance: Implementation of Level 1 - 12 PDM System Approved PDMS Policy in place
Level 3
1
1
-
-
Annual assessment for previous cycle finalized by due
1
1
-
-
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date
Moderation for previous cycle by due date
1
1
-
-
Performance outcomes in relation to the development of employees, the management of poor performance and the recognition of performance actively managed by the Department
1
1
-
-
Mid-year assessments and feedback sessions for current 6-months cycle performed
1 1
- -
Management of Performance: Implementation of SMS Performance Management System (excluding Head of Department) (iii) Signed Performance
Agreements signed and submitted by all SMS Members by the 31
st of
May
Level 2 1
1 - -
(iv) Annual assessment for previous cycle finalized by due date
1
1
-
-
Moderation concluded for previous cycle by due date
1
1 -
-
Performance outcomes in relation to the development of employees, the management of poor performance and the recognition of performance actively managed by the Department
1
1 -
-
Mid-year assessments and feedback sessions for current cycle performed
1 1 -
-
Management of Performance: Implementation of SMS Performance Management System for Head of Departments
Signed Performance Agreement for the current cycle submitted to EA by 31 May
Level 2
1
-
1
-
Performance Agreement filed with PSC
1
1
-
-
Changes as directed PSC incorporated
1
1 - No changes indicated yet
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Verification statement submitted on time to relevant authority for the previous cycle
1 1 - -
Performance in relation to the development of poor performance and recognition of performance managed
1 1
- -
Human Resource Strategy and Planning: Organizational Design and Implementation
Approved structure, aligned with MTEF, implemented in the Department, with only funded vacancies captured on PERSAL
Level 1
1
1
-
-
Approved structure based on assessment of functions
Structure reviewed periodically, at least in the last 5 years towards aligning it with generic functional structures based on Service Delivery Model of the Department
1
1
1
1
- -
- -
Assessment of accountability mechanisms (Audit Committee):
Audit Committee in place and constituted in accordance with Chapter 3 of the National Treasury Regulations
Level 3
1
1
-
-
Audit Committee meets as scheduled
1
1
-
-
Audit Committee has an approved Audit Committee Charter with clearly defined objectives, key performance indicators and reviewed annually
1
1
-
-
Audit Committee assessed by stakeholders such as AG and departmental managers
1
1
-
-
Audit Committee reviewed management responses to audit issues and reports thereon
1 1 - -
Internal Audit: Assessment of internal audit arrangements
Three-year strategic internal audit plan and operational plan that is risk-based approved and
Level 2
1
1
-
-
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monitored quarterly
Internal audit charter approved for internal audit unit
1
1
-
-
Internal assessment conducted by internal audit unit in terms of ISPPIA 1311
1
1
-
-
External review of internal audit unit conducted at least once every 5 years in terms of ISPPIA 1312
1
1
-
-
Internal audit recommendations acted on by Management
1
1
-
-
Ethics: Assessment of policies and systems to ensure professional ethics
All SMS Members completed financial disclosures, signed by EA and submitted to PSC by 31
Level 2
1
1
-
-
Risk Management: Assessment of risk management arrangements 1. Risk Management
Committee in place in accordance with Chapter 13 of risk management framework
Level 2
1
1
-
-
2. Risk assessment or review
conducted by the Department
1
1
-
-
3. Risk assessment and risk management implementation plan approved by the Accounting Officer and Audit Committee
1
1
-
-
Regular reports provided to the Audit Committee by the Risk Management Committee on the implementation of the Risk Management Plan)
1
1
-
-
a) Ethics: Assessment of policies and systems to ensure professional ethics
Mechanisms in place towards providing /
1
1
-
-
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communicating the Code of Conduct to employees
b) Human Resource Strategy and Planning: Human Resources Development Planning
Approved annual HRD Plan submitted to DPSA (1
st Draft by 31
March and final plan by 31 Mar)
Level 1 1
1
-
HRD monitoring questionnaire on implementation submitted (1
st Draft by
31 March and final plan by 31 May)
1 1 - -
c) Human Resource Practices and Administration: Pay sheet certification
Process of transferring and terminating staff in place to avoid fruitless expenditure
1
1
-
-
d) Human Resource Practices and Administration: Application of recruitment and retention practices
Recruitment process with clear roles and responsibilities approved and fully and consistently implemented
1
1
-
-
Exit interviews conducted with all employees leaving the Department
Exit interviews analysed and remedial actions taken if necessary
1
1
1
1
- -
- -
Human Resource Practices and Administration: Management of diversity
Job Access Strategic Framework Implementation Plan in place
1
-
-1 Skill capacity constraints
Special programme
Officer has been appointed and is
undergoing training
Gender Equality Strategic Framework Implementation Plan in place
1
-
-1
Job Access Strategic Framework Implementation
1
-
-1
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Report submitted to DPSA 6-monthly
Gender Equality Strategic Framework Implementation Report submitted to DPSA 6-monthly
1 - -1
e) Human Resource Practices and Administration: Management of Employee Health
EH&W Operational Plan, addressing Gender and Human Rights Dimensions of HIV&AIDS and TB in place.
1
1
-
-
Systems Monitoring Tool (SMT) report submitted to DPSA by 30 September.
1 1 - -
All 4 Employee Health and Wellness Policies implemented.
Approved GSRB HIV&AIDS Mainstreamed Operational Plans for the next financial year submitted to DPSA by 31 March 2014
Quarterly and Annual EH&W Implementation Review reports submitted to DPSA by the
following dates: - 31
st July
- 31st October
- 31st January
- 15th
May
1
1
4
1 -
3
-
-1
-1 -
-
Underachievement: GSRB mainstreamed HIV operational plans are still in draft.
The quarterly review report will be
submitted at the end of April 2015, due to misalignment of the timeframes of Non-Financial Reporting
and the DPSA
f) Employee Relations: Management of disciplinary cases
Disciplinary cases finalized within policy requirements and captured on PERSAL (with no suspensions longer than 60 days and cases finalized within 90 days of identification and 60 days from notice)
-
-
-
Captured on PERSAL
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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Analysis conducted on nature of misconduct and/or preventative measures implemented unless the Department has less than 10 disciplinary cases for the previous 12 Months
1 1 - -
No. of Monthly Key Control Matrix Reports submitted to Provincial Treasury
12 11
-1 No report is expected during December according Treasury instructions.
No. of Quarterly Key Control Matrix Reports submitted to Provincial Treasury
4 4
- -
Delegations: Approved Head of Department delegations for financial administration in terms of the PFMA
Delegations approved in alignment to National Treasury guidelines and approved structure
Level 3
1
-
-1
Delegations are in a draft form
Delegations from Head of Department to all relevant performer levels appropriate for the levels
1 - -1
Delegations are in a draft form
Supply Chain Management: Demand Management
Procurement plan i.r.o departmental procurement above R500,000 that meets Treasury requirements approved and submitted to Treasury by 30 April
Level 2
1
1
-
-
Demand Management Plan that covers all the departmental procurement needs above and below R500,000 approved
1
1
-
-
Reports on the procurement plan regularly reviewed
1 1
-
Supply Chain Management: Acquisition Management
Supplier database in place that meets NT minimum requirements
Level 1
1
1
-
-
Bid Committees in place and meeting when required
1 1
-
-
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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Code of Conduct signed by Bid Committee Members and SCM practitioners
1
1 - -
Supply Chain Management: Logistics Management
Policy / processes for the setting of inventory levels, placing of orders, receiving, inspection and issuing of goods documented
-
1
1
-
-
Internal customer satisfaction survey conducted and actions taken on findings.
1 -
-1 The internal customer survey has been developed and will be implemented in the new financial year
Supply Chain Management: Disposal Management
Disposal strategy / policy in place and implemented
Level 1
1
1
-
-
Disposal Committee appointed and meetings held
1
1
- -
Record of redundant assets unserviceable an obsolete assets maintained
1 1
- -
Expenditure Management: Management of cash flow and expenditure vs. Budget
Cash-flow projection in place and submitted to PT on time
Level 1
1
1
-
-
Expenditure v/s planned budget regularly reviewed by Management and actions taken to prevent under/over expenditure
1
1
- -
Reports provided towards monitoring spending versus planned expenditure
4
4
- -
a) Expenditure Management: Payment of suppliers
Monthly exception reports on payment of suppliers submitted to Provincial Treasury
12
12
-
-
Invoice tracking system in place
1
1
- -
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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Reports provided towards monitoring the no. of invoices not paid within 30 days
4
4 -
-
Reasons for late or non-payment of invoices investigated and effectiveness of business processes for managing payments reviewed where necessary
4 4 - -
Expenditure Management: Management of unauthorized, irregular, fruitless and wasteful expenditure
Process in place to prevent and detect unauthorized, irregular, fruitless and wasteful expenditure
1
1
-
-
Unauthorized, irregular, fruitless and wasteful expenditure identified and investigated, management findings communicated to responsible officials and disciplinary action taken against negligent officials
4
4
- -
Audit findings on fruitless, unauthorized and irregular expenditure addressed.
1
1
-
No. of reports produced towards monitoring the utilisation of all vehicles in the department
12 12
- -
Human Resource Practices and Administration: Pay sheet certification
Pay sheet certification process in place
Level 2
1
1
-
-
Pay sheet certification process fully implemented on a monthly basis
12 12
- -
ICT: Corporate Governance of ICT
Approved: - Corporate Governance
of ICT Policy / Framework
- Corporate Governance of ICT Charter
- ICT Plan - ICT Plan periodically
improved
Level 1
1
-
-1
The unit planned to outsource the
development of outstanding plans to SITA but could not due to inadequate funding. The plans
(IT Plan, Implementation plan
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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and Operational plan) will be
developed in the new financial year
Ethics: Prevention of 1 and Corruption
Fraud Prevention Plan with policy statement and implementation plan approved
Level 1
1
1
-
-
Whistle-blowing Policy and implementation plan approved
1
1 - -
Minimum Anti-Corruption Capacity (MACC) Requirements Implementation Plan approved
1 -
-1 Draft MACC implementation plan in development phase.
Feedback provided to PSC on anti-corruption hotline cases within 40 days
1
1
- -
Disciplinary procedures and/or criminal procedures and/or civil procedures applied where fraud and corruption occur
1
1
- -
Access to information Good governance and accountability practices in place in the Department in relation to access to information:
Good governance and Deputy Information Officer appointed / confirmed
1
1
-
Section 14 manual updated annually and in compliance with all requirements;
1
1
-
-
Section 15 notice issued, information disclosed voluntary and records made available
Section 32 report submitted to the Human
1
1
-
-
Rights Commission annually, fully compliant with requirements
1
1
-
-
Departmental communication planning, strategy development and implementation:
1
1
-
-
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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Communication Strategy and implementation plan developed and approved
Effective involvement in the development and implementation of the LGCS, Provincial communication strategy
1
1
-
-
Effective implementation and management of campaigns
1 2
+1 Overachievement is a result of the continued marketing of FLISP.
Effective management and use of appropriate communication channels
1 3 +2 More channels were used for dissemination of information:
Provincial write-ups
Branding – creations
Internal communication channels
Use of media for publicity
Radio interviews
Building and sustaining a positive reputation of the Department
1 3
+2 Continuous interaction with Help Desk enquiries to address public concerns
Continuously addressing media queries to ensure that a good reputation is maintained
Effective management of unplanned and urgent communication
1 1
-
Suitable accommodation secured for the Department
1 1 -
Effective record management practices applied in the Department:
Record Management Policy approved and/or updated.
Record Management Policy fully implemented
1
1
1 -
-
-1
- The Department is in the process of training officials in records management
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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Reasons for deviations Reasons for deviations are provided in comment on deviations column above
Strategy to overcome areas of underperformance
Strategies to overcome under-performance are provided in the columns of the tables above.
Changes to planned targets
None
Sub-programme expenditure: Programme 1
Sub- Programme
Name
2014/2015 2013/2014
Final Appropriation
Actual Expenditure
(Over)/Under Expenditure
Final Appropriation
Actual Expenditure
(Over)/Under Expenditure
R’000 R’000 R’000 R’000 R’000 R’000
Corporate Services
80485 77314 3171 68672 68257 415
Total 80485 77314 3171 68672 68257 415
4.2. Programme 2: Housing Needs, Research and Planning
Purpose: To facilitate and undertake housing delivery
The programme consists of four sub-programmes:
Policy
Planning
Research
Strategic objectives, performance indicators, planned targets and actual achievements
PROGRAMME 2: HOUSING NEEDS, RESEARCH AND PLANNING
Programme / Sub-programme: Planning
Strategic Objective: Planning for Human Settlements delivery
Performance
Indicator
Actual
Achievement
2013/2014
Planned
Target
2014/2015
Actual
Achievement
2014/2015
Deviation from
planned target
to Actual
Achievement for
2014/2015
Comment on deviations
No. of houses enrolled
with NHBR
3299 5000 14212
+9212
Projects from the previous
financial years form part of these
enrolments
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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A Multi Year Housing Development Plan/ APP developed by October approved
0 1 - -1 The HDA has been mandated to
assist the 19 Local and 1 Metro
Municipalities to craft and/or
review their Housing Chapters as
part of the 2014/2015 MTOP
These Housing Chapters are to
be consolidated into and inform
the Multi Year Housing
Development Plan The
Department and the HDA are in
the process of finalizing the
MTOP for the next five years
Number of projects
approved
0 125 73 -52 Project strategy was changed to
that of multi-year mega projects
Reasons for deviations
Reasons for deviations are provided in comment on deviations column above.
Strategy to overcome areas of underperformance
Strategies to overcome under-performance are provided in the columns of the tables above.
Changes to planned targets: None
Sub-programme expenditure: Programme 2
Sub- Programme
Name 2014/2015 2013/2014
Final Appropriation
Actual Expenditure
(Over)/Under Expenditure
Final Appropriation
Actual Expenditure
(Over)/Under Expenditure
R’000 R’000 R’000 R’000 R’000 R’000
Administration: 1941 1874 67 1507 1492 15
Policy: 2175 2129 46 1842 1831 11
Planning: 14437 13604 833 9845 9506 339
Total 18553 17607 946 13194 12829 365
4.3 Programme 3: Housing Development
Purpose
To provide individual subsidies and housing opportunities to beneficiaries in accordance with the housing policy
Financial Interventions
Incremental Interventions
Social and Rental interventions
Strategic objectives, performance indicators, planned targets and actual achievements
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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PROGRAMME 3: HOUSING DEVELOPMENT, IMPLEMENTATION, PLANNING AND TARGETS
Programme / Sub-programme: Financial Intervention
Strategic Objective: Facilitate immediate access to housing Goods and services creating enabling environments and
providing implementation support
Performance
Indicator
Actual
Achievement
2013/2014
Planned
Target
2014/2015
Actual
Achievement
2014/2015
Deviation from
planned target to
Actual
Achievement for
2014/2015
Comment on
deviations
Number of new housing units completed in the province across all housing programmes being utilised by the province
6758 7338 5313 -2025 Some contractors did not perform very well and therefore the department terminated or warned such contractors. Rains hindering contractors progress in the last quarter
Number of new sites connected to basic water and sanitation services as part of the Integrated Residential Development Programme
1273 4484 1920 -2564 Departmental procurement committees were changed to cluster committees which only started work in the new financial year Service providers have since been appointed late. This led to the poor achievement as a result service providers starting work late
Number of households connected to basic services as part of the Informal Settlements Upgrading Programme
4315 3265 3774 +509 Due to additional funding gazetted and transferred to Mangaung Metro, they were able to connect and service more sites.
Programme / Sub-programme: FINANCIAL INTERVENTION
Strategic Objective: Facilitating immediate access to Housing Goods and Services creating enabling environments and
providing implementation support
Performance Indicator Actual
Achievement
2013/2014
Planned
Target
2014/2015
Actual
Achievement
2014/2015
Deviation from
planned target
to Actual
Achievement
for 2014/2015
Comment on
deviations
Number of low-income / affordable housing units constructed in prioritized areas
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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(i) FLISP
9 250 13 -237 Over-indebtedness of potential FLISP beneficiaries and some applications failed HSS searches because they are not 1
st time buyers.
(ii) Special Programmes
Military Veterans
Teachers
Land Restitution
Emergency
0 6
201 534
1724 320 -1404 Difficulty in the acquisition of sites for military veterans. The database of the beneficiaries also took long to finalise. 30 sites have been acquired in Mangaung and the contractor is in the process of being appointed Slow contractor performance for teachers‟ cottages leading to his termination. Challenges with regards to services on land restitution project in Kroonstad and housing committee administrative issues in Harrismith, hampered progress
(iii) *Rectification Programme - Dilapidated
722 197 238 +41 The contractors managed to recover the production time lost in the previous quarter as a result of adverse weather.
(iv) Incomplete houses 338 9 2895 +2886
(v) #BNG 4648 4358 422 -3936 Some contractors not performing well The department has issued termination letters to such contractors and warning letters to some. Concentrate a bulk of
the work to take place
during the dry season.
No. of (new) applications approved on HSS
1383 6529 3791 -2738 The Department utilised existing applications previously captured on HSS in the respective areas where allocation have been made.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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Number of Deeds of transfer registered in favour of qualifying beneficiaries
Enhanced Extended Discount Benefit Scheme (EEDBS)
8 400 0 -400 The creation of the database of conveyancing firms to register these deeds took longer than anticipated
Act 81 of 1988
673 600 693 +93 More beneficiaries qualifying for the conversion of rights applied; There was an additional resource capacity through the filling of vacant posts in the unit responsible for this KPI.
Act 107 of 1997 486 3165 461 -2704 The creation of the database of conveyancing firms to register these deeds took longer than anticipated. Some properties are constructed on townships with outstanding township registers and delays in the signing of deeds documents. Late release of delegation of municipal manager delegation of powers. The conveyancing contract of the appointed firms provides for opening of township registers.
No. of township registers opened
5 5 5 - -
No. of parcels of land identified and transferred to municipalities for development purposes
4 8 8 -
No. of erven planned and surveyed
1671 7726 5615 -2111 This is a lengthy multi-year process with milestones, undertaken by various stakeholders
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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and completion of these is outside the Department‟s control.
No. of municipalities supported towards accreditation
5 LM supported towards readiness for level 1
1 Metro – Level 3
6 6 - -
No. of houses handed over to beneficiaries together with title deeds
3638 3165 932 -2233 The handover of title deeds is a function of the Municipalities. Underachievement is as a result of slow submission of control lists from Municipalities; Some municipalities failing to comply with the reporting template despite this having been thoroughly work- shopped.
No. of municipalities supported for the expansion of the National Upgrading Support Programme : - Metsimaholo - Dihlabeng - Matjhabeng - Moqhaka - Mangaung - Maluti-A-Phofung
6
6 20 +14 The Free State Provincial Government decided to develop the Provincial Strategy on Informal Settlements Upgrading, thus the inclusion of other municipalities over and above the NUSP prioritised Municipalities.
No. of job opportunities created through resettlement and housing construction projects
0
5000 1646 -3354 Due to short span of jobs created as a result of the nature of housing construction, not all of the jobs created could be recorded as job opportunities, therefore , only a few job opportunities were recorded
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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Programme / Sub-programme: Incremental interventions
Strategic Objective: Facilitate access to housing opportunities through a phased process providing implementation support
Performance Indicator Actual
Achievement
2013/2014
Planned Target
2014/2015
Actual
Achievement
2014/2015
Deviation
from planned
target to
Actual
Achievement
for 2014/2015
Comment on
deviations
Km of roads constructed in newly-formalized areas
4km 1.9 km Viljoenskroon
(Mphatlalatsane)
1.9 km - -
No. of trainers mentored on consumer education
20 15 96 +81 The Department extended the mentoring to Community Development workers in Municipalities hence the over achievement
No. human settlements training/skills programmes conducted based on needs analysis.
6 4 4 - -
No. of partnerships established and maintained towards improving human settlement delivery:
Capacity Building
Research
Funding
Internships – experiential training
Housing institutions
2 5 5 - -
No. of emerging youth – and women contractors mentored and supported
0 10 24 +14 The department particularly focused on the development of women contractors as recommended by the provincial strategy. 54% of the housing budget was allocated to women contractors over the 30% prescribed by the minister.
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No. of municipalities supported and capacitated on the Housing Subsidy System on line
0 20 0 -20 The programme was put on hold until the data quality in the HSS could be improved The Department has since appointed a service provider for the updating of the HSS and the transfer skills
No. of municipalities capacitated on the successful roll-out and/or maintenance of the Housing Demand Database (metro and local municipalities)
0 20
0 -20 The programme was put on hold because National Department of Human Settlements is in the process of redeveloping the National Housing Demand database. The Department will therefore continue the roll-out after national has roll-out the system.
Programme / Sub-programme: Social and Rental Interventions
Strategic Objective: Facilitating access to Rental Housing opportunities, supporting Urban Restructuring and
Integration
Performance
Indicator
Actual
Achievement
2013/2014
Planned
Target
2014/2015
Actual
Achievement
2014/2015
Deviation from
planned target
to Actual
Achievement
for 2014/2015
Comment on deviations
No. of CRU units approved, upgraded and converted
0 400 424 +24 Merriespruit CRU
No units were delivered during 4
th quarter of
2013/2014 due to labour and community unrests at the project site but with the calmness in the unrest during the first quarter of 2014/2015 contractors were able to finalize some of the outstanding units.
No. of new affordable rental units delivered through Social Housing
516 400 284 -116 Brandwag SH
The project needs to evict all the illegal occupants in the refurbishment units and is awaiting the said relevant Court Orders. Applications for Eviction Orders are serving before the High Court of SA in Bloemfontein and the outcome is still awaited
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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Reasons for deviations
Reasons for deviations are provided in the comment on deviations column above.
Strategy to overcome areas of underperformance
Strategies to overcome under-performance are provided in the columns of the tables above.
Changes to planned targets
None
Sub-programme expenditure: Programme 3
Sub- Programme Name
2014/2015 2013/2014
Final Appropriation
Actual Expenditure
(Over)/Under Expenditure
Final Appropriation
Actual Expenditure
(Over)/Under Expenditure
R’000 R’000 R’000 R’000 R’000 R’000
Administration 49574 48106 1468 50358 49564 794
Financial Interventions 211588 211559 29 193371 193380 -9
Incremental Interventions
756517 741662 14855 871359 871355 4
Social & Rental Interventions
110537 110534 3 286206 286201 5
Total 1128216 1111861 16355 1401294 1400500 794
4.4. Programme 4: Housing Assets Management and Property Management
Purpose
To provide effective management of housing
Strategic objectives, performance indicators, planned targets and actual achievements
PROGRAMME 4: HOUSING ASSETS MANAGEMENT
Programme / Sub-programme: Sale and transfer of housing properties Strategic Objective: To provide for the Sale and transfer of Rental Stock
Performance
Indicator
Actual
Achievement
2013/2014
Planned
Target
2014/2015
Actual
Achievement
2014/2015
Deviation from
planned target
to Actual
Achievement
for 2014/2015
Comment on deviations
No. of rental units sold to beneficiaries • Rental top
structure • Sites
- - - - -
No. of (existing) rental units
- 56 28 -28 Some units are not legitimately occupied and
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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transferred (to beneficiaries) • Top structures Sites
others are occupied by persons who have already benefitted in other government housing subsidy programmes. The cases will be submitted to a legal process to determine the relevant course of action.
Programme / Sub-programme: : Housing properties maintenance Strategic Objective: Housing Properties Maintenance
Performance
Indicator
Actual
Achievement
2013/2014
Planned
Target
2014/2015
Actual
Achievement
2014/2015
Deviation from
planned target to
Actual
Achievement for
2014/2015
Comment on deviations
No. of rental units sold to beneficiaries • Rental top structure Sites
- - - -
Programme / Sub-programme: Sale and transfer of housing properties Strategic Objective: To provide for the Sale and transfer of Rental Stock
Performance
Indicator
Actual
Achievement
2013/2014
Planned
Target
2014/2015
Actual
Achievement
2014/2015
Deviation from
planned target
to Actual
Achievement
for 2014/2015
Comment on deviations
No. of housing assets maintained
5 0 -5 No requests for maintenance were received and the assets are being transferred to legitimate occupants
No. of debtors reduced per financial year (under which sub-programme does this indicator fall)
56 28 -28 Some units are not legitimately occupied and others are occupied by persons who have already benefitted in other government housing subsidy programmes. The cases will be submitted to a legal process to determine the relevant course of action.
Reasons for deviations
Reasons for deviations are provided in the comment on deviations column above.
Strategy to overcome areas of underperformance
Strategies to overcome under-performance are provided in the columns of the tables above.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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Changes to planned targets
Sub-programme expenditure: Programme 4
Sub- Programme Name
2014/2015 2013/2014
Final Appropriation
Actual Expenditure
(Over)/Under Expenditure
Final Appropriation
Actual Expenditure
(Over)/Under Expenditure
R’000 R’000 R’000 R’000 R’000 R’000
Administration 964 770 194 1007 175 832
Total 964 770 194 1007 175 832
5. TRANSFER PAYMENTS
5.1 Transfer payments to public entities
Name of Public Entity
Services rendered by the public entity
Amount transferred to the public entity
Amount spent by the public entity
Achievements of the public entity
None - - - -
5.2 Transfer payments to all organisations other than public entities
The table below reflects the transfer payments made for the period 1 April 2014 to 31 March 2015 Name of
transferee Type of
organisation Purpose for
which the funds were used
Did the dept. comply with s 38 (1) (j) of the
PFMA
Amount transferred
(R’000)
Amount spent by the entity
Reasons for the funds
unspent by the entity
None - - - - - -
The table below reflects the transfer payments which were budgeted for in the period 1 April 2014 to 31 March 2015, but no transfer payments were made.
Name of transferee Purpose for which the funds were to
be used
Amount budgeted for
(R’000)
Amount transferred
(R’000)
Reasons why funds were not transferred
None - - - -
6. CONDITIONAL GRANTS
6.1 Conditional grants and earmarked funds paid The conditional grants and ear marked funds paid during for the period 1 April 2014 to 31 March 2015.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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Department who transferred the grant None
Purpose of the grant N/A
Expected outputs of the grant N/A
Actual outputs achieved N/A
Amount per amended DORA N/A
Amount received (R‟000) N/A
Reasons if amount as per DORA was not received
N/A
Amount spent by the department (R‟000) N/A
Reasons for the funds unspent by the entity N/A
Reasons for deviations on performance N/A
Measures taken to improve performance N/A
Monitoring mechanism by the receiving department
N/A
(NB. The next paragraph makes provision for the paid funds.)
6.2 Conditional grants and earmarked funds received
The table below details the conditional grants and ear marked funds received during for the period 1 April
2014 to 31 March 2015.
Department who transferred the grant Human Settlements Development Grant
( Schedule 5, Part A)
Purpose of the grant To provide funding for the creation of sustainable human settlements
Expected outputs of the grant
No. of residential units delivered in each housing programme.
No of serviced sites delivered in each housing programme
No. of finance linked subsidies approved & disbursed
No. of households in informal settlements provided with household
access to services.
Actual outputs achieved N/A
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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Amount per amended DORA Matjhabeng R26.8 million
Moqhaka R5.2 million
Amount received (R’000) R1 078 642 000
Reasons if amount as per DORA was not received
N/A
Amount spent by the department (R‟000)
R1 063 756 000
Reasons for the funds unspent by the entity
N/A
Reasons for deviations on performance N/A
Measures taken to improve performance N/A
Monitoring mechanism by the receiving department
Monthly and quarterly monitoring of expenditure against the set targets.
7 DONOR FUNDS
7.1. Donor Funds Received The department received no donor funds.
8 CAPITAL INVESTMENT
8.1. Capital investment, maintenance and asset management plan
The department does not have capital investments maintenance and asset management plan.
The table below indicates expenditure on new and replacement assets. New and
replacement Assets
2014/2015 2013/2014
Final Appropriation
R’000
Actual Expenditure
R’000
(Over)/Under Expenditure
R’000
Final Appropriation
R’000
Actual Expenditure
R’000
(Over)/Under Expenditure
R’000
Audio video equipment
8,000 7,599.00 401.00 - - -
Construction and main equipment
494,000.00 493,700.00 300.00 - - -
Office equipment 435,000.00 250,354.84 184,645.16 269,000.00 217,310.37 51,689.63
Office furniture 414,000.00 374,906.37 39,093.63 431,000.00 - 431,000.00
Computer hardware &sys- desktop
242,000.00 176,003.99 65,996.01 48,000.00 16,316.00 31,684.00
Computer hardware & sys- laptop
771,000.00 606,830.48 164,169.52 479,000.00 338,121.14 140,878.86
Computer hardware & sys - tablet
40,000.00 38,597.92 1,402.08 102,000.00 27,038.00 74,962.00
Finance leases other machinery
933,000.00 804,412.31 128,587.69 796,000.00 780,364.28 15,635.72
TOTAL
3,337,000.00 2,752,404.71 584,595.29 2,125,000.00 1 379 745,850.21
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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PART C: GOVERNANCE
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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1 INTRODUCTION
The following structures were operstional within the department during the year under review towards ensuring that the department maintains the highest standards of governance, thereby effectively utilizing the department‟s resources.
2 RISK MANAGEMENT
The department has a risk management strategy that guides the implementation of the risk management policy.
It includes the plan of action on how the department intends to improve the maturity of risk management. The risk
management policy communicates the department‟s risk management philosophy on how risk management is
expected to support the department in achieving its objectives. It also has a process of identifying new and
emerging risks once every quarter. The department has and maintains a Risk management committee that is
appointed by the Accounting Officer as per the requirement by the Public Sector Risk Management Framework.
The audit committee provides an independent and objective assurance on the effectiveness of risk management
in the department. In executing its responsibilities as set out in the risk management strategy, management
included risk management as a standing item on the agenda of the senior management meetings.
3 FRAUD AND CORRUPTION
The Security Management and Anti-Corruption Directorate (SMAC) have developed a Departmental Fraud
Prevention Plan. The plan will be reviewed annually to ensure its relevance and effectiveness. The review
process will include amongst others an Effectiveness Survey which will be conducted in the 2015/2016 financial
year involving governance components and other role players.
A Minimum Anti-Corruption Capacity Requirements Implementation Plan is in the development stage and the draft will be circulated for consultation to all departmental role players in the 2015/2016 Financial Year.
Whistle blowing is one of the mechanisms in place to report fraud and corruption. The Whistleblowing Policy is included in the Fraud Prevention Plan and the employees are continuously made aware of it through the departmentally arranged awareness sessions. The effectiveness of this mechanism will also be tested during the annual Effectiveness Survey.
The Security Manager reports on a monthly basis to the Head of Department on the status of all cases. Recommendations on the management of the SMAC Case Management System that was put forward by the Combined Audit Committee, was implemented in this financial year.
In the 2015/2016 financial year, the monthly reports- including nil reports- will be submitted to the Public Service
Commission in relation to cases referred to the department by the National Anti-Corruption Hotline.
4 MINIMISING CONFLICT OF INTEREST
As prescribed by chapter three of the Public Service Act, 1994 (Act No. 103 of 1994), read with related
regulations regarding financial disclosures, All Senior Management Members (SMS) except six (6) SMS who are
on suspension have completed the disclosure forms and these were signed off by the Executive Authority. The
department have consulted the State Law Advisors as well as the legal representatives of these officials regarding
their compliance with the prescripts.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
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These disclosures formed the basis to minimize conflict of interest. These reports were presented to the office of
Public Service Commission as required by the Act.
5 CODE OF CONDUCT
In order to give practical effect to the relevant constitutional provisions relating to the public service, all employees are expected to comply with the Code of Conduct provided for in Chapter two (2) of the Public Service Regulations. The Code act as a guideline to employees as to what is expected of them from an ethical point of view, both in their individual conduct and in their relationship with others. Compliance with the Code can be expected to enhance professionalism and help to ensure confidence in the public service. The need exists to provide direction to employees with regard to their relationship with the legislature, political and executive office-bearers, other employees and the public and to indicate the spirit in which employees should perform their duties, what should be done to avoid conflicts of interests and what is expected of them in terms of their personal conduct in public and private life. Although the Code of Conduct was drafted to be as comprehensive as possible, it is not an exhaustive set of rules regulating standards of conduct in the Department. However, our Head of Department Mr N Mokhesi, by virtue of his responsibility in terms of section 7(3)(b) of the Public Service Act which deals with efficient management and administration and the maintenance of discipline, is, inter alia, under a duty to ensure that the conduct of all employees conform to the basic values and principles governing public administration and the norms and standards prescribed by the Act. The HOD also has a duty to ensure that all employees are acquainted with these measures, and that they accept and abide by them. In order to achieve this, our Human Resources Management and Development Directorate is tasks through the APP of the Department to arrange Information Sessions where the Code of Conduct is unpacked or presented to officials. Officials are also furnished with copies of same where upon they complete a questionnaire confirming that such training took place. The primary purpose of the Code is a positive one, viz. to promote exemplary conduct. Notwithstanding this, an employee shall be guilty of misconduct, and may be dealt with in accordance with the relevant collective agreement if she or he contravenes any provision of the Code of Conduct or fails to comply with any provision thereof.
6 HEALTH, SAFETY AND ENVIRONMENTAL ISSUES
The split of the department compounded the challenge of office space, however, the department continues to engage the Department of Public Works and Infrastructure in addressing the issue in question. The shortage of offices leads to a situation whereby two or three officials share an office without proper cabling and expose them to hazardous conditions. The departmental policies on Employee Health and Wellness and their operational plans have been approved and are aimed at promoting the employees‟ health and safety.
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7 PORTFOLIO COMMITTEES
The department attended the following Portfolio Committee meetings:
Date Matters discussed
12 August 2014 Consideration of the Annual Performance Plan
20 August 2014 Consideration of the 1st Quarter Report (Non-Financial)
6 November 2014 Consideration of the 2nd
Quarter Report (Non-Financial) and 2013/2014 Annual Report
06 March 2015 Consideration of the 3rd
Quarter Report (Non-Financial)
8 PROPAC RESOLUTIONS
Resolution No.
Subject Details Response by the department
Resolved (Yes/No)
Resolution 2 of 2008
Housing Fund
The department must:
Prepare an action plan with time frames on the closing of the housing fund
Report on the progress with the integration of housing into the department
Additional 24 properties were transferred in 2014 and 84 is currently in various stages of being transferred. Most suspense accounts have been cleared and the department is awaiting the National Department of Human Settlements to pass the new Housing Act to allow departments to close the fund.
Application forms distributed to the beneficiaries and to complete. Some applications already lodged with the State Attorney.
No
Resolution 2 of 2010
Capacity
Ensure that the
financial section
of the
department is
sufficiently
capacitated by
skilled officials
to ensure that
financial
functions are
properly
executed.
In terms of the support function
related to the department no
additional funds were received
from Provincial Treasury until
the end of the 2012/13 financial
year. Funds were only made
available from 1 April 2013 to
start the process although the
additional allocation is in the
case of both departments not
enough for the most critical
functions in the Support
Service Directorates. Provincial
Treasury also only made
Compensation of Employee
funds available, but no funds
Vacancies filled to date: FIVE posts Still vacant and advertised; - Dir – Finance - DD – Finance - PA – Director Interviews have been conducted for the Director Finance. Posts were advertised. Currently in the process of short-listing suitable candidates
No
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Resolution No.
Subject Details Response by the department
Resolved (Yes/No)
for operation matters, resulting
the possible filling of some of
the critical posts, but not having
tools of the trade for those
officials to effectively function.
Levels 13 and up were already
split and the department is in
the process to split levels 1 to
12 after which the most critical
posts will be advertised for
filling as from April 2013.
Declaration of
interest:
Implement
control
measures to
ensure that all
employees
declare their
own spouses‟
and other close
relatives‟
interests in
companies or
closed
corporations
tendering,
providing
quotation or
doing business
with
departments.
Declarations of all Senior
Managers were done
Systems were
implemented. All Senior
Managers submitted
Yes
Resolution 2/2012
Advance Payments to contractors Department made advance payments to contractors contrary to laws and regulations.
Reconcile amounts and claims
unspent funds back
Summonses have been
issued against all
suppliers, they have
filed notices of intention
to defend and the
department is
responding accordingly.
No
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9 PRIOR MODIFICATIONS TO AUDIT REPORTS The Department appointed the consultants Ernest and Young in order to enhance the capacity challenges within the Chief Directorate: Financial and Supply Management and part of their extended mandate included the following:
Policy development and/or review across the department,
Maintenance of the Irregular, Fruitless and Wasteful Expenditure Registers and the investigations thereof,
HSS/BAS reconciliations,
the development of the Action Plans based on the AGSA Audit Reports and Management Letter, population thereof and periodically reporting on the progress to Provincial Treasury and Internal Audit Directorate for evaluation purposes,
Monthly reporting progress to Provincial Treasury on behalf of the Department on the Key Control Matrix. These reports were signed off by the Accounting Officer.
The Department further continued with the Audit Steering Committee meetings which were held bi-weekly in order to assess progress on the implementation of AGSA‟s recommendation. The minutes of these meetings are maintained and the feedback reports presented to the Accounting Officer. The AGSA‟s Action Plans is a standing item in the agenda of the Shared Audit Committee and progress on the implementation status quo is tabled at these meetings.
Nature of qualification, disclaimer, adverse opinion and matters of non-compliance
Financial year in which it first arose
Progress made in clearing / resolving the matter
N/A
10 INTERNAL CONTROL UNIT
The Department appointed Consultants to assist with the functions of the Internal Control Unit during the year
under review due to human skills and capacity constraints. The functions the Department was assisted with were
as follows:
Checking and verification of all transactions related to payments to Suppliers and Contractors and
payments to officials;
Checking and verification of all transactions that was made via journal entries on the system;
Safeguarding of all relevant supporting documentation;
Evaluating payments to update and maintain the registers related to the following:
o Irregular Expenditure;
o Fruitless and Waste full Expenditure; and
o Unauthorised expenditure
The officials from the Consultancy Firm and officials from the Internal Control unit are working together to ensure that the necessary skills are transferred.
11 INTERNAL AUDIT AND AUDIT COMMITTEES
The objective of Human Settlement‟s Internal Audit Activity (Activity) is encapsulated in the definition of Internal
Auditing which is to provide an independent, objective assurance and consulting service designed to add value
and improve the Departments‟ operations. It helps the Department to accomplish its objectives by bringing a
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systematic, disciplined approach to evaluate and improve the effectiveness of risk management, internal control
and governance.
In terms of the scope of work of this Activity, a duly appointed Shared Audit Committee approved the Annual and
Three Year Risk Based Internal Audit Coverage Plan. The plan focused primarily on statutory audits, audits
related to EXCO Resolutions, Audit Reports and Management Letter received from Auditor-General South Africa
for 2012/13 financial year, Ad-hoc Assignments, follow-up audits as well as financial audits.
The Activity reported progress against the approved Plan on quarterly basis to the Shared Audit Committee.
The Shared Audit Committee was established and functions in terms of Treasury Regulations, 2005(TR) 3.1.1 to
3.1.16 which came into effect as a result of section 76 as well as section 77 of the Public Finance Management
Act, 1999 (Act No. 1 of 1999).
The Shared Audit Committee was appointed by the Member of Executive Council: Free State Provincial Treasury
in consultation with Member of Executive Council: Cooperative Governance, Traditional Affairs and Human
Settlements, for a period of three years, with effect from 01 October 2014.
During the period under review, the Shared Audit Committee fulfilled its mandate, roles and responsibility as
elaborated under paragraph 12 below.
Name Qualifications Internal or
external
If internal,
position in
the
department
Date
appointed
Date
Resigned
No. of
Meetings
attended
Mr David
Lekoto
B.Com B.Com (Hons-Part 1) Diploma in Certified Fraud Examiners Certified Public Account (SA), GIA
External N/A 01 October
2014 N/A
Ref to
paragraph 12
below
Dr C Olivier N. Dip in Public Administration B. Luris Public Service Masters in Public Administration Ph. D in Public
Management
External N/A 01 October
2014 N/A
Mr. I Mokoena Diploma Industrial Engineering Project Management Management Advancement Programme MBA
External N/A 01 October
2014 N/A
Dr. K
Laubscher
B. Com B. Com (Hons) Masters of Science Ph. D Agricultural
Economics
External N/A 01 October
2014 N/A
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Adv. J Block Baccalaureus Legum Baccalaureus Lurisprudentiae Diploma in Tax Law Certificate Public Finance Management Certificate
Procurement
Management
External N/A 01 October
2014 N/A
12 AUDIT COMMITTEE REPORT
SHARED AUDIT COMMITTEE REPORT
The Shared Audit Committee of the Department of Human Settlements is pleased to present its report for the financial year ended 31 March 2015.
Background Information The Shared Audit Committee has non-executive status in an advisory capacity to the Accounting Officer and Member of the Executive Council, to assist the Accounting Officer in fulfilling its oversight responsibility relating to:
(i) The integrity of the Department’s financial statements and financial reporting process; (ii) System of internal control, risk management and governance processes; (iii) The audit processes both internal and external; and (iv) The Department’s process for monitoring compliance with laws, regulations and the code of conduct.
In discharging its responsibilities, the Shared Audit Committee is not itself responsible for the planning or conducting of audits or for any determination that the financial statements of the Department are complete and accurate or in accordance with generally recognised accounting procedures and standards. This is the responsibility of management and the independent auditors. The Committee‟s role is that of an independent monitoring and evaluation of activities within the Department. The Shared Audit Committee was appointed by the Member of Executive Council: Free State Provincial Treasury in consultation with Member of Executive Council: Cooperative Governance, Traditional Affairs and Human Settlements, for a period of three years, with effect from 01 September 2014. The term of office of the then Shared Audit Committee expired in August 2014. Shared Audit Committee Members and Attendance The Shared Audit Committee consists of the members listed hereunder and should meet at least four (4) times per annum as per its approved Audit Committee Charter. Further, special meetings are arranged as and when necessary in order to address urgent matters.
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During the year under review four (4) meetings were held as reflected in the table below.
Name Capacity
Normal Meeting 30 April 2014
Special Meeting 28 May 2014
Special Meeting 28 July 2014
Normal Meeting 06 February 2015
Ms M M Nkomo Chairperson ≠ * * #
Mr D Lekoto Chairperson £ * * #
Mr G S Majola Member * * * * Mr R I Mokoena Member * * * *
Dr C D Olivier Member * * * *
Adv D Block Member * * * * Dr K Laubscher Member * * * *
Legend: Ms M M Nkomo is the former Chairperson of the committee and her term of office expired in August 2014
* - Attended the meeting £ - Mr D Lekoto is the new Chairperson and was only appointed in September 2014 ≠ - Apology
# - did not attend because they are former members of the Committee Notwithstanding the fact that the current Shared Audit Committee was appointed and constituted late into the new financial year, it progressed with its oversight responsibilities. The performance of the committee was therefore not compromised due to the late appointment. Shared Audit Committee Responsibility The Shared Audit Committee reports that it has complied with its roles and responsibilities arising from Section 38(1)(a) of the Public Finance Management Act and Treasury Regulation 3.1.1 to 3.1.16 with regards to its establishment and Terms of Reference.
S38(1)(a) S38(1)(a)(ii) of the PFMA state the following:
(PFMA) (1) “The accounting officer for a department,
(a) must ensure that department,…. has and maintains-
(ii) a system of internal audit under the control and direction of an audit committee complying with and operating in accordance with regulations and instructions prescribed in terms of sections 76 and 77”
The purpose of the Shared Audit Committee is to:
assist management in discharging its duties relating to the safeguarding of assets, the operation of adequate systems, control and reporting processes, and the preparation of accurate reporting and financial statements in compliance with the applicable legal requirements and accounting standards;
oversee the activities of, and to ensure coordination between, the activities of internal and external audit;
provide a forum for discussing financial, enterprise-wide, market, regulatory, safety and other risks and control issues; and to monitor controls designed to minimize these risks;
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review the department‟s annual integrated report, including the consolidated and separate annual financial statements, as well as its interim report and any other public reports or announcements containing financial information;
receive and deal with any complaints concerning the accounting practices, internal and external audit or the content and audit of its financial statements or related matters; and
annually review the committee‟s work and charter to make recommendations to the board to ensure its effectiveness.
Duties carried out The Shared Audit Committee has performed its duties and responsibilities during the financial year according to its Charter.
The Shared Audit Committee also reports that during the financial year under review it has reviewed and adopted appropriately:
The Revised Audit Committee Charter,
Revised Internal Audit Charter,
Revised Internal Audit Coverage Plan for the period,
Revised Internal Audit Manual,
A report on the Performance against the approved Internal Audit Coverage Plan,
A report on the progress on the implementation of recommendation by the Auditor-General South Africa,
Key Control Matrix and Dash Board Reports, and
Risk Management and Risk Management Committee Reports.
The Effectiveness of Internal Control During the year under review, several instances of non-compliance were reported by the Internal Audit Directorate that resulted in a breakdown in the functioning of internal controls. Further, the systems of internal controls were not entirely effective for the year under review, as compliance with prescribed policies and procedures were lacking in certain instances. During the year under review, the Department has put much emphasis on improving internal controls and adherence to policies and procedures. The Shared Audit Committee is thus content to report that management‟s efforts in this regard have led to an increased level of compliance to internal controls, policies and procedures. Not taking away that there are still areas of concern where the state and status of internal controls can be enhanced. The Internal Audit Directorate presented the Activity Reports during the above-mentioned sittings of the Shared Audit Committee, the reports of which included performance against the approved internal Audit coverage plan with all supporting documents, which highlighted the shortcomings as outlined in the above-mentioned paragraph.
The Shared Audit Committee is pleased to report that, whilst the objectives of the Internal Audit Directorate and the Auditor-General South Africa (AGSA) are different, the AGSA, determined that, based on their assessment
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of the scope of specific work performed, the objectivity and technical competence of the Internal Audit Directorate, and whether the work is carried out with due care, the procedures performed on the Comparative Figures on the Draft 2014/15 Annual Financial Statement prior to submission to AGSA will be taken into consideration in the performance of the external audit work. Further other work performed by the Internal Audit Directorate has been used to assess risk and internal control deficiencies that may impact on the audit process. All the reports issued had thus been distributed to Auditor-General South Africa for that purpose.
The quality of in year management and monthly/quarterly reports submitted in terms of the PFMA and the Division of Revenue Act The Shared Audit Committee noted all in year management and quarterly reports submitted in terms of the PFMA and the Division of Revenue Act to Provincial Treasury. These reports were presented at each Shared Audit Committee meetings as per the schedule above. Predetermined Objectives
The Shared Audit Committee noted the presentations done on Predetermined Objectives and the progress on the achievement thereof by the Departmental Planning and Performance Monitoring Directorate during the course of the financial year.
The Shared Audit Committee noted with concern that adequate and reliable corroborating evidence could not be provided for 50% and 29% of the targets related to Programme 2: Housing Needs, Research and Planning and Programme 3: Housing Development respectively in order to assess the reliability of the reported performance information. The Shared Audit Committee thus request management to develop realistic and achievable targets and monitor on regular basis the performance against these targets as well as the quality of the reports for consideration by the Shared Audit Committee.
Review and Evaluation of Interim Financial Statements
The Shared Audit Committee noted the quarterly reviews performed by the Internal Audit Directorate on the Interim Financial Statements. These reports were included in the Internal Audit Activity Reports which were presented at each sitting of the Shared Audit Committee.
Review and Evaluation of Annual Financial Statements
The Shared Audit Committee has:
Reviewed and discussed the unaudited/audited annual financial statements to be included in the annual report with the Accounting Officer‟s Report,
Reviewed progress on Auditor-General South Africa‟s management report and management responses thereto for the 2014/2015 financial year and the effect of which to the current audit,
Reviewed changes in accounting policies and practices,
Reviewed the department‟s compliance with legal and regulatory provisions,
Reviewed the information on predetermined objectives to be included in the annual report,
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Reviewed significant adjustments resulting from the audit,
Reviewed the Auditor-General‟s Management Letter and responses thereof of the 2014/15 financial year
The Shared Audit Committee concurs and accepts the conclusion of Auditor-General South Africa on the annual financial statement which resulted in the qualified audit opinion, and is of the view that the audited financial statements be accepted and read together with the report of Auditor-General South Africa. The acceptance also apply to the audited financial statement of the Housing Fund, The Shared Audit Committee is concerned with reoccurrence of the issues raised during the audited financial statements for the 2013/14 financial year. Notwithstanding the above-mentioned, despite an assurance that the appointed consultants will assist in addressing prior year issues, the Shared audit Committee is concerned that the Department has not improved in light of the number of the qualification paragraphs as well as a number of internal control weaknesses raised in the management letter. The committee had requested management to develop action plans to address all those identified deficiencies and in particular recurring findings, and this plan will be co-signed between the Shared Audit Committee and Management. The Internal Audit Directorate will monitor the implementation status quo and report periodically to the Shared Audit Committee. Internal Audit Directorate The Shared Audit Committee is satisfied that the Internal Audit Directorate is operating effectively and that in all the reports perused and approved it has addressed the risks pertinent to the department in its audits. The Shared Audit Committee reviewed and approved the annual internal audit plans and evaluated the independence,
effectiveness and performance of the internal audit function; The Shared Audit Committee expressed its appreciation on the compilation of the three year and annual internal audit coverage plans because it is based on the outcome of the risk assessment thus making it a risk based Internal Audit Coverage Plan which is in compliance with the Standards of Professional Practice of Internal Auditing.
The Shared Audit Committee considered the reports of the internal auditors regarding systems of internal control including
financial controls, business risk management and maintenance of effective internal control systems;
The Shared Audit Committee reviewed issues raised by Internal Audit Directorate and the adequacy of corrective action
taken by management in response thereto. The Shared Committee concluded that there were no material breakdowns in internal control and in instance were such existed, considered and assessed the adequacy of the corrective action taken and progress implementation status quo and found it satisfactory;
The Shared Audit Committee is also pleased that Auditor-General South Africa used some of the work performed by the Internal Audit in expressing an audit opinion thereby alleviating duplication of efforts.
The Shared Audit Committee concerns were reported and escalated to the accounting officer in their quarterly reports during the financial year. It should also be noted that it remains the ultimate goal of the Shared Audit Committee to see a shift in the reduction of external audit hours as a result of the synergy between the External Audit and Internal Audit Strategies as more reliance is placed on the work of Internal Audit.
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Risk Management The Department‟s risk maturity is at a basic level. However, there is a Risk Management Committee that meets on a regular basis and periodically reports to the Audit Committee.
The Shared Audit Committee had on numerous occasions raised concerns regarding the non-completion/finalization of the risk assessment process within the department and how it negatively impacts on the Internal Audit activities, in particular the compilation of the risk based Internal Audit Coverage Plan.
Further, the Committee is concerned regarding challenges experienced by the Risk Management Sub-Directorate which amongst others includes capacity constraints experienced within the Sub-Directorate and non-availability of key officials during the risk assessment process.
The Committee requested management to develop mechanisms to address these challenges and ensure that the risk management sub-Directorate performs efficiently.
Notwithstanding the above-mentioned, the Shared Audit Committee is pleased with the progress made to this end in the Sub-Directorate.
Other matters of emphasis Notwithstanding the above-mentioned, the Shared Audit Committee is pleased to have noticed the following:-
The Shared Audit Committee have made inputs which were significantly invaluable to the Head of Department and Management and laid solid foundation for risk management, governance processes and Internal control systems;
The Shared Audit Committee have managed to assist both the Head of Department and Management to get financial policies and procedures finalized and approved as well as noted that the Department had addressed capacity challenges in Senior Management positions
The Shared Audit Committee have managed to assist management to be accountable and engage the Auditor-General South Africa in the way they are supposed to which is in line with PFMA, and
The Shared Audit Committee's presence has instilled management's resilience and surpasses their mandate.
The Shared Audit Committee that with this basis, or foundation built, it will deliver an "Unqualified Audit Opinion" Report by the Auditor –General South Africa 2015/16.
Auditor-General South Africa The Shared Audit Committee is satisfied that there is a cordial relationship between the Auditor- General South Africa and the Department due to the following:
Approved the external audit engagement letter, the audit strategy and implementation plan and the budgeted audit fees payable to Auditor- General South Africa,
The Shared Audit Committee met with the Auditor-General South Africa to ensure that there is no unresolved issues,
The Auditor-General South Africa met periodically with management to discuss the progress on the implementation of the recommendations in the management reports,
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Obtained assurances from Auditor-General South Africa that adequate accounting records were being maintained
The Auditor-General South Africa attendance of the Shared Audit Committee meetings as well as their participation in the shared audit committee meetings during the audit of the annual financial statements,
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PART D: HUMAN RESOURCE MANAGEMENT
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1. INTRODUCTION
The human resource management and Development directorate of the department of Human Settlements is
made up of the following: personnel provisioning and Utilization, Employee Health and Wellness, Labour relations
and human resource development.
2. OVERVIEW OF HUMAN RESOURCES
The status of human resources in the department.
The department as a whole has been faced with chronic staff shortage and budget limitations. This is mostly felt
in technical as well as in project management, while we continue to ensure that we understand and support the
lines of business we serve, we do not always get cooperation when it comes to the planning and management of
human resources in the Department.
Human resource priorities for the year under review and the impact of these.
Filling of critical vacancies with skilled staff to address the skills gap (especially in technical services and finance)
Retention of key and scarce skills and competencies in the department
Alignment of the structure to the strategic objectives of the department (including Job Evaluation of all posts)
Conduct a skills audit to determine and align the available skills and to enable the department to plan for its future
needs.
Increased delegation of authority in terms of the Public Service Act and Regulations
Workforce planning and key strategies to attract and recruit a skilled and capable workforce.
The department has an approved recruitment and selection policy as well as an HR plan which is used as a
basis for workforce planning. Employee workforce analysis is done and submitted to all managers to assist in their
plans and contribution towards the achievement of equity targets.
As a strategy to retain skilled and capable workforce the department considers the reward system of PDMS,
though it is not enough as the public service is not able to compete with salary structures offered by the private
Sector, and even municipalities.
To attract suitable skills the department participates in the Human Settlements Scholarship which is aimed at
provincial students studying towards scarce skills needed in the department.
Budgetary constraints as well as the scarcity of professionals meeting the requirement of the professional bodies
makes it difficult to place the students and to retain them once they have been employed.
Training to address development areas training is provided for under the skills development levy and it is
mandatory that such training be relevant to the department as well as the functions performed by the official.
Employee Performance Management
The Public Service Regulations, Chapter 1, Part VIII 2001, B.1 requires from an executing authority to determine
a system for performance management and development for jobholders, other than Senior Management Service
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Members, in her/his department. In line with that the Free State Provincial Government approved a policy
framework on PDMS for levels 1-12. The Department of Human Settlements has implemented the PDMS in line
with this Framework.
Performance and Development Plans for official at levels 1-12 for the performance year 2013/2014 were
completed by all the officials. The process of performance assessment was finalised by October 2014. Out of 240
employees, only 148 employees received cash bonuses.
Challenges experienced by the Department in completing the PDEMS assessment process within the timeframe
were that there were human resource capacity constraints. However the Department has employed another
official to increase the capacity of the Unit.
Chapter 4, Part III of the Public Service Regulation (PSR), 2001, read with Chapter 4 of the SMS Handbook
provides prescripts on PMDS for SMS members which determines that: the performance of SMS members must
be managed in accordance with Performance Agreements (PAs) and must be linked to the department's strategic
goals and must comply with the prescribed criteria.
In terms of DPSA Handbook for SMS Performance Management, SMS Managers including the Head of the
Department are required to have signed Performance agreements by the end of May every year, and for newly
appointed SMS, three months after the appointment of the official. For the period 2014/2015, due to the extension
period provided as the result of the election process out of 21 SMS members including the HOD, 14 completed
performance agreements, six officials were on suspension and one was appointed after the period of submission.
Performance assessment for the SMS in the Department was concluded in December 2014. Out of 21 SMS
members, 11 benefitted in terms of receiving cash bonuses, 6 were still on suspension, three were less than
twelve months in the positions. HOD‟s verification report was also completed and submitted to the relevant
authorities, however, was not awarded a performance bonus.
Source documents used were: Free State Provincial Government Policy Framework on PDMS from level 1-12
and SMS Handbook on performance management
Employee Wellness Programmes
The department has a functional employee health and wellness programme, with all the four policies as well as
operational plans approved and implemented. These have been presented to the highest structure in the
department (SMS meeting) and road shows have been held as a means of bringing awareness to the officials of
the department.
The programme is currently faced with a serious challenge of human resources as well as a dedicated budget to
enable it to carry out its mandate.
Highlight achievements and challenges faced by the department, as well as future human resource
source plans /goals.
The department has managed to reduce the number of vacancies which have been vacant for more than
12 months. Though resources and accommodation become a serious challenge once the officials assume
duties.
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3. HUMAN RESOURCES OVERSIGHT STATISTICS
3.1. Personnel related expenditure
Table 3.1.1 Personnel expenditure by programme for the period 1 April 2014 to 31 March 2015
Programme Total
expenditure
(R’000)
Personnel
expenditure
(R’000)
Training
expenditure
(R’000)
Professional
and special
services
expenditure
(R’000)
Personnel
expenditure
as a % of
total
expenditure
Average
personnel
cost per
employee
(R’000)
1. Administration:
Programme 1
77 314
48 677
428
0
62.96%
302.34
2 Housing needs,
research and planning:
Programme 2
17 607
12 545
0
0
71.25%
392.03
3. Housing
development:
Programme 3
1 111 861
46 039
0
3 968 079
4.14%
438.47
4. Housing assets
management:
Programme 4
770
511
0
0
66.36%
255.50
Total
1 207 552
107 772
428
3 968 079
8.92%
359.24
Table 3.1.2 Personnel costs by salary band for the period 1 April 2014 to 31 March 2015
Salary band Personnel
expenditure
(R’000)
% of total
personnel
cost
No. of
employees
Average personnel cost
per employee (R’000)
Lower skilled (Levels 1-2) 0 0 0 0
Skilled (Levels 3-5) 11 834 10.98 50 236.68
Highly skilled production (Levels 6-8) 33 871 31.43 140 241.94
Highly skilled supervision (Levels 9-12) 31 581 29.30 72 438.63
Senior management
(Levels 13-16)
20 500 19.02 18 1 138.89
Periodic remuneration 0
Contract 3-5 424 0.39 3 141.33
6-8 1 814 1.68 3 604.67
9-12 7 266 6.74 13 558.92
13-16 482 0.45 1 482
Total 107 772 100 300 359.24
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Table 3.1.3 Salaries, Overtime, Home Owners Allowance and Medical Aid by programme for the period 1 April
2014 to 31 March 2015
Programme
Salaries Overtime Home Owners
Allowance
Medical Aid
Amount
(R’000
Salaries
as a % of
personnel
costs
Amount
(R’000)
Overtime
as a % of
personnel
costs
Amount
(R’000)
HOA as a
% of
personnel
costs
Amount
(R’000)
Medical aid as
a % of
personnel
costs
1. Administration:
Programme 1 36753 74.6 130 0.3 1313 2.7 1853 3.8
2 Housing needs,
research & planning:
Programme 2 427 71.4 0 0 19 3.2 19 3.2
3. Housing
development:
Programme 3 35582 73.4 376 0.8 1432 3 1790 3.7
4. Housing assets
management:
Programme 4 9507 73.5 45 0.3 252 1.9 282 2.2
TOTAL 82269 73.9 551 0.5 3016 2.7 3944 3.5
Table 3.1.4 Salaries, Overtime, Home Owners Allowance and Medical Aid by salary band for the period 1 April
2014 to 31 March 2015
Salary band
Salaries Overtime
Home Owners Allowance
Medical Aid
Amount (R’000
Salaries as a % of personnel
costs
Amount (R’000)
Overtime as a % of personnel
costs
Amount (R’000)
HOA as a % of
personnel costs
Amount (R’000)
Medical aid as a % of personnel
costs
Skilled (Levels 1-2)
0 0 0 0 0 0 0 0
Skilled (Levels 3-5) 6119 68.1 105 1.2 460 5.1 760 8.5
Highly skilled production (Levels 6-8) 25478 69.1 355 1 1319 3.6 2106 5.7
Highly skilled supervision (Levels 9-12) 25548 73 92 0.3 586 1.7 860 2.5
Senior Management (Levels 13-16) 15137 76.5 0 0 652 3.3 218 1.1
Contract (Levels 3-5) 424 100 0 0 0 0 0 0
Contract(Levels 6-8) 1814 99.9 0 0 0 0 0 0
Contract (Levels 9-12) 7266 92.7 0 0 0 0 0 0
Contract (Levels 13-16) 482 95.1 0 0 0 0 0 0
TOTAL 82268 73.9 552 0.5 3017 2.7 3944 3.5
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
77
3.2. Employment and Vacancies
Table 3.2.1 Employment and vacancies by programme as on 31 March 2015 Programme Number of
posts on
approved
establishment
Number of
posts filled
Vacancy
Rate
Number of employees
additional to the establishment
1.Adminstration: Programme 1 257 128 50.19% 0
2 Housing Needs Research and
Planning: Programme 2
75 33 56% 0
3. Housing Development
Programme 3
201 83 53.73% 15
4. Housing Assets Management
Programme 4
88 49 44.3% 0
Total 621 293 52.82% 15
Table 3.2.2 Employment and vacancies by salary band as on 31 March 2015
Salary band Number of
posts on
approved
establishment
Number of
posts filled
Vacancy Rate Number of employees additional
to the establishment
Lower skilled (Levels1-2) 0 0 0% 0
Skilled(Levels 3-5) 63 49 22.2% 0
Highly skilled production
(Levels 6-8)
145 130 10.3% 3
Highly skilled supervision
(Levels 9-12)
80 70 12.5% 13
Senior management (Levels
13-16)
27 19 30% 1
Total 315 268 15% 17
Table 3.2.3 Employment and vacancies by critical occupations as on 31 March 2015
Critical occupation Number of
posts on
approved
establishment
Number of
posts filled
Vacancy
Rate
Number of employees
additional to the
establishment
Technical/Engineering Related Advisory Services
32 15 08
(contracts)
62.5% 2.66%
0 08
TOTAL 32 15 65.5% 8
3.3. Filling of SMS Posts
The tables in this section provide information on employment and vacancies as it relates to members of the Senior Management Service by salary level. It also provides information on advertising and filling of SMS posts, reasons for not complying with prescribed timeframes and disciplinary steps taken.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
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Table 3.3.1 SMS post information as on 31 March 2015
SMS Level Total
number of
funded
SMS posts
Total
number of
SMS posts
filled
% of SMS
posts filled
Total number of
SMS posts vacant
% of SMS posts vacant
Director-General/ Head of
Department 1 1 100% 0 0%
Salary Level 15 1 1 100% 0 0%
Salary Level 14 5 5 100% 0 0%
Salary Level 13 20 12 60% 8 40%
Total 27 19 70% 8 30%
Table 3.3.2 SMS post information as on 30 September 2014
SMS Level Total
number of
funded
SMS posts
Total
number of
SMS posts
filled
% of SMS
posts filled
Total number of
SMS posts vacant
% of SMS posts vacant
Director-General/ Head of Department
1 1 100% 0 0%
Salary Level 15 1 1 100% 0 0%
Salary Level 14 5 5 100% 0 0%
Salary Level 13 20 11 55% 9 45%
Total 27 18 67% 9 33%
Table 3.3.3 Advertising and filling of SMS posts for the period 1 April 2014 to 31 March 2015
SMS Level Advertising Filling of Posts
Number of vacancies per
level advertised in 6
months of becoming
vacant
Number of vacancies
per level filled in 6
months of becoming
vacant
Number of vacancies per level not
filled in 6 months but filled within
12 months
Director-General/ Head of
Department 1 0 0
Salary Level 15 0 0 0
Salary Level 14 0 0 0
Salary Level 13 5 0 5
Total 6 0 5
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
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Table 3.3.4 Reasons for not having complied with the filling of funded vacant SMS - Advertised within 6 months
and filled within 12 months after becoming vacant for the period 1 April 2014 to 31 March 2015
Reasons for vacancies not advertised within six months
Insufficient budget
Accommodation and resource shortage challenges
Reasons for vacancies not filled within twelve months
Insufficient budget
Accommodation and resource shortage challenges
Table 3.3.5 Disciplinary steps taken for not complying with the prescribed timeframes for filling SMS posts within
12 months for the period 1 April 2014 to 31 March 2015
No disciplinary steps taken
Reasons for vacancies not advertised within six months
Insufficient budget
Accommodation and resource shortage challenges
Reasons for vacancies not filled within six months
Insufficient budget
Accommodation and resource shortage challenges
3.4. Job Evaluation
Table 3.4.1 Job Evaluation by Salary band for the period 1 April 2014 to 31 March 2015
Salary band Number of posts on approved
establishment
Number of Jobs
Evaluated
% of posts evaluated by salary
bands
Posts Upgraded Posts downgraded
Number % of posts
evaluated
Number % of posts
evaluated
Lower Skilled (Levels1-2)
0 0 0 0 0 0 0
Skilled (Levels 3-5) 63 2 3% 2 3% 0 0
Highly skilled production (Levels 6-8)
145 1 1% 1 1% 0 0
Highly skilled supervision (Levels 9-12)
80 2 3% 2 3% 0 0
Senior Management Service Band A
20 0 0 0 0 0 0
Senior Management Service Band B
5 0 0 0 0 0 0
Senior Management Service Band C
1 0 0 0 0 0 0
Senior Management Service Band D
1 0 0 0 0 0 0
Total 315 5 2% 5 2% 0 0%
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
80
The following table provides a summary of the number of employees whose positions were upgraded due to their
post being upgraded. The number of employees might differ from the number of posts upgraded since not all
employees are automatically absorbed into the new posts and some of the posts upgraded could also be vacant.
Table 3.4.2 Profile of employees whose positions were upgraded due to their posts being upgraded for the period
1 April 2014 to 31 March 2015
Gender African Asian Coloured White Total
Female 1 0 0 0 1
Male 2 0 0 1 3
Total 3 0 0 1 4
Employees with a disability 0
The following table summarises the number of cases where remuneration bands exceeded the grade determined by job evaluation. Reasons for the deviation are provided in each case.
Table 3.4.3 Employees with salary levels higher than those determined by job evaluation by occupation for the
period 1 April 2014 to 31 March 2015
Occupation Number of
employees
Job evaluation level Remuneration
level
Reason for deviation
None
Total number of employees whose salaries exceeded the level determined by job
evaluation
0
Percentage of total employed 0
The following table summarises the beneficiaries of the above in terms of race, gender, and disability.
Table 3.4.4 Profile of employees who have salary levels higher than those determined by job evaluation for the
period 1 April 2014 and 31 March 2015
Total number of Employees whose salaries exceeded the grades determine by job evaluation 0
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
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Employment Changes
This section provides information on changes in employment over the financial year. Turnover rates provide an
indication of trends in the employment profile of the department. The following tables provide a summary of
turnover rates by salary band and critical occupations.
Table 3.5.1 Annual turnover rates by salary band for the period 1 April 2014 to 31 March 2015
Salary band Number of
employees at
beginning of period-
1 April 2014
Appointments
and transfers
into the
department
Terminations
and
transfers out
of the
department
Turnover rate
Lower skilled ( Levels 1-2) 0 0 0 0%
Skilled (Levels 3-5) 63 49 1 2.0%
Highly skilled production
(Levels 6-8)
145 26 5 3%
Highly skilled supervision
(Levels 9-12)
80 23 2 3%
Senior Management Service Bands A 20 1 1 5%
Senior Management Service Bands B 5 0 0 0
Senior Management Service Bands C 1 0 0 0
Senior Management Service Bands D 1 0 0 0
Contracts 1 0 0 0
Total 316 99 9 3%
Table 3.5.2 Annual turnover rates by critical occupation for the period 1 April 2014 to 31 March 2015
Critical occupation Number of
employees at
beginning of
period-April 2014
Appointments
and transfers
into the
department
Terminations
and
transfers out
of the
department
Turnover rate
Technical/Engineering Related Advisory
Services
9 0 2 22.2%
Total 9 0 2 22.2%
The table below identifies the major reasons why staff left the department.
Table 3.5.3 Reasons why staff left the department for the period 1 April 2014 to 31 March 2015
Termination Type Number % of Total Resignations
Death 0 0%
Resignation 03 0.88%
Expiry of contract 03 0.88%
Dismissal – operational changes 02 0.58%
Dismissal – misconduct 01 0.29%
Dismissal – inefficiency 0 0%
Discharged due to ill-health 0 0%
Retirement 08 2.35%
Transfer to other Public Service Departments 06 1.76%
Other 0 0%
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
82
Total 23 9%
Total number of employees who left as a % of total
employment
23 9%
Table 3.5.4 Promotions by critical occupation for the period 1 April 2014 to 31 March 2015
Occupation Employees
1 April
2014
Promotions
to another
salary level
Salary level
promotions as
a % of
employees by
occupation
Progressions
to another
notch within
a salary level
Notch progression as a %
of employees by
occupation
- - - - - -
Total - - - - -
Table 3.5.5 Promotions by salary band for the period 1 April 2014 to 31 March 2015
Salary Band Employees
1 April
2014
Promotions
to another
salary level
Salary
bands
promotions
as a % of
employees
by salary
level
Progressions
to another
notch within
a salary level
Notch progression as a % of
employees by salary bands
Lower skilled (Levels 1-
2)
0 0 0 0 0
Skilled
(Levels 3-5)
49 4 8% 7
Highly skilled production
(Levels 6-8)
130 1 1% 2
Highly skilled supervision
(Levels 9-12)
70 4 6% 0
Senior Management
(Level 13-16)
19 0 0% 0
Total 268 9 3.% 9
3.5. Employment Equity
Table 3.6.1 Total number of employees (including employees with disabilities) in each of the following
occupational categories as on 31 March 2015
Occupational category
Male Female Total
African Coloured Indian White African Coloured Indian White
Legislators, senior officials and managers
11 0 0 0 7 1 0 0 19
Professionals 0 0 0 0 0 0 0 0 0
Technicians and associate professionals
2 6 0 0 0 1 0 0 9
Clerks 1 0 0 0 22 1 0 0 24
Service and sales workers
0 0 0 0 0 0 0 0 0
Skilled agriculture and 0 0 0 0 0 0 0 0 0
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
83
fishery workers
Craft and related trades workers
0 0 0 0 0 0 0 0 0
Plant and machine operators and assemblers
0 0 0 0 0 0 0 0 0
Elementary occupations
0 0 0 0 0 0 0 0 0
Total Employees with disabilities
14 6 0 0 29 3 0 0 52
Table 3.6.2 Total number of employees (including employees with disabilities) in each of the following occupational
bands as on 31 March 2015
Occupational band Male Female Total
African Coloured Indian White African Coloured Indian White
Top Management 14-16
4 0 0 0 2 0 0 0 6
Senior Management 13 7 0 0 0 5 1 0 0 13
Professionally qualified and experienced specialists and mid-management 9-12
37 6 0 5 28 4 0 7 87
Skilled technical and academically qualified workers, junior management, supervisors, foreman and superintendents 6-8
39 0 0 2 79 3 0 19 142
Semi-skilled and discretionary decision making 3-5
28 0 0 1 24 1 0 0 54
Unskilled and defined decision making 1-2
0 0 0 0 0 0 0 0 0
Total 115 6 0 8 138 9 0 26 302
Table 3.6.3 Recruitment for the period 1 April 2014 to 31 March 2015
Occupational band Male Female Total
African Coloured Indian White African Coloured Indian White
Top Management 0 0 0 0 0 0 0 0 0
Senior Management 1 0 0 0 1 0 0 0 2
Professionally qualified and experienced specialists and mid-management
4 0 0 1 2 0 0 0 7
Skilled technical and academically qualified workers, junior management, supervisors, foreman and superintendents
3 0 0 0 8 0 0 1 12
Semi-skilled and discretionary decision making
0 0 0 0 4 0 0 0 4
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
84
Unskilled and defined decision making
0 0 0 0 0 0 0 0 0
Total (Employees with
disabilities taken care of)
8 0 0 1 15 0 0 1 25
Table 3.6.4 Promotions for the period 1 April 2014 to 31 March 2015
Occupational band Male Female Total
African Coloured Indian White African Coloured Indian White
Top Management 0 0 0 0 0 0 0 0 0
Senior Management 0 0 0 0 0 0 0 0 0
Professionally qualified
and experienced
specialists and mid-
management
0 0 0 1 0 0 0 0 1
Skilled technical and
academically qualified
workers, junior
management,
supervisors, foreman and
superintendents
0 0 0 1 0 0 0 0 1
Semi-skilled and
discretionary decision
making
5 0 0 0 0 0 0 0 5
Unskilled and defined
decision making
0 0 0 0 0 0 0 0 0
Total (Employees with disabilities)
5 0 0 2 0 0 0 0 7
Table 3.6.5 Terminations for the period 1 April 2014 to 31 March 2015
Occupational band Male Female Total
African Coloured Indian White African Coloured Indian White
Top Management 0 0 0 0 0 0 0 0
Senior Management 1 0 0 0 2 0 0 0 3
Professionally qualified and
experienced specialists and
mid-management
2 0 0 3 2 1 0 0 8
Skilled technical and
academically qualified
workers, junior management,
supervisors, foreman and
superintendents
6 0 0 1 5 0 0 1 13
Semi-skilled and discretionary
decision making
0 0 0 0 1 2 0 3
Unskilled and defined
decision making
0 0 0 0 0 0 0 0 0
Employees with Disabilities 0 0 0 0 0 0 0 0 0
Total (Employees with
disabilities)
9 0 0 4 10 3 0 1 27
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
85
Table 3.6.6 Disciplinary action for the period 1 April 2014 to 31 March 2015
Disciplinary action Male Female Total
African Coloured Indian White African Coloured Indian White
Disciplinary action
Demotion 0 0 0 0 0 0 0 0 0
Final written warning 0 0 0 0 01 0 0 0 01
Written warning 0 0 0 0 0 0 0 0 0
Dismissal 01 0 0 0 0 0 0 0 01
Suspension without pay 0 0 0 0 01 0 0 0 01
TOTAL 01 0 0 0 02 0 0 0 03
Table 3.6.7 Skills development for the period 1 April 2014 to 31 March 2015
Occupational category Male Female Total
African Coloured Indian White African Coloured Indian White
Legislators, senior officials and managers
30 0 1 4 30 1 0 2 68
Professionals 8 0 0 0 0 0 0 0 8
Technicians and associate professionals
Clerks 86 0 0 0 116 2 0 30 234
Service and sales workers 0 0 0 0 0 0 0 0 0
Skilled agriculture and fishery workers
0 0 0 0 0 0 0 0 0
Craft and related trades workers 0 0 0 0 0 0 0 0 0
Plant and machine operators and assemblers
0 0 0 0 0 0 0 0 0
Elementary occupations 0 0 0 0 0 0 0 0 0
Total 124 0 1 4 146 3 0 32 310 *Employees with disabilities are included in the above occupations
3.6. Signing of Performance Agreements by SMS Members
Table 3.7.1 Signing of Performance Agreements by SMS members as on 31 May 2014
SMS Level Total number of
funded SMS posts
Total number of SMS
members
Total number of
signed performance
agreements
Signed performance
agreements as % of
total number of SMS
members
Director-General/
Head of Department
1 1 1 100%
Salary Level 15 1 1 1 100%
Salary Level 14 5 5 2 40%
Salary Level 13 14 14 10 71%
Total 21 21 14 66%
Table 3.7.2 Reasons for not having concluded Performance agreements for all SMS members as on 31 May 2014
Reasons
Six of the SMS members were on suspension. One SMS Member was only appointed after May 2014.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
86
Table 3.7.3 Disciplinary steps taken against SMS members for not having concluded Performance agreements as
on 31 May 2014
Reasons Not applicable
3.7. Performance Rewards
Table 3.8.1 Performance Rewards by race, gender and disability for the period 1 April 2014 to
31 March 2015
Race and Gender
Beneficiary Profile Cost
Number of
beneficiaries
Number of
employees
% of total
within group
Cost (R’000) Average cost
per employee
AFRICAN 115 203 56% n/a n/a
Male 45 95 47% n/a n/a
Female 70 108 64% n/a n/a
ASIAN 1 1 100% n/a n/a
Male 0 0 0 n/a n/a
Female 1 1 100% n/a n/a
COLOURED 6 6 100% n/a n/a
Male 0 0 0 n/a n/a
Female 6 6 100% n/a n/a
WHITE 27 30 90% n/a n/a
Male 9 11 81% n/a n/a
Female 18 19 94% n/a n/a
Employees with disability 0 1 0% n/a n/a
TOTAL 149 241 62% 2 059 13 815.00
NB. Employees with disabilities are included in the above occupations. The total cash bonus excluded notches and SMS members‟ bonuses. It is only from levels 1-12 officials. Also the system does not provide information on costs and average per race. Table 3.8.2 Performance Rewards by salary band for personnel below Senior Management Service for the period 1 April 2014 to 2015
Salary band
Beneficiary Profile Cost Total cost as a
% of the total
personnel
expenditure
Number of
beneficiaries
Number of
employees
% of total
within salary
bands
Total Cost
(R’000)
Average cost
per employee
Lower skilled levels 1-2
0 0 0% 0 0 0%
Skilled levels 3-5 6 30 20% 144 24 010 6%
Highly skilled production level 6-8
94 139 67% 993 10562 48%
Highly skilled supervision 9-12
46 67 68% 885 19230 42%
Contract (levels 9-12)
3 5 60% 37 12346 1%
Total
149 241 62% 2059 13 815 100%
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
87
Table 3.8.3 Performance Rewards by critical occupation for the period 1 April 2014 to 31 March 2015
Critical occupation
Beneficiary Profile Cost
Number of
beneficiaries
Number of
employees
% of total
within
occupation
Total Cost
(R’000)
Average cost
per employee
Technical/Engineering Related Advisory Services
N/A N/A N/A N/A N/A
Total N/A N/A N/A N/A N/A
Table 3.8.4 Performance related rewards (cash bonus), by salary band for Senior Management Service for the
period 1 April 2014 to 31 March 2015
Salary band
Beneficiary Profile Cost Total cost as a
% of the total
personnel
expenditure
Number of
beneficiaries
Number of
employees
% of total
within salary
bands
Total Cost
(R’000)
Average cost
per employee
Band A 8 14 57% 789 587.77 83 000.00 65%
Band B 2 5 40% 295 539.30 140 000.00 24%
Band C 1 1 100% 113 691.00 113 691.00 9%
Band D 0 1 0% 0 0 0%
Total 11 21 52% 1 198 818 83 000.00 100%
3.8. Foreign Workers
The tables below summarise the employment of foreign nationals in the department in terms of salary band and major occupation.
Table 3.9.1 Foreign workers by salary band for the period 1 April 2014 to 31 March 2015
Salary band 01 April 2014 31 March 2015 Change
Number % of total Number % of total Number % Change
Lower skilled 0 0 0 0 0 0
Highly skilled production (Levels 6-8)
1 11% 1 12.5% 0 0
Highly skilled supervision (Levels 9-12)
0 0 0 0 0 0
Contract (Levels 9-12) 7 78% 6 75% 1 100%
Contract (Levels 13-16) 1 11% 1 12.5% 0 0
Total 9 100% 8 2.66% 1 100%
Table 3.9.2 Foreign workers by major occupation for the period 1 April 2013 to 31 March 2014
Major occupation 01 April 2014 31 March 2015 Change
Number % of total Number % of total Number % Change
Engineering Related 8 2.77% 8 2.66% 1 0.33%
Total 8 2.77% 8 2.66% 0.33%
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
88
3.9. Leave utilisation
The Public Service Commission identified the need for careful monitoring of sick leave within the public service.
The following tables provide an indication of the use of sick leave and disability leave. In both cases, the
estimated cost of the leave is also provided.
Table 3.10.1 Sick leave for the period 1 January 2014 to 31 December 2014
Salary band Total
days
% Days with
Medical
certification
Number of
Employees
using sick
leave
% of total
employees
using sick
leave
Average
days per
employee
Estimated
Cost
(R’000)
Lower Skills (Levels 1-2) 0 0 0 0 0 0
Skilled (Levels 3-5) 352 88.1 38 18.5 9 222
Highly skilled production (Levels 6-8)
976
83.8
110
53.7 9 958
Highly skilled supervision (Levels 9 -12)
329
82.7
46
22.4 7 579
Top and Senior management (Levels 13-16)
115
90.4
11
5.4 10 403
Total 1772 84.9 205 100 9 2162
Table 3.10.2 Disability leave (temporary and permanent) for the period 1 January 2014 to 31 December 2014
Salary band Total
days
% Days with
Medical
certification
Number of
Employees
using
disability
leave
% of total
employees
using
disability
leave
Average
days per
employee
Estimated Cost
(R’000)
Lower skilled (Levels 1-2) 0 0 0 0 0 0
Skilled (Levels 3-5) 116 100 6 35.3% 19 73,429.75
Highly skilled production (Levels
6-8)
330 100 9 52.9 37 362,429.75
Highly skilled supervision (Levels
9-12)
13 100 2 11.8% 7 27,823.10
Senior management (Levels 13-
16)
0 0 0 0 0 0
Total 459 100 17 100% 27 466.6825
Table 3.10.3 Annual Leave for the period 1 January 2014 to 31 December 2014
Salary band Total days taken Number of Employees
using annual leave
Average per employee
Lower skilled (Levels 1-2) 0 0 0
Skilled (Levels 3-5) 1,100.00 53 21
Highly skilled production 3,028.84 135 22
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
89
(Levels 6-8)
Highly skilled supervision (Levels 9-
12)
1,729.00 71 24
Senior management
(Levels 13-16)
267 16 17
Contract 6-8 3 1 3
Contract 9-12 19 2 10
Contract 13-16 7 1 7
Total 6513.84 279 23
Table 3.10.4 Capped leave for the period 1 January 2014 to 31 December 2014
Salary band Total
days of
capped
leave
taken
Number of
Employees using
capped leave
Average number
of days taken per
employee
Average capped leave
per employee as on 31
March 2014
Lower skilled (Levels 1-2)
0 0 0 0
Skilled (Levels 3-5) 0 0 0 0
Highly skilled production (Levels 6-8)
0 0 0 0
Highly skilled supervision( Levels 9-12)
18 3 6 21
Senior management (Levels 13-16) 0 0 0 0
Total 18 3 6 21
The following table summarise payments made to employees as a result of leave that was not taken.
Table 3.10.5 Leave pay-outs for the period 1 April 2014 to 31 March 2015
Reason Total amount
(R’000)
Number of
employees
Average per
employee (R’000)
Leave pay-out for 2014/15 due to non-utilisation of leave
for the previous cycle
0 0 0
Capped leave pay-outs on termination of service for
2014/15
127 5 25.4
Current leave pay-out on termination of service for
2014/15
0 0 0
Total 127 9 25.4
3.10. HIV/AIDS & Health Promotion Programmes
Table 3.11.1 Steps taken to reduce the risk of occupational exposure
Units/categories of employees identified to be at high risk of contracting HIV & related diseases (if any)
Key steps taken to reduce the risk
NONE
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
90
Table 3.11.2 Details of Health Promotion and HIV/AIDS Programmes
Question Yes No Details, if yes
1. Has the department designated a member of the SMS to implement the provisions contained in Part VI E of Chapter 1 of the Public Service Regulations, 2001? If so, provide her/his name and position.
x No designated SMS member has been specifically appointed to implement the provisions as stipulated in the PSR. Currently, this responsibility is carried out by the Director: Human Resources Management and Organizational Development, clearly this SMS member has a whole range of other responsibilities to manage. Name: Ms. N.A Matiwane Position: Director: Human Resources Management and Development
2 Does the department have a dedicated unit or has it designated specific staff members to promote the health and well-being of your employees? If so, indicate the number of employees who are involved in this task and the annual budget that is available for this purpose.
X No budget is designated to the Employee Health and Wellness unit; funds are being availed per request for a specific project from other programmes within the broader Corporate Services Chief Directorate.
3 Has the department introduced an Employee Assistance or Health Promotion Programme for your employees? If so, indicate the key elements/services of this Programme.
X The department has introduced Employee Health & Wellness programmes like: -EAP referral services
Sporting activities for employees
Observing related National/ International Health calendar day activities
The Policies of all Four Pillars have been signed by HOD including two Operational Plans
4. Has the department established (a) committee(s) as contemplated in Part VI E.5 (e) of Chapter 1 of the Public Service Regulations, 2001? If so, please provide the names of the members of the committee and the stakeholder(s) that they represent.
X Employee Health and Wellness committee and their respective components: Offices of the MEC and HoD: Mr Percy Ramosedi Corporate Services Chief Directorate: Maki Van Wyk Financial and Supply Chain Management Chief Directorate: Mr. T Nkhese. Department Of Human Settlements: Mr. Tshenolo Molatedi Ms. Wandisa Soga Ms. Faith Mokoena Mr. Sabata Lebone Mr.Mike Moepane District Services Chief Directorate: Mr. Hoaeana (Welkom) Ms. Pulane Mokhachane (Sasolburg) Ms. Mamabefu Modipa (Qwa-Qwa)
5. Has the department reviewed its employment policies and practices to ensure that these do not unfairly discriminate against employees on the basis of their HIV status? If so, list the employment policies/practices so reviewed.
X At the moment, the department is operating on the Employee Health and Wellness Four Pillars of approved policies including approved Operational Plans on SHERQ and HIV and AIDS and TB Management in the department.
6. Has the department introduced measures to protect HIV-positive employees or those perceived to be HIV-positive from discrimination? If so, list the key elements of these measures.
X Employee Wellness Day done in partnership with GEMS and the department of Health do cover such during the day screening and testing including educating our employees on HIV and AIDS. Furthermore, employees during induction programme are further given awareness programme related to the Employee health and Wellness including HIV and AIDS
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
91
Question Yes No Details, if yes
7. Does the department encourage its employees to undergo Voluntary Counselling and Testing? If so, list the results that you have you achieved.
X During the departmental HCT campaign, the following were discovered: HCT Results for Females: 18 out of the 61 participants were tested. The results of the employees were confidentially shared with them. HCT Results for Males: 10 out of the 38 participants were tested. The results of the employees were confidentially shared with them. There is a challenge in relations to testing since employees are still afraid to test for HIV.
8. Has the department developed measures/indicators to monitor & evaluate the impact of its health promotion programme? If so, list these measures/indicators.
X The indicators are mainly with the Service providers and are share confidentially with them. This financial year, 2015/16, the programme will ensure that monitoring and evaluation results will be requested from service providers to reflect on the indicators and intervention programmes on behalf of the employees. Thandile Health Risk Management results are mainly requested to assist in relations to intervention.
3.11. Labour Relations
Table 3.12.1 Collective agreements for the period 1 April 2014 and 31 March 2015
Total number of Collective agreements None
TOTAL COLLECTIVE AGREEMENTS (PSCBC AND GPSSBC RESOLUTIONS)
1) GPSSBC Resolution 5 of 2014 – Agreement of recognition in improved qualifications in the public service
2) GPSSBC Resolution 4 of 2014 – Agreement on the increase of levies
3) GPSSBC Resolution 3 of 2014 – Organizational rights agreement between the state as employer in the GPSSBC and admitted trade unions
4) PSCBC Resolution 01 of 2015 – Agreement on the review and impact of existing outsourcing and agentisation practices within the public service & conducting an independent impact study on the principles of decent work
5) PSCBC Resolution 01 of 2014 – Agreement on the transfer and placement of staff in the reconfiguration of Departments.
Signed on 19
th August 2014
Signed on 31
st July 2014
Signed on 7
th July 2014
Signed on 10
th February
2015. Signed on 28
th July 2014.
Table 3.12.2 Misconduct and disciplinary hearings finalised for the period 1 April 2014 to 31 March 2015
Outcomes of disciplinary hearings Number % of total
Correctional counselling 0 0%
Verbal warnings 0 0%
Written warning 0 0%
Final written warning 0 0%
Suspended without pay coupled with fww 01 50%
Fine 0 0%
Demotion 0 0%
Dismissal 01 50%
Not guilty 0 0%
Case withdrawn 0 0%
Total 02 100%
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
92
Table 3.12.3 Types of misconduct addressed at disciplinary hearings for the period 1 April 2014 to 31 March 2015
Type of misconduct Number % of total
Misrepresentation & corruption 01 10%
Code of conduct 0 0%
Financial irregularities (case pending finalisation) 06 60%
Unlawfully operating a money lending scheme 01 10%
Abuse of government property 00 0%
Absenteeism, insubordination, derogatory language & carrying a firearm at work
01 10%
Dishonesty 01 10%
TOTAL 10 100%
Table 3.12.4 Grievances logged for the period 1 April 2014 to 31 March 2015
Grievances Number % of Total
Number of grievances resolved 09 64.28%
Number of grievances not resolved 05 35.71%
Total number of grievances lodged 14 100 %
Table 3.12.5 Disputes logged with Councils for the period 1 April 2014 to 31 March 2015
Disputes Number % of Total
Number of disputes upheld 14 100%
Number of disputes dismissed 0 0%
Total number of disputes lodged 14
Table 3.12.6 Strike actions for the period 1 April 2014 to 31 March 2015
Total number of person working days lost
0% Total number of persons working days lost
0
Total cost of working days lost 0% Total costs working days lost 0
Amount (r‟000) recovered as a result of no work no pay
0% Amount recovered as a result of no work no pay (R‟000)
0
Table 3.12.7 Precautionary suspensions for the period 1 April 2014 to 31 March 2015
Number of people suspended 11
Number of people whose suspension exceeded 30 days 10
Average number of days suspended 284.9
Cost of suspension(R‟000) R 7’ 705’ 476. 50
3.12. Skills development
Table 3.13.1 Training needs identified for the period 1 April 2014 to 31 March 2015
Occupational
category
Gender Number of
employees
as at 1
April 2014
Training needs identified at start of the reporting period
Learnerships Skills Programmes &
other short courses
Other forms of
training
Total
Legislators, senior officials and managers
Female 5
10
Executive
Development
Monitoring and
Evaluation
Strategic Planning
Policy Development
Service Delivery
Improvement
Financial Management
HRDC Summit;
PSTF
Conference;
Internal Auditor‟s
Forum; IIASA
Breakfast Forum
15
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
93
Budgeting
Mentoring and coaching
Male 20
40
Executive
Development
Performance Monitoring
& Evaluation
Service Delivery
Improvement
Fraud Prevention and
Anti-Corruption
Middle Management
Improvement Plan
Budget Management
Mentoring and coaching
Project Khaedu
Report writing
Disciplinary &
Investigation Skills
Contract Drafting
Legislative Drafting
Emerging Management
Dev Programme
Financial Management
for Non-Financial
Job Evaluation
Equate System
Organizational Design &
Development
Compulsory Induction
Programme
SITA CovTech
Conference ;
Annual Labour
Law Coference;
IIASA Breakfast
Forum; HRDC
Summit; PSTF
Conference; TLN
Conference
60
Professionals Female 3
5
Project Management
Diversity Management
Risk Management
Compulsory Induction
Programme
8
Male 33
45
Junior
Management
Report Writing
Code of Conduct
Conflict Management
Computer skills
Meeting and Minutes
Taking
Batho Pele Principles
Customer Care
Basic Computer Skills
Office Admin
Office Management
Presentation Skills
Records Management
Time Management
Diversity Management
Risk Management
Advance MS/Excel 2007
OHS
Compulsory Induction
78
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
94
Programme
Technicians and associate professionals
Female 61
100
0 0 161
Male Executive
Development
Management and
Leadership
Corporate
Governance
Monitoring and
Evaluation
Performance
Management
Risk
Management
Fraud Prevention
and Anti-
Corruption
Financial
Management
Budgeting
Mentoring and
coaching
Project Khaedu
Dialogic
Facilitation
Labour Relations
Conflict resolution
Knowledge
management
Report writing
Clerks Female 5
10
Executive
Development
Monitoring and
Evaluation
Strategic Planning
Policy Development
Service Delivery
Improvement
Financial Management
Budgeting
Mentoring and coaching
HRDC Summit;
PSTF
Conference;
Internal Auditor‟s
Forum; IIASA
Breakfast Forum
15
Male 20
40
Executive
Development
Performance Monitoring
& Evaluation
Service Delivery
Improvement
Fraud Prevention and
Anti-Corruption
Middle Management
Improvement Plan
Budget Management
Mentoring and coaching
Project Khaedu
Report writing
Disciplinary &
Investigation Skills
Contract Drafting
SITA CovTech
Conference ;
Annual Labour
Law Coference;
IIASA Breakfast
Forum; HRDC
Summit; PSTF
Conference; TLN
Conference
60
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
95
Legislative Drafting
Emerging Management
Dev Programme
Financial Management
for Non-Financial
Job Evaluation
Equate System
Organizational Design &
Development
Compulsory Induction
Programme
Service and sales workers
Female 3
5
Project Management
Diversity Management
Risk Management
Compulsory Induction
Programme
8
Male 33
45
Junior
Management
Report Writing
Code of Conduct
Conflict Management
Computer skills
Meeting and Minutes
Taking
Batho Pele Principles
Customer Care
Basic Computer Skills
Office Admin
Office Management
Presentation Skills
Records Management
Time Management
Diversity Management
Risk Management
Advance MS/Excel 2007
OHS
Compulsory Induction
Programme
78
Skilled agriculture and fishery workers
Female 61
100
0 0 161
Male Executive
Development
Management and
Leadership
Corporate
Governance
Monitoring and
Evaluation
Performance
Management
Risk
Management
Fraud Prevention
and Anti-
Corruption
Financial
Management
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
96
Budgeting
Mentoring and
coaching
Project Khaedu
Dialogic
Facilitation
Labour Relations
Conflict resolution
Knowledge
management
Report writing
Craft and related trades workers
Female 5
10
Executive
Development
Monitoring and
Evaluation
Strategic Planning
Policy Development
Service Delivery
Improvement
Financial Management
Budgeting
Mentoring and coaching
HRDC Summit;
PSTF
Conference;
Internal Auditor‟s
Forum; IIASA
Breakfast Forum
15
Male 20
40
Executive
Development
Performance Monitoring
& Evaluation
Service Delivery
Improvement
Fraud Prevention and
Anti-Corruption
Middle Management
Improvement Plan
Budget Management
Mentoring and coaching
Project Khaedu
Report writing
Disciplinary &
Investigation Skills
Contract Drafting
Legislative Drafting
Emerging Management
Dev Programme
Financial Management
for Non-Financial
Job Evaluation
Equate System
Organizational Design &
Development
Compulsory Induction
Programme
SITA CovTech
Conference ;
Annual Labour
Law Coference;
IIASA Breakfast
Forum; HRDC
Summit; PSTF
Conference; TLN
Conference
60
Plant and machine operators and assemblers
Female 3
5
Project Management
Diversity Management
Risk Management
Compulsory Induction
Programme
8
Male 33 Junior Report Writing 78
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
97
45
Management Code of Conduct
Conflict Management
Computer skills
Meeting and Minutes
Taking
Batho Pele Principles
Customer Care
Basic Computer Skills
Office Admin
Office Management
Presentation Skills
Records Management
Time Management
Diversity Management
Risk Management
Advance MS/Excel 2007
OHS
Compulsory Induction
Programme
Elementary occupations
Female 61
100
0 0 161
Male Executive
Development
Management and
Leadership
Corporate
Governance
Monitoring and
Evaluation
Performance
Management
Risk
Management
Fraud Prevention
and Anti-
Corruption
Financial
Management
Budgeting
Mentoring and
coaching
Project Khaedu
Dialogic
Facilitation
Labour Relations
Conflict resolution
Knowledge
management
Report writing
Sub Total Female 5
10
Executive
Development
Monitoring and
Evaluation
Strategic Planning
Policy Development
Service Delivery
Improvement
HRDC Summit;
PSTF
Conference;
Internal Auditor‟s
Forum; IIASA
Breakfast Forum
15
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
98
Financial Management
Budgeting
Mentoring and coaching
Male 20
40
Executive
Development
Performance Monitoring
& Evaluation
Service Delivery
Improvement
Fraud Prevention and
Anti-Corruption
Middle Management
Improvement Plan
Budget Management
Mentoring and coaching
Project Khaedu
Report writing
Disciplinary &
Investigation Skills
Contract Drafting
Legislative Drafting
Emerging Management
Dev Programme
Financial Management
for Non-Financial
Job Evaluation
Equate System
Organizational Design &
Development
Compulsory Induction
Programme
SITA CovTech
Conference ;
Annual Labour
Law Conference+
+; IIASA
Breakfast Forum;
HRDC Summit;
PSTF
Conference; TLN
Conference
60
Total 3
5
Project Management
Diversity Management
Risk Management
Compulsory Induction
Programme
8
Table 3.13.2 Training provided for the period 1 April 2014 to 31 March 2015
Occupational category Gender Number of
employees
as at 1 April
2014
Training provided
within the
reporting period
Skills
Programmes
& other short
courses
Other forms
of training
Total
Legislators, senior officials and managers
Leadership
Female 3 Executive development
Monitoring
and
Evaluation
Strategic
Planning
Policy
Development
Service
- 3
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
99
Delivery
Improvement
Financial
Management
Budgeting
Mentoring and coaching
Male 4 Management Development
Monitoring
and
Evaluation
Strategic
Planning
Policy
Development
Service
Delivery
Improvement
Financial
Management
Budgeting
Mentoring and coaching
- 4
Professionals Female 1 1
Budget Management
HRDC Summit; PSTF Conference; Internal Auditor‟s Forum; IIASA Breakfast Forum
Male 7 7
Executive Development
Budget Management
SITA CovTech
Conference ; Annual
Labour Law Conference;
IIASA Breakfast Forum; HRDC
Summit; PSTF
Conference; TLN
Conference
11
Technicians and associate professionals
Female 2 Management Development
Monitoring
and
Evaluation
Strategic
Planning
Policy
Development
- 2
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
100
Service
Delivery
Improvement
Financial
Management
Budgeting
Mentoring and coaching
Male 4 Management Development
Monitoring
and
Evaluation
Strategic
Planning
Policy
Development
Service
Delivery
Improvement
Financial
Management
Budgeting
Mentoring and coaching
- 4
Junior Management
Diversity Management Project Management Compulsory Induction Performance Management
- -
Male 28 Diversity Management Project Management Compulsory Induction Performance Management
Compulsory Induction
28
Female 21 Junior Management
Diversity Management Project Management Compulsory Induction Performance Management
Compulsory Induction
21
Elementary Occupations
Male - - - - -
3.13. Injury on duty
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
101
The following tables provide basic information on injury on duty.
Table 3.14.1 Injury on duty for the period 1 April 2014 to 31 March 2015
Nature of injury on duty Number % of total
Required basic medical attention only 1 100%
Temporary Total Disablement 0 0%
Permanent Disablement 0 0%
Fatal 0 0%
Total 1 100%
3.14. Utilisation of Consultants (To be finalized)
The following tables relate information on the utilisation of consultants in the department. In terms of the Public Service Regulations “consultant‟ means a natural or juristic person or a partnership who or which provides in terms of a specific contract on an ad hoc basis any of the following professional services to a department against remuneration received from any source:
(a) The rendering of expert advice; (b) The drafting of proposals for the execution of specific tasks; and (c) The execution of a specific task which is of a technical or intellectual nature, but excludes an employee of
a department.
Table 3.15.1 Report on consultant appointments using appropriated funds for the period 1 April 2014 to 31 March 2015
Project title
Consultants Total number
of consultants that worked on project
Duration Contract value in
(work days) Rand
Bloemfontein -100 Del Two CMax E'tsho Civils 1 171 days 9 365 745.48
Bloemfontein-100 Heidedal CMax E'tsho Civils 1 171 days 11 094 700.00
Malay Kamp-RUWACON E'tsho Civils 1 171 days 7 433 449.00
CMax-Delapidated Houses(2) E'tsho Civils 1 171 days 84 065.79
Caleb Motshabi E'tsho Civils 1 171 days 27 000 000.00
Mob Business 78 E'tsho Civils 1 171 days 588 394.59
Moyakhe-94 E'tsho Civils 1 171 days 2 353 578.36
Bloemfontein 355 M2M E'tsho Civils 1 171 days 21 686 543.46
Ruwacon-Real Deal E'tsho Civils 1 171 days 672 522.96
Ruwacon-Shale (Retention) E'tsho Civils 1 171 days 168 130.74
Superb Home 500 (14 Additional Units) E'tsho Civils 1 171 days 1 176 915.18
Superb Home (YBK)51 E'tsho Civils 1 171 days 4 287 333.87
Naturena Rock 11 (Military Vet) E'tsho Civils 1 171 days 84 065.37
Tochgekregen Farm E'tsho Civils 1 171 days 1 620 162.36
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
102
Pamper 371 Botshabelo E'tsho Civils 1 171 days 19 755 361.95
Suprim Trading 396 Botshabelo Dibetsi Consulting 1 165 days 26 564 656.92
Matsapa Trading 124 Botshabelo Dibetsi Consulting 1 165 days 3 867 007.02
Biz Africa Botshabelo 50 Dibetsi Consulting 1 165 days 1 345 045.92
Phukallang Basali Botshabelo 79 Dibetsi Consulting 1 165 days 4 406 802.49
Kentha Developers-30 Botshabelo Dibetsi Consulting 1 165 days 1 856 948.70
Biz Africa-Thaba Nchu 26 E'tsho Civils 1 171 days 168 130.74
Rehauhetswe-Botshabelo 41 Dibetsi Consulting 1 165 days 2 156 125.50
Your Trade 250 (54) Thaba Nchu E'tsho Civils 1 171 days 673 439.52
Your Trade (Jore) 229 Dibetsi Consulting 1 165 days 16 531 537.50
Your Trade (Rehauhetswe) 20 E'tsho Civils 1 171 days 1 357 659.44
Your Trade ( People First) 54 E'tsho Civils 1 171 days 2 635 456.56
Caleb Motshabi-1000 (New) Mafuri Infrastructure Africa
1 329 days 36 574 507.00
Brandwag Social Housing Project LTE 1 242 days 16 590 910.00
Hillside View Social Housing Project LTE 1 242 days 20 000 000.00
Dark & Silver City Hostels LTE 1 242 days 30 000 000.00
Merriespruit CRU Rental Housing Phetogo Consulting 1 302 days 6 999 997.50
President Steyn CRU N/A 0 N/A
G Hostel CRU Rental Family Units LTE 1 242 days 40 000 000.00
Harmony 3-500 CRU(feasibily) N/A 0 N/A 2 000 000.00
Thandanani 2010-1424 Sido Consulting 1 N/A 38 505 643.52
Nyakallong,300-Portion 8 of Uitkyk 258 N/A 0 N/A 256 020.00
Bronville:erven32179,23180,32371(Ext 10 Homestead 668)
N/A 0 N/A
54 455.00
Broville Freedom Square:erven14136,15534,28068,28069
N/A 0 N/A
296 060.10
Kutlwanong(Odendalsrus):Prtn 2 & remndr of leeubosch 285
N/A 0 N/A
268 366.00
Thandanani-Greenfield) Sido Consulting 1 N/A 12 426 064.00
Welkom Bedelia 200-Distinctive Choice (Retention)
Mafuri Infrastructure Africa
1 329 days 168 131.58
Bronville 200-M2M (34) Mafuri Infrastructure Africa
1 329 days 1 008 789.48
Welkom 300-Quick Leap Morula Consulting 1 0 days 8 405 637.00
Welkom 1700-Quick Leap Morula Consulting 1 N/A 8 405 637.00
Mmamahabane N/A 0 N/A 277 670.00
Phomolong N/A 0 N/A 154 945.00
Henneman 200 CMAX Mafuri Infrastructure Africa
1 329 days 5 214 509.00
Welkom 200 Etsho Civils Mafuri Infrastructure Africa
1 329 days 11 094 700.00
Bronville -Two Roomed Houses Rectification
Mafuri Infrastructure Africa 1 329 days
11 094 700.00
Ventersburg 50-M2M Mafuri Infrastructure Africa
1 329 days 221 894.00
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
103
Ventersburg 80- Future Solar Morula Investments 1 N/A 8 875 760.00
Lejweleputswa 126-CMAX Mafuri Infrastructure Africa
1 329 days 13 979 322.00
Ventersburg 20-Future Solar Mafuri Infrastructure Africa
1 329 days 2 700 000.00
Henneman 111-Amkelo(Land Restitution)27
Dibetsi Consulting 1 165 days
2 272 860.00
Ventersburg 5-M2M(Retention) Mafuri Infrastructure Africa
1 329 days 167 502.86
Teachers Cottages Henneman-Amkelo Morula Consulting 1 N/A 750 000.00
(Wesselsbron)Manyakeng Water & Sewer reticulation for 1000 sites + LR 112
IGS 1
N/A 34 401 000.00
Township Establishment-Bothaville 1500 N/A 0 N/A 1 061 880.00
Wesselsbron 112-CMax Morula Consulting 1 N/A 12 426 064.00
Wesselsbron 82-Amkelo Morula Consulting 1 N/A 6 892 622.34
Phahameng/Bultfontein N/A 0 N/A 172 040.00
Tikwana Hoopstad N/A 0 N/A 142 012.64
Phahameng water and sewer reticulation for erven 837
N/A 0
N/A 21 507 552.00
Verkeerdevlei N/A 0 N/A 550 296.00
Brandfort 200-Lihle Marketing IGS 1 1 day 5 043 382.20
Winburg 100-MKRK IGS 1 N/A 3 110 085.69
Winburg 106 MKRK (14) IGS 1 N/A 840 563.70
Brandfort 109 Ntilane(10)(Naturena) IGS 1 22 days 840 563.70
Naturena Rock (Woman's Built)100 Brandfort
IGS 1
22 days 2 941 972.95
Naturena Rock (Moraphooko) 100 (38) IGS 1 N/A 2 017 352.88
Naturena Rock 28 Mafuri Infrastructure Africa
1 329 days
168 112.74
Naturena Rock 156 IGS 1 N/A 4 875 269.46
Soutpan 101-Ruwacon Dibetsi Consulting 1 165 days 11 205 647.00
Bultfontein 150-Distinctive Choice (Retention)
Mafuri Infrastructure Africa
1 329 days
168 112.74
Hertzogville 100-Ruwacon(42) Dibetsi Consulting 1 165 days 4 659 774.00
Hoopstad 100-Setsoto Brick Mafuri Infrastructure Africa
1 329 days
672 450.96
Boshof 79-Phukallang Basadi Mafuri Infrastructure Africa
1 329 days
168 112.74
Dealsville 70-Ruwacon Dibetsi Consulting 1 165 days 7 766 290.00
Boshof 35 Dibetsi Consulting 1 165 days 3 883 145.00
Dealsville 60-PB (Ruwacon) Retention Mafuri Infrastructure Africa
1 329 days 168 112.94
Rammulotsi Road & Storm Water (Reticulation)
E'tsho Civils 1
171 days 11 454 412.00
Kroonstad 100-Lesoli Construction IGS 1 22 days 1 440 000.00
Viljoenskroon 100-Mminathoko Mafuri Infrastructure Africa
1 329 days
168 112.74
Kroonstad-350-Thotela Bogolo Morula Consulting 1 N/A 21 014 092.50
Future Solar-Brentpark Kroonstad IGS 1 N/A 3 987 500.00
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
104
Future Solar-Viljoenskroon IGS 1 N/A 5 883 945.90
Uvoko Civils & Maintenance IGS 1 N/A 4 202 818.50
Bokahosane Ba Bana Morula Consulting 1 N/A 6 999 999.90
Kroonstad 171-Moleboheng Developers IGS 1 N/A 13 364 962.83
Orangeville 48-Thutelabogolo Enterprise Mafuri Infrastructure Africa
1 329 days
168 112.74
Water and Sewer reticulation 2614(Refengkgotso) Mooiplats 581(Greenfield) +
IGS 1
N/A
24 980 867.62
New Project (Greenfield)(Refenkgotso) IGS 1 N/A 36 723 457.00
Orangeville 150-SEDTrade Phetogo Consulting 1 302 days 2 941 972.95
Sasolburg 400- Phetogo Consulting 1 302 days 18 408 345.03
Sasolburg 500- Phetogo Consulting 1 302 days 4 623 100.35
Sasolburg 400- Mafuri Infrastructure Africa
1 329 days
168 112.74
Zamdela Hostel 4 Morula Consulting 1 N/A 40 000 002.90
Phiritona Ext 10(922)& Tumahole Ext 7(964)Approval in Jan 14
N/A 0
N/A 679 755.89
Phiritona Ext 9(600) N/A 0 N/A 769 200.00
Ngwathe 5300-Tumahole 1000,Phiritona 1000, Mokwallo 700
N/A 0
N/A 1 768 610.00
Heilbron 150-Robs Inv Mafuri Infrastructure Africa
1 329 days
168 112.74
Heilbron 300-MB MAlatjie Mafuri Infrastructure Africa
1 329 days
2 521 691.10
Heilbron 250-MB Malatjie Morula Consulting 1 329 days 12 608 455.50
Koppies 350-Thotela Bogolo Morula Consulting 1 329 days 25 216 911.00
Parys 200-MB Malatjie Morula Consulting 1 329 days 12 020 060.91
Heilbron-(One Door-Two Roomed Units Rectification)
Phetogo Consulting 1
302 days 5 547 350.00
Frankfort/Villiers/Cornelia/Tweeling N/A 0 N/A 489 880.00
Frankfort 500-SEDTRADE Phetogo Consulting 1 302 days 4 202 818.50
Tweeling 300-SEDTRADE Phetogo Consulting 1 302 days 4 202 818.50
Villiers 200-SEDTRADE Mafuri Infrastructure Africa
1 329 days
168 112.74
Schoonplaatz Phase 4 provision of services 754 sites
Morula Consulting 1
N/A 19 374 784.00
Intabazwe 1029 N/A 0 N/A 397 152.84
Qwaqwa 300 & 200 GT Molefe (Retetion) Mafuri Infrastructure Africa
1 329 days
336 225.48
GT Molefe-Qwaqwa 100 Dibetsi Consulting 1 165 days 11 097 400.00
Subcobiz -Qwaqwa 100 (71) Mafuri Infrastructure Africa
1 329 days
168 112.74
Qwaqwa 400 & 1-Tswara Thebe Mafuri Infrastructure Africa
1 329 days
368 000.00
Harakisha 400 Tswara Thebe (396) Mafuri Infrastructure Africa
1 329 days
4 508 000.00
Qwaqwa 300-Robs Construction Mafuri Infrastructure Africa
1 329 days
4 324 000.00
Kerstel 100-Robs Construction Mafuri Infrastructure 1 329 days 184 000.00
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
105
Africa
Qwaqwa 400 Group Ywo(Retention) Mafuri Infrastructure Africa
1 329 days
184 000.00
Harrismith 100 Group Ywo (69) Mafuri Infrastructure Africa
1 329 days
2 300 000.00
Momoxa-Qwaqwa 100 (63) Mafuri Infrastructure Africa
1 329 days
1 120 000.00
Cedoh Trading-Qwaqwa 50 (38)(Retention) Mafuri Infrastructure Africa
1 329 days
168 112.74
Clarens & Diyatalawa 100-Tswara Thebe Mafuri Infrastructure Africa
1 329 days
168 130.74
Schoonplaatz Land Restitution 226 Gibb Engineering 1 N/A 26 454 204.00
Qwaqwa 750H Project Group Ywo (479) Mafuri Infrastructure Africa
1 329 days
7 061 491.08
Qwaqwa 250 Bluegumbosch Group Ywo (230)
Mafuri Infrastructure Africa
1 329 days
672 522.96
Bethlehem 500-(Barken Park Ext 5) Morula Consulting 1 N/A 53 670 400.00
Excelsior Mahlatswetsa Ext 3 Water & Sewer Reti
Phetogo Consulting 1
302 days 10 715 232.00
Thaba-Phatswa Bulk Morula Consulting 1 N/A 5 000 000.00
Teachers Cottage Tweespruit Dibetsi Consulting 1 165 days 1 173 545.00
Baken Park Ext 6 N/A 0 N/A Rate only
Dihlabeng CRU(Feasibility) N/A 0 N/A 4 000 000.00
Abuja-Paul Roux 52 Mafuri Infrastructure Africa
1 329 days
3 446 680.17
Abuja-Bethlehem 1 Mafuri Infrastructure Africa
1 329 days
84 056.37
Rosendal 21 Tswara Thebe (17) Mafuri Infrastructure Africa
1 329 days
1 429 111.29
Rosendal 50 Tswara Thebe (Retention) Mafuri Infrastructure Africa
1 329 days
168 130.74
Tlhoriso General Construction Senekal 150 Mafuri Infrastructure Africa
1 329 days
6 880 388.00
Reitz Petsana Ext 7 Water and Sewer Reti 701 sites
LTE 1
242 days 18 012 896.00
Lindley Abuja 100(Retention) Mafuri Infrastructure
Africa 1
329 days
168 112.74
Petrus Steyn 350-Vheranani 113 (1 unit) Mafuri Infrastructure
Africa 1
329 days
252 169.11
Reitz 50-Retlaphel (49) Mafuri Infrastructure
Africa 1
329 days
168 112.74
Ruwacon Reitz 100 (47) Mafuri Infrastructure
Africa 1
329 days
3 110 085.69
Warden 94-Tswara Thebe 94 Mafuri Infrastructure
Africa 1
329 days
7 901 298.78
Warden 31-Tswara Thebe(29) Mafuri Infrastructure
Africa 1
329 days
2 437 634.73
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
106
Warden 336-Tswara Thebe Gibb Engineering 1 N/A 18 660 514.14
Warden/Vrede/Memel 6000 sites N/A 0 N/A 902 520.00
Memel Ext 1 Water & Sewer Reticulation for 310 sites
Dibetsi Consulting 1
165 days 8 370 000.00
Future Indefinate-Vrede 100(Retention) Mafuri Infrastructure
Africa 1
329 days
168 130.74
Ficksburg 100-Tswara Thebe (Retention) Mafuri Infrastructure
Africa 1
329 days
168 112.74
Ficksburg 300 & 70-Tswara Thebe (Retention)
Mafuri Infrastructure
Africa 1
329 days
336 225.48
Ficksburg (New Project) Greenfield Mafuri Infrastructure
Africa 1
329 days
41 716 072.00
Superb Homes-Thaba Patswa100 Morula Consulting 1 329 days 4 454 987.61
Matsapa Trading-Ficksburg 100 ( Retention)
Mafuri Infrastructure
Africa 1
329 days
168 112.74
Ladybrand/Hobhouse 60 Lebone Const. Mafuri Infrastructure
Africa 1
329 days 8 160 000.00
Hobhouse 60 Ruwacon(60) Mafuri Infrastructure
Africa 1
329 days
6 656 820.00
Hobhouse 60 Ruwacon (46) Mafuri Infrastructure
Africa 1
329 days
3 866 593.02
Ladybrand 200- Bokang Q Mafuri Infrastructure
Africa 1
329 days
1 344 901.92
Ladybrand 100- Bokang Q (80) Mafuri Infrastructure
Africa
1 329 days 8 875 760.00
Ficksburg 70-Tswara Thebe Mafuri Infrastructure
Africa
1 329 days 168 112.74
Letsemeng 3400 erven N/A 0 N/A 1 283 160.00
Jacobsdal Ratanang Ext 4 200 N/A 0 171 days 24 000.00
Springfontein 250-Mampotla Dora E'tsho Civils 1 171 days 6 052 058.64
Springfontein 250-Suprim Zastron E'tsho Civils 1 171 days 5 883 945.90
Springfontein Suprim 121 E'tsho Civils 1 171 days 10 170 820.77
Petrusburg 72-Sediti E'tsho Civils 1 171 days 168 112.74
Gariep Dam-Sediti 66 E'tsho Civils 1 171 days 168 112.74
Koffiefontein 130-Sediti E'tsho Civils 1 171 days 168 112.74
Tierpoort 4 E'tsho Civils 1 171 days 998 857.96
Reddersburg 500 erven N/A 0 N/A 607 190.00
Bethulie 110-Zimvo Trading E'tsho Civils 1 171 days 1 051 876.70
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
107
Suprim Trading -Zastron (100) E'tsho Civils 1 171 days 1 864 288.23
Leviticus-Smithfield 10(Retention) E'tsho Civils 1 171 days 168 130.74
Leviticus -Rouxville 100 (Retention) E'tsho Civils 1 171 days 168 130.74
Furn Serv Zastron 60 (Retention) E'tsho Civils 1 171 days 168 130.74
Bethulie 100-Mminathoko Trading Dibetsi Consulting 1 165 days 11 097 400.00
Trompsburg Social Housing (Feasibility) N/A 0 N/A 2 000 000.00
Jaggersfontein-Sedite Construction 50 E'tsho Civils 1 171 days 1 670 931.25
Luckoff Teachers Cottages E'tsho Civils 1 171 days 1 248 667.45
Leviticus (Land Res,Tromp,Wepnr & De Wet) 7
E'tsho Civils 1 171 days
960 884.40
Wepener 159-Bokang Q E'tsho Civils 1 171 days 168 112.74
Dewetsdorp 150-Lapeng CC E'tsho Civils 1 171 days 168 112.74
OPSCAP N/A 0 N/A 55 875 250.00
Emergency N/A 0 N/A 22 000 000.00
Unit Shortfall (50sqm+SANS10400XA) vs 40sqm)
N/A 0
N/A
NHBRC N/A 0 N/A 15 000 000.00
Total number of projects Total individual consultants Total duration
Work days
Total contract value in
Rand
186 10 R 1 280 929 009.01
Table 3.15.2 Report on consultant appointments using Donor funds for the period 1 April 2014 to 31 March 2015
Project title Consultants
Total Number of consultant
s that worked on
project
Duration
Donor and contract value in Rand (Work
days)
Bloemfontein -100 Del Two CMax E'tsho Civils
1
6 months
(171 days)
9 365 745.48
Bloemfontein-100 Heidedal CMax E'tsho Civils
1
6 months
(171 days)
11 094 700.00
Malay Kamp-RUWACON E'tsho Civils
1
6 months
(171 days)
7 433 449.00
CMax-Delapidated Houses(2) E'tsho Civils
1
6 months
(171 days)
84 065.79
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
108
Caleb Motshabi E'tsho Civils
1
6 months
(171 days)
27 000 000.00
Mob Business 78 E'tsho Civils
1
6 months
(171 days)
588 394.59
Moyakhe-94 E'tsho Civils
1
6 months
(171 days)
2 353 578.36
Bloemfontein 355 M2M E'tsho Civils
1
6 months
(171 days)
21 686 543.46
Ruwacon-Real Deal E'tsho Civils
1
6 months
(171 days)
672 522.96
Ruwacon-Shale (Retention) E'tsho Civils
1
6 months
(171 days)
168 130.74
Superb Home 500 (14 Additional Units) E'tsho Civils
1
6 months
(171 days)
1 176 915.18
Superb Home (YBK)51 E'tsho Civils
1
6 months
(171 days)
4 287 333.87
Naturena Rock 11 (Military Vet) E'tsho Civils
1
6 months
(171 days)
84 065.37
Tochgekregen Farm E'tsho Civils
1
6 months
(171 days)
1 620 162.36
Pamper 371 Botshabelo E'tsho Civils
1
6 months
(171 days)
19 755 361.95
Suprim Trading 396 Botshabelo Dibetsi Consulting 1 N/A 26 564 656.92
Matsapa Trading 124 Botshabelo Dibetsi Consulting 1 N/A 3 867 007.02
Biz Africa Botshabelo 50 Dibetsi Consulting 1 N/A 1 345 045.92
Phukallang Basali Botshabelo 79 Dibetsi Consulting 1 N/A 4 406 802.49
Kentha Developers-30 Botshabelo Dibetsi Consulting 1 N/A 1 856 948.70
Biz Africa-Thaba Nchu 26 E'tsho Civils
1
6 months
(171 days)
168 130.74
Rehauhetswe-Botshabelo 41 Dibetsi Consulting 1 N/A 2 156 125.50
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
109
Your Trade 250 (54) Thaba Nchu E'tsho Civils
1
6 months
(171 days)
673 439.52
Your Trade (Jore) 229 Dibetsi Consulting 1 N/A 16 531 537.50
Your Trade (Rehauhetswe) 20 E'tsho Civils
1
6 months
(171 days)
1 357 659.44
Your Trade ( People First) 54 E'tsho Civils
1
6 months
(171 days)
2 635 456.56
Caleb Motshabi-1000 (New) Mafuri Investments 1 N/A 36 574 507.00
Brandwag Social Housing Project LTE 1 N/A 16 590 910.00
Hillside View Social Housing Project LTE 1 N/A 20 000 000.00
Dark & Silver City Hostels LTE 1 N/A 30 000 000.00
Merriespruit CRU Rental Housing Phetogo Consulting 1 N/A 6 999 997.50
President Steyn CRU N/A 0 N/A
G Hostel CRU Rental Family Units LTE 1 N/A 40 000 000.00
Harmony 3-500 CRU(feasibily) N/A 0 N/A 2 000 000.00
Thandanani 2010-1424 Sido Consulting 1 N/A 38 505 643.52
Nyakallong,300-Portion 8 of Uitkyk 258 N/A 0 N/A 256 020.00
Bronville:erven32179,23180,32371(Ext 10 Homestead 668)
N/A 0 N/A
54 455.00
Broville Freedom Square:erven14136,15534,28068,28069
N/A 0 N/A
296 060.10
Kutlwanong(Odendalsrus):Prtn 2 & remndr of leeubosch 285
N/A 0 N/A
268 366.00
Thandanani-Greenfield) Sido Consulting 1 N/A 12 426 064.00
Welkom Bedelia 200-Distinctive Choice (Retention)
Mafuri Infrastructure
Africa 1 N/A
168 131.58
Bronville 200-M2M (34) Mafuri Infrastructure
Africa 1 N/A
1 008 789.48
Welkom 300-Quick Leap Mafuri Infrastructure
Africa 1 N/A
8 405 637.00
Welkom 1700-Quick Leap Mafuri Infrastructure
Africa 1 N/A
8 405 637.00
Mmamahabane N/A 0 N/A 277 670.00
Phomolong N/A 0 N/A 154 945.00
Henneman 200 CMAX Mafuri Infrastructure
Africa 1 N/A
5 214 509.00
Welkom 200 Etsho Civils Mafuri Infrastructure
Africa 1 N/A
11 094 700.00
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
110
Bronville -Two Roomed Houses Rectification
Mafuri Infrastructure
Africa 1 N/A
11 094 700.00
Ventersburg 50-M2M Mafuri Infrastructure
Africa 1 N/A
221 894.00
Ventersburg 80- Future Solar Morula Investments 1 N/A 8 875 760.00
Lejweleputswa 126-CMAX Mafuri Infrastructure
Africa 1 N/A
13 979 322.00
Ventersburg 20-Future Solar Mafuri Infrastructure
Africa 1 N/A
2 700 000.00
Henneman 111-Amkelo(Land Restitution)27
Dibetsi Consulting 1 N/A
2 272 860.00
Ventersburg 5-M2M(Retention) Mafuri Infrastructure Africa
1 N/A 167 502.86
Teachers Cottages Henneman-Amkelo Morula Consulting 1 N/A 750 000.00
(Wesselsbron)Manyakeng Water & Sewer reticulation for 1000 sites + LR 112
IGS 1
N/A
34 401 000.00
Township Establishment-Bothaville 1500
N/A 0
N/A 1 061 880.00
Wesselsbron 112-CMax Morula Consulting 1 N/A 12 426 064.00
Wesselsbron 82-Amkelo Morula Consulting 1 N/A 6 892 622.34
Phahameng/Bultfontein N/A 0 N/A 172 040.00
Tikwana Hoopstad N/A 0 N/A 142 012.64
Phahameng water and sewer reticulation for erven 837
N/A 0
N/A 21 507 552.00
Verkeerdevlei N/A 0 N/A 550 296.00
Brandfort 200-Lihle Marketing IGS 1 N/A 5 043 382.20
Winburg 100-MKRK IGS 1 N/A 3 110 085.69
Winburg 106 MKRK (14) IGS 1 N/A 840 563.70
Brandfort 109 Ntilane(10)(Naturena) IGS 1 N/A 840 563.70
Naturena Rock (Woman's Built)100 Brandfort
IGS 1
N/A 2 941 972.95
Naturena Rock (Moraphooko) 100 (38) IGS 1 N/A 2 017 352.88
Naturena Rock 28 Mafuri Infrastructure Africa
1 N/A
168 112.74
Naturena Rock 156 IGS 1 N/A 4 875 269.46
Soutpan 101-Ruwacon Dibetsi Consulting 1 N/A 11 205 647.00
Bultfontein 150-Distinctive Choice (Retention)
Mafuri Infrastructure Africa
1 N/A
168 112.74
Hertzogville 100-Ruwacon(42) Dibetsi Consulting 1 N/A 4 659 774.00
Hoopstad 100-Setsoto Brick Mafuri Infrastructure Africa
1 N/A
672 450.96
Boshof 79-Phukallang Basadi Mafuri Infrastructure Africa
1 N/A
168 112.74
Dealsville 70-Ruwacon Dibetsi Consulting 1 N/A 7 766 290.00
Boshof 35 Dibetsi Consulting 1 N/A 3 883 145.00
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
111
Dealsville 60-PB (Ruwacon) Retention Mafuri Infrastructure Africa
1
6 months
(171 days)
168 112.94
Rammulotsi Road & Storm Water (Reticulation)
E'tsho Civils 1
N/A 11 454 412.00
Kroonstad 100-Lesoli Construction IGS 1 N/A 1 440 000.00
Viljoenskroon 100-Mminathoko Mafuri Infrastructure Africa
1 N/A
168 112.74
Kroonstad-350-Thotela Bogolo Morula Consulting 1 N/A 21 014 092.50
Future Solar-Brentpark Kroonstad IGS 1 N/A 3 987 500.00
Future Solar-Viljoenskroon IGS 1 N/A 5 883 945.90
Uvoko Civils & Maintenance IGS 1 N/A 4 202 818.50
Bokahosane Ba Bana Morula Consulting 1 N/A 6 999 999.90
Kroonstad 171-Moleboheng Developers
IGS 1
N/A 13 364 962.83
Orangeville 48-Thutelabogolo Enterprise
Mafuri Infrastructure Africa
1 N/A
168 112.74
Water and Sewer reticulation 2614(Refengkgotso) Mooiplats 581(Greenfield) +
IGS 1
N/A
24 980 867.62
New Project (Greenfield)(Refenkgotso) IGS 1 N/A 36 723 457.00
Orangeville 150-SEDTrade Phetogo Consulting 1 N/A 2 941 972.95
Sasolburg 400- Phetogo Consulting 1 N/A 18 408 345.03
Sasolburg 500- Phetogo Consulting 1 N/A 4 623 100.35
Sasolburg 400- Mafuri Infrastructure Africa
1 N/A
168 112.74
Zamdela Hostel 4 Morula Consulting 1 N/A 40 000 002.90
Phiritona Ext 10(922)& Tumahole Ext 7(964)Approval in Jan 14
N/A 0
N/A 679 755.89
Phiritona Ext 9(600) N/A 0 N/A 769 200.00
Ngwathe 5300-Tumahole 1000,Phiritona 1000, Mokwallo 700
N/A 0
N/A 1 768 610.00
Heilbron 150-Robs Inv Mafuri Infrastructure Africa
1 N/A
168 112.74
Heilbron 300-MB MAlatjie Mafuri Infrastructure Africa
1 N/A
2 521 691.10
Heilbron 250-MB Malatjie Morula Consulting 1 N/A 12 608 455.50
Koppies 350-Thotela Bogolo Morula Consulting 1 N/A 25 216 911.00
Parys 200-MB Malatjie Morula Consulting 1 N/A 12 020 060.91
Heilbron-(One Door-Two Roomed Units Rectification)
Phetogo Consulting 1
N/A 5 547 350.00
Frankfort/Villiers/Cornelia/Tweeling N/A 0 N/A 489 880.00
Frankfort 500-SEDTRADE Phetogo Consulting 1 N/A 4 202 818.50
Tweeling 300-SEDTRADE Phetogo Consulting 1 N/A 4 202 818.50
Villiers 200-SEDTRADE Mafuri Infrastructure Africa
1 N/A
168 112.74
Schoonplaatz Phase 4 provision of services 754 sites
Morula Consulting 1
N/A 19 374 784.00
Intabazwe 1029 N/A 0 N/A 397 152.84
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
112
Qwaqwa 300 & 200 GT Molefe (Retetion)
Mafuri Infrastructure Africa
1 N/A
336 225.48
GT Molefe-Qwaqwa 100 Dibetsi Consulting 1 N/A 11 097 400.00
Subcobiz -Qwaqwa 100 (71) Mafuri Infrastructure
Africa 1
N/A
168 112.74
Qwaqwa 400 & 1-Tswara Thebe Mafuri Infrastructure
Africa 1
N/A
368 000.00
Harakisha 400 Tswara Thebe (396) Mafuri Infrastructure
Africa 1
N/A
4 508 000.00
Qwaqwa 300-Robs Construction Mafuri Infrastructure
Africa 1
N/A
4 324 000.00
Kerstel 100-Robs Construction Mafuri Infrastructure
Africa 1
N/A
184 000.00
Qwaqwa 400 Group Ywo(Retention) Mafuri Infrastructure
Africa 1
N/A
184 000.00
Harrismith 100 Group Ywo (69) Mafuri Infrastructure
Africa 1
N/A
2 300 000.00
Momoxa-Qwaqwa 100 (63) Mafuri Infrastructure
Africa 1
N/A
1 120 000.00
Cedoh Trading-Qwaqwa 50 (38)(Retention)
Mafuri Infrastructure
Africa 1
N/A
168 112.74
Clarens & Diyatalawa 100-Tswara Thebe
Mafuri Infrastructure
Africa 1
N/A
168 130.74
Schoonplaatz Land Restitution 226 Gibb Engineering 1 N/A 26 454 204.00
Qwaqwa 750H Project Group Ywo (479)
Mafuri Infrastructure
Africa 1
N/A
7 061 491.08
Qwaqwa 250 Bluegumbosch Group Ywo (230)
Mafuri Infrastructure
Africa 1
N/A
672 522.96
Bethlehem 500-(Barken Park Ext 5) Morula Consulting 1 N/A 53 670 400.00
Excelsior Mahlatswetsa Ext 3 Water & Sewer Reti
Phetogo Consulting 1
N/A 10 715 232.00
Thaba-Phatswa Bulk Morula Consulting 1 N/A 5 000 000.00
Teachers Cottage Tweespruit Dibetsi Consulting 1 N/A 1 173 545.00
Baken Park Ext 6 N/A 0
N/A Rate only
Dihlabeng CRU(Feasibility) N/A 0 N/A 4 000 000.00
Abuja-Paul Roux 52 Mafuri Infrastructure
Africa 1
N/A
3 446 680.17
Abuja-Bethlehem 1 Mafuri Infrastructure 1 N/A 84 056.37
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
113
Africa
Rosendal 21 Tswara Thebe (17) Mafuri Infrastructure
Africa 1
N/A
1 429 111.29
Rosendal 50 Tswara Thebe (Retention) Mafuri Infrastructure
Africa 1
N/A
168 130.74
Tlhoriso General Construction Senekal 150
Mafuri Infrastructure
Africa 1
N/A
6 880 388.00
Reitz Petsana Ext 7 Water and Sewer Reti 701 sites
LTE 1
N/A 18 012 896.00
Lindley Abuja 100(Retention) Mafuri Infrastructure
Africa 1
N/A
168 112.74
Petrus Steyn 350-Vheranani 113 (1 unit)
Mafuri Infrastructure
Africa 1
N/A
252 169.11
Reitz 50-Retlaphel (49) Mafuri Infrastructure
Africa 1
N/A
168 112.74
Ruwacon Reitz 100 (47) Mafuri Infrastructure
Africa 1
N/A
3 110 085.69
Warden 94-Tswara Thebe 94 Mafuri Infrastructure
Africa 1
N/A
7 901 298.78
Warden 31-Tswara Thebe(29) Mafuri Infrastructure
Africa 1
N/A
2 437 634.73
Warden 336-Tswara Thebe Gibb Engineering 1 N/A 18 660 514.14
Warden/Vrede/Memel 6000 sites N/A 0 N/A 902 520.00
Memel Ext 1 Water & Sewer Reticulation for 310 sites
Dibetsi Consulting 1
N/A 8 370 000.00
Future Indefinate-Vrede 100(Retention) Mafuri Infrastructure
Africa 1
N/A
168 130.74
Ficksburg 100-Tswara Thebe (Retention)
Mafuri Infrastructure
Africa 1
N/A
168 112.74
Ficksburg 300 & 70-Tswara Thebe (Retention)
Mafuri Infrastructure
Africa 1
N/A
336 225.48
Ficksburg (New Project) Greenfield Mafuri Infrastructure Africa
1 N/A
41 716 072.00
Superb Homes-Thaba Patswa100 Morula Consulting 1 N/A 4 454 987.61
Matsapa Trading-Ficksburg 100 ( Retention)
Mafuri Infrastructure
Africa 1
N/A
168 112.74
Ladybrand/Hobhouse 60 Lebone Const.
Mafuri Infrastructure
Africa 1
N/A
8 160 000.00
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
114
Hobhouse 60 Ruwacon(60) Mafuri Infrastructure
Africa 1
N/A
6 656 820.00
Hobhouse 60 Ruwacon (46) Mafuri Infrastructure
Africa 1
N/A
3 866 593.02
Ladybrand 200- Bokang Q Mafuri Infrastructure
Africa 1
N/A
1 344 901.92
Ladybrand 100- Bokang Q (80) Mafuri Infrastructure
Africa 1
N/A
8 875 760.00
Ficksburg 70-Tswara Thebe Mafuri Infrastructure
Africa 1
N/A
168 112.74
Letsemeng 3400 erven N/A 0 N/A 1 283 160.00
Jacobsdal Ratanang Ext 4 200
0
6 months
(171 days)
24 000.00
Springfontein 250-Mampotla Dora E'tsho Civils
1
6 months
(171 days)
6 052 058.64
Springfontein 250-Suprim Zastron E'tsho Civils
1
6 months
(171 days)
5 883 945.90
Springfontein Suprim 121 E'tsho Civils
1
6 months
(171 days)
10 170 820.77
Petrusburg 72-Sediti E'tsho Civils
1
6 months
(171 days)
168 112.74
Gariep Dam-Sediti 66 E'tsho Civils
1
6 months
(171 days)
168 112.74
Koffiefontein 130-Sediti E'tsho Civils
1
6 months
(171 days)
168 112.74
Tierpoort 4 E'tsho Civils
1
6 months
(171 days)
998 857.96
Reddersburg 500 erven N/A 0 N/A 607 190.00
Bethulie 110-Zimvo Trading E'tsho Civils
1
6 months
(171 days)
1 051 876.70
Suprim Trading -Zastron (100) E'tsho Civils
1
6 months
(171 days)
1 864 288.23
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
115
Leviticus-Smithfield 10(Retention) E'tsho Civils
1
6 months
(171 days)
168 130.74
Leviticus -Rouxville 100 (Retention) E'tsho Civils
1
6 months
(171 days)
168 130.74
Furn Serv Zastron 60 (Retention) E'tsho Civils
1
6 months
(171 days)
168 130.74
Bethulie 100-Mminathoko Trading Dibetsi Consulting 1 N/A 11 097 400.00
Trompsburg Social Housing (Feasibility)
N/A 0 N/A
2 000 000.00
Jaggersfontein-Sedite Construction 50 E'tsho Civils
1
6 months
(171 days)
1 670 931.25
Luckoff Teachers Cottages E'tsho Civils
1
6 months
(171 days)
1 248 667.45
Leviticus (Land Res,Tromp,Wepnr & De Wet) 7
E'tsho Civils
1
6 months
(171 days)
960 884.40
Wepener 159-Bokang Q E'tsho Civils
1
6 months
(171 days)
168 112.74
Dewetsdorp 150-Lapeng CC E'tsho Civils
1
6 months
(171 days)
168 112.74
OPSCAP N/A 0 N/A 55 875 250.00
Emergency N/A 0
N/A 22 000 000.00
Unit Shortfall (50sqm+SANS10400XA) vs 40sqm)
N/A 0
N/A
NHBRC N/A 0
N/A 15 000 000.00
Total number of projects
Total individual consultants
Total duration Total contract value in Rand
Work days
186 10 R 1 280 929 009.01
3.15. Severance Packages
Table 3.16.1 Granting of employee initiated severance packages for the period 1 April 2014 to
31 March 2015
No severance packages were initiated and paid.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART D HUMAN RESOURCE MANAGEMENT
116
PART E: FINANCIAL INFORMATION
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART E FINANCIAL INFORMATION: REPORT OF THE AUDITOR GENERAL
117
Report of the Auditor General to the Free State Legislature
on Vote no. 13: Department of Human Settlements
Report on the financial statements
Introduction
1 I have audited the financial statements of the Department of Human Settlements set out on pages 129 to 181, which comprise the appropriation statement, the statement of financial position as at 31 March 2015, the statement of financial performance, statement of changes in net assets, cash flow statement for the year then ended, as well as the notes, comprising a summary of significant accounting policies and other explanatory information.
Accounting officer’s responsibility for the financial statements
2 The accounting officer is responsible for the preparation and fair presentation of these financial statements in accordance with the Modified Cash Standard prescribed by the National Treasury, the requirements of the Public Finance Management Act of South Africa, 1999 (Act No. 1 of 1999) (PFMA) and the Division of Revenue Act of South Africa, 2014 (Act No. 10 of 2014) (DoRA), and for such internal control as the accounting officer determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor-general’s responsibility
3 My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with International Standards on Auditing. Those standards require that I comply with ethical requirements, and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
4 An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor‟s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity‟s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity‟s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART E FINANCIAL INFORMATION: REPORT OF THE AUDITOR GENERAL
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5 I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my qualified audit opinion.
Basis for qualified opinion
Accruals and payables not recognised
6 The department did not have adequate systems to maintain records of accounts payable for goods and services received but not yet paid for. I was unable to obtain sufficient appropriate audit evidence for the amounts disclosed as accruals and payables not recognised in note 21 to the financial statements. I could not confirm accruals and payables by alternative means. Consequently, I was unable to determine whether any adjustment to accruals and payables stated at R956 860 000 in the financial statements was necessary.
Commitments
7 I was unable to obtain sufficient appropriate audit evidence for commitments disclosed in note 20 to the financial statements as the department did not maintain accurate and complete records of the contractual information used to determine commitments. I could not confirm the amounts by alternative means. Consequently, I was unable to determine whether any adjustment to commitments stated at R2 032 824 000 in the financial statements was necessary.
Qualified opinion
8 In my opinion, except for the possible effects of the matters described in the basis for qualified opinion paragraphs, the financial statements present fairly, in all material respects, the financial position of the Department of Human Settlements as at 31 March 2015 and its financial performance and cash flows for the year then ended, in accordance with the Modified Cash Standards prescribed by the National Treasury and the requirements of the PFMA and DoRA.
Emphasis of matters
9 I draw attention to the matters below. My opinion is not modified in respect of these matters.
Irregular expenditure
10 As disclosed in note 25 to the financial statements, the department incurred irregular expenditure of R980 965 000 (2014: R858 934 000) during the year under review as the department did not design and implement a policy relating to housing contracts that will address the constitutional requirement of fair, equitable and transparent procurement processes.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART E FINANCIAL INFORMATION: REPORT OF THE AUDITOR GENERAL
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Restatement of corresponding figures
11 As disclosed in note 32 to the financial statements, the corresponding figures for 31 March 2014 have been restated as a result of an error discovered during the financial year ending 31 March 2015 in the financial statements of the Department of Human Settlements at and for the year ended 31 March 2014.
Significant uncertainties
12 With reference to note 19 to the financial statements, the department has received claims amounting to R98 495 000 (2014: R68 571 000). The department is opposing these claims. The outcome of the matter cannot presently be determined and no provision for any liability that may result has been made in the financial statements.
Impairment of receivables
13 As disclosed in note 12 to the financial statements, material impairment of R3 227 000 was incurred as a result of irrecoverable debtors. The receivables are more than three years old and the impairment is due to unsuccessful attempts to recover the amount.
Unspent transfers
14 As disclosed in note 7 to the financial statements, the department transfers funds to state agencies and other suppliers to assist the department to fulfil its mandate. The disclosed unspent funds at year end amounts to R130 246 000.
Additional matter
15 I draw attention to the matter below. My opinion is not modified in respect of this matter.
Unaudited supplementary schedules
16 The supplementary information set out on pages 181 to 192 does not form part of the financial statements and is presented as additional information. I have not audited these schedules and, accordingly, I do not express an opinion thereon.
Report on other legal and regulatory requirements
17 In accordance with the Public Audit Act of South Africa, 2004 (Act No. 25 of 2004) (PAA) and the general notice issued in terms thereof, I have a responsibility to report findings on the reported performance information against predetermined objectives for selected programmes presented in the annual performance report, compliance with legislation and internal control. The objective of my tests was to identify reportable findings as described under each subheading but not to gather evidence to
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART E FINANCIAL INFORMATION: REPORT OF THE AUDITOR GENERAL
120
express assurance on these matters. Accordingly, I do not express an opinion or conclusion on these matters.
Predetermined objectives
18. I performed procedures to obtain evidence about the usefulness and reliability of the reported performance information for the following selected programmes presented in the annual performance report of the department for the year ended 31 March 2015:
Programme 2: Housing needs, research and planning on pages 45 to 46
Programme 3: Housing development on pages 46 to 53
19. I evaluated the reported performance information against the overall criteria of usefulness and reliability.
20. I evaluated the usefulness of the reported performance information to determine whether it was presented in accordance with the National Treasury‟s annual reporting principles and whether the reported performance was consistent with the planned programmes. I further performed tests to determine whether indicators and targets were well defined, verifiable, specific, measurable, time bound and relevant, as required by the National Treasury’s Framework for managing programme performance information (FMPPI).
21. I assessed the reliability of the reported performance information to determine whether it was valid, accurate and complete.
22. The material findings in respect of the selected programmes are as follows:
Programme 2: Housing needs, research and planning
Reliability of reported performance information
23. The FMPPI requires auditees to have appropriate systems to collect, collate, verify and store performance information to ensure valid, accurate and complete reporting of actual achievements against planned objectives, indicators and targets. I was unable to obtain the information and explanations I considered necessary to satisfy myself as to the reliability of the reported performance information. This was due to the completeness of source documentation in support of actual achievements not being monitored and the validity of reported achievements not being frequently reviewed against source documentation.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART E FINANCIAL INFORMATION: REPORT OF THE AUDITOR GENERAL
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Programme 3: Housing development
Reliability of reported performance information
24. The FMPPI requires auditees to have appropriate systems to collect, collate, verify and store performance information to ensure valid, accurate and complete reporting of actual achievements against planned objectives, indicators and targets. Adequate and reliable corroborating evidence could not be provided for 29% of the targets to assess the reliability of the reported performance information. The auditee‟s records did not permit the application of alternative audit procedures. This was due to the completeness of source documentation in support of actual. Achievements not being monitored and the validity of reported achievements not being frequently reviewed against source documentation.
Additional matters
25. I draw attention to the following matters:
Achievement of planned targets
26 Refer to the annual performance report on pages 45 to 46 and 46 to 53 for information on the achievement of planned targets for the year. This information should be considered in the context of the material findings on the reliability of the reported performance information for the selected programmes reported in paragraphs 23 and 24 of this report.
Compliance with legislation
27. I performed procedures to obtain evidence that the department had complied with applicable legislation regarding financial matters, financial management and other related matters. My material findings on compliance with specific matters in key legislation, as set out in the general notice issued in terms of the PAA, are as follows:
Strategic planning and performance management
28. Effective, efficient and transparent systems of internal control with respect to performance information and management was not maintained as required by section 38(1)(a)(i) of the PFMA.
Annual financial statements
29. The financial statements submitted for auditing were not prepared in accordance with the prescribed financial reporting framework and supported by full and proper records as required by section 40(1)(a) and (b) of the PFMA. Material misstatements of disclosure items identified by the auditors in the submitted financial statements were subsequently corrected; the supporting records that could not be provided resulted in the financial statements receiving a qualified audit opinion.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART E FINANCIAL INFORMATION: REPORT OF THE AUDITOR GENERAL
122
Procurement and contract management
30. I could not obtain sufficient appropriate audit evidence that all contracts were awarded in accordance with the legislative requirements as requested tender documentation could not be submitted.
31. Quotations were awarded to bidders who did not submit a declaration on whether they are employed by the state or connected to any person employed by the state, which is prescribed to comply with treasury regulation 16A8.3.
32. Persons in the service of the department whose close family members, partners or associates had a private or business interest in contracts awarded by the department failed to disclose such interest, as required by treasury regulation 16A8.4.
33 Persons in the service of other state institutions who had a private or business interest in contracts awarded by the department participated in the process relating to that contract in contravention of treasury regulation 16A8.4.
Human resource management
34. Funded vacant posts were not filled within 12 months as required by public service regulation 1/VII/C.1A.2.
Grants management
35 Sufficient appropriate audit evidence could not be obtained that the rectification process was performed on houses that qualified for rectification, in contravention of paragraph 2.3 of Part 3 of the Housing Code, issued in terms of section 4 of the Housing Act, 1997 (Act No. 107 of 1997).
Expenditure management
36. Steps taken were not effective to prevent irregular and fruitless and wasteful expenditure, as required by section 38(1)(c)(ii) of the PFMA and treasury regulation 9.1.1.
37. Contractual obligations and money owed by the department were not settled within 30 days or an agreed period, as required by section 38(1)(f) of the PFMA and treasury regulation 8.2.3.
Assets management
38. Proper control systems to safeguard and maintain assets were not implemented, as required by section 38(1)(d) of the PFMA and treasury regulation 10.1.1(a).
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART E FINANCIAL INFORMATION: REPORT OF THE AUDITOR GENERAL
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Consequence management
39. Investigations were not conducted into all allegations of financial misconduct committed by officials, as required by treasury regulation 4.1.1.
Internal control
40. I considered internal control relevant to my audit of the financial statements, annual performance report and compliance with legislation. The matters reported below are limited to the significant internal control deficiencies that resulted in the basis for qualified opinion, the findings on the annual performance report and the findings on compliance with legislation included in this report.
Leadership
41. Steps taken to ensure the effective oversight of financial and performance reporting, compliance with laws and regulations and related internal controls did not result in fewer significant audit findings. The leadership of the department did not timeously capacitate the finance section to ensure improvement in the controls relating to financial and performance reporting.
Financial and performance management
42. The department did not maintain a timely and proper record management system to ensure that complete, relevant and accurate information was accessible and available to support financial and performance reporting. Due managements‟ slow response in addressing prior year audit findings this contributed to the department‟s inability to implement internal controls over daily and monthly processing of transactions.
Governance
43. The internal audit unit did not review IT related matters and asses IT controls during the financial year under review. This contributed to the department not being able to improve the housing subsidy system which is used as a contract management system and to report on performance.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART E FINANCIAL INFORMATION: REPORT OF THE AUDITOR GENERAL
124
Other reports
Investigations
44 An investigation is being conducted on suspected fraud in the payment of advances to material suppliers during 2010-11 financial years. The investigation commenced in June 2012 and was still on-going at the time of reporting.
45 An investigation is being conducted on housing subsidies paid to beneficiaries. The investigation
commenced in the 2008-09 financial year. This investigation has been extended to include suspected fraud in the
payment of advances to material suppliers during the 2010-2011 financial years. The investigation was still in
progress at the reporting date.
Bloemfontein
31 July 2015
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART E FINANCIAL INFORMATION: REPORT OF THE AUDITOR GENERAL- FREE STATE HOUSING FUND
125
Report of the Auditor-General to Free State Legislatureon
the Free State Housing Fund
Report on the financial statements
Introduction
1. I have audited the financial statements of the Free State Housing Fund set out on pages 195 to 217, which comprise the statement of financial position as at 31 March 2015, the statement of financial performance, statement of changes in net assets and cash flow statement for the year then ended, as well as the notes, comprising a summary of significant accounting policies and other explanatory information.
Accounting officer’s responsibility for the financial statements
2. The accounting officer is responsible for the preparation and fair presentation of these financial statements in accordance with the South African Standards of Generally Recognised Accounting Practice (SA standards of GRAP) and the requirements of the Public Finance Management Act of South Africa, 1999 (Act No. 1 of 1999) (PFMA), and for such internal control as the accountingofficer determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor-general’s responsibility
3. My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with International Standards on Auditing. Those standards require that I comply with ethical requirements, and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor‟s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity‟s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity‟s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
5. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART E FINANCIAL INFORMATION: REPORT OF THE AUDITOR GENERAL- FREE STATE HOUSING FUND
126
Opinion
6. In my opinion, the financial statements present fairly, in all material respects, the financial position of the Free State Housing Fund as at 31 March 2015 and itsfinancial performance and cash flows for the year then ended, in accordance with SA standards of GRAP and the requirements of the PFMA.
Emphasis ofmatters
I draw attention to the matters below. My opinion is not modified in respect of these matters
Significant uncertainties
7. The Free State Housing Fund will discontinue once the housing act No.107 of 1997 is cancelled. Specific timeline pertaining to this matter has not been outlined. As a result the entity is a process of clearing all the assets, accounts, and transactions, but will only be able to close the fund once the housing act has been repealed.
Related parties
8. As disclosed in the annual financial statements, the Free State Housing Fund‟s management decisions are controlled by the Free State department of human settlements. Amount disclosed in payables regarding the related party transactions is R12 167 000.
Report on other legal and regulatory requirements
9. We did not audit performance against predetermined objectives, as the fund is not required to prepare a report on its performance against predetermined objectives. The fund does not fall within the ambit of the PFMA and the entity-specific legislation does not require reporting on performance against predetermined objectives.
Compliance with legislation
10. We did not audit compliance with legislation, as the fund is not required to comply with the PFMA. The fund does not fall within the ambit of the PFMA.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART E FINANCIAL INFORMATION: REPORT OF THE AUDITOR GENERAL- FREE STATE HOUSING FUND
127
Internal control
11. I considered internal control relevant to my audit of the financial statements, programme performance information and compliance with legislation. I did not identify any significant deficiencies in internal control.
Bloemfontein
31 July 2015
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
PART E FINANCIAL INFORMATION: REPORT OF THE AUDITOR GENERAL- ANNUAL FINANCIAL
STATEMENTS
128
1. ANNUAL FINANCIAL STATEMENTS
Table of Contents
Appropriation Statement 129
Notes to the Appropriation Statement 142
Statement of Financial Performance 145
Statement of Financial Position 146
Statement of Changes in Net Assets 147
Cash Flow Statement 148
Notes to the Annual Financial Statements (including Accounting policies) 149
Disclosures Notes to the Annual Financial Statements
Annexures (Unaudited Supplementary Information) 181
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
APPROPRIATION STATEMENT for the year ended 31 March 2015
129
1. Appropriation per programme
Appropriation per programme
2014/15 2013/14
Voted funds and Direct charges Adjusted
Appropriation
Shifting of
Funds
Virement Final
Appropriation
Actual
Expenditure
Variance Expenditure
as % of
final
appropriation
Final
Appropriation
Actual
Expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Programme
1. Administration
83 506
-
(3 021)
80 485
77 314
3 171
96.1%
68 672
68 257
2. Housing, needs, research and
Planning
17 677 - 876 18 553 17 607 946 94.9% 13 194 12 829
3. Housing Development 1 126 141 - 2 075 1 128 216 1 111 861 16 355 98.6% 1 401 294 1 400 500
4. Housing Asset Management,
Property Management
894 - 70 964 770 194 79.9% 1 007 175
TOTAL 1 228 218 - 1 228 218 1 207 552 20 666 98.3% 1 484 167 1 481 761
2014/15 2013/14
Final
Appropriation
Actual
Expenditure
Final
Appropriation
Actual
Expenditure
Actual amounts per statement of financial performance (total revenue) 1 228 218 1 484 167
ADD
Aid assistance - -
Prior year unauthorised expenditure approved without funding - -
Actual amounts per statement of financial performance (total expenditure) 1 207 552 1 481 761
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
APPROPRIATION STATEMENT for the year ended 31 March 2015
130
Appropriation per economic classification
2014/15 2013/14
Adjusted
Appropriation
Shifting of
Funds
Virement Final
Appropriation
Actual
Expenditure
Variance Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Current payments 149 699 (541) 149 158 144 316 4 842 96.8% 130 241 128 380
Compensation of employees 108 491 (542) 406 108 355 107 772 583 99.5% 92 624 92 442
Salaries and wages 94 020 1 280 297 95 597 95 114 483 99.5% 80 979 80 797
Social contributions 14 471 (1 822) 109 12 758 12 658 100 99.2% 11 645 11 645
Goods and services 41 158 (406) 40 752 36 515 4 237 89.6% 37 511 35 832
Administrative fees 340 224 - 564 423 141 75.0% 265 193
Advertising 1 043 (679) 114 478 245 233 51.3% 493 457
Minor assets 394 41 - 435 250 185 57.5% 512 50
Audit costs: External 8 200 (499) - 7 701 7 009 692 91.0% 10 069 10 724
Bursaries: Employees 300 (173) - 127 43 84 33.9% - -
Catering: Departmental activities 1 449 (458) - 991 734 257 74.1% 1 516 1 510
Communication 1 730 (599) - 1 131 1 084 47 95.8% 1 238 1 241
Computer services 841 2 042 (922) 1 961 1 933 28 98.6% - -
Consultants: Business and advisory services
552 (497) - 55 54 1 98.2% - -
Legal services 4 041 (1 267) - 2 774 2 767 7 99.7% 4 135 3 252
Contractors 1 095 736 - 1 831 1 724 107 94.2% 554 21
Agency and support / outsourced services
- 85 - 85 85 1 683 3 231
Entertainment 88 (52) - 36 10 26 27.8% 31 14
Fleet services 2 500 188 - 2 688 2 688 100.0% 2 167 2 382
Inventory: Clothing material and supplies
68 (56) - 12 1 11 8.3% 17 -
Consumable supplies 185 2 - 187 104 83 55.6% 143 47
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
APPROPRIATION STATEMENT for the year ended 31 March 2015
131
Appropriation per economic classification
2014/15 2013/14
Adjusted
Appropriation
Shifting of
Funds
Virement Final
Appropriation
Actual
Expenditure
Variance Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Consumable: Stationery, printing and office supplies
2 000 (622) - 1 378 963 415 69.9% 767 521
Operating leases 3 500 593 - 4 093 3 869 224 94.5% 2 977 2 973
Property payments 404 136 - 540 399 141 73.9% 984 368
Transport provided: Departmental activity
- - - - - - - 1 1
Travel and subsistence 10 303 159 402 10 864 9 773 1 091 90.0% 8 024 7 203
Training and development 735 (229) - 506 428 78 84.6% 306 242
Operating payments 1 020 560 - 1 580 1 335 245 84.5% 1 062 857
Venues and facilities 370 365 - 735 679 56 92.4% 566 545
Rental and hiring - - - - - - - 1 -
Interest and rent on land 50 1 - 51 29 22 56.9% 106 106
Interest 50 1 - 51 29 22 56.9% 106 106
Transfers and subsidies 1 075 723 - - 1 075 723 1 060 406 15 317 98.6% 1 351 801 1 351 801
Higher education institutions 808 (42) (5) 761 352 409 46.3% - -
Households 1 074 915 42 5 1 074 962 1 060 054 14 908 98.6% 1 351 801 1 351 801
Social benefits 20 256 79 355 350 5 98.6% 865 865
Other transfers to households 1 074 895 (214) (74) 1 074 607 1 059 704 14 903 98.6% 1 350 936 1 350 936
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
APPROPRIATION STATEMENT for the year ended 31 March 2015
132
Appropriation per economic classification
2014/15 2013/14
Adjusted
Appropriation
Shifting of
Funds
Virement Final
Appropriation
Actual
Expenditure
Variance Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Payments for capital assets 2 796 541 - 3 337 2 752 585 82.5% 2 125 1 379
Machinery and equipment 2 796 541 - 3 337 2 752 585 82.5% 2 125 1 379
Transport equipment - - - - - - - - -
Other machinery and equipment
2 796 541 - 3 337 2 752 585 82.5% 2 125 1 379
Payments for financial assets - - - - 78 (78) - - 201
1 228 218 - - 1 228 218 1 207 552 20 666 98.3% 1 484 167 1 481 761
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
APPROPRIATION STATEMENT for the year ended 31 March 2015
133
Programme 1: Administration
2014/15 2013/14
Adjusted
Appropriation
Shifting of
Funds
Virement Final
Appropriation
Actual
Expenditure
Variance Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Sub programme
1. Corporate Services
83 506
-
(3 021)
80 485
77 314
3 171
96.1%
68 672
68 257
83 506 - (3 021) 80 485 77 314 3 171 96.1% 68 672 68 257
Economic classification
Current payments 82 132 (509) (3 025) 78 598 75 740 2 858 96.4% 67 625 67 191
Compensation of employees 51 626 (542) (2 103) 48 981 48 677 304 99.4% 41 238 41 184
Salaries and wages 43 904 605 (1 670) 42 839 42 590 249 99.4% 35 984 35 930
Social contributions 7 722 (1 147) (433) 6 142 6 087 55 99.1% 5 254 5 254
Goods and services 30 456 33 (922) 29 567 27 035 2 532 91.4% 26 281 25 901
Administrative fees 175 197 - 372 282 90 75.8% 80 66
Advertising 375 (202) - 173 84 89 48.6% - -
Minor assets 225 (77) - 148 73 75 49.3% 48 12
Audit costs: External 8 200 (499) - 7 701 7 009 692 91.0% 10 069 10 724
Bursaries: Employees 300 (173) - 127 43 84 33.9% - -
Catering: Departmental activities 540 50 - 590 433 157 73.4% 173 131
Communication 1 730 (599) - 1 131 1 084 47 95.8% 1 238 1 241
Computer services 841 2 042 (922) 1 961 1 933 28 98.6% - -
Consultants: Business and advisory services
552 (497) - 55 54 1 98.2% - -
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
APPROPRIATION STATEMENT for the year ended 31 March 2015
134
Programme 1: Administration
2014/15 2013/14
Adjusted
Appropriation
Shifting of
Funds
Virement Final
Appropriation
Actual
Expenditure
Variance Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Legal services 4 041 (1 267) - 2 774 2 767 7 99.7% 3 481 2 752
Contractors 928 425 - 1 353 1 289 64 95.3% 1 526 1
Agency and support / outsourced services
- 85 - 85 - 85 - 1 680 3 028
Entertainment 49 (25) - 24 9 15 37.5% 15 8
Fleet services 2 500 188 - 2 688 2 688 - 100.0% 2 167 2 382
Housing - - - - - - - - -
Inventory: Clothing material and supplies
24 (24) - - - - - - -
Consumable supplies 115 17 - 132 72 60 54.5% 39 34
Consumable: Stationery, printing and office supplies
1 030 (360) - 670 520 150 77.6% 298 213
Operating leases 3 500 593 - 4 093 3 869 224 94.5% 2 965 2 961
Property payments - 1 - 1 - 1 - - -
Travel and subsistence 4 526 148 - 4 674 4 205 469 90.0% 2 130 2 066
Training and development 735 (229) - 506 428 78 84.6% 306 242
Operating payments 50 140 - 190 95 95 50.0% 66 39
Venues and facilities 20 99 - 119 98 21 82.4% - 1
Interest and rent on land 50 - - 50 28 22 56.0% 106 106
Interest 50 - - 50 28 22 56.0% 106 106
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
APPROPRIATION STATEMENT for the year ended 31 March 2015
135
Programme 1: Administration
2014/15 2013/14
Adjusted
Appropriation
Shifting of
Funds
Virement Final
Appropriation
Actual
Expenditure
Variance Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Transfers and subsidies - - 4 4 3 1 75.0% 38 38
Households - - 4 4 3 1 75.0% 38 38
Social benefits
- - 4 4 3 1 75.0% 38 38
Payments for capital assets 1 374 509 - 1 883 1 571 312 83.4% 1 009 918
Machinery and equipment 1 374 509 - 1 883 1 571 312 83.4% 1 009 918
Other machinery and equipment
Payment for financial assets
1 374
-
509
-
-
-
1 883
-
1 571
-
312
-
83.4%
-
1 009
-
918
110
Total 83 506 - (3 021) 80 485 77 314 3 171 96.1% 68 672 68 257
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
APPROPRIATION STATEMENT for the year ended 31 March 2015
136
Programme 2: Housing Needs, Research and Planning
2014/15 2013/14
Adjusted
Appropriation
Shifting of
Funds
Virement Final
Appropriation
Actual
Expenditure
Variance Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Sub programme
1. Housing Needs, Research and
Planning
17 677 - 876 18 553 17 607 946 94.9% 13 194 12 829
17 677 - 876 18 553 17 607 946 94.9% 13 194 12 829
Economic classification
Current payments 16 125 - 975 17 100 16 617 483 97.2% 11 966 11 818
Compensation of employees 11 588 - 975 12 563 12 545 18 99.9% 8 758 8 741
Salaries and wages 10 683 (365) 890 11 208 11 196 12 99.9% 7 736 7 719
Social contributions 905 365 85 1 355 1 349 6 99.6% 1 022 1 022
Goods and services 4 537 - - 4 537 4 072 465 89.8% 3 208 3 077
Administrative fees 71 (12) - 59 53 6 89.8% 43 37
Advertising 200 (115) - 85 47 38 55.3% 172 166
Minor assets 169 (56) - 113 93 20 82.3% 33 -
Catering: Departmental activities 540 (202) - 338 269 69 79.6% 342 367
Legal services - - - - - - - 654 500
Contractors 37 219 - 256 222 34 86.7%
Agency and support / outsourced services
- - - - - - - 3 195
Entertainment
Inventory: Clothing material and accessories
3 - - 3 - 3 - -
7
-
Consumable supplies 15 16 - 31 21 10 67.7% 3 3
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
APPROPRIATION STATEMENT for the year ended 31 March 2015
137
Programme 2: Housing Needs, Research and Planning
2014/15 2013/14
Adjusted
Appropriation
Shifting of
Funds
Virement Final
Appropriation
Actual
Expenditure
Variance Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Consumable: Stationery, printing and office supplies
295 (108) - 187 151 36 80.7% 154 155
Property payments 230 137 - 367 279 88 76.0% 153 153
Transport provided: Departmental activity
- - - - - - - 1 1
Travel and subsistence 1 857 (413) - 1 444 1 354 90 93.8% 1 073 973
Training and development - - - - - - - - -
Operating payments 770 281 - 1 051 1 002 49 95.3% 538 496
Venues and facilities 350 253 - 603 581 22 96.4% 31 31
Rental and hiring - - - - - - - 1 -
Transfers and subsidies 1 070 - (99) 971 551 420 56.7% 827 827
Higher education institutions 808 (42) (5) 761 352 409 46.3% - -
Non-profit institutions - - - - - - - - -
Households 262 42 (94) 210 199 11 94.8% 827 827
Social benefits 20 96 (20) 96 96 - 100.0% 827 827
Other transfers to households 242 (54) (74) 114 103 11 90.4% - -
Payments for capital assets 482 - - 482 439 43 91.1% 401 110
Other machinery and equipment
Payment for financial assets
482
-
-
-
-
-
482
-
439
-
43
-
91.1%
-
401
-
110
74
Total 17 677 - 876 18 553 17 607 946 94.9% 13 194 12 829
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
APPROPRIATION STATEMENT for the year ended 31 March 2015
138
Programme 3: Housing Development
2014/15 2013/14
Adjusted
Appropriation
Shifting of
Funds
Virement Final
Appropriation
Actual
Expenditure
Variance Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Sub programme
1. Housing Development
1 126 141
-
2 075
1 128 216
1 111 861
16 355
98.6%
1 401 294
1 400 500
1 126 141 - 2 075 1 128 216 1 111 861 16 355 98.6% 1 401 294 1 400 500
Economic classification
Current payments 50 548 (32) 1 980 52 496 51 189 1 307 97.5% 49 735 49 196
Compensation of employees 44 827 - 1 464 46 291 46 039 252 99.5% 42 539 42 476
Salaries and wages 39 061 1 033 1 007 41 101 40 886 215 99.5% 37 172 37 109
Social contributions 5 766 (1 033) 457 5 190 5 153 37 99.3% 5 367 5 367
Goods and services 5 721 (32) 516 6 205 5 150 1 055 83.0% 7 196 6 720
Administrative fees 94 39 - 133 88 45 66.2% 142 90
Advertising 248 (248) 114 114 114 100.0% 262 239
Minor assets - 174 - 174 84 90 48.3% 431 38
Catering: Departmental activities 369 (306) - 63 32 31 50.8% 1 001 1 012
Contractors 130 92 - 222 213 9 95.9% (980) 12
Agency and support / outsourced services
- - - - - - - - 8
Entertainment 36 (27) - 9 1 8 11.1% 16 6
Inventory: Clothing material and supplies
44 (32) - 12 1 11 8.3% 10 -
Consumable supplies 55 (31) - 24 11 13 45.8% 30 10
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
APPROPRIATION STATEMENT for the year ended 31 March 2015
139
Programme 3: Housing Development
2014/15 2013/14
Adjusted
Appropriation
Shifting of
Funds
Virement Final
Appropriation
Actual
Expenditure
Variance Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Consumable: Stationery, printing and office supplies
575 (250) - 325 134 191 41.2% 292 132
Operating leases - - - - - - - 12 12
Property payments 50 (19) - 31 20 11 64.5% 166 162
Travel and subsistence 3 920 424 402 4 746 4 214 532 88.8% 4 821 4 164
Operating payments 200 139 - 339 238 101 70.2% 458 322
Venues and facilities - 13 - 13 - 13 - 535 513
Transfers and subsidies 1 074 653 - 95 1 074 748 1 059 852 14 896 98.6% 1 350 936 1 350 936
Households 1 074 653 - 95 1 074 748 1 059 852 14 896 98.6% 1 350 936 1 350 936
Social benefits - 160 95 255 251 4 98.4% - -
Other transfers to households 1 074 653 (160) - 1 074 493 1 059 601 14 892 98.6% 1 350 936 1 350 936
Payments for capital assets 940 32 - 972 742 230 76.3% 623 351
Machinery and equipment 940 32 - 972 742 230 76.3% 623 351
Other machinery and equipment
940 32 - 972 742 230 76.3% 623 351
Payments for financial assets - - - - 78 (78) - - 17
Total 1 126 141 - 2 075 1 128 216 1 111 861 16 355 98.6% 1 401 294 1 400 500
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
APPROPRIATION STATEMENT for the year ended 31 March 2015
140
Programme 4: Housing Asset Management & Property Management
2014/15 2013/14
Adjusted
Appropriation
Shifting of
Funds
Virement Final
Appropriation
Actual
Expenditure
Variance Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Sub programme
1. Administration
894
-
70
964
770
194
79.9%
1 007
175
894 - 70 964 770 194 79.9% 1 007 175
Economic classification
Current payments 894 - 70 964 770 194 79.9% 915 175
Compensation of employees 450 - 70 520 511 9 98.3% 89 41
Salaries and wages 372 7 70 449 442 7 98.4% 87 39
Social contributions 78 (7) - 71 69 2 97.2% 2 2
Goods and services 444 (1) - 443 258 185 58.2% 826 134
Advertising 220 (114) - 106 - 106 - 59 52
Contractors - - - - - - - 8 8
Consumable supplies - - - - - - 71 -
Consumable: Stationery, printing and office supplies
100 96 - 196 158 38 80.6% 23 21
Property payments 124 17 - 141 100 41 70.9% 665 53
Interest and rent on land - 1 - 1 1 - 100.0% - -
Interest - 1 - 1 1 100.0% - -
Transfers and subsidies - - - - - - - - -
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
APPROPRIATION STATEMENT for the year ended 31 March 2015
141
Programme 4: Housing Asset Management & Property Management
2014/15 2013/14
Adjusted
Appropriation
Shifting of
Funds
Virement Final
Appropriation
Actual
Expenditure
Variance Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Payments for capital assets - - - - - - - 92 -
Machinery and equipment - - - - - - - 92 -
Other machinery and equipment
- - - - - - - 92 -
Payments for financial assets - - - - - - - - -
Total 894 - 70 964 770 194 79.9% 1 007 175
FREE STATE: DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE APPROPRIATION STATEMENT
for the year ended 31 March 2015
142
1. Detail of transfers and subsidies as per Appropriation Act (after Virement):
Detail of these transactions can be viewed in the note on Transfers and subsidies, disclosure notes and
Annexure 1 (A-D) to the Annual Financial Statements.
2. Detail of specifically and exclusively appropriated amounts voted (after Virement):
Detail of these transactions can be viewed in note 1 (Annual Appropriation) to the Annual Financial
Statements.
3. Detail on payments for financial assets
Detail of these transactions per programme can be viewed in the note on Payments for financial assets
to the Annual Financial Statements.
4. Explanations of material variances from Amounts Voted (after Virement):
4.1 Per programme Final
Appropriation
Actual
Expenditure
Variance
R’000
Variance as a
% of Final
Appropriation
Administration 80 485 77 314 3 171 4%
Housing Needs, Research & Planning 18 553 17 606 947 5%
Housing Development 1 128 216 1 111 862 16 354 1%
Housing Assets Management & Property
Management
964 769 195 20%
Explanation of variance: Programme 1 under spent mainly on goods & services by R2, 3 million due to funds
made available to SITA to improve IT infrastructure, however SITA completed the work late and submitted the
invoice in the new financial year. Machinery & equipment by R0.283 million as the suppliers submitted the invoices
late. Programme 2 under spent on goods & services By R0.340 million because the Department received invoices
late from suppliers and higher education institutions by R0.409 million due to invoices from the University which
were only submitted after 31st March because the program run until the 20
th of March 2015. Programme 3 under
spent due to a special adjustment budget that was done late in March for the Military Veterans project (R14.8
million). Programme 4 under spent on goods & services also as a result of cost containment measures.
Programme 1: Administration Final
Appropriation
Actual
Expenditure
Variance
R’000
Variance as a
% of Final
Appropriation
Compensation of employees 48 981 48 677 304 1%
Goods and services 29 567 27 034 2 533 9%
Interest and rent on land 50 29 21 42%
Households (H/H) 4 3 1 25%
Machinery and Equipment 1 883 1 571 312 17%
Explanation of variance: Programme 1 under spent mainly on goods & services by R2, 3 million due to funds
made available to SITA to improve IT infrastructure, however SITA completed the work late and submitted the
invoice in the new financial year. Machinery & equipment by R0.283 million as the suppliers submitted the invoices
late.
FREE STATE: DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE APPROPRIATION STATEMENT
for the year ended 31 March 2015
143
Programme 2: Housing needs, Research
and Planning
Final
Appropriation
Actual
Expenditure
Variance
R’000
Variance as a
% of Final
Appropriation
Compensation of employees 12 563 12 544 19 0%
Goods and services 4 537 4 072 465 10%
Higher Education Institutions 761 352 409 54%
Households (H/H) 210 199 11 5%
Machinery and Equipment 482 439 43 9%
Explanation of variance: The under spending on higher education institution is due to invoices from the University
which only submitted after the 31st March 2015, because the programme ran until the 20
th of March 2015.
Programme 2 also under spent on goods & services By R0.340 million because the Department received invoices
late from suppliers.
Programme 3: Housing Development Final
Appropriation
Actual
Expenditure
Variance
R’000
Variance as a
% of Final
Appropriation
Compensation of employees 46 291 46 039 252 1%
Goods and services 6 205 5 150 1 055 17%
Households (H/H) 1 074 748 1 059 853 14 895 1%
Machinery and Equipment 972 742 230 24%
Payment for Financial Assets - 78 78 -
Explanation of variance: Programme 3 under spent on goods & services by an amount of R0, 895 million as well
as on machinery & equipment by an amount of R0, 207 million because of the cost containment measures that was
implemented by Provincial Treasury in the 2014/2015 financial year. Programme 3 also under spent due to a special
adjustment budget that was done late in March for the Military Veterans project (R14.8 million).
Programme 4: Housing Asset
Management, Property Management
Final
Appropriation
Actual
Expenditure
Variance
R’000
Variance as a
% of Final
Appropriation
Compensation of employees 520 510 10 2%
Goods and services 443 258 185 42%
Interest and rent on land 1 1 - -
Explanation of variance: Programme 4 under spent on goods & services also as a result of cost containment
measures.
FREE STATE: DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE APPROPRIATION STATEMENT
for the year ended 31 March 2015
144
4.2 Per economic classification: Final
Appropriation
Actual
Expenditure
Variance Variance as a
% of Final
Appropriation
R’000 R’000 R’000 R’000
Current expenditure
Compensation of employees 108 355 107 772 583 1%
Goods and services 40 752 36 514 4 238 10%
Interest and rent on land 51 29 22 43%
Transfers and subsidies
Higher education institutions 761 352 409 54%
Households 1 074 962 1 060 055 14 907 1%
Payments for capital assets
Machinery and equipment 3 337 2 752 585 18%
Payments for financial assets - 78 - -
Explanation of variance: The under spent mainly on goods & services by R 3.6 million due to funds made
available to SITA to improve IT Infrastructure, however SITA completed the work late and submitted the invoice in the new financial year and machinery and equipment by R 0.534 million as the suppliers submitted the invoices late . The transfers and subsidies also under spent on higher education institutions by R 0.409 million due to invoices from the University which only submitted after the 31st of March, because the programme ran until the 20th of March 2015. Programme 3 also under spent due to a special adjustment budget that was done late in March for the Military Veterans project (R14.8 million).
4.3 Per conditional grant
Final
Appropriation
Actual
Expenditure
Variance Variance as a
% of Final
Appropriation
R’000 R’000 R’000 %
Human Settlements Development Grant
Individual Housing Subsidies 8 047 8 045 2 0%
Rectification of RDP stock 1994-2002 2 400 2 400 0 0%
Rectification of Hous Stoc Pre 1994 96 498 96 488 10 0%
Operational Capital Budget 33 571 33 570 1 0%
Unblocked of Blocked Projects 14 783 14 766 17 0%
Procurement of Land 20 000 20 000 0 0%
NHBRC Enrolment of land 36 289 36 289 0 0%
Integrate Resid Den Prog: Phase 1 99 513 99 495 18 0%
Integrate Resid Den Prog: Phase 4 633 082 618 250 14 832 2%
People Housing Process 10 731 10 731 0 0%
Emergency Housing Assistance 11 191 11 188 3 0%
Institutional Subsidies 28 189 28 188 1 0%
Community Residential Unit 82 348 82 346 2 0%
Explanation of variance: The Human Settlements Development Grant under spend on objective Integrate
Residential Development Programme: Phase 4 because of the Special Adjustment budget that was done late in
March 2015 for the Military Veterans project.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
STATEMENT OF FINANCIAL PERFORMANCE
for the year ended 31 March 2015
145
Reconciliation of Net Surplus for the year
Voted funds 20 666 2 406
Annual appropriation 5 779 2 406
Conditional grants 14 886 -
SURPLUS FOR THE YEAR 20 666 2 406
Note 2014/15 2013/14
R'000 R'000
REVENUE
Annual appropriation 1 1 228 218 1 484 167
TOTAL REVENUE 1 228 218 1 484 167
EXPENDITURE
Current expenditure
Compensation of employees 3 107 772 92 442
Goods and services 4 36 515 35 832
Interest and rent on land 5 29 106
Total current expenditure 144 316 128 380
Transfers and subsidies
Transfers and subsidies 7 1 060 406 1 351 801
Total transfers and subsidies 1 060 406 1 351 801
Expenditure for capital assets
Tangible assets 8 2 752 1 379
Total expenditure for capital assets 2 752 1 379
Payments for financial assets
6
78
201
TOTAL EXPENDITURE 1 207 552 1 481 761
SURPLUS FOR THE YEAR 20 666 2 406
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
STATEMENT OF FINANCIAL POSITION for the year ended 31 March 2015
146
Note 2014/15 2013/14
R'000 R'000
ASSETS
Current assets 25 215 8 013
Unauthorised expenditure 9 - 29
Cash and cash equivalents 10 17 386 20
Prepayments and advances 11 27 238
Receivables 12 7 802 7 726
Non-current assets 86 68
Receivables 12 86 68
TOTAL ASSETS 25 301 8 081
LIABILITIES
Current liabilities 22 687 5 374
Voted funds to be surrendered to the Revenue Fund 13 20 666 2 406
Departmental revenue and NRF Receipts to be surrendered
to the Revenue Fund
14 10 -
Bank overdraft 15 - 1 140
Payables 16 2 011 1 828
TOTAL LIABILITIES 22 687 5 374
NET ASSETS 2 614 2 707
Represented by:
Recoverable revenue 2 614 2 707
TOTAL 2 614 2 707
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
STATEMENT OF CHANGES IN NET ASSETS for the year ended 31 March 2015
147
2014/15 2013/14
Recoverable revenue R'000 R'000
Opening balance 2 707 2 893
Transfers: (93) (186)
Debts recovered (included in Departmental receipts) (267) (207)
Debts raised 174 21
Closing balance 2 614 2 707
TOTAL 2 614 2 707
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
CASH FLOW STATEMENT for the year ended 31 March 2015
148
Note 2014/15 2013/14
R'000 R’000
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts 1 229 374 1 484 822
Annual appropriated funds received 1.1 1 228 218 1 484 167
Departmental revenue received 2 1 149 641
Interest received 2.2 7 14
Net (increase)/decrease in working capital 329 301
Surrendered to Revenue Fund (3 552) (21 742)
Current payments (144 287) (128 274)
Interest paid 5 (29) (106)
Payments for financial assets (78) (201)
Transfers and subsidies paid (1 060 406) (1 351 801)
Net cash flow available from operating activities 17 21 351 (17 001)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for capital assets 8 (2 752) (1 379)
Net cash flows from investing activities (2 752) (1 379)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase/(decrease) in net assets (93) (186)
Net cash flows from financing activities (93) (186)
Net increase/(decrease) in cash and cash equivalents 18 506 (18 566)
Cash and cash equivalents at beginning of period (1 120) 17 446
Cash and cash equivalents at end of period 18 17 386 (1 120)
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
149
Summary of significant accounting policies
The financial statements have been prepared in accordance with the following policies, which have been
applied consistently in all material aspects, unless otherwise indicated.
The historical cost convention has been used, except where otherwise indicated. Management has used
assessments and estimates in preparing the annual financial statements. These are based on the best
information available at the time of preparation.
Where appropriate and meaningful, additional information has been disclosed to enhance the usefulness of
the financial statements and to comply with the statutory requirements of the Public Finance Management
Act (PFMA), Act 1 of 1999 (as amended by Act 29 of 1999), and the Treasury Regulations issued in terms
of the PFMA and the annual Division of Revenue Act.
1 Basis of preparation
The financial statements have been fairly presented and are prepared in accordance with the
Modified Cash Standard.
2 Going concern
The financial statements have been prepared on a going concern basis.
3 Presentation currency
Amounts have been presented in the currency of the South African Rand (R) which is also the
functional currency of the Department.
4 Rounding
Unless otherwise stated financial figures have been rounded to the nearest one thousand Rand
(R‟000).
5
5.1
5.2
Comparative information
Prior period comparative information
Prior period comparative information has been presented in the current year‟s financial
statements. Where necessary figures included in the prior period financial statements have
been reclassified to ensure that the format in which the information is presented is consistent
with the format of the current year‟s financial statements.
Current year comparison with budget
A comparison between the approved, final budget and actual amounts for each programme and
economic classification is included in the appropriation statement.
6 Revenue
6.1 Appropriated funds
Appropriated funds comprises of Departmental allocations as well as direct charges against the
revenue fund (i.e. statutory appropriation).
Appropriated funds are recognised in the statement of financial performance on the date the
appropriation becomes effective. Adjustments made in terms of the adjustments budget
process are recognised in the statement of financial performance on the date the adjustments
become effective.
The net amount of any appropriated funds due to the relevant revenue fund at the reporting date
is recognised as a payable in the statement of financial position.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
150
6.2 Departmental revenue
Departmental revenue is recognised in the statement of financial performance when received
and is subsequently paid into the relevant revenue fund, unless stated otherwise.
Any amount owing to the relevant revenue fund at the reporting date is recognised as a payable
in the statement of financial position.
6.3 Accrued Departmental revenue
Accruals in respect of Departmental revenue (excluding tax revenue) are recorded in the notes
to the financial statements when:
it is probable that the economic benefits or service potential associated with the transaction
will flow to the Department; and the amount of revenue can be measured reliably.
The accrued revenue is measured at the fair value of the consideration receivable.
Accrued tax revenue (and related interest and / penalties) is measured at amounts receivable
from collecting agents.
7 Expenditure
7.1 Compensation of employees
7.1.1
Salaries and wages
Salaries and wages are recognised in the statement of financial performance on the date of
payment.
7.1.2 Social contributions
Social contributions made by the Department in respect of current employees are recognised in
the statement of financial performance on the date of payment.
Social contributions made by the Department in respect of ex-employees are classified as
transfers to households in the statement of financial performance on the date of payment.
7.2 Other expenditure
Other expenditure (such as goods and services, transfers and subsidies and payments for
capital assets) is recognised in the statement of financial performance on the date of payment.
The expense is classified as a capital expense if the total consideration paid is more than the
capitalisation threshold and the expense meets the requirements of capital assets as per the
reporting standards.
The Department also transfers funds to implementing agencies to assist the Department to fulfil
its mandate. Due to this there is an element of unspent funds relating to transfers and subsidies
that is disclosed as such.
7.3 Accrued expenditure payable
Accrued expenditure payable is recorded in the notes to the financial statements when the
goods are received or, in the case of services, when they are rendered to the Department and
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
151
the payment for the goods or services had not taken place as at year end.
Accrued expenditure payable is measured at cost.
7.4 Leases
7.4.1 Operating leases
Operating lease payments made during the reporting period are recognised as current
expenditure in the statement of financial performance on the date of payment.
The operating lease commitments are recorded in the notes to the financial statements and are
been reviewed on a quarterly basis when the Department have to submit their Interim Financial
Statements.
7.4.2 Finance leases
Finance lease payments made during the reporting period are recognised as capital expenditure
in the statement of financial performance on the date of payment.
The finance lease commitments are recorded in the notes to the financial statements and are
not apportioned between the capital and interest portions.
Finance lease assets acquired at the end of the lease term are recorded and measured at the
lower of:
cost, being the fair value of the asset; or
the sum of the minimum lease payments made, including any payments made to acquire
ownership at the end of the lease term, excluding interest.
8 Cash and cash equivalents
Cash and cash equivalents are stated at cost in the statement of financial position.
Bank overdrafts are shown separately on the face of the statement of financial position. For the
purposes of the cash flow statement, cash and cash equivalents comprise cash on hand,
deposits held, other short-term highly liquid investments and bank overdrafts.
9 Prepayments and advances
Prepayments and advances are recognised in the statement of financial position when the
Department receives or disburses the cash.
Prepayments and advances are initially and subsequently measured at cost.
10 Loans and receivables
Loans and receivables are recognised in the statement of financial position at cost plus accrued
interest, where interest is charged, less amounts already settled or written-off.
11 Investments
Investments are recognised in the statement of financial position at cost.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
152
12 Impairment of financial assets
Where there is an indication of impairment of a financial asset, an estimation of the reduction in
the recorded carrying value, to reflect the best estimate of the amount of the future economic
benefits expected to be received from that asset, is recorded in the notes to the financial
statements.
13 Payables
Loans and receivables are recognised in the statement of financial position at cost.
14 Capital Assets
14.1 Immovable capital assets
Immovable capital assets are initially recorded in the notes to the financial statements at cost.
Immovable capital assets acquired through a non-exchange transaction is measured at fair
value as at the date of acquisition.
Where the cost of immovable capital assets cannot be determined accurately, the immovable
capital assets are measured at R1 unless the fair value of the asset has been reliably estimated,
in which case the fair value is used.
All assets acquired prior to 1 April 2005 may be recorded at R1.
Immovable capital assets are subsequently carried at cost and are not subject to depreciation or
impairment. Subsequent expenditure that is of a capital nature is added to the cost of the asset
at the end of the capital project unless the immovable asset is recorded by another Department
in which case the completed project costs are transferred to that Department.
14.2 Movable capital assets
Movable capital assets are initially recorded in the notes to the financial statements at cost.
Movable capital assets acquired through a non-exchange transaction is measured at fair value
as at the date of acquisition.
Where the cost of movable capital assets cannot be determined accurately, the movable capital
assets are measured at fair value and where fair value cannot be determined; the movable
assets are measured at R1. All assets acquired prior to 1 April 2005 may be recorded at R1.
Movable capital assets are subsequently carried at cost and are not subject to depreciation or
impairment. Subsequent expenditure that is of a capital nature is added to the cost of the asset
at the end of the capital project unless the movable asset is recorded by another
Department/entity in which case the completed project costs are transferred to that Department.
14.3 Intangible assets
Intangible assets are initially recorded in the notes to the financial statements at cost. Intangible
assets acquired through a non-exchange transaction are measured at fair value as at the date
of acquisition.
Internally generated intangible assets are recorded in the notes to the financial statements when
the Department commences the development phase of the project.
Where the cost of intangible assets cannot be determined accurately, the intangible capital
assets are measured at fair value and where fair value cannot be determined; the intangible
assets are measured at R1. All assets acquired prior to 1 April 2005 are recorded at R1.
Intangible assets are subsequently carried at cost and are not subject to depreciation or
impairment.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
153
Subsequent expenditure that is of a capital nature is added to the cost of the asset at the end of
the capital project unless the intangible asset is recorded by another Department/entity in which
case the completed project costs are transferred to that Department.
15 Provisions and Contingents
15.1 Provisions
Provisions are recorded in the notes to the financial statements when there is a present legal or
constructive obligation to forfeit economic benefits as a result of events in the past and it is
probable that an outflow of resources embodying economic benefits or service potential will be
required to settle the obligation and a reliable estimate of the obligation can be made. The
provision is measured as the best estimate of the funds required to settle the present obligation
at the reporting date.
15.2 Contingent liabilities
Contingent liabilities are recorded in the notes to the financial statements when there is a
possible obligation that arises from past events, and whose existence will be confirmed only by
the occurrence or non-occurrence of one or more uncertain future events not within the control
of the Department or when there is a present obligation that is not recognised because it is not
probable that an outflow of resources will be required to settle the obligation or the amount of
the obligation cannot be measured reliably
15.3 Contingent assets
Contingent assets are recorded in the notes to the financial statements when a possible asset
arises from past events, and whose existence will be confirmed by the occurrence or non-
occurrence of one or more uncertain future events not within the control of the Department
15.4 Commitments
Commitments are recorded at cost in the notes to the financial statements when there is a
contractual arrangement or an approval by management in a manner that raises a valid
expectation that the Department will discharge its responsibilities thereby incurring future
expenditure that will result in the outflow of cash
16 Unauthorised expenditure
Unauthorised expenditure is recognised in the statement of financial position until such time as
the expenditure is either:
approved by Parliament or the Provincial Legislature with funding and the related funds are
received; or
approved by Parliament or the Provincial Legislature without funding and is written off
against the appropriation in the statement of financial performance; or
transferred to receivables for recovery.
Unauthorised expenditure is measured at the amount of the confirmed unauthorised
expenditure.
17 Fruitless and wasteful expenditure
Fruitless and wasteful expenditure is recorded in the notes to the financial statements when
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
154
confirmed. The amount recorded is equal to the total value of the fruitless and / or wasteful
expenditure incurred.
Fruitless and wasteful expenditure is removed from the notes to the financial statements when it
is resolved or transferred to receivables for recovery.
Fruitless and wasteful expenditure receivables are measured at the amount that is expected to
be recoverable and are de-recognised when settled or subsequently written-off as irrecoverable.
18 Irregular expenditure
Irregular expenditure is recorded in the notes to the financial statements when confirmed. The
amount recorded is equal to the total value of the irregularity unless it is impracticable to
determine, in which case reasons therefore are provided in the note.
Irregular expenditure is removed from the note when it is either condoned by the relevant
authority or transferred to receivables for recovery.
Irregular expenditure receivables are measured at the amount that is expected to be
recoverable and are de-recognised when settled or subsequently written-off as irrecoverable.
19 Changes in accounting policies, accounting estimates and errors
Where there has been a change in accounting policy in the current year, the adjustment is made
retrospectively as far as is practicable and the prior year comparatives are restated accordingly.
20 Prior period errors
Where material accounting errors, which relate to prior periods, have been identified in the
current year, the correction is made retrospectively as far as is practicable and the prior year
comparatives are restated accordingly and the note related to that was completed as well as the
narrative.
21 Non-adjusting events after the reporting date
The Department will disclose the nature of the event and an estimate of its financial effect or a
statement that such estimate cannot be made in respect of all material non-adjusting events,
where non-disclosure could influence the economic decisions of users taken on the basis of the
financial statements.
22 Recoverable revenue
Amounts are recognised as recoverable revenue when a payment made in a previous financial
year becomes recoverable from a debtor in the current financial year. Amounts are transferred
to the Provincial Revenue Fund when recovered or are transferred to the statement of financial
performance when written-off.
23 Related party transactions
A related party transaction is a transfer of resources, services or obligations between the
reporting entity and a related party. Related party transactions are recorded in the notes to the
financial statements when the transaction is not at arm‟s length. The Housing Fund is a related
party to the Department of Human Settlements and this related party transaction will no longer
be applicable if and when the Housing Fund finally dissolves once all transfers took place into
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
155
the beneficiaries‟ name.
24 Key management personnel
Key management personnel are those persons having the authority and responsibility for
planning, directing and controlling the activities of the Department. All officials from level 14 and
above are deemed to be key management personnel. Employees on level 13 or below acting
for key management of level 14 and above during the financial year are also included in the
note. Remuneration paid to key management personnel includes short-term employee benefits,
post-employee benefits, other long term employee benefits and termination benefits.
Remuneration paid to close family members of key management personnel is also disclosed in
the note.
25 Agent-principal arrangements
The Department is acting as a principal when it has the power to exercise beneficial control over
an activity. The Department has beneficial control when it has both the power to direct the
activity, and the ability to benefit from that power. “Benefits” can consist of economic benefits,
service potential or both.
Where the Department acts as a principal it discloses the following in the notes to the financial statements:
the total payments made to its agents (where applicable) during the period; and
an explanation about the nature, circumstances and terms relating to the arrangements.
1. Annual appropriation
1.1 Annual appropriation
Included are funds appropriated in terms of the Appropriation Act (and the Adjustments Appropriation Act)
for National Departments (Voted funds) and Provincial Departments:
2014/15
Final
Appropriation
Actual Funds
Received
Funds not
requested/
not received
Appropriation
received
Programmes: R’000 R’000 R’000 R’000
Administration 80 485 80 485 - 68 672
Housing Needs, Research and Planning 18 553 18 553 - 13 194
Housing Development 1 128 216 1 128 216 - 1 401 294
Housing Asset Management, Property
Management
964 964 - 1 007
Total 1 228 218 1 228 218 - 1 484 167
All funds requested were received during the financial year.
1.2 Conditional grants
Note 2014/15 2013/14
R’000 R’000
Total grants received 33 1 078 642 1 350 936
Provincial grants included in Total Grants received - -
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
156
2 Departmental Revenue
Note 2014/15 2013/14
R’000 R’000
Sales of goods and services other than capital assets 2.1 425 284
Interest, dividends and rent on land 2.2 7 14
Transactions in financial assets and liabilities 2.3 724 357
Total revenue collected 1 156 655
Less: Own revenue included in appropriation 14 1 156 655
Departmental revenue collected - -
2.1 Sales of goods and services other than capital assets
Note
2
2014/15 2013/14
R’000 R’000
Sales of goods and services produced by the Department 425 284
Administrative fees 425 284
Total 425 284
2.2 Interest, dividends and rent on land
Note
2
2014/15 2013/14
R’000 R’000
Interest 7 14
Total 7 14
2.3 Transactions in financial assets and liabilities
Note
2
2014/15 2013/14
R’000 R’000
Other Receipts including Recoverable Revenue 724 357
Total 724 357
3. Compensation of employees
3.1 Salaries and Wages
2014/15 2013/14
R’000 R’000
Basic salary 74 001 63 015
Performance award 2 994 2 314
Service Based 198 247
Compensative/circumstantial 1 205 1 060
Other non-pensionable allowances 16 716 14 167
Total 95 114 80 803
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
157
3.2 Social contributions
2014/15 2013/14
5.1 R’000 R’000
Employer contributions
Pension 8 695 7 690
Medical 3 944 3 933
Bargaining council 19 16
Total 12 658 11 639
Total compensation of employees 107 772 92 442
Average number of employees 292 249
4. Goods and services
Note 2014/15 2013/14
R’000 R’000
Administrative fees 423 193
Advertising 244 457
Minor assets 4.1 250 50
Bursaries (employees) 43 -
Catering 733 1 510
Communication 1 084 1 241
Computer services 4.2 1 933 -
Consultants: Business and advisory services 54 -
Legal services 2 767 3 252
Contractors 1 725 21
Agency and support / outsourced services - 3 231
Entertainment 11 14
Audit cost – external 4.3 7 009 10 724
Fleet services 2 688 2 382
Consumables 4.4 1 069 568
Operating leases 3 869 2 973
Property payments 4.5 399 368
Transport provided as part of the Departmental activities - 1
Travel and subsistence 4.6 9 771 7 203
Venues and facilities 679 545
Training and development 428 242
Other operating expenditure 4.7 1 336 857
Total 36 515 35 832
4.1 Minor assets
Note 2014/15 2013/14
4 R’000 R’000
Tangible assets
Machinery and equipment 250 50
Total 250 50
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
158
4.2 Computer services
Note
4
2014/15 2013/14
R’000 R’000
6.1
SITA computer services 1 933 -
Total 1 933 -
4.3 Audit cost - External
Note
4
2014/15 2013/14
R’000 R’000
Regularity audits 5 847 8 605
Investigations 1 162 2 119
Total 7 009 10 724
4.4 Consumables
Note 2014/15 2013/14
4 R’000 R’000
Consumable supplies 106 47
Uniform and clothing 2 15
Household supplies 45 31
Building material and supplies 48 -
Communication accessories 3 -
Other consumables 8 1
Stationery, printing and office supplies 963 521
Total 1 069 568
4.5 Property payments
Note 2014/15 2013/14
4 R’000 R’000
Municipal services 120 69
Other 279 299
Total 399 368
4.6 Travel and subsistence
Note 2014/15 2013/14
4 R’000 R’000
Local 8 832 6 571
Foreign 939 632
Total 9 771 7 203
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
159
4.7 Other operating expenditure
Note 2014/15 2013/14
4 R’000 R’000
Resettlement costs 75 42
Other 1 261 815
Total 1 336 857
5. Interest and rent on land
Note 2014/15 2013/14
R’000 R’000
Interest paid 29 106
Total 29 106
6. Payments for financial assets
Note 2014/15 2013/14
R’000 R’000
Other material losses written off 6.1 - 104
Debts written off 6.2 78 97
Total 78 201
6.1 Other material losses
Other material losses written off
Note 2014/15 2013/14
6 R’000 R’000
Nature of losses
Settlement of motor vehicle accident - 104
Total - 104
6.2 Debts written off
Note 2014/15 2013/14
6 R’000 R’000
Nature of debts written off
Staff Debt - 97
Ex Employee debt 72 -
Supplier debt 6 -
Total debt written off 78 97
7. Transfers and subsidies
2014/15 2013/14
R’000 R’000
Higher education institutions Annex 1A 352 -
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
160
Households Annex 1B 1 060 054 1 351 801
Total 1 060 406 1 351 801
Unspent funds transferred to the above beneficiaries 130 246 619 853
2014/15
Unspent amount included in transfers to households is R21 634 104 which were transferred to the
Housing Development Agency for the procurement of land.
Unspent amount included in transfers to households is R12 471 512 which was transferred to the Free
State Development Corporation for the procurement of land.
Unspent amount included in transfers to households is R 4 581 540 which was transferred to the
Mangaung Support of Housing Fund for the procurement of land.
Unspent amount included in transfers to households is R34 151 308 which was transferred to Stefanutti
Stocks for the implementation of a social housing project
Unspent amount included in transfers to households is R143 957 which was transferred to Utshani Fund
for the implementation of a social housing project.
Unspent amount included in transfers to households is R27 635 763 which was transferred to Rossouw
and Conradie/ Kentha Developers for the implementation of a social housing project
Unspent amount included in transfers to households is R14 346 895 which was transferred to Coreland
Property Development Company for the implementation of a social housing project
Unspent amount included in transfers to households is R5 000 000 which was transferred to Eskom for
the implementation of a social housing project
Unspent amount included in transfers to households is R181 507 which was transferred to Maluti Batlokoa
Project Trust Fund for the implementation of a social housing project
Unspent amount included in transfers to households is R10 031 865 which was transferred to Mafuri
Turnkey Accelerated Construction for the implementation of a social housing project
Unspent amount included in transfers to households is R67 609.75 which was transferred for Maphodi -
Springfontein for the implementation of a social housing project.
2013/2014
Unspent amount included in transfers to households is R 230 000 000 which was transferred to Bloem
Water to provide support and expedite the delivery of water and sanitation services to beneficiaries within
Free State Province
Unspent amount included in transfers to households is R 101 639 940 which was transferred to the
Housing Development Agency for the procurement of land
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
161
Unspent amount included in transfers to households is R 51 473 508 which was transferred to the Free
State Development Corporation for the procurement of land.
Unspent amount included in transfers to households is R 71 872 610 which was transferred to the
Mangaung Metropolitan Municipality for the support of housing fund allocation.
Unspent amount included in transfers to households is R 57 014 030 which was transferred to Stefanutti
Stocks for the implementation of a social housing project.
Unspent amount included in transfers to households is R 1 000 which was transferred to Social Housing
Regulatory Authority for the implementation of social housing projects.
Unspent amount included in transfers to households is R 176 998 which was transferred to Utshani Fund
for the implementation of a social housing project.
Unspent amount included in transfers to households is R 43 548 884 which was transferred to Rossouw
and Conradie / Kentha Developers for the implementation of a social housing project.
Unspent amount included in transfers to households is R 93 975 which was transferred to Maluti Batlokoa
Project Trust Fund for the implementation of a social housing project.
'Unspent amount included in transfers to households is R 63 930 670 which was transferred to Coreland
Property Development Company for the implementation of a social housing project.
8. Expenditure for capital assets
Note 2014/15 2013/14
R’000 R’000
Tangible assets 2 752 1 379
Machinery and equipment 29.1 2 752 1 379
Total 2 752 1 379
8.1 Analysis of funds utilised to acquire capital assets – 2014/15
Voted funds Aid
assistance
Total
R’000 R’000 R’000
Tangible assets 2 752 2 752
Machinery and equipment 2 752 - 2 752
Total 2 752 - 2 752
8.2 Analysis of funds utilised to acquire capital assets – 2013/14
Voted funds Aid
assistance
Total
R’000 R’000 R’000
Tangible assets 1 379 - 1 379
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
162
Machinery and equipment 1 379 - 1 379
Total 1 379 - 1 379
8.3 Finance lease expenditure included in Expenditure for capital assets
2014/15 2013/14
R’000 R’000
Tangible assets
Machinery and equipment 804 780
Total 804 780
9. Unauthorised expenditure
9.1 Reconciliation of unauthorised expenditure
2014/15 2013/14
R’000 R’000
Opening balance 29 29
Less: Amounts approved by Parliament/Legislature with
funding
(29) -
Unauthorised expenditure awaiting authorisation / written
off
-
29
9.2 Analysis of unauthorised expenditure awaiting authorisation per economic classification
2014/15 2013/14
R’000 R’000
Current - 29
Total - 29
9.3 Analysis of unauthorised expenditure awaiting authorisation per type
2014/15 2013/14
R’000 R’000
Unauthorised expenditure incurred not in accordance with
the purpose of the vote or main division
-
29
Total - 29
10. Cash and cash equivalents
2014/15 2013/14
R’000 R’000
Consolidated Paymaster General Account 17 366 -
Cash on hand 20 20
Total 17 386 20
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
163
There are no significant cash and cash equivalent balances held by the Department that are not available
for use.
There are no undrawn borrowing facilities available for future operating activities or to settle capital
commitments.
11. Prepayments and advances
2014/15 2013/14
R’000 R’000
Travel and subsistence 27 238
Total 27 238
12. Receivables
2014/15 2013/14
Note
Less than
one year
One to
three years
Older than
three
years
Total
Total
R’000 R’000 R’000 R’000 R’000
Claims recoverable 12.1
Annex 4
105 14 495 614 510
Staff debt 12.2 136 119 - 254 357
Other debtors 12.3 278 4 009 2 732 7 020 6 927
Total 519 4 142 3 227 7 888 7 794
12.1 Claims recoverable
Note 2014/15 2013/14
12 R’000 R’000
National Departments 14 14
Provincial Departments 105 -
Public entities - 1
Local governments 495 495
Total 614 510
12.2.1 Staff debt
Note 2014/15 2013/14
12 R’000 R’000
Salary Overpayments 20 87
Communication Debt 185 213
Tax Debt 1 34
Breach of Contract 17 15
Leave Without Pay 31 8
Total 254 357
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
164
12.3 Other debtors
Note 2014/15 2013/14
12 R’000 R’000
Supplier Debt 7 020 6 927
Total 7 020 6 927
12.4 Impairment of receivables
Note 2014/15 2013/14
12 R’000 R’000
Estimate of impairment of receivables 3 227 1 202
Total 3 227 1 202
13. Voted funds to be surrendered to the Revenue Fund
2014/15 2013/14
R’000 R’000
Opening balance 2 406 21 050
Transfer from statement of financial performance 20 666 2 406
Paid during the year (2 406) (21 050)
Closing balance 20 666 2 406
14. Departmental revenue and NRF Receipts to be surrendered to the Revenue Fund
2014/15 2013/14
R’000 R’000
Opening balance - 37
Own revenue included in appropriation 1 156 655
Paid during the year (1 146) (692)
Closing balance 10 -
15. Bank Overdraft
2014/15 2013/14
R’000 R’000
Consolidated Paymaster General Account - 1 140
Total - 1 140
16. Payables – current
Note 2014/15 2013/14
R’000 R’000
Other payables 16.1 1 596 1 581
Clearing accounts 415 247
Total 2 011 1 828
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
165
16.1 Other payables
Note 2014/15 2013/14
16 R’000 R’000
Housing Fund 1 596 1 581
Total 1 596 1 581
Salary Income Tax and Salary Pension Fund clearing accounts were previously disclosed under other
payables. Refer to note 16.2 where it is currently disclosed. Refer to note 32 for more information.
16.2 Clearing accounts
Note 2014/15 2013/14
16 R’000 R’000
Salary Income Tax 411 233
Salary Pension Fund 4 14
Total 415 247
Salary Income Tax and Salary Pension Fund clearing accounts were previously disclosed under other
payables. Refer to note 32 for more information.
17 Net cash flow available from operating activities
2014/15 2013/14
R’000 R’000
Net surplus/(deficit) as per Statement of Financial
Performance
20 666 2 406
Add back non cash/cash movements not deemed operating
activities
685 (19 407)
(Increase)/decrease in receivables – current (94) 192
(Increase)/decrease in prepayments and advances 211 (63)
(Increase)/decrease in other current assets 29 -
Increase/(decrease) in payables – current 183 172
Expenditure on capital assets 2 752 1 379
Surrenders to Revenue Fund (3 552) (21 742)
Own revenue included in appropriation 1 156 655
Net cash flow generated by operating activities 21 351 (17 001)
18 Reconciliation of cash and cash equivalents for cash flow purposes
2014/15 2013/14
R’000 R’000
Consolidated Paymaster General account 17 366 (1 140)
Cash on hand 20 20
Total 17 386 (1 120)
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
166
19 Contingent liabilities and contingent assets
19.1 Contingent liabilities
Note 2014/15 2013/14
R’000 R’000
Liable to
Claims against the Department Annex
2
98 495 68 571
Total 98 495 68 571
The amount for contingent liabilities is dependent on the outcome of the court cases occurring in the
future, which will only be finalised in the future.
The possibility of reimbursement will only be certain upon completion of the court cases.
The comparative information was restated. Refer to note 32 for more information.
20. Commitments
2014/15 2013/14
R’000 R’000
Current expenditure
Approved and contracted 2 005 4 145
2 005 4 145
Capital expenditure
Approved and contracted 2 015 933 506 765
Approved but not yet contracted 14 886 3 083
2 030 819 509 848
Total Commitments 2 032 824 513 993
Commitments to the value of R2 024 546‟ are in respect of a period longer than a year.
The comparative information was restated. Refer to note 32 for more information.
21. Accruals and payables not recognised
2014/15 2013/14
R’000 R’000
Listed by economic classification
30 Days 30+ Days Total Total
Other 188 - 188 -
Goods and services 4 769 2 433 7 202 6 228
Transfers and subsidies 319 469 629 968 949 437 612 193
Capital Assets 33 - 33 29
Total 324 459 632 401 956 860 618 450
2014/15 2013/14
R’000 R’000
Listed by programme level
Administration 6 978 5 720
Housing Needs, Research and Planning 216 331
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
167
Housing Development 949 646 612 365
Housing Asset Management and Property Management 20 34
Total 956 860 618 450
“Other Employee Benefits” to the amount of R‟519 is included in accruals. Previously these amounts relating to
Employee Benefits (which includes payments such as S&T allowances, acting allowances, overtime etc.) were
disclosed in Note 22.
The comparative information was restated. Refer to note 32 for more information.
The amount above relates to ongoing investigations of advances to material suppliers. However, due to
the nature of the ongoing investigations the department is in the process of determining the full extent
thereof.
Note 2014/15 2013/14
R’000 R’000
Confirmed balances with other Departments Annex 4 1 321 256
Confirmed balances with other government entities Annex 4 562 709
Total 1 883 965
22. Employee benefits
2014/15 2013/14
R’000 R’000
Leave entitlement 4 830 4 834
Service bonus (Thirteenth cheque) 2 675 2 523
Performance awards 3 909 2 994
Capped leave commitments 2 223 2 635
Other (Long Services Awards) 53 66
Total 13 690 13 052
There is a long term portion of the long services awards. The provisioning on the long service awards
provision disclosed above does not include the long term portion of the long service awards.
The comparative information was restated. Refer to note 32 for more information.
23. Lease commitments
23.1 Operating leases expenditure
2014/15
Specialised
military
equipment
Land
Buildings
and other
fixed
structures
Machinery
and
equipment
Total
R’000 R’000 R’000 R’000 R’000
Not later than 1 year - - - 2 099 2 099
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
168
Later than 1 year and not later
than 5 years
- - - 4 126 4 126
Total lease commitments - - - 6 225 6 225
2013/14 Specialised
military
equipment
Land Buildings
and other
fixed
structures
Machinery
and
equipment
Total
R’000 R’000 R’000 R’000 R’000
Not later than 1 year - - - 2 050 2 050
Later than 1 year and not later
than 5 years
- - - 5 570 5 570
Total lease commitments - - - 7 620 7 620
The Department has entered into a SLA with Fleet Management for the provision of vehicles. This is an
operating lease.
No assets are sub-leased by the Department.
There were no sale and lease back agreements entered into by the Department.
23.2 Finance leases expenditure
2014/15 Specialised
military
equipment
Land Buildings
and other
fixed
structures
Machinery
and
equipment
Total
R’000 R’000 R’000 R’000 R’000
Not later than 1 year - - - 718 718
Later than 1 year and not later
than 5 years
- - - 232 232
Total lease commitments - - - 950 950
2013/14 Specialised
military
equipment
Land Buildings
and other
fixed
structures
Machinery
and
equipment
Total
R’000 R’000 R’000 R’000 R’000
Not later than 1 year - - - 651 651
Later than 1 year and not later
than 5 years
- - - 270 270
Total lease commitments - - - 921 921
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
169
The Department rents 4 photocopiers over a period of 36 months which will only expire during
2015 and 2017 respectively.
The Department rents 20 cell phones from MTN over a fixed term period of 24 months.
The Department rents 143 cell phones from Vodacom over a fixed term period of 24 months.
The Department rents 21 cell phones from Cell C over a fixed term period of 24 months.
No assets are sub-leased by the Department.
The Department does not have any renewal or purchase options in any of its lease
agreements.
There are also no escalation clauses in the lease agreements and the fees are standard/fixed
for the term of agreement.
There are no restrictions imposed on the Department through any lease agreement.
There were no sale and lease back agreements entered into by the Department.
The comparative information was restated. Refer to note 32 for more information.
24. Accrued Departmental revenue
2014/15 2013/14
R’000 R’000
Transfers received (incl. conditional grants to be repaid by
provincial Departments)
559 480 559 480
Total 559 480 559 480
The amount above relates to ongoing investigations of advances to material suppliers. However, due to
the nature of the ongoing investigations the department is in the process of determining the full extent
thereof.
The comparative information was restated. Refer to note 32 for more information.
24.1 Analysis of accrued departmental revenue
2014/15 2013/14
R’000 R’000
Opening balance
Less: Amounts received
559 480
-
101 838
-
Add: Amounts recognised - 457 642
Less Amounts written off or reversed as irrecoverable -
Closing balance 559 480 559 480
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
170
25. Irregular expenditure
25.1 Reconciliation of irregular expenditure
2014/15 2013/14
R’000 R’000
Opening balance
Add: Irregular expenditure – relating to prior year
3 596 445
-
2 737 511
-
Add: Irregular expenditure – relating to current year 980 965 858 934
Less Amounts not condoned and not recoverable (1 637 940) -
Closing balance 2 939 470 3 596 445
Analysis of awaiting condensation per age classification
Current year 980 965 858 934
Prior years 1 958 505 2 737 511
Total 2 939 470 3 596 445
The prior year irregular expenditure increased with R1 218 040 based on the conclusion reached on the
items included in the current year audit and which have a prior year impact.
The comparative information was restated. Refer to note 25.5 for more information.
25.2 Details of irregular expenditure – current year
Incident Disciplinary steps
taken/criminal proceedings
2014/15
R’000
Sufficient number of quotation not obtained (< R30 000) None 3 813
Sufficient number of quotations not always obtained and
not always fully met PPFA requirement (R30 000 –
R500 000)
Payment of acting allowance
None
None
4 059
8
Housing grant – procurement processes not followed None 973 085
Total 980 965
25.3 Details of irregular expenditure not recoverable (not condoned)
Incident Not condoned by (condoning
authority)
2014/15
R’000
Sufficient number of quotations not obtained (R2 000 –
R10 000)
National Treasury 25
Sufficient number of quotations not obtained (R10 000 –
R30 000)
Sufficient number of quotations not always obtained and
PPPFA requirements not always fully met (R30 000 –
R500 000)
National Treasury
National Treasury
1 583
5 514
Adequate tender procedures not followed (Above National Treasury 21 454
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
171
R500 000)
Housing grant procurement processes not followed National Treasury 1 609 364
Total 1 637 940
25.4 Details of irregular expenditures under investigation
Incident 2014/15
R’000
Sufficient number of quotations not obtained (R10 000 – R30 000) 5 566
Sufficient number of quotation not obtained and PPFA requirement not always fully met
(R30 000 – R500 000)
6 975
Adequate tender procedures not followed (Above R500 000) 31 444
Employee acted n higher vacant posts for an uninterrupted period 102
Contracts taken over 12 874
Appointment of employees on contract basis 3 846
Overtime worked 4
Housing grant procurement processes not followed 2 878 659
Total 2 939 470
25.5 Prior period error
Note 2013/14
R’000
Nature of prior period error
Relating to 2013/14
31
Irregular expenditure 1 218
Total 1 218
Irregular expenditure increased with R1 218 040 based on the conclusion reached on the items included
in the current year audit and which have a prior year impact.
25.6 Details of the non-compliance where an institution was not represented in a bid committee
for contracts arranged by other institutions
Incident 2014/15
R’000
Blackhead Consulting T/A Diamond Hill 76 000
Total 76 000
During the year the Department entered into a contract with Blackhead Consulting T/A Diamond Hill for
the audit and assessment of asbestos eradication.
The service provider was used by Gauteng Province and the Department obtained permission to use the
service provider in terms of TR16A6.6.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
172
Due to the fact that the appointment of Blackhead Consulting was not seen as fair, equitable and
transparent by the auditors of Human Settlements: Gauteng, the appointment is deemed to be irregular
for Department Human Settlements: Free State Province
26. Fruitless and wasteful expenditure
26.1 Reconciliation of fruitless and wasteful expenditure
2014/15 2013/14
R’000 R’000
Opening balance 2 226 1 968
Fruitless and wasteful expenditure – relating to current year 190 258
Fruitless and wasteful expenditure awaiting resolution 2 416 2 226
26.2 Analysis of awaiting resolution per economic classification
2014/15 2013/14
R’000 R’000
Current 680 490
Transfers and subsidies 1 736 1 736
Total 2 416 2 226
26.3 Analysis of Current year’s fruitless and wasteful expenditure
Incident Disciplinary steps
taken/criminal proceedings
2014/15
R’000
Interest on overdue accounts None 188
Payment to SARS None 2
Total 190
27. Related party transactions
2014/15 2013/14
R’000 R’000
Loans to /from related parties
Non-interest bearing loans to/(from) 12 168 11 456
Total 12 168 11 456
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
173
The Housing Fund falls under the administration of the Department of Human Settlements and shares the same
Accounting Officer. Once the fund ceases to operate, the bank balance will be surrendered to the Department.
The Department of Cooperative Governance and Traditional Affairs rendered a shared service on the following
directorates within Programme 1 to the Department of Human Settlements: Ant-corruption and Security,
Information Technology and Communication services there were also communication expenditure that was paid
by the Department of Human Settlements on behalf of the Department of Cooperative Governance and
Traditional Affairs and vice versa. The service provider is in process to assess the amount for each Department.
The Department of Cooperative Governance and Traditional Affairs also paid certain invoices on behalf of the
Department of Human Settlements with regard to SITA services and the MEC‟s outreach programme that is
recorded/ in the inter Departmental payables. Due to the complexity of the shared service between the
Departments, it is impracticable to include an exact amount of the shared service and therefore no value for this
service can be attributed to these transactions. The Departments have also come to an understanding that no
value for these services will be exchanged.
28. Key management personnel
No. of
Individuals
2014/15 2013/14
R’000 R’000
Level 15 to 16 2 (2) 3 250 2 978
Level 14 (incl. CFO if at a lower level) 5 (6) 5 321 5 507
Family members of key management personnel 1 (1) 253 235
Total 8 824 8 720
29. Non-adjusting events after reporting date
2014/15
R’000
During the current financial year the department was involved in a court case, which was
still ongoing at year-end. Subsequent to year-end, the court case was finalised and an
outcome was provided to the department. The outcome of the court case resulted in the
immediate dismissal of certain senior managers involved in the case. The leave for these
employees will still be paid out by the department. The leave amount to be paid will be
R1 420 137.83.
1 420
Total 1 420
30. Movable Tangible Capital Assets
MOVEMENT IN MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED
31 MARCH 2015
Opening
balance
Additions Disposals Closing
Balance
R’000 R’000 R’000 R’000
MACHINERY AND
EQUIPMENT
7 523 2 044 - 9 567
Computer equipment 3 702 861 - 4 563
Furniture and office equipment 3 561 682 - 4 243
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
174
Other machinery and equipment 260 501 - 761
-
TOTAL MOVABLE TANGIBLE
CAPITAL ASSETS
7 523
2 044
-
9 567
Movable Tangible Capital Assets under investigation
Number Value
R’000
Included in the above total of the movable tangible capital assets per the
asset register are assets that are under investigation:
Computer equipment 92 1 163
Furniture and office equipment 33 366
Other machinery and equipment 4 37
Total 129 1 566
Included in the asset register are 129 major assets which are under investigation by the Department. The
assets identified as under investigation relate to assets not verified in the financial year. As this process was
completed at year-end, the Department deemed it necessary to perform additional verifications in the next
financial year to identify the location of these assets. Should the assets still not be located, the Department
would determine the last users of these assets and enquire as to the location of the assets. Based on this the
Department will determine if the assets can be located or if the assets should be written-off or if loss control
proceedings will be initiated and recoveries performed.
30.1 Additions
ADDITIONS TO MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED
31 MARCH 2015
Cash Non-cash (Capital
Work in
Progress
current
costs and
finance
lease
payments)
Received
current, not
paid
(Paid
current
year,
received
prior year)
Total
R’000 R’000 R’000 R’000 R’000
MACHINERY AND
EQUIPMENT
2 752 - (804) 96 2 044
Computer equipment 822 - - 39 861
Furniture and office equipment 625 - - 57 682
Other machinery and equipment 1 305 - (804) - 501
TOTAL ADDITIONS TO
MOVABLE TANGIBLE
CAPITAL ASSETS
2 752
-
(804)
96
2 044
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
175
30.1 Movement for 2013/14
MOVEMENT IN MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED
31 MARCH 2014
Opening
balance
Prior period
error
Additions Disposals Closing
Balance
R’000 R’000 R’000 R’000 R’000
MACHINERY AND
EQUIPMENT
4 090 (16) 3 449 - 7 523
Computer equipment 2 260 - 1 441 - 3 702
Furniture and office equipment 1 810 1 1 768 - 3 561
Other machinery and equipment 20 (17) 240 - 260
TOTAL MOVABLE TANGIBLE
CAPITAL ASSETS
4 090
(16)
3 449
-
7 523
30.1.1 Prior period error
Note 2013/14
30.1 R’000
Nature of prior period error
Relating to 2013/14 financial year. Error relates to the rounding errors
resulting in computer equipment and furniture and office equipment
being increased by R1 000 each.
2
Additionally donations were incorrectly not removed from the asset
register resulting in a decrease of furniture and office equipment to the
amount of R18 000
(18)
Total (16)
30.2 Minor assets
MOVEMENT IN MINOR ASSETS PER THE ASSET REGISTER FOR THE YEAR ENDED AS AT
31 MARCH 2015
Specialised
military
assets
Intangible
assets
Heritage
assets
Machinery
and
equipment
Biological
assets
Total
R’000 R’000 R’000 R’000 R’000 R’000
Opening
balance
- 56 - 3 706 - 3 762
Additions - - - 250 - 250
TOTAL MINOR
ASSETS
-
56
-
3 956
-
4 012
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
176
Minor Capital Assets under investigation
Number Value
R’000
Included in the above total of the minor capital assets per the asset
register are assets that are under investigation:
Machinery and equipment 387 553
Included in the asset register are 387 minor assets which are under investigation by the Department. The assets
identified as under investigation relate to assets not verified in the financial year. As this process was completed
at year-end, the Department deemed it necessary to perform additional verifications in the next financial year to
identify the location of these assets. Should the assets still not be located, the Department would determine the
last users of the assets and enquire as to the location of these assets. Based on this the Department will
determine if the assets can be located or if the assets should be written-off or if loss control proceedings will be
initiated and recoveries performed.
Minor assets
MOVEMENT IN MINOR ASSETS PER THE ASSET REGISTER FOR THE YEAR ENDED AS AT
31 MARCH 2014
Specialised
military
assets
Intangible
assets
Heritage
assets
Machinery
and
equipment
Biological
assets
Total
R’000 R’000 R’000 R’000 R’000 R’000
Opening
balance
- 56 - 3 660 - 3 716
Prior period
error
- - - (4) - (4)
Additions - - - 50 - 50
TOTAL
MINOR
ASSETS
-
56
-
3 706
-
3 762
Specialised
military
assets
Intangible
assets
Heritage
assets
Machinery
and
equipment
Biological
assets
Total
R’000 R’000 R’000 R’000 R’000 R’000
Number of R1
minor assets
- - 182 - 182
Number of
minor assets at
- 20 - 2 495 - 2 515
TOTAL MINOR
ASSETS
-
20
-
2 677
-
2 697
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
177
Specialised
military
assets
Intangible
assets
Heritage
assets
Machinery
and
equipment
Biological
assets
Total
R’000 R’000 R’000 R’000 R’000 R’000
Number of R1
minor assets
- - - 91 - 91
Number of
minor assets at
cost
- 20 - 2 454 - 2 474
TOTAL
NUMBER OF
MINOR
ASSETS
-
20
-
2 545
-
2 565
30.3.1 Prior period error
Note 2013/14
29.2 R’000
Nature of prior period error
Relating to 2013/14 The restatement consisted of donations that were
erroneously not removed from Minor assets
(4)
Total (4)
31. Intangible Capital Assets
MOVEMENT IN INTANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED
31 MARCH 2015
Opening
balance
Prior period
error
Additions Disposals Closing
Balance
R’000 R’000 R’000 R’000 R’000
SOFTWARE 629 - - - 629
TOTAL INTANGIBLE CAPITAL
ASSETS
629
-
-
-
629
31.1 Movement for 2013/14
MOVEMENT IN INTANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED
31 MARCH 2014
Opening
balance
Prior period
error
Additions Disposals Closing
Balance
R’000 R’000 R’000 R’000 R’000
SOFTWARE 629 - - - 629
TOTAL INTANGIBLE CAPITAL
ASSETS
629
-
-
-
629
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
178
32. Prior period errors
32.1 Correction of prior period errors
2013/14
R’000
Expenditure
Increase in Unspent Funds transferred to Beneficiaries 1 137
Net effect 1 137
Unspent Funds transferred to Beneficiaries were restated due to new confirmations received of amounts
utilised by beneficiaries.
2013/14
R’000
Assets
Decrease in Accrued Departmental Revenue (29 885)
Decrease in Minor Assets (4)
Decrease in Machinery and Equipment (16)
Net effect (29 905)
Accrued Departmental Revenue was restated due to the fact that payments made to material suppliers
were incorrectly included in the balance.
Minor Assets were restated due to donations made that were erroneously not removed in the previous
financial year.
Machinery and Equipment were restated due to rounding errors and donations made that were
erroneously not removed in the previous financial year.
2013/14
R’000
Liabilities
Increase in Commitments: Current Expenditure Approved and Contracted 281
Decrease in Commitments: Capital Expenditure Approved and Contracted (42 836)
Decrease in Accruals (18 989)
Decrease in Employee Benefits: Other (256)
Decrease in Payables: Other Payables (247)
Increase in Payables: Clearing Accounts 247
Increase in Finance Lease Commitments 4
Increase in Employee Benefits: Performance awards
Decrease in Contingent liabilities
2 994
(7 687)
Net effect (66 489)
Commitments were assessed and restated to improve the fair presentation of the financial statements.
Accruals were assessed and restated to improve the fair presentation of the financial statements.
Payments made to material suppliers were also incorrectly included in the balance.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
179
Employee Benefits were restated due to Other Employee Benefits (which includes payments such as S&T
allowances, acting allowances, overtime etc.) which were incorrectly included in Employee Benefits, the
removal of negative leave credits as well as the recognition of Long Service Awards.
Other Payables and Clearing Accounts were restated due to Salary Income Tax and Salary Pension Fund
that were incorrectly disclosed under Other Payables instead of Clearing Accounts.
Finance Lease Commitments were restated due to incorrect expiry dates used in the Finance Lease
Commitment calculation.
Employee Benefits: Performance awards were restated to include the entire provision of the performance
awards.
Contingent liabilities were restated to take into account a payment made before year-end.
33. Agent-principal arrangements
33.1 Department acting as principal
2014/15 2013/14
R’000 R’000
National Housing Fund Corporation (NHFC) - -
Total - -
NHFC was appointed by the Department to act as its agent in administering and implementing the
Finance Linked Individual Subsidy Programme (FLISP) on its behalf in the Free State.
The Department did not make any payments to NHFC during 2013/14 or 2014/15.
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
NOTES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
180
34 STATEMENT OF CONDITIONAL GRANTS RECEIVED
NAME OF
DEPARTMENT
GRANT ALLOCATION SPENT 2013/14
Division of
Revenue
Act/
Provincial
Grants
Roll
Overs
DORA
Adjust-
ments
Other
Adjust-
ments
Total
Available
Amount
received
by
Department
Amount
spent by
Department
Under /
(Over-
spending)
% of
available
funds
spent by
Department
Division
of
Revenue
Act
Amount
spent by
Department
R’000 R’000 R'000 R'000 R’000 R'000 R'000 R'000 % R’000 R’000
HSDG 1 061 756 - - - 1 061 756 1 061 756 1 061 756 - 100% 1 350 936 1 350 936
EPWP 2 000 - - - 2 000 2 000 2 000 - 100% - -
Military Veterans 14 886 - - - 14 886 14 886 - - 0% - -
1 078 642 - - - 1 078 642 1 078 642 1 063 756 14 886 1 350 936 1 350 936
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
181
ANNEXURE 1 A
STATEMENT OF TRANSFERS TO HIGHER EDUCATION INSTITUTIONS
NAME OF HIGHER EDUCATION
INSTITUTION
TRANSFER ALLOCATION TRANSFER 2013/14
Adjusted
Appropriation
Roll
Overs
Adjustments Total
Available
Actual
Transfer
Amount not
transferred
% of
Available
funds
Transferred
Appropriation
Act
R'000 R'000 R'000 R'000 R'000 R'000 % R'000
University of the Witwatersrand /
Free State
1 108 - - 1 108 352 756 215% -
1 108 - - 1 108 352 756 - -
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
182
ANNEXURE 1B
STATEMENT OF TRANSFERS TO HOUSEHOLDS
HOUSEHOLDS
TRANSFER ALLOCATION EXPENDITURE 2013/14
Adjusted
Appro-
priation
Act
Roll
Overs
Adjust
-ments
Total
Available
Actual
Transfer
% of
Available
funds
Transferred
Appro-
priation
Act
R'000 R'000 R'000 R'000 R'000 % R'000
Transfers
Individual housing subsidies (R0-R3 500) non – credit linked (1 534) - 9 652 8 118 8 118 100% 7 987
Housing finance linked individual subsides (FLIPS)-(R3 501 –
R7 000)
5 480 - (5 480) - - - -
Enhanced Extended Discount Benefit Scheme (EEDBS) 514 - (514) - - - -
Rectification of housing stock (pre 1994) 80 791 - 6 623 87 414 87 414 100% 13 980
Operational Capital Budget 53 088 - (19 518) 33 570 28 570 85% 60 476
Blocked projects 5 858 - 91 573 97 431 97 431 100% 22 315
NHBRC enrolment (related to grant) 15 000 - 21 792 36 792 36 792 100% 6 988
Land parcels procured (IHAHSD) 20 000 - 20 000 20 000 100% 70 000
Integrated Residential Development Programme: Phase 1: Planning and
Services
192 440 - (151 819) 40 621 40 621 100% 403 139
Integrated Residential Development Programme: Phase 1: Planning and
Services INFORMAL SETTLEMENT
6 344 49 391 55 735 55 735 100% -
Integrated Residential Development Programme: Phase 4: Top Structure
construction (Informal settlement)
528 594 - 36 489 565 083 550 197 97% 400 619
People‟s Housing process 3 781 - 8 708 12 489 12 489 100% 51 474
Emergency Housing Assistance 9 810 (9001) 8 910 8 910 100% 16 166
Institutional Subsidies 33 591 - (5 458) 28 133 28 133 100% 95 503
Community residential unit (CRU) Converted/Upgraded 107 999 - (25 653) 82 346 82 346 100% 190 769
Social and Economic Facilities - - - - - - 1 233
Accreditation of Municipalities - - - - - - 5 000
Social House Cap GRT for Rental Housing - - - - - 235
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
183
HOUSEHOLDS
TRANSFER ALLOCATION EXPENDITURE 2013/14
Adjusted
Appro-
priation
Act
Roll
Overs
Adjust
-ments
Total
Available
Actual
Transfer
% of
Available
funds
Transferred
Appro-
priation
Act
R'000 R'000 R'000 R'000 R'000 % R'000
Rectification of RDP Stock 1994-2002 - - - - - - 5 052
H/H Donations & Gifts 965 - 965 949 98% 808
H/H Empl S/Ben Leave gratuity 355 - - 335 350 99% 57
EPWP Incentive Grant 2 000 - - 2000 2 000 100% -
Total 1 065 076 - 14 886 1 079 962 1 060 054 1 351 801
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
184
ANNEXURE 1C
STATEMENT OF GIFTS, DONATIONS AND SPONSORSHIPS RECEIVED
NAME OF ORGANISATION NATURE OF GIFT, DONATION OR SPONSORSHIP
2014/15 2013/14
R’000 R’000
Received in cash
Etso Civils GOVERN MBEKI AWARDS 150 10
Ernst & Young GOVERN MBEKI AWARDS 50 -
Mafuri Infrastructure Africa GOVERN MBEKI AWARDS 115 -
Mafuri Turnkey GOVERN MBEKI AWARDS 150 -
Subtotal 465 10
Received in kind
NHBRC – Sponsor of a voucher at Lillies Sales & Service - 100
Ernst & Young - 50
Housing Development Agency (HDA) – 3 Mini Ipads - 15
NURCHA – 2 Laptops and 300 Laptop bags - 10
ETSO Civils – Accommodation Freedom Day Celebrations 45 -
Mafuri Infrastructure Africa – Transport and Catering Freedom Day Celebrations 35 -
Subtotal 80 175
TOTAL 545 185
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
185
ANNEXURE 1D
STATEMENT OF ACTUAL MONTHLY EXPENDITURE PER GRANT
Grant type April
2014
R’000
May
2014
R’000
June
2014
R’000
July
2014
R’000
August
2014
R’000
September
2014
R’000
October
2014
R’000
November
2014
R’000
December
2014
R’000
January
2015
R’000
February
2015
R’000
March
2015
R’000
Total
R’000
Human
Settlement
Development
Grant
- 69 679 71 406 50 314 70 675 127 508 153 404 104 063 137 732 57 179 110 060 109 736 1 061 756
Other - - - - - 800 600 - - 600 - - 2 000
Total - 69 679 71 406 50 314 70 675 128 308 154 004 104 063 137 732 57 779 110 060 109 736 1 063 756
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
186
ANNEXURE 2
STATEMENT OF CONTINGENT LIABILITIES AS AT 31 MARCH 2015
Nature of Liability
Liabilities incurred
during the year
Liabilities paid/cancelle
d/reduced during the
year
Liabilities recoverable
(Provide details
hereunder)
Opening Closing
Balance Balance
1 April 2014 31 March
2015
R’000 R’000 R’000 R’000 R’000
Claims against the Department
DOCMANIA SIX/MEC HS
Claim for 74 housing units constructed in Boshoff 302 - 302 - -
INZUZO TRADING 509 CC/DEPT HS. An application wherein the applicant is requesting the court to order the Department to pay for losses in income due to termination of construction contracts as at 31 March
33 575 - - - 33 575
Claims received by the Department currently under investigation 32 483 45 593 23 597 - 54 479
CEM BRICK MANUGACTURERS CC/HOD HS & ZIMVO TRADING
The plaintiff is suing the Department and the Contractor jointly and severally the one to pay the other to be absolved. The claim is based on a material cession agreement that was entered into between the Contractor and the Plaintiff. The Plaintiff is alleging that the Department failed to pay the cession agreement in full.
1 756 - - - 1 756
TEBFIN PTY LTD/ZINGANA MBELE CONSTRCUTIO & MEC HUMAN SETTLEMENT
Claim for the non-payment of a cession agreement 455 - - - 455
UBUHLEBETHU BUSINESS ENTERPRISES CC AND THE MEC FOR HS
Applicant is claiming for the partially completed 38 houses - 316 316 - -
SPRING LIGHTS DEVELOPMENT PTY LTD/MOLEBOHENG TRADING CC AND THE THREE OTHERS
Applicant is claiming from the first respondent which is the amount that would have been - 2 969 2 969 - -
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
187
Nature of Liability
Liabilities incurred
during the year
Liabilities paid/cancelle
d/reduced during the
year
Liabilities recoverable
(Provide details
hereunder)
Opening Closing
Balance Balance
1 April 2014 31 March
2015
R’000 R’000 R’000 R’000 R’000
due to them as the sub-contractor in terms of a contractor for building houses between the Department and the first respondent. They are also praying for an order in terms of which the Department will be ordered to pay any and all amounts due to the first respondent directly to the applicant
DMV BAELETSI PTY LTD/MEC HS
The applicant is suing the Department of Project Management and Engineering Services provided by the applicant in the Development of Houses in Maqhekung
- 336 336 - -
DEPT HS SELLOANE & 200 OTHERS REAHOLA HOUSING ASSOCIATION & 10 OTHERS STANDARD BANK
- 55 - - 55
Om 23 October 2014 the CFO was served with a notice of execution of the Departments property. This resulted from a High Court matter wherein the Department appointed MB Mogotsi Attorneys to act on behalf of Mr Selloane and 200 residents of Reahola. The application was to dissolve the Reahola Housing Board under Reahola Housing Association. The respondent in this matter, reasons for dissolving the Board were mismanagement of funds, failure to issue title deeds, failure to maintain the place etc. The Department was involved in the mater as a way of protecting the Housing Institutional Subsidies that were issued to these residents. In the notice received it is indicated that the respondent received a Court Order against the Department on the 25 August 2014, however the Department was not aware of such matter we were never served and we also checked with the registers file there in no return served.
TEBFIN PTY LTD/KENTHA CONSTRUCTION (PTY) LTD & MEC COGTA & HS - 72 - - 72
Claim of R72 000 for the non-payment of a cession agreement
VISIBLE SPEED T/A APOLO CONSTRUCTION & MEC COGTA/HS
Breach of contract by the defendant, by not allowing the plaintiff to complete the projects they were appointed for 106 units in Hennenman and 100 units in Ventersburg
- 2 399 - - 2 399
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
188
Nature of Liability
Liabilities incurred
during the year
Liabilities paid/cancelle
d/reduced during the
year
Liabilities recoverable
(Provide details
hereunder)
Opening Closing
Balance Balance
1 April 2014 31 March
2015
R’000 R’000 R’000 R’000 R’000
INDIVIDUAL SUBSIDIES The Department had contingent liability due to letters sent to contractors and attorneys with regard to individual subsidies
- 5 704 - - 5 704
TOTAL 68 571 57 444 27 520 - 98 495
DEPARTMENT OF HUMAN SETTLEMENTS VOTE 13
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2015
189
ANNEXURE 3
CLAIMS RECOVERABLE
Government Entity
Confirmed balance outstanding
Unconfirmed balance outstanding Total
Cash in transit at year end 2014/15 *
31/03/2015 31/03/2014 31/03/2015 31/03/2014 31/03/2015 31/03/2014
Receipt date up to six (6)
working days after year
end Amount
R’000 R’000 R’000 R’000 R’000 R’000 R’000
Department
National Department of Home Affairs
- 14 14 - 14 14 - -
Cooperative Governance - - 26 - 26 - - -
Sub-Total - 14 40 40 14 - -
Other Government Entities - -
Mangaung Furnserv - - 265 265 265 265 - -
Mangaung Bomme Building construction
- - 230 230 230 230 - -
SARS - 1 19 - 19 1 - -
Matjhabeng Municipality - - 34 - 34 - - -
Moqhaka Municipality - - 26 - 26 - - -
Sub-Total - 1 574 495 574 496 - -
TOTAL - 15 614 495 614 510 - -
DEPARTMENT OF HUMAN SETTLEMENT VOTE 13
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS
for the year ended 31 March 2015
AFS for Free State Department of Human Settlements 190
ANNEXURE 4
INTER-GOVERNMENT PAYABLES
GOVERNMENT ENTITY
Confirmed balance outstanding
Unconfirmed balance outstanding TOTAL
Cash in transit at year end 2014/15 *
31/03/2015 31/03/2014 31/03/2015 31/03/2014 31/03/2015 31/03/2014
Payment date up to six (6)
working days before year
end Amount
R’000 R’000 R’000 R’000 R’000 R’000 R’000
DEPARTMENTS
Current
Department of the Premier 112 86 - - 112 86 - -
Department of Cooperative Governance
1 118 3 - - 1 118 3 - -
Department of Justice 91 167 - - 91 167 - -
Total 1 321 256 - - 1 321 256 - -
OTHER GOVERNMENT ENTITY
Current
Fleet Management 562 709 - - 562 709 - -
Subtotal 562 709 - - 562 709 - -
Total 1 883 965 - - 1 883 965 - -
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191
ANNEXURE 5
INVENTORIES
Inventory Note Quantity 2014/15 Quantity 2013/14
R’000 R’000
Opening balance 6 747 7 - -
Add/(Less): Adjustments to prior year balance - - - 2
Add: Additions/Purchases - Cash - - 4 714
Add: Additions - Non-cash 1 593 91 527 6 764 24
(Less): Issues - - (4) (714)
Add/(Less): Adjustments - - (17) (19)
- - - -
Closing balance 8 340 91 534 6 747 7
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ANNEXURE 6
MOVEMENT IN CAPITAL WORK IN PROGRESS
MOVEMENT IN CAPITAL WORK IN PROGRESS FOR THE YEAR ENDED 31 MARCH 2015
Opening
balance
Current
Year Capital
WIP
Completed
Assets
Closing
balance
R’000 R’000 R’000 R’000
BUILDINGS AND OTHER FIXED
STRUCTURES
453 182 544 422 (91 527) 906 077
Dwellings 453 182 544 422 (91 527) 906 077
TOTAL 453 182 544 422 (91 527) 906 077
MOVEMENT IN CAPITAL WORK IN PROGRESS FOR THE YEAR ENDED 31 MARCH 2014
Opening
balance
Prior period
error
Current
Year Capital
WIP
Completed
Assets
Closing
balance
R’000 R’000 R’000 R’000 R’000
BUILDINGS AND OTHER
FIXED STRUCTURES
- - 453 189 (7) 453 182
Dwellings - - 453 189 (7) 453 182
TOTAL - - 453 189 (7) 453 182
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193
FREE STATE HOUSING FUND ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2015
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CONTENTS PAGE GENERAL INFORMATION 195 REPORT OF THE ACCOUNTING OFFICER 197 ACCOUNTING OFFICERS RESPONSIBLITIES AND APPROVAL STATEMENT 199 REPORT OF THE AUDITOR-GENERAL 200 STATEMENT OF FINANCIAL POSITION 201 STATEMENT OF FINANCIAL PERFORMANCE 202 STATEMENT OF CHANGES IN NET ASSETS 203 CASH FLOW STATEMENT 204 ACCOUNTING POLICIES 205 NOTES TO THE FINANCIAL STATEMENTS 217
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FREE STATE HOUSING FUND
FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2015 GENERAL INFORMATION Accounting Officer: Mr N. Mokhesi Registered office: OR Tambo House Cnr St Andrews and Markgraaf Street Bloemfontein 9301 Business address: OR Tambo House Cnr St Andrews and Markgraaf Street Bloemfontein 9301 Postal address: P.O. Box 211 Bloemfontein 9300 Domicile and legal form: The Fund is domiciled in Bloemfontein within the Free State
Province, South Africa. The Fund is an entity falling under the administration of the Free State Department of Human Settlements.
Jurisdiction: The Fund falls within the jurisdiction of the Republic of South Africa. Banker: Standard Bank of South Africa Auditor: Auditor-General Nature of business: The provision of low cost housing in the Free State in terms of the
Free State Housing Act of 1999. Level of assurance: These annual financial statements have been prepared in
accordance with Generally Recognised Accounting Practices in order to provide users thereof with relevant and accurate economic information regarding the Fund for the year ended 31 March 2015.
Preparer: The annual financial statements were independently compiled by
Ernst & Young Advisory Services (Proprietary) Limited.
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Supervised by: The annual financial statements are under the direction and supervision of Mr. N. Mokhesi, the Head of the Department of Human Settlements.
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FREE STATE HOUSING FUND REPORT OF THE ACCOUNTING OFFICER FOR THE YEAR ENDED 31 MARCH 2015 The accounting officer submits his report for the year ended 31 March 2015: 1. Review of activities Main business and operations The Fund is established for the provision of low cost housing in the Free State in terms of the Free State Housing Act of 1999. The operating results and state of affairs of the Fund are fully set out in the attached annual financial statements and do not in my opinion require any further comment. 2. Going concern It is the intention of the Accounting officer to close the Fund during the next financial year and therefore it is no longer a going concern as management intends to liquidate the Fund or to cease operations. GRAP 1 – Presentation of Financial Statements requires that the financial statements should not be prepared on a going concern basis if management intends to liquidate the Fund or to cease trading. In view of this the carrying value of the assets, which were determined in accordance with the going concern basis, have been reviewed for possible impairment and changes which have occurred since the year end and consideration has been given as to whether any additional provisions are necessary as a result of the decision to cease operations. It is expected that all assets will realise the amounts at which they are included in the statement of financial position and there will be no material additional liabilities. Accordingly management does not expect an alternative basis of preparation to be materially different from the going concern basis, and therefore the financial statements have been prepared on a going concern basis. 3. Events after the reporting period The accounting officer is not aware of any matters or circumstances arising since the end of the financial year. 4. Auditor The Auditor-General South Africa will audit the Fund as prescribed.
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5. Compilation of annual financial statements The compiler was responsible for the preparation of the annual financial statements based on information provided by management and worked under the supervision of management. Management is responsible for these annual financial statements. The state of the fund‟s affairs, its performance and cash flow for the year under review is properly disclosed in the enclosed financial statements. The financial statements state the affairs, performance, and cash flow for the individual fund.
________________________ Accounting Officer
N Mokhesi Date: 31 July 2015
________________________ Acting Chief Financial Officer
N Leuna Date: 31 July 2015
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FREE STATE HOUSING FUND ACCOUNTING OFFICER’S RESPONSIBILITIES AND APPROVAL STATEMENT FOR THE YEAR ENDED 31 MARCH 2015
The accounting officer of the Fund is required in terms of the Public Finance Management Act No, 1 of 1999 (PFMA) to maintain adequate accounting records and is responsible for the content and integrity of the annual financial statements and related financial information included in this report. It is their responsibility to ensure that the annual financial statements fairly present the state of affairs of the Fund as at the end of the financial year and the results of its operations and cash flows for the period then ended, in conformity with Generally Recognised Accounting Practices. The external auditors are engaged to express an independent opinion on the annual financial statements.
The annual financial statements are prepared in accordance with Generally Recognised Accounting Practices and are based upon appropriate accounting policies consistently applied and supported by reasonable and prudent judgments and estimates. The accounting officer acknowledges that he is ultimately responsible for the system of internal financial control established by the Fund and places considerable importance on maintaining a strong control environment. To enable the accounting officer to meet these responsibilities, standards for internal control have been set aimed at reducing the risk of error or loss in a cost effective manner. The standards include the proper delegation of responsibilities within a clearly defined framework, effective accounting procedures and adequate segregation of duties to ensure an acceptable level of risk. These controls are monitored throughout the fund and all employees are required to maintain the highest ethical standards in ensuring the fund‟s operations are conducted in a manner that in all reasonable circumstances is above reproach. While operating risk cannot be fully eliminated, the fund endeavours to minimise it by ensuring that appropriate infrastructure, controls, systems and ethical behaviour are applied and managed within predetermined procedures and constraints.
The accounting officer is of the opinion, based on the information and explanations given by management that the system of internal control provides reasonable assurance that the financial records may be relied on for the preparation of the annual financial statements. However, any system of internal financial control can provide only reasonable, and not absolute, assurance against material misstatement or loss.
The external auditors are responsible for independently reviewing and reporting on the fund's annual financial statements. The annual financial statements have been examined by the Fund‟s external auditors and their report is presented on page 7.
The annual financial statements set out on pages 8 to 30, which have been prepared on the going concern basis, were approved by the accounting officer on and were signed by:
______________________ ________________________ Accounting Officer Acting Chief Financial Officer N. Mokhesi N Leuna Date: 31 July 2015 Date: 31 July 2015
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FREE STATE HOUSING FUND REPORT OF THE AUDITOR GENERAL FOR THE YEAR ENDED 31 MARCH 2015
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FREE STATE HOUSING FUND STATEMENT OF FINANCIAL POSITION AT 31 MARCH 2015
Notes
2014/15 R’000
2013/14 R’000
ASSETS Current assets 13 780 13 058
Trade and other receivables from exchange transactions
3 81 78
Cash and cash equivalents 4 13 699 12 980
Non-Current assets held for sale
2
571
804
Total assets
14 351
13 862
EQUITY AND LIABILITIES Capital and reserves Accumulated surplus 2 184 2 406
Current liabilities
Trade and other payables 5 12 167 11 456
Total equity and liabilities
14 351
13 862
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FREE STATE HOUSING FUND STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 31 MARCH 2015
Notes
2014/15 R’000
2013/14 R’000
Revenue from exchange transactions Revenue from non-exchange transactions
9 9
549
860
- Expenditure:
Provision for doubtful debts 547 (222) Other operating expenses Finance expense Bad debt written off
- (725) (591)
- (613)
Operating Surplus / (Deficit) (220) 25
Other income- Administration fees raised on property debtors
- -
- Capital adjustments on loans - -
Surplus / (Deficit) for the period
(220)
25
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FREE STATE HOUSING FUND STATEMENT OF CHANGES IN NET ASSETS FOR THE YEAR ENDED 31 MARCH 2015
Note
Accumulated Surplus
Total R’000
Balance at 01 April 2012 2 374
Restated Surplus / (Deficit) for the period 7
Restated balance at 31 March 2013
2 381
Surplus / (Deficit) for the period 25
Balance at 31 March 2014
2 406
Surplus / (Deficit) for the period (221)
Balance at 31 March 2015
2 185
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FREE STATE HOUSING FUND CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARCH 2015
Note
2014/15 R’000
Restated 2013/14 R’000
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash receipts from customers 57
240
Cash paid to suppliers and employees (57)
(240)
Cash generated from operations 6 - - Interest received Interest paid
719
-
606
-
Net cash flow from operating activities
6
719
606
CASH FLOWS FROM INVESTING ACTIVITIES Net (decrease) / increase in cash and cash equivalents Cash and cash equivalents at beginning of period
4
-
719 12 980
-
606
12 374
Cash and cash equivalents at end of period
4
13 699
12 980
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FREE STATE HOUSING FUND ACCOUNTING POLICIES TO THE FINANCIAL STATEMENTS AT 31 MARCH 2015 1. PRESENTATION OF ANNUAL FINANCIAL STATEMENTS The principal accounting policies, applied in the preparation of these annual financial statements, are set out below. These accounting policies are consistent with those applied in the preparation of the prior year annual financial statements, unless specified otherwise. 1.1 BASIS OF PREPARATION
These annual financial statements were prepared in accordance with Standards of Generally Recognised Accounting Practice (GRAP), as issued by the Accounting Standards Board in accordance with Section 91(1) of the Public Finance Management Act (Act No 1 of 1999).
The annual financial statements were prepared on the accrual basis of accounting and incorporate the historical cost conventions as the basis of measurement, except where specified otherwise.
In the absence of an issued and effective Standard of GRAP, accounting policies for material transactions, events or conditions were developed in accordance with paragraphs 8, 10 and 11 of GRAP 3 as read with Directive 5.
Assets, liabilities, revenues and expenses were not offset, except where offsetting is either required or permitted by a Standard of GRAP.
1.2 PRESENTATION CURRENCY These annual financial statements are presented in South African Rand, which is the functional currency of the Fund, and amounts have been rounded to the nearest thousand Rand.
1.3 GOING CONCERN ASSUMPTION It is the intention of the Accounting Officer to close the Fund during the next financial year and therefore it is no longer a going concern, as management intends to liquidate the Fund or to cease operations. GRAP 1 – Presentation of Financial Statements requires that the financial statements should not be prepared on a going concern basis if management intends to liquidate the Fund or to cease trading. In view of this the carrying value of the assets, which were determined in accordance with the going concern basis, have been reviewed for possible impairment and changes which have occurred since the year end and consideration has been given as to whether any additional provisions are necessary as a result of the decision to cease operations. It is expected that all assets will realise the amounts at which they are included in the statement of financial position and there will be no material additional liabilities.
Accordingly management does not expect an alternative basis of preparation to be materially different from the going concern basis, and therefore the financial statements have been prepared on a going concern basis.
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1.4 COMPARATIVE INFORMATION
Prior year comparatives
When the presentation or classification of items in the annual financial statements is amended, prior period comparative amounts are also reclassified and restated, unless such comparative reclassification and / or restatement is not required by a Standard of GRAP. The nature and reason for such reclassifications and restatements are also disclosed. Where material accounting errors, which relate to prior periods, have been identified in the current year, the correction is made retrospectively as far as is practicable and the prior year comparatives are restated accordingly. Where there has been a change in accounting policy in the current year, the adjustment is made retrospectively as far as is practicable and the prior year comparatives are restated accordingly.
The presentation and classification of items in the current year is consistent with prior periods. 1.5 STANDARDS, AMENDMENTS TO STANDARDS AND INTERPRETATIONS ISSUED BUT NOT YET EFFECTIVE The following standards have been issued, but are not effective for the 2014/15 financial year:
GRAP 18 - Segment Reporting The standard does not yet have an effective date. The standard requires the identification and aggregation of the operating segments of the Fund into reportable segments. For each of the reportable segments identified details of the financial performance and financial position should be disclosed.
This standard will not have an effect on the financial statements of the Fund as the Fund does not have different segments for which it is appropriate to separately report financial information.
GRAP 20 – Related Parties (revised) The standard does not yet have an effective date. This standard provides the requirements for the disclosure of related parties and transactions and balances with related parties. It is based on IPSAS 20, however several principles from IAS 24 has been included. Furthermore definitions and terms have been amended to be relevant in a South African context.
The Fund complied with the requirements of this standard during the period under review.
GRAP 32 - Service Concession Arrangements: Grantor
The standard does not yet have an effective date. The standard provides guidance on how the grantor should account for service concession arrangements. The standard addresses how service concession revenue and the related assets and liabilities should be accounted for. Taking into
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consideration that the Fund is not involved in service concession arrangements it is considered that this standard will not have a significant impact on its financial statements once it becomes effective.
GRAP 105 – Transfer of Function between Entities under Common Control The standard does not yet have an effective date. This standard provides the accounting treatment for transfers of functions between entities under common control. The standard determines that assets and liabilities transferred to entities under common control will be recognised at their carrying values (determined by the transferring Entity using an accrual accounting basis) in the records of the receiving Entity. The difference between the consideration transferred and the carrying value of the assets / liabilities transferred is recognised in accumulated surplus / deficit. This standard will only have an effect on the financial statements of the Fund when functions are transferred between entities under common control. The transfer of functions would be accounted for as mentioned above.
GRAP 106 – Transfer of Function between Entities Not Under Common Control This standard deals with other transfers of functions not under common control and requires the Entity to measure transferred assets and liabilities at fair value. The difference between the consideration transferred and the carrying value of the assets / liabilities transferred is recognised in accumulated surplus / deficit. This standard does not yet have an effective date. This standard will only have an effect on the financial statements of the Fund when functions are transferred between entities not under common control. The transfer of functions would be accounted for as mentioned above.
GRAP 107 – Mergers
This standard deals with requirements of accounting for a merger between two or more entities. The standard determines that the assets and liabilities acquired through the merger should be measured at their carrying values. Any difference between these carrying values and the consideration transferred for the merger is recognised in accumulated surplus / deficit. This standard does not yet have an effective date.
This standard will only have an effect on the financial statements of the Fund when it enters into a merger. The merger would be accounted for as mentioned above.
GRAP 108 - Statutory Receivables
The standard does not yet have an effective date. This standard prescribes the accounting treatment for receivables arising from legislation rather than from contracts entered into between parties. This standard provides that statutory receivables are initially measured at transaction price and subsequently measured using the cost model. Application of the cost model allows for adjustment to the carrying amount to reflect any interest or other charges that may have accrued on the receivable, impairment losses or amounts de-recognised. This standard is not anticipated to have a significant impact on the financial statements of the Fund.
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IGRAP 12 – Jointly Controlled Entities – Non-monetary Contributions by Venturers
This interpretation provides guidance on the recognition of gains and losses resulting from contributions of non-monetary assets to jointly controlled entities. This interpretation does not yet have an effective date. This interpretation will not have an effect on the financial statements of the Fund.
1.6 SIGNIFICANT JUDGMENTS AND ESTIMATES
The use of judgment, estimates and assumptions is inherent to the process of preparing annual financial statements. These judgements, estimates and assumptions affect the amounts presented in the annual financial statements. Uncertainties about these estimates and assumptions could result in outcomes that require a material adjustment to the carrying amount of the relevant asset or liability in future periods.
Judgements
In the process of applying these accounting policies, management has not been required in the current year to make judgements that may have a significant effect on the amounts recognised in the financial statements.
Estimates Estimates are informed by historical experience, information currently available to management, assumptions, and other factors that are believed to be reasonable under the circumstances. These estimates are reviewed on a regular basis. Changes in estimates that are not due to errors are processed in the period of the review and applied prospectively.
In the process of applying the Fund‟s accounting policies the following estimates, were made: Provision for bad debts
The measurement of receivables is derived after consideration of the provision for bad debts. Management makes certain assumptions regarding the categorisation of debtors into groups with similar risk profiles so that the effect of any impairment on a group of receivables would not differ materially from the impairment that would have been determined had each debtor been assessed for impairment on an individual basis. The determination of this allowance is predisposed to the utilisation of estimates, assumptions and management judgements. In determining this allowance the estimates are made about the probability of recovery of the debtors based on their past payment history and risk profile.
An allowance for this was created on the following basis
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Amount of debt outstanding for 120 days or more as a percentage of the total debt outstanding Recommended allowance
80-100% 100%
60-80% 80%
40-60% 60%
20-40% 40%
0-20% 20%
The basis used has not changed from the prior year, and reflects the most accurate provision calculation. Effective interest rate The Fund uses an appropriate interest rate, taking into account guidance provided in the standards, and applying professional judgement to the specific circumstances, to discount future cash flows. The Fund used the following in arriving at the effective interest rate used:
No Consideration Inputs related to the consideration
1 Market related rate used as starting point National Treasury guidelines
1.7 FINANCIAL INSTRUMENTS
Initial Recognition The Fund recognises a financial asset or a financial liability in its Statement of Financial Position when, and only when, the Fund becomes a party to the contractual provisions of the instrument. This is achieved through the application of trade date accounting.
Upon initial recognition the Fund classifies financial instruments or their component parts as financial liabilities, financial assets or residual interests in conformity with the substance of the contractual arrangement and to the extent that the instrument satisfies the definitions of a financial liability, a financial asset or a residual interest.
Financial instruments are evaluated, based on their terms, to determine if those instruments contain both liability and residual interest components (i.e. to assess if the instruments are compound financial instruments). To the extent that an instrument is in fact a compound instrument, the components are classified separately as financial liabilities and residual interests as the case may be.
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Initial Measurement
When a financial instrument is recognised, the Fund measures it initially at its fair value plus, in the case of a financial asset or a financial liability not subsequently measured at fair value, transaction costs that are directly attributable to the acquisition or issue of the financial asset or financial liability.
Subsequent Measurement
Subsequent to initial recognition, financial assets and financial liabilities are measured at fair value, amortised cost or cost.
All financial assets and financial liabilities are measured after initial recognition using the following categories:
(a) Financial instruments at fair value (b) Financial instruments at amortised cost, or (c) Financial instruments at cost. The Fund assesses which instruments should be subsequently measured at fair value, amortised cost or cost, based on the definitions of financial instruments at fair value, financial instruments at amortised cost or financial instruments at cost as set out above. Concessionary loans
The part of the concessionary loan that is a social benefit or non-exchange revenue is determined as the difference between the fair value of the loan and the loan proceeds, either paid or received.
After initial recognition, the Fund measures concessionary loans in accordance with the subsequent measurement criteria set out for all financial instruments.
De-recognition
A financial asset is derecognised at trade date, when: a) The cash flows from the asset expire, are settled or waived; b) Significant risks and rewards are transferred to another party; or c) Despite having retained significant risks and rewards, the Fund has transferred control of the asset to another entity.
A financial liability is derecognised when the obligation is extinguished. Exchanges of debt instruments between a borrower and a lender are treated as the extinguishment of an existing liability and the recognition of a new financial liability. Where the terms of an existing financial liability are modified, it is also treated as the extinguishment of an existing liability and the recognition of a new liability.
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Gains and losses
A gain or loss arising from a change in the fair value of a financial asset or financial liability measured at fair value is recognised in surplus or deficit.
For financial assets and financial liabilities measured at amortised cost or cost, a gain or loss is recognised in surplus or deficit when the financial asset or financial liability is derecognised or impaired or through the amortisation process.
Offsetting
The Fund does not offset financial assets and financial liabilities in the Statement of Financial Position unless a legal right of set-off exists and the parties intend to settle on a net basis.
Impairments
All financial assets measured at amortised cost, or cost, are subject to an impairment review. The Fund assesses at the end of each reporting period whether there is any objective evidence that a financial asset or group of financial assets is impaired. For financial assets held at amortised cost
The Fund first assesses whether objective evidence of impairment exists individually for financial assets that are individually significant and individually or collectively for financial assets that are not individually significant. If the Fund determines that no objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, it includes the asset in a group of financial assets with similar credit risk characteristics and collectively assesses them for impairment. Assets that are individually assessed for impairment and for which an impairment loss is or continues to be recognised are not included in the collective assessment of impairment.
If there is objective evidence that an impairment loss on financial assets measured at amortised cost has been incurred, the amount of the loss is measured as the difference between the asset‟s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset‟s original effective interest rate (i.e. the effective interest rate computed at initial recognition). The carrying amount of the asset is reduced through the use of an allowance account. The amount of the loss is recognised in surplus or deficit.
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor‟s credit rating), the previously recognised impairment loss shall be reversed either directly or by adjusting an allowance account. The reversal shall not result in a carrying amount of the financial asset that exceeds what the amortised cost would have been had the impairment not been recognised at the date the impairment is reversed. The amount of the reversal is recognised in surplus or deficit.
For financial assets held at cost
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If there is objective evidence that an impairment loss has been incurred on an investment in a residual interest that is not measured at fair value because its fair value cannot be measured reliably, the amount of the impairment loss is measured as the difference between the carrying amount of the financial asset and the present value of estimated future cash flows discounted at the current market rate of return for a similar financial asset. Such impairment losses are not reversed.
Policies relating to specific financial instruments
Cash and cash equivalents
Cash and cash equivalents are measured at fair value.
Cash includes cash on hand and cash with banks. Cash equivalents are short-term highly liquid investments that are held with registered banking institutions with maturities of three months or less and are subject to an insignificant risk of change in value.
For the purposes of the Cash Flow Statement, cash and cash equivalents comprise cash on hand and deposits held on call with banks.
Trade and other receivables Trade and other receivables are initially recognised at fair value plus transaction costs that are directly attributable to the acquisition and subsequently stated at amortised cost, less provision for impairment. All trade and other receivables are assessed at least annually for possible impairment. Impairments of trade and other receivables are determined in accordance with the accounting policy for impairments. Impairment adjustments are made through the use of an allowance account.
In the current year, and consistent with the prior year, the method of determination of fair value has been determined by actual outstanding debt.
Bad debts are written off in the year in which they are identified as irrecoverable. Amounts receivable within 12 months from the reporting date are classified as current. Interest is charged on overdue accounts.
Trade and other payables
Trade payables are initially measured at fair value plus transaction costs that are directly attributable to the acquisition and are subsequently measured at amortised cost using the effective interest rate method. 1.8 NON-CURRENT ASSETS HELD FOR SALE Recognition
Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered through a sale transaction rather than through continuing use. This condition is
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regarded as met only when the sale is highly probable and the asset (or disposal group) is available for immediate sale in its present condition. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date of classification. If the sale is delayed by events or circumstances beyond the Fund‟s control and the Fund remains committed to its plan to sell, this does not preclude the assets as from being classified as held for sale.
Measurement
Non-current assets held for sale (or disposal group) are measured at the lower of carrying amount and fair value less costs to sell.
A non-current asset is not depreciated (or amortised) while it is classified as held for sale or while it is part of a disposal group classified as held for sale.
Interest and other expenses attributable to the liabilities of a disposal group classified as held for sale are recognised in surplus or deficit.
De-recognition
Non-current assets and disposal groups held for sale are derecognised upon disposal of the item or where no further economic benefits or service potential is expected to flow from the asset or disposal group. Gains / losses that result from the de-recognition of non-current assets or disposal groups held for sale are recognised in surplus / deficit in the period of the de-recognition. 1.9 REVENUE RECOGNITION Revenue from Exchange Transactions
Revenue from exchange transactions refers to revenue that accrues to the Fund directly in return for services rendered or goods sold, the value of which approximates the consideration received or receivable, excluding indirect taxes, rebates and discounts.
Recognition
Revenue from exchange transactions is only recognised once all of the following criteria have been satisfied:
a) The Fund retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold; b) The amount of revenue can be measured reliably; and c) It is probable that the economic benefits or service potential associated with the transaction will flow to the Fund and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Revenue arising out of situations where the Fund acts as an agent on behalf of another entity (the principal) is limited to the amount of any fee or commission payable to the Fund as compensation for executing the agreed services.
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Specific exchange-revenue sources Rental income arising from Non-Current Assets held for sale is recognised as it legally accrues in terms of the original contract until the date of disposal of the particular property.
Interest on loans is recognised at fair value on a time proportion basis, taking account of the principal outstanding and the effective rate over the period to maturity.
Interest received on the bank account represents an amount that is due to the Provincial Department of Human Settlements on winding-up of the Fund and as such is credited directly to this liability included in Trade Payables. Measurement
Revenue from exchange transactions is measured at the fair value of the consideration received or receivable taking into account the amount of any trade discounts and volume rebates allowed by the Fund. Expenditure from Exchange Transactions The accounting policy for expenditure arising from exchange transactions is similar to the policy for exchange revenue. Revenue from Non-Exchange Transactions
Non-exchange transactions are transactions that are not exchange transactions.
Revenue from non-exchange transaction arises when the Fund either receives value from another entity without directly giving approximately equal value in exchange or gives value to another entity without directly receiving approximately equal value in exchange.
Revenue from non-exchange transactions is generally recognised to the extent that the related receipt or receivable qualifies for recognition as an asset and there is no liability to repay the amount.
Grants, transfers and donations received or receivable are recognised when the resources that have been transferred meet the criteria for recognition as an asset and there is not a corresponding liability in respect of related conditions.
Measurement
An asset that is recognised as a result of a non-exchange transaction is recognised at its fair value at the date of the transfer. Consequently, revenue arising from a non-exchange transaction is measured at the fair value of the asset received, less the amount of any liabilities that are also recognised due to conditions that must still be satisfied.
DEPARTMENT OF HUMAN SETTLEMENT VOTE 13
FREE STATE HOUSING FUND
for the year ended 31 March 2015
215
Where there are conditions attached to a grant, transfer or donation that gave rise to a liability at initial recognition, that liability is transferred to revenue as and when the conditions attached to the grant are met.
Grants without any conditions attached are recognised as revenue in full when the asset is recognised, at an amount equalling the fair value of the asset received.
Interest earned on the investment is treated in accordance with grant conditions. If it is payable to the funder it is recorded as part of the creditor. Expenditure relating to Non-Exchange Transactions
The accounting policy for expenditure arising from non-exchange transactions is similar to policy for non-exchange revenue. 1.10 SURPLUS OR DEFICIT
Income, expenditure, gains and losses are recognised in surplus or deficit except for the exceptional cases where recognition directly in net assets is specifically allowed or required by a Standard of GRAP. 1.11 EVENTS AFTER THE REPORTING DATE
Events after the reporting date are those events, both favourable and unfavourable, that occur between the reporting date and the date when the financial statements are authorised for issue. Two types of events can be identified:
Those that provide evidence of conditions that existed at the reporting date (adjusting events after the reporting date); and
Those that are indicative of conditions that arose after the reporting date (non-adjusting events after the reporting date).
The Fund will adjust the amounts recognised in the financial statements to reflect adjusting events after the reporting date once the event occurred.
The Fund will disclose the nature of the event and an estimate of its financial effect or a statement that such estimate cannot be made in respect of all material non-adjusting events, where non-disclosure could influence the economic decisions of users taken on the basis of the financial statements.
1.12 RELATED PARTIES
The Fund has processes and controls in place to aid in the identification of related parties. A related party is a person or an entity with the ability to control or jointly control the other party or exercise significant influence over the other party, or vice versa, or an entity that is subject to common control, or joint control. Related party relationships where control exists are disclosed regardless of whether any transactions took place between the parties during the reporting period.
DEPARTMENT OF HUMAN SETTLEMENT VOTE 13
FREE STATE HOUSING FUND
for the year ended 31 March 2015
216
Where transactions occurred between the Fund and any one or more related parties, and those transactions were not within:
normal supplier and/or client/recipient relationships on terms and conditions no more or less favourable than those which it is reasonable to expect the Fund to have adopted if dealing with that individual entity or person in the same circumstances; and
terms and conditions within the normal operating parameters established by the reporting Fund‟s legal mandate;
Further details about those transactions are disclosed in the notes to the financial statements.
1.13 CONSIDERATION OF CONSOLIDATION
The Department of Human Settlements has the ultimate control over the Housing Fund. According to IAS 27 consolidated annual financial statements should be prepared for the Department and Housing Fund, but consolidation is not required due to the fact that the Housing Fund is presented on the GRAP basis of accounting whilst the Department is presented on the modified cash basis of accounting, therefore no consolidated financial statements have to be prepared.
FREE STATE HOUSING FUND NOTES TO THE FINANCIAL STATEMENTS AT 31 MARCH 2015
2014/15 R’000
2013/14 R’000
2. NON-CURRENT ASSETS HELD FOR SALE Opening balance
804 804
Assets sold (233) - Adjustment for impairment loss - -
Closing balance at end of year 571 804
The Assets held for sale consists of land and residential houses. The Free State Housing Fund retains ownership of 80 housing units. In the current year the Debtors system has been updated and 31 properties has been transferred. These units are occupied by tenants who are required to reimburse the Fund for the usage thereof. It is, however, the intention of the Housing Fund to dispose of the units to the occupants thereof. Whilst this has not occurred up to the year ended 31 March 2015, the circumstances which dictated this were outside of management‟s control, and it remains the intention of management to dispose of the units to the occupants thereof within the next 12 months. Therefore, the units have been disclosed as "Non-current assets held for sale."
DEPARTMENT OF HUMAN SETTLEMENT VOTE 13
FREE STATE HOUSING FUND
for the year ended 31 March 2015
217
3. TRADE AND OTHER RECEIVABLES FROM EXCHANGE TRANSACTIONS
Rental debtors at gross value 1385 1 935 Provision for bad debts for rental debtors (1368) (1 915)
Rental debtors at fair value 17 20
Loans to individuals at gross value 35 35
Provision for bad debts for loans to individuals at fair value
(35)
(35)
Loans to individuals at fair value - -
Properties sold at gross value 29 29 Provision for bad debts for properties Sold
(29)
(29)
Loan account: Department of Human Settlements
- Finance income receivable – Standard Bank 64 58
81 78
Debtors are charged interest as they become past due at a rate of 9% per annum. Trade and other receivables past due but not impaired:
Debtor classification
Neither past due nor impaired
30-60 days 61-90 days 91-120 days
>120 days
Total
Rental debtors 2 2 - - - 2
Individual loan debtors
- - - - - -
Properties sold debtors
- - - - - -
Totals 2 2 - - - 2
Trade and other receivables impaired:
Debtor classification 1-3 months >3 months
Rental debtors 66 1 320
Individual loan debtors 1 35
Properties sold debtors 1 30
Total 68 1 385
Summary of Debtors by Customer Classification
Consumers Industrial / Commercial
R '000 R '000
as at 31 March 2015
Current (0 – 30 days) 12 64
-
DEPARTMENT OF HUMAN SETTLEMENT VOTE 13
FREE STATE HOUSING FUND
for the year ended 31 March 2015
218
31 - 60 Days 12 - 61 - 90 Days 12 - 91 - 120 Days 11 - 121 - 365 Days 1403 - + 365 Days - -
Sub-total 1 450 64
Less: Provision for doubtful debts
(1433) -
Total debtors by customer classification
17
64
as at 31 March 2014
Current (0 – 30 days) 19 58 31 - 60 Days 19 - 61 - 90 Days 19 - 91 - 120 Days 19 - 121 - 365 Days 1 924 - + 365 Days
Sub-total 2 000 58 Less: Provision for doubtful debts
(1 980) -
Total debtors by customer classification
20
58
Reconciliation of the doubtful debt provision
2014/15 R’000
2013/2014 R’000
Balance at beginning of the year
1 982 1760
Contributions to provision
-547 - 222
Doubtful debts written off against provision
-
-
Reversal of provision -
Increase/ (Decrease) due to change in estimate
-
-
Change due to correction of errors
-
1982
Balance at end of year 1 435
DEPARTMENT OF HUMAN SETTLEMENT VOTE 13
FREE STATE HOUSING FUND
for the year ended 31 March 2015
219
2014/15 R’000
2013/14 R’000
4. CASH AND CASH EQUIVALENTS Cash on hand and bank balances
13 699
12 980
13 699 12 980
Cash at Standard Bank earned 5% interest per annum.
5. TRADE AND OTHER PAYABLES
Sundry payables Funds to be transferred to Department of Human Settlements, made up as follows: Funds owed to the Department of Human Settlements represented by the cash and cash equivalents of the Fund, less Funds owed to the Housing Fund by the Department of Human Settlements
2014/15 R’000
-
12 167
13 764
(1 596)
2013/14 R’000
-
11 456
13 037
(1 581)
12 167 11 456
Upon closure of the Fund, the amount owed by the Department of Human Settlements will be settled against the payable owed to the Department of Human Settlements, and the net amount will be paid over to the aforementioned Department.
6. RECONCILIATION OF NET PROFIT TO CASH GENERATED FROM OPERATIONS
2014/15 R’000
2013/14 R’000
Surplus/(Deficit) for the year (221) 25
Adjustments for: - Interest received - Provision for bad debts movement - Bad debt write off - Rebate on sale of assets
(719) (547) 591 232
(606) 219 - -
DEPARTMENT OF HUMAN SETTLEMENT VOTE 13
FREE STATE HOUSING FUND
for the year ended 31 March 2015
220
Operating profit before working capital changes
(664)
(362)
Changes in working capital:
-(Increase) / Decrease in Trade and other receivables
(47)
(227)
- Increase / (Decrease) in Trade and other payables
711
589
Cash generated from Operations
-
-
FREE STATE HOUSING FUND NOTES TO THE FINANCIAL STATEMENTS AT 31 MARCH 2015 7. FINANCIAL INSTRUMENTS
Set out below is a comparison by category of carrying amounts and fair values of all of the Fund‟s financial instruments that are carried in the financial statements at other than fair values:
Carrying amount Fair Value Note 2014/15
R’000 Restated
2013/14 R’000
2014/15 R’000
Restated 2013/14 R’000
Financial Assets
Trade Receivables 3 81 78 81 78 Cash and cash equivalents
4
13 699 12 980 13 699 12 980
Financial Liabilities
Trade Payables 5 12 167 11 456 12 167 11 456
The financial assets and liabilities by category:
The accounting policies for financial instruments have been applied to the line items below:
2015 Financial assets at
fair value Financial assets and liabilities at amortised cost
Total
Trade receivables - 81 81 Cash and cash equivalents
13 699 - 13 699
Trade payables (12 167) (12 167)
13 699 12 086 1 613
DEPARTMENT OF HUMAN SETTLEMENT VOTE 13
FREE STATE HOUSING FUND
for the year ended 31 March 2015
221
2014 Financial assets at
fair value Financial assets and liabilities at amortised cost
Total
Trade receivables - 78 78 Cash and cash equivalents
12 980 - 12 980
Trade payables - (11 456) (11 456)
12 980 (11 378) 1 602
Risk Management
7.1 Maximum credit risk exposure
The credit risk of trade receivables is not manageable due to the fact that houses are being allocated to low-income tenants in terms of Government policy to promote social housing. In the light of the above significant provision for bad debts has been raised against trade receivables to achieve a recoverable carrying amount.
Credit risk consists mainly of cash deposits, cash equivalents and trade debtors. The Fund only deposits cash with major banks with high quality credit standing and limits exposure to any one counter-party.
Trade and other receivables are presented in the financial statements at amortised cost.
7.1.1 Collateral held and other credit enhancements
The credit risk exposure, as posed by the financial assets detailed above, is mitigated by collateral held in the form of the housing units owned by the Free State Housing Fund in relation to these instruments. Such units remain the property of the Fund until such time as debts are settled and ownership is officially transferred.
7.1.2 Concentration of credit risk
The concentration of credit risk is mainly within the trade and other receivables, relating to debtors at year end, rather than in the cash and cash equivalents of the Fund.
7.2 Liquidity risk
The Fund‟s risk to liquidity is a result of the funds available to cover future commitments. The Fund manages liquidity risk through an ongoing review of future commitments and credit facilities. Adequate utilised borrowing facilities are monitored.
DEPARTMENT OF HUMAN SETTLEMENT VOTE 13
FREE STATE HOUSING FUND
for the year ended 31 March 2015
222
The table below analyses the Fund‟s financial liabilities into relevant maturity groupings based on the remaining period at the Statement of Financial Position to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.
2015 Not later than one month Later than one month and not later than three months
Trade and other payables
- -
2015 Later than three months and not later than one year
Later than one year and not later than five years
Trade and other payables
12 167
-
2014 Not later than one month Later than one month and not later than three months
Trade and other payables
- -
2014 Later than three months and not later than one year
Later than one year and not later than five years
Trade and other payables
11 456 -
7.2.1 Concentration of liquidity risk
The concentration of liquidity risk is mainly within the trade and other payables, which relates to the liability payable to the Department of Human Settlements. 7.2.2 Collateral held and other credit enhancements
The Fund holds no collateral and / or credit enhancements that aid in the mitigation of the liquidity risk it is exposed to.
7.3 Interest rate risk
As the Fund has significant interest-bearing assets, the Fund‟s income and operating cash flows are not substantially independent of changes in market interest rates. At year end, financial instruments exposed to interest rate risk were as follows: - Cash and cash equivalents
7.3.1 Concentration of interest rate risk
The concentration of interest rate risk is mainly within the cash and cash equivalents, as this is where the Fund is most exposed to changes in the interest rate.
DEPARTMENT OF HUMAN SETTLEMENT VOTE 13
FREE STATE HOUSING FUND
for the year ended 31 March 2015
223
7.3.2 Interest rate risk sensitivity analysis
The susceptibility of the Fund‟s financial performance to changes in interest rates can be illustrated as follows:
2015 2015 impact 2014 impact
Interest income
Interest rate increase of 100 basis points 137 130
Interest rate decrease 100 basis points (137) (130)
Interest expense
Interest rate increase of 100 basis points - -
Interest rate decrease 100 basis points - -
The following methods and assumptions were applied in the determination of the interest rate sensitivity analysis:
The main assumption utilised was that the interest rate would not change by more than a percent either way, due to stability in overall rates in the country in the preceding financial year.
The method applied to determine the interest rate sensitivity analysis has the following limitations that may result in the information not being fully representative of the actual future results:
- Market rate volatility may impact the interest rates more than expected.
No changes were made to the methods and assumptions applied, in the prior year, to the determination of the sensitivity analysis.
7.3.3 Collateral held and other credit enhancements
The Fund holds collateral in the form of housing units which may be disposed of in order to mitigate the interest rate risk it is exposed to. No credit enhancements are held which mitigate such risk. 7.4 Financial assets pledged as security
No financial assets have been pledged as security for liabilities in the current or prior year.
7.5 Defaults and breaches
No defaults or breaches occurred in the current or prior year. 7.6 Credit quality of financial assets carried at amortised cost/fair value
7.6.1 Method of determining credit quality of other current financial assets
DEPARTMENT OF HUMAN SETTLEMENT VOTE 13
FREE STATE HOUSING FUND
for the year ended 31 March 2015
224
The credit quality of trade and other receivables from exchange transactions are determined and monitored with reference to historical payment trends. Accordingly the credit quality of the customers included in the balance of trade and other receivables from exchange transactions is determined internally through application of the Fund's own credit policy. Based on the evaluation of the historical payment trends, customers included in the balance are categorised into groups as per note 1.6 in the financial statements. 7.6.1.1 Impairment disclosures for other current financial assets carried at amortised cost / fair value
Reconciliation between gross and net balances
Gross Balances Provision for Doubtful
Debts
Net Balance
R’000 R’000 R’000
Rental debtors 1385 (1368) 17
Individual loan debtors 35 (35) -
Property debtors 30 (30) -
Total 1 450 (1 433) 17
8. RELATED PARTIES The only related party of the Fund is the Free State Department of Human Settlements, since the Fund falls under the administration of the Department, and since the Fund shares the same accounting officer. The following represents the total closing balance of amounts due by / (to) the Department. These amounts are not guaranteed. Once the Fund ceases to operate, the bank balance will be surrendered to the Department to cover the payable amount. All related party transactions are at arm‟s length. Statement of Financial Position Note 2014/15 2013/14 R’000 R’000
Loan Account included in Accounts Payable 5 (12 167) (11 456) The above loan is included to represent the amount owed to the Department of Human Settlements upon closure of the Fund. There are no terms or conditions attached to this loan. In addition, the value of services provided to the Housing Fund by the Department of Human Settlements includes the usage of the BAS system as well as the use of services of the employees of the Department to administer the Fund. The value of these services cannot be reliably estimated.
DEPARTMENT OF HUMAN SETTLEMENT VOTE 13
FREE STATE HOUSING FUND
for the year ended 31 March 2015
225
9. REVENUE 2014/15
R’000 2013/14 R’000
From exchange transaction Rent income 57 247
Property sold Rebates Finance income-Bank Finance income- Debtors
(232) 725
-
- 613
-
Total 550 860
From non-exchange transactions: None in the current or previous year.
226
ANNUAL REPORT
2014/2015 FINANCIAL YEAR
PR311/2015
ISBN 978-0-621-44021-8
DEPARTMENT OF HUMAN SETTLEMENTS P O BOX 211
BLOEMFONTEIN 9300
