Minister of Human Settlements on allegations concerning the National Home Builders Registration Council

Meeting report

Briefing by the Minister of Human Settlements
The Honourable Tokyo Sexwale, Minister of Human Settlements, had undertaken to brief the Committee on the allegations of corruption leveled against the National Home Builders Registration Council (NHBRC).  The matter was brought up during parliamentary question time the previous week.  He had requested that the briefing was attended by Mr Willie Hofmeyr of the Special Investigations Unit (SIU) and Dr Chauke, Chairperson of the NHBRC Board.  A press conference would be held immediately after the briefing to the Committee.

Minister Sexwale had appointed a National Audit Task Team to investigate allegations of corruption in the housing sector.  An investigation audit into the alleged irregularities at the NHBRC was instigated and further investigations were undertaken by the SIU.  The initial SIU report to the Minister contained discrepancies.  He decided not to release the report and referred the matter back to the SIU for further investigation.  The final report of the SIU would be made available to the Committee.  He stressed that the Chairperson of the NHBRC Board had provided his full cooperation during the investigative process.  The matter concerning the employment of a senior official of the SIU by the NHBRC would be investigated separately.

The NHBRC was the regulatory agency for the Department of Human Settlements (DHS).  As such, the NHBRC played a monitoring and policing role.  Problems with badly-built houses had been experienced by the DHS since 1994.  He pointed out that there were many old buildings in South Africa that were still standing after hundreds of years and it was unacceptable that new houses collapsed within a short period of time despite the modern construction methods that were available.  The NHBRC had been tasked with identifying the houses with construction faults and to ensure that repairs were carried out.  The Department should focus on the ongoing provision of housing and creating jobs in construction and should not be burdened with rectification.  The cost of rectification was expected to exceed R20 billion.  Statistical data was in the process of being compiled and would be made available to the Committee in due course.

Minister Sexwale advised that most countries had regulatory bodies similar to the NHBRC and required inspections to be carried out at specified stages of construction.  He congratulated the Limpopo Province on being the first provincial authority to blacklist a contractor for corruption.  The contractor concerned was subsequently turned down by the Eastern Cape provincial authority because of the blacklisting.  He anticipated that there would be a significant number of cases involving the failure of contractors to deliver on tender contracts.  The process of litigation was costly and time-consuming and would require significant human and financial resources.  The Department would require additional funds for litigation, which was unlikely to be recovered.

The Director-General of the DHS was very involved in the matter.  The SIU was the watchdog but was itself under investigation for involvement in the corruption allegations against the NHBRC.  In terms of the current NHBRC Act, the Council was responsible for both regulation and rectification.  He suggested that the applicable legislation was reviewed and welcomed any suggestions by the Committee.

Discussion
The Chairperson thanked Minister Sexwale for the briefing.  She pointed out that a Member of the Committee had first raised the matter with the Minister during an oversight visit in Gauteng.  The Committee appreciated and commended the action taken by the Minister, which demonstrated his commitment to resolving the issues.  She trusted that the subsequent developments concerning the Member would be addressed as well.  She explained the role of Members of Parliament in representing the interests of the electorate.  Members of Parliament enjoyed the protection offered by the Rules of Parliament, which was not the case for other whistle-blowers.  The Committee wanted the assurance of the Minister that all the issues would be satisfactorily addressed.

Ms N Mnisi (ANC) expressed concern over the exorbitant cost of rectification of shoddily-built houses.  She asked what action was taken to ensure that houses provided by the State would not require repair in future.

Mr A Figlan (DA) said that it became clear during earlier briefings by the NHBRC to the Committee that the Council did not know how to resolve the issue of badly-built houses.  Responsibility for the Independent Development Trust (IDT) was recently transferred to the Department of Public Works (DPW).  The IDT was responsible for providing sanitation services.  He was concerned that the IDT was required to work with 18 different Departments and entities and that the organisation was being set up for failure.

Mr L Suka (ANC) wanted to know what the future plans and the timeframes were for completing the rectification programme.  He suggested that the different types of construction faults were categorised.  All officials had to disclose their interests in accordance with the Code of Conduct and declare any conflict of interest.  He asked Minister Sexwale to clarify the latest developments in the matter.  He suggested that the Committee noted that legislation making an entity responsible for both regulation and for repair was undesirable.  Whistle-blowers should be dealt with in a sensitive manner and care must be taken that the individuals were protected.

Mr D Mavunda (ANC) asked for the input of the representatives of the SIU and NHBRC.

The Chairperson said that the response of the NHBRC was not required at this time.

Ms B Ngcobo (ANC) said that the IDT played a significant role in the provision of sanitation services in rural areas.  Concerns had been raised over the lack of progress, the adequacy of the funding provided and if the IDT had sufficient skill capacity to meet its mandate.

Minister Sexwale replied that he was currently discussing the matters concerning the IDT with the Minister of Public Works.  The transfer of responsibility for sanitation from the Department of Water Affairs to the DPW was complex but he was confident that the Minister would address the issue of the IDT in due course.  Discussion with the National Treasury had revealed that the IDT was currently involved in a number of projects, worth several billion Rands.  He was however concerned over the ability of the IDT to successfully complete the projects.  He wanted to be sure that the problems at the IDT were resolved before State funding went to the private sector.

Minister Sexwale confirmed that all officials were required to sign the Code of Conduct and declare their interests.  However, the mere legal disclosure of interest was not enough and issues of integrity, morality and ethics needed to be taken into consideration as well.  He felt that communities needed to play a more active role in bringing the problems with housing and services provided to the attention of authorities.  He cited the example of unenclosed toilets in the Western Cape and the Free State.  He pointed out that corruption was basically the theft of taxpayers’ money, originally intended for the upliftment of the community.

The Chairperson said that the Committee awaited the report on the IDT.  The Committee’s expectations were clear.  Parliament had made funds available for the provision of sanitation services but the Committee was not satisfied with the performance to date.

The meeting was adjourned.