Department of Human Settlements budget vote: Analysis by Financial and Fiscal Commission Update report on unenclosed toilets in Moqhaka Local Municipality

Meeting report

Opening remarks

The Chairperson said the Financial and Fiscal Commission (FFC) presentation would help Members understand if the DHS had planned correctly and had responded to the State of the Nation address, but would also highlight the budgetary challenges that were there. The FFC was one institution whose expertise the Committee could regularly tap into; these institutions were created by the Constitution to support Members in their work. If an external support on research was required, the FFC could be relied upon. Members should use the opportunity to utilise the constitutional structures that were there to support the monitoring function.

The Chairperson said Members were still pursuing the Rural Housing Infrastructure Grant (RHIG) battle, and were secure in the knowledge that the FFC supported them. She pleaded with the FFC not to change its stance (this was in light of reports indicating that National Treasury (NT) would rather have the function of sanitation administered by local government, whose supervision was under the Department of Cooperative Governance and Traditional Affairs – Cogta). The Deputy Minister of Finance, Mr Nhlanhla Nene, had committed to appearing before the Committee, but was currently abroad. She had indicated that a meeting should  be rescheduled with the Deputy Minister on his return. The Committee would not take the RHIG battle lying down -- certainly not after the President had made a proclamation that sanitation should be administered by the DHS.

The Committee’s contention was that sanitation could not be separated from housing provision. The Committee was less interested in the industrial part of it, but in terms of ensuring that households had adequate sanitation facilities, this was the responsibility of the DHS. The Committee would not back down on that. Support was needed, even if the rescheduling of the function was stipulated as a Section 5 requirement.  There also would be an update on unenclosed toilets from Moqhaka local municipality.

Briefing by the Financial and Fiscal Commission (FFC)

Mr Bongani Khumalo, FFC Chairperson, said the FFC had made a substantive submission on the RHIG during deliberations on the Division of Revenue Bill (DRB) in February. The position that the Commission had taken on RHIG had not changed. There were processes going on between Parliament and NT, and the FFC would be following those. The Commission was required by legislation to respond to requests by organs of state on this particular type of issue. This was the legislative context that had brought the FFC to Parliament.

In approaching the request, the FFC had looked at what the key strategic DHS programmes for 2013/14 were. These were the implementation of the revised Finance-Linked Individual Subsidy (FLiSP) programme, the implementation of the management rectification programme, municipal accreditation programme, improved intergovernmental collaboration, and also the delivery of the social and rental housing. The discussion was really about the analysis of these programmes. Intergovernmental collaboration had been prominent during discussion on the DRB, and the Committee would do well in putting emphasis on this aspect.

In terms of policy context in which these programmes should be pursued, there was the National Upgrading Support Programme (NUSP); National Development Plan; Outcome 8, which set certain targets and timeframes; but also the new Housing Guarantee Scheme that needed to be implemented.

Mr Sabelo Mtantato, FFC Senior Researcher: Human Settlements and Built Environment, said there were four key programmes the DHS would use to achieve key objectives.  These were administration; human settlements policy, strategy and planning; programme delivery support; and housing development finance. The analysis had started from 2009, right up to the revised figures for 2013/14. Housing Development Finance (HDF) was the main programme for the Department and took up over 95% of the budget. The programme was responsible for, among other things, management of public entities, provinces and municipalities with respect to human settlements; acceleration of delivery of housing through the various departmental grants; improvement of access to housing finance; and ensuring equitable access to private housing finance.

The biggest sub-programme within HDF was the Human Settlement Development Grant (HSDG), which accounted for well over 68% of the total funding on this programme. This trend had continued through all the years. A closer scrutiny indicated spending on the programme was improving. Nevertheless there were those programmes that showed inconsistency in spending. Under-spending was as a result of delays in securing additional building, vacancies and a moratorium that had been placed on the filling of positions in the Department.

The HSDG was a key conditional grant in the delivery of housing and was transferred to all provinces using a formula that took into account housing needs. Municipalities were dependent on this grant for housing delivery, since they had capacity challenges in raising their own revenue. Generally the spending of the HSDG had been good over the period, and averaged around 98%.  A decrease in spending was noticeable in provinces like the Eastern Cape and Limpopo due to issues of capacity, inadequate bulk services, land, delayed payments to contractors and cash flow challenges.

Underperformance was as a result of the fragmented nature of the grants in the built environment. There was a need to align and sequence the grants. Provincial transfers not made on time affected performance.  The DHS’s intention to transfer the housing allocation function to six metros was a positive development. This would contribute to resolving the housing challenge, but not entirely eliminate it.

The RHIG had been introduced in 2010 to assist with the achievement of universal access to water and sanitation by 2014. The grant was established as a result of backlogs in water and sanitation in most rural municipalities. It was important to note that the President had proclaimed the transfer of the sanitation function from the Department of Water Affairs (DWA) to the DHS. The grant had not performed well since inception. The allocation to the grant had been reduced in the previous financial year by about R138 million. There would definitely be challenges in meeting the 2014 deadline to eliminate sanitation backlogs. By January 2013, the spending on the grant’s total allocation of R479.5 million was about 18%.

The Urban Settlement Development Grant (USDG) was introduced in the 2011 Medium Term Expenditure Framework (MTEF) for metros to improve on efficiency and coordination of investments in the built environment. The intention of the grant was to provide metros with resources and control over investment programmes in the built environment. The grant had not been performing well; only two metros – Nelson Mandela Bay Metro and eThekwini – had been able to spend over 50%. Challenges reported by the Department included procurement and project management inefficiencies, and monitoring difficulties.

The Department had fallen short on its delivery outcome, as it had targeted 250 000 units but had constructed only 220 000. There was a constant shortfall in delivering houses. Some of the challenges were beyond the Department’s control. This implied that the shortfall on reaching targets had added to the backlog.  The movement of people in between towns did not help the situation either. There was also the cost of providing services, increasing unit costs, and limited fiscal resources.

It was important to think of alternative funding for the provision of houses. The FFC had engaged in public hearings to explore other ways that would assist the government. The fiscus could not keep up with the increasing demand. Other measures had not been assessed due to the unavailability of data.

The DHS annual performance plans and the strategic plans had been assessed against the policy frameworks like the National Development Plan and Outcome 8. It was found there was correct alignment of the plans and those policies. Indicators were clear and measurable, and would be able to be assessed. The issue of targets not being clearly defined had been raised with the Committee previously. The Commission was happy that targets were credible and were in line with the recommendations that had been put forward.

Ms Tania Ajam, FFC Commissioner, said the FFC could only reiterate its previous recommendations. The Commission was happy that one such recommendation, the accreditation of municipalities, was progressing well with noticeable positive developments. In principle the FFC supported the assignment of the housing function to six metros. It was important that information gaps be addressed as they pertained:

·         Provision of agreements between affected provinces and metros

·         Detailed asset registers from provinces

·         Detailed information of housing projects to be transferred to metros

·         Due diligence on projects under way

·         Valuation of assets and any liabilities

·         Cut off date for current liabilities

·         An appropriate baseline

She said if the original under-funded function was transferred, that could create problems for the recipient. There had to be an understanding on the baselines. The Department had been asked to go back and focus on areas where information was not availed to the Commission. This was a way of managing the risk of transferring the function, but also to reap the benefits.

The Commission reiterated its view, expressed in the DRB discussions, that there be a review of the RHIG grant, with a view of making it flexible and, where necessary, cost effective. The Commission had made a detailed submission on this and the views stood. A case had also been made on developing an effective monitoring system for verification of projects delivered. It was critical that the Department assessed how its housing delivery instruments performed.  The DHS should strengthen its monitoring for the entire sector operations.

The FFC was aware the Department did not play a delivery role; it played a sector leadership and monitoring role, spanning both the private and public sector. At issue was not just housing provision, but other services like water and sanitation that needed to be sequenced before housing projects were constructed. Even though it did not fall within the operational mandate of the Department, it was important that the DHS had a complete view of the human settlements development chain.

The DHS should also be focussing not only on the money indicators, but also performance indicators. There had to be detailed information on some of the developments. Housing expenditure needed to be improved in the programmes, with tangible targets. The moratorium on filling vacancies should be lifted. The Department had made positive steps in certain areas. Migration and households splitting had resulted in the demand far exceeding delivery. Unless the DHS worked differently, it would not be able to address the backlog. The delivery challenges were not just a money problem, because the Department continued to under-spend. The challenge was much broader. The Commission was preparing a report following its engagements with different stakeholders in the sector, and it would be available around June 2013.

Discussion

The Chairperson said it would be ideal if the FFC first shared the report with the Committee.  Time would be scheduled for such an engagement.

Ms G Borman (ANC) commented that the information presented had become “old hat” to the Committee. These were issues that the Committee had previously raised. The fact that the Department had spent almost 100% of the money but had fallen hopelessly short on the targets was a concern. Where was the problem, she asked?

Ms Borman said if the business plan targeted a certain number of units, there had to be money to deliver those. Although the targets were now quantifiable, the challenge was whether the financing related to them. She sought clarity on the public hearings on alternative funding that the presentation had mentioned. The problem of backlogs out there was huge, and the backlog was growing. Could this alternative funding be unpacked?

Ms Borman commented that she agreed that money would not fix the problem. She believed the biggest hurdle in housing delivery was a management problem, and not filling posts with the right people.

Ms Borman said in interactions with the metros, the Committee had found they were not ready to be accredited.  If this function was going to be handed over, what should the Department be doing? There were metros which could deliver. Where is the nub of the problem?

Mr K Sithole (IFP) requested that the FFC express an opinion on sanitation, because the presentation was silent on this aspect. He asked to what extent under-spending contributed to the housing backlog?

Mr Sithole said it was important to shift funding from those unders-pending programmes towards eradicating informal settlements. This phenomenon was disastrous and spiralling out of control.

Ms A Mashishi (ANC) asked if the challenges over the delivery of houses in Limpopo were a result of the governance challenges experienced by the province.

Ms D Dlakude (ANC) said the presentation was an eye opener, and had highlighted some issues that the Committee had been complaining about. What needed to be done to curb under-spending? Parliament could not approve a budget that the Department did not see a need for, and yet people on the ground needed the services.

Ms Dlakude said she was worried about the RHIG, especially as by February, expenditure was only at 11%, yet by the end of March it was around 55%. This was fiscal dumping. People in rural areas, where water was really scarce, suffered. The CSIR could come up with many models that could be used to construct toilets for people. In North West, the RHIG funding was never touched last year. What needed to be done to prevent this kind of fiscal dumping? She said the suggestion should take into consideration the failure to spend by the EC and Limpopo, as to how the situation in those two provinces could be improved.

Mr R Bhoola (MF) said there was a need to carry out a thorough evaluation of the success rate of objectives against a particular grant. The baseline and financial muscle aligned with a particular programme should at least indicate why other municipalities managed to spend so much, while others did not, if they were monitored by the same policy.

Mr Bhoola asked if the FFC had been able to analyse the success of a new monitoring and evaluation model. It had been indicated that the decrease was increasing and yet the delivery had decreased -- he jibed that “this sounded like a Chinese jigsaw puzzle.” But could the Department deliver on old and outdated legislation? Was there any challenging aspect that stagnated delivery; by  its own interpretation, it had indicated that money was not the problem.

Mr Bhoola said with regard to those metros that were not delivering, it was time to transfer funds to provinces that were able to spend all their money so that they could address their backlogs.

Mr Bhoola said issues of under-spending as a result of legislation and as a result of bulk infrastructure should be separated. At what point did one concluded that infrastructure became a problem to an extent where spending became “constipated”?

Mr S Mokgalapa (DA) said the FFC had already raised some of the issues last year. The points would be beneficial during the budget vote debate in the National Assembly (NA). The presentation did not mention the fact that although money was being spent, there were no deliverables on the ground. This was the problem, and this state of affairs was difficult to accept. When would the country get to a stage where delivery would be matched with the budget?

He requested that the FFC comment on corruption in the portfolio. How did the issue of acknowledgement of debt (AOD) impact on procurement? The Committee had been informed by the Audit Committee last week that the Special Investigative Unit (SIU) was focussed on recovery. He said the whole system was corrupt, so was keeping these officials in the system not a danger?

Ms N Mnisi (ANC) commented that giving the function of building houses to municipalities would pose its own challenges. The challenge was great and she was not sure what the metros thought could be done. More effort was needed towards putting effective monitoring and evaluation mechanisms into place. Without monitoring, nothing good could be achieved from the system. Even if more money could be allocated, nothing would be achieved without monitoring. Where could the Department tighten up, in order to improve monitoring?

Ms J Sosibo (ANC) wanted to know if the FFC had engaged the Department in so far as its recommendations on RHIG were concerned.

The Chairperson asked if the FFC had been able to interact with the provincial treasuries (PTs) of the EC and Limpopo, especially as there appeared to be delays in transferring the money to departments.

The Chairperson asked what the FFC’s view on FLiSP was. The Committee condemned the issue of FLiSP being linked to projects.  It was recommended that FLiSP take into consideration individuals. It appeared there was discrimination; some people were denied access in the way this programme was being implemented. This issue was being taken up with the Minister.

The alternative funding issue needed to be discussed extensively. How could it be ensured that human settlement developments were linked to economic development?  This was a debate to embark on. If people were working, they could easily build their own houses. What kind of legislative environment was needed once people could afford to build their own houses? The issue of title deeds became imperative. This was a challenge throughout the country. She requested that the FFC make an input on this matter before the budget vote debate happened. The Commission should get an overall picture on how the issuing of title deeds was happening, and the kind of challenges that were being encountered.

Mr Khumalo gave an overall reply and said there were a lot of issues that needed to be understood about the grants that the Department managed and how they translated to delivery outcomes. It was important that DHS start from there. The recommendations were made to Parliament; this was the primary centre of FFC focus.

Parliament should then engage with departments, and indicate to them that this was what the Commission had said, and ask why they were not doing it. The Commission’s recommendations should be queried with the purpose of getting clarity on what they meant for individual departments. The FFC had made two submissions in the past month, one on the Division of Revenue Bill (DORB), within which a special submission had been made on RHIG, and how the FFC thought it should be treated in the DORB. This was where things had broken down -- the accountability framework derived from the Bill for the grant. If RHIG was not dealt correctly in the DORB, with clarity on who was responsible, and what schedule it fell under --, and therefore who took accountability when things failed -- then the Government would have failed.

The FFC recommendations on RHIG, as presented previously at the Committee and at the Select Committee on Appropriations, stood; the Commission had not shifted. This was the answer to the broad comments made on RHIG, but the FFC could come and present the recommendations again if the Committee so required.   He would propose that the key respective departments involved in the sanitation function “debacle” all be present.

Mr Mokgalapa interjected and proposed a meeting with NT, in the presence of the FFC.

Mr Khumalo said the second submission related to the assignment of the housing function to the six metros. A submission had been made to the Ministers of Finance, Human Settlements and Cogta, but the submission had also been tabled in Parliament, as required by the law.  The FFC’s role in the assignment of the housing function was not about assigning or not, but to highlight fiscal implications of such a decision. The Commission had highlighted the issue about the correct baseline, and had identified all the current and future liabilities.

In 2006, the Commission had prepared a template that could be used to assess fiscal implications relating to a shift of a function. This was an executive decision which, when made, was likely to impact on another sphere of government. The template had been given to the Department. The kind of information that was received from the relevant metros, provincial departments and the national departments, was “terrible”. There were serious gaps of information.  But one had to look at the broader context.

Metros were called to Parliament to indicate if they ready or not, and FFC assumed that metros could not lie to Parliament. The FFC then had to protect their interests by looking at what the financial and fiscal implications would be. Obviously, they could not be ready at the same level. A list of recommendations had been presented, and they needed to be addressed as a matter of urgency.

He said it would be appreciated if the Committee could invite the Commission, in the presence of DHS, to present the recommendations on the shifting of the housing function to metros. A submission had been made to the Department, but there had been no acknowledgement from the DHS that the submission was ever received.

The Chairperson interjected that the Human Settlements budget vote would be different this year. It would detail the issues on the budget itself, and the implications. Such a submission would help the Committee. She said the Committee would consider receiving the report next week, and the Department should stand ready for the invitation.

Mr Khumalo replied that another submission had been made to Parliament in August of 2012, on the issue of intervention in Limpopo and Section 100.  He clarified that the provincial DHS in Limpopo was not under administration, but the challenge was that if a PT was under administration, everybody else receiving funds from that department would be under administration. There was no enabling constitutional legislation to address a situation on what happened when some other departments were not under administration, while the PT was. This had to be addressed urgently.

The FFC had not directly interacted with the EC and Limpopo on delays in transfers. It was important for the FFC to do things independent of what the provinces thought or did. The Commission worked and formulated an opinion on official documents provided by provinces. FFC could even differ with the AG.  Provinces made targets and they should live with them. This Department made targets and had consistently fallen short. Another issue was thinking that once the money had left the Department, it was spent; sometimes transfers did not equate to spending. The issue had been raised previously.

The Department had played a leadership role on transfers, and it was a pity some of the national departments had not. The accountability framework sometimes broke down. Departments had spoken proudly about how they had not transfered to failing municipalities, while they were the ones who had motivated for the money. This kind of accountability was important.

He said the FFC would be tabling a report on the review of the local government fiscal framework on Monday. The spending on any of the Government programmes constituted the broad local government fiscal framework. The spending side was as important as the revenue. There was a definite increase in backlogs and there were definite pressures in urban areas. This related to how human settlement developments were linked to economic development. This was a big responsibility, requiring the DHS to play a leadership role. As economic centres became concentrated, informal settlements increased; whose responsibility was it to ensure that those on the move were housed adequately?  The DHS should work with other departments to ensure people were housed properly.

Commissioner Ajam said when it came to targets and financing, the Commission did not want to speak about the budget, but about the backlog. The FFC had tried to estimate where the backlog and the money were. But the FFC had also tried to look at the possible way of doing things differently. Findings were that that would influence delivery and cost.

Things had to be looked at broadly, and it was impossible to reduce the debate into one single reason as to what was wrong. It was correct to say it was partially a management problem. There were problems at different levels of the value chain. The FFC was awaiting Municipal Systems Amendment Act competency standards to come into effect. These applied to finance officials and excluded planners and engineers. The Commission was not sure where the process of the competency standards was, but it was really needed in the system. When vacancies were filled, they ought to be filled with competent people

Commissioner Ajam said the way in which houses were delivered was part of the problem and contributed to the increase of informal dwellings. Poorly located land excluded young people from economic opportunities. The country needed to be looking more at safe and dense communities within inner cities. This could rejuvenate inner cities. A lot of data had been gathered around this matter, and ideally the FFC would want to share that with the Committee.

The Department had already changed its approach to informal settlements; where in situ upgrades were possible, they were encouraged. This was positive, but this should be linked to self-building. The challenge was that there were no private institutions interested in making funds available for this. The question was, why? Another innovative way would be to load on people’s SASSA (social security) cards credit they could use for building materials, instead of giving money to providers. Right now the system made people wait, and it could take up to 20 years just to get on to the waiting list. There were different ways to mobilise people to partner with government, where money for materials could be made available. There were technological ways to fast-track delivery.

The Chairperson commented the challenge regarding the Commission’s innovative ways of housing delivery, was not sitting with the DHS. The information should have been presented first hand to the Department, especially as it was currently reviewing policies. Engaging more broadly was required. Last year, the DHS had been asked to interact with the FFC, and they had not. How would the Department be able to review policies all by itself?  The information presented had spoken to issues of long-term planning and if the DHS was not privy to that information, how could it deliver? She reiterated that the institutions were meant to enhance the performance of government, and yet departments continued to ignore them. The mentality of working in “silos” would kill the country, she warned.

Moqhaka Local Municipality presentation

The Chairperson said the Mayor of Moqhaka Local Municipality, Mr Jihad Mohapi, had come to present on the situation that existed. The Committee had thought the issue with unenclosed toilets had been finalised in 2010/11, so it had been shocking to see this coming up in the news.  The Department had even been surprised when asked, because the impression had been that the matter had been brought to finality. The State of the Nation address had made it clear that complaints had to be responded to before people went out on the street. It was unfair to the people that they had to protest before their issues got attention. This was the basis for the invitation to the Mayor, and his presence was highly appreciated.

Mr Mohapi, said the issue of Moqhaka’s unenclosed toilets had to be understood within the context of a media statement by the South African Human Rights Commission (SAHRC) on their visit to the municipality. The media statement had indicated that municipality had restored the dignity of the people. The challenge of open toilets had resulted from a programme that the municipality had implemented around eradication of the bucket system. Funds had been allocated for the bucket eradication programme, but were not enough. The municipality had limited funding, so they had established toilets without walls.

There had been a public outcry around 2010 on the issue of unenclosed toilets. The SAHRC had resolved that toilets be built in Moqhaka. Soon after the SAHRC visit in 2010, the municipality had conducted an audit confirming that over 1 881 toilets were not enclosed. The municipality had looked to solve the problem in 2011, but funding had been a challenge. Financial support from Cogta, the DHS and money from the municipal coffers had been received, and savings from another programme had been used for the purpose of enclosing the toilets. The municipality had also solicited R2.7 million funding from the Development Bank of SA, although a commitment had initially been made for R7 million.

Around R13 million had been spent on addressing the challenge of open toilets in Moqhaka. Different service providers had been tasked with the building of structures. Challenges arose during the building of toilets.  These included the lack of grant funding, and people demolishing their toilets in the hope that new structures would be built for them. Contractors instigated this behaviour, and when they were asked to fix those toilets with structural defects, they gave the impression that people were getting new toilets.

During the SAHRC visit in April, an allegation had been made by members of the public that a DA councillor had encouraged people to demolish their toilets. As part of addressing the challenge, during ward constituency meetings, members of the community were warned they would not get another toilet. It was also discovered that while the community of Ramolutsi had toilets inside RDP houses, they also wanted the outside toilets for use by backyard tenants. To the municipality, this was wasteful expenditure. Other challenges involved the late payment of service providers.

He blamed the media for the latest reporting on the unenclosed toilets in Moqhaka. The Sowetan newspaper had reported that Moqhaka had failed to honour the ruling of the SAHRC. The report was accompanied by a photo of a collapsing toilet structure. On a visit to that particular area, it had been discovered that the owner had two toilets -- the one outside and one inside her RDP house. The media had not been objective. As a result of people demolishing toilets, the number of toilets to be constructed had increased by 253. The municipality would soon be drawing up by-laws to counter the practice of people demolishing toilets.

In 2010/11, the municipality had requested assistance from the DHS, and R64 million had been received. The money was mainly used for Viljoenskroon, which was an informal settlement. The funding helped to earmark sites where bulk infrastructure could be developed. Most of the families in this area had been successfully located, and only 77 were still waiting to be relocated. The site identified for the 77 families was meant for a high school, and the municipality could not therefore upgrade it. Money allocated was for bulk infrastructure. Where the municipality was building RDP houses for the poor, such houses came with a toilet inside.

Another noticeable challenge was ageing infrastructure, especially given the growth of the area. The bigger the area became, the more stress it led to in terms of the treatment plant and other services. The Council for Scientific and Industrial Research (CSIR) had been engaged on the possible sanitation alternatives. The cost implications were unfortunately too high for the municipality to incur. It was thus resolved that the process of building RDP houses be expedited. The municipality was conducting further investigations into the cheapest models of treatment plants and reticulation, and had visited Swartruggens in the North West.  In May, there was a scheduled visit to Botswana.

He said the municipality spent half a million rands every month to transport water into its area, while it generated only R250 000 in revenue. Assistance from Parliament would really be appreciated.

Discussion

Ms Sosibo commented that the municipality would always operate at a deficit if it spent twice the amount it generated monthly only on transporting water into the area. She sought clarity on the claim that a DA councillor had called on people to demolish their outside toilets.

Mr Mohapi commented that by having a toilet outside people generated income, as that attracted backyard dwellers, and this was a challenge.  Even dilapidated toilets had been declared unenclosed, hence people saw fit to demolish them.  It had become a challenge if the municipality was expected to reconstruct those toilets. The priority of the municipality was not only on the issue of sanitation. There were many basic services that the municipality had to render, including electricity. In Viljoenskroon, the municipality required R30 million to address the challenge of electricity. If it was not for the saga of toilets, the money could have been utilised on other basic services.

Ms Dlakude commented that the Moqhaka Municipality situation was a worrying factor. During the local government elections in 2011, this was an electioneering tool. While the ANC had thrown stones at the DA (reference to Makhaza in Cape Town), its back had been exposed too.  She asked if there were open toilets in Moqhaka. The Committee would bear testimony to the Mayor’s assertions about some families having two toilets. The Committee had raised the matter because it amounted to wasteful expenditure.

Ms Dlakude asked if there was a plan to discourage those instigating people into demolishing their toilets. This reflected badly on the municipality. It would be daunting to accomplish eradication of informal settlements if small towns were not enhanced in such a way that they too became centres of economic activity.

Mr Mohapi replied that the municipality could deal with the matter only if those involved in instigating this behaviour were councillors. Councillors subscribed to a code of conduct. Then the Speaker of the municipality would then investigate. With residents, the development of by-laws could help.

Ms P Duncan (DA) wanted to know if there was bucket system in the municipal area. She said if there was no readily available answer to that question, the municipality should then prepare a report with regard to the issue of the bucket system and avail it to the Committee.

Mr Mohapi replied yes, buckets were still used in informal settlements. Even if people were reallocated to new settlements, the challenge would always be the cost of providing running water.

Ms Duncan commented that the Municipal Infrastructure Grant (MIG) went to municipalities to ensure there was infrastructure. They then had to apply for RHIG funding. This was something that the Committee needed to have further deliberations on. Once rural municipalities had exhausted their MIG funds, then the RHIG should soon be made available for erecting toilet structures. There had to be proper communication on how the two grants functioned.

Mr Mohapi commented this was an issue the Committee could help out with.

Mr Philip Chauke, Chief Director, Sanitation, explained that the MIG was a permanent grant that the Government had to address infrastructural backlogs. This grant had a budget of about R14 billion and the allocation formula of that specified that 50% of the money had to go to sanitation and water. The ability to allocate the funds to municipality infrastructure projects lay with the municipalities; they decided on their own what infrastructural projects to upgrade, maintain and build. He clarified that MIG was used to construct VIP toilets even today.

Ms Borman wanted to know what reasons had been advanced by the DBSA in availing only R2.5 million, while the commitment was R7.5 million.

Mr Mohapi replied the memorandum of understanding had taken a while before it was finalised. There had been a bit of bargaining; but the municipality was only able to start with its money. Dates could be confirmed at a later stage, if there were a need for it.

Ms Borman requested that such information be forwarded to the Committee.

Ms Borman commented that it was easy for people in communities to make mischief. She knew about the issue with two toilets per household, as she had been to the community. The problem with the media, it did not go and do proper checking. The Committee was happy with how this matter had been dealt with.

Mr Mokgalapa commented Members were happy with the immaculate explanation given about the issues. This should have been how the interaction with the SAHRC should have been handled. He sought clarity on whether the municipality had received an RHIG allocation.

Mr Mohapi replied the municipality had received an allocation from RHIG previously.

Mr Chauke clarified that there had never been a RHIG allocation to Moqhaka Local Municipality, but there were other rural municipalities who had benefited in the Free State.  Moqhaka did not qualify because the grant was used to benefit specific rural sanitation. The RHIG was promulgated as a stop-gap measure to facilitate rural sanitation challenges. Many of the areas spoken about in Moqhaka were townships.

Ms Dlakude commented that it could never be correct to regard Moqhaka Local Municipality as an urban municipality if it transported water for an amount of R500 000. This needed to be dealt with in the next meeting of the Committee.

Mr Mokgalapa asked the Mayor to elaborate on the proposed by-laws. He said he thought it was good that this was being considered. At the end of the day, it was about restoring the dignity of the people; toilets were not about politics, but good sanitation and the dignity of the people.

Mr Sithole asked how many toilet structures had been demolished as a result of instigation. Could the Mayor also indicate how much money was used from the municipal coffers to build the unenclosed toilets?  He asked if the visit by Ms Winnie Madikizela-Mandela had been beneficial to the municipality, by way of bringing in finances.

Mr Mohapi replied that 1 831 toilets had been built last year; and the figure also was confirmed by the SAHRC. He said he did not know how many structures were demolished, but demolition had happened.

Ms Mashishi asked if there was policy to address the challenge of backyard dwellers.

Mr Mohapi replied that the municipality used town planning management schemes. This specified what was expected from people who had backyard dwellers. People always claimed the RDP houses were small and therefore necessitated backyard dwelling. Although the municipality had developed bylaws, law enforcement was a challenge.

The Chairperson commented that policy development was the competency of national development. The DHS was best placed to respond to the question.

Mr Chauke replied there was a draft policy on backyard dwellers. He reminded the Committee that a pilot project was under way in Gauteng to ascertain the viability of backrooms in homes. The dilemma experienced was double-dipping where one household benefited twice – through the RDP house, and two rooms being constructed at the back of the house.

Ms Mnisi asked if the 77 families yet to be relocated in Ramolutsi had proper sanitation.

Mr Mohapi replied that communal taps had been inserted for the benefit of the 77 families and there were also buckets that were removed on specific days.

The Chairperson commented that the MIG and RHIG funding had been a bone of contention. The Committee had always wanted to know what percentage of MIG was allocated for human settlements bulk infrastructure.  Knowing this information would help the Committee when municipalities came to account.

The Chairperson said the Committee appreciated the work done by the municipality. Those who demolished toilets were not appreciative; instead of accepting that the government had made a mistake in their favour, they were spitting on an opportunity. She said the Committee would issue a media statement to denounce the action, and also call for action against those involved.

Adoption of minutes

The Committee adopted the minutes of 27 and 28 November 2012, with amendments.

The meeting was adjourned.