Preparation for Department of Human Settlements Budget vote: briefing by Minister

Meeting report

Introduction by the Chairperson
The Chairperson welcomed Members of the Committee and appreciated the presence of the Minister and Deputy Minister of Human Settlements. She further acknowledged the presence of the Director-General and the rest of the delegation.

The meeting was in preparation for the Department’s budget vote taking place on 23 May 2013. The Committee had been preparing for the budget vote and had carried out many activities in that regard. A joint oversight visit had even been undertaken by the Committee and the Department of Human Settlements.

The Chairperson mentioned that the Committee would appreciate it if the Minister could just come to the Committee’s meetings without an invitation. It was important for the Minister to remember that he was a member of the Committee and did not need an invitation to update the Committee on his work. It was a good thing that the Minister had responded positively to the invitation.

Strategic Overview of the Budget Vote by the Minister of Human Settlements
Minister Tokyo Sexwale thanked the Committee for allowing the meeting to hold.  He was happy to be reminded by the Chairperson that he was a Member of Parliament. Minister Sexwale said that the meeting was all about accountability and that was why the budget vote was very important. Firstly, he wanted to set the record straight and denied any involvement in the whole scandal which was rocking government relating to the landing of an airplane at the WaterKloof Air Force base.

Minister Sexwale said that the power of accountability was in planning. Rome was not built in a day so even South Africa had to take time in its housing and human settlements progress. In the budget vote, he was going to outline what the Department and Ministry had done in the past 5 years. The task of the Committee and the Department was to establish how far the progress was and what the approach of the Ministry and the Department was.

On the funding model of Human Settlement programmes, the challenge was that there were laws which were still in other government offices. The basis had been laid in terms of policy and it was now time for arranging the budget and the funding model.

The lands between Umlazi and Durban and between Soweto and Johannesburg were no man’s land. The focus and approach of government in those areas was one of deracialisation.

It was an important duty for the Department to outline the future of human settlements in South Africa. Grants were just a welfare scheme and did not really constitute the basis of the South African human settlements plans. It was just a welfare fund. It was a given in South Africa that this low route had to be taken. It was just a safety net. A Housing Policy could not be successful with the welfare grants only.
Where should the housing policy lie? In the rest of the world, people were assisted to build their own houses. The Department of Human Settlements (DHS) was willing to assist people to get bonds. This was what was used in America, China and many other countries which had successfully transformed housing into sustainable human settlements. Individuals were sent to the banks and were backed by the government.
A Human Settlement grant was about R85 000. The higher someone earned, the lesser the grant. Banks were willing to give bonds but needed the backing of the government.

Minister Sexwale said that the Finance-Linked Individual Subsidy Programme (FLISP) was the future of human settlements in South Africa.

Unemployment was another issue which was going to be addressed in the budget vote. Unemployment was a major concern as 40% of South Africans were unemployed. If the economy could take off, the FLISP funding model was going to work. The good human settlement projects were those which helped people get their own houses.

Minister Sexwale said that the budget vote was going to be focused on outcome 8, which was focused on human settlements.

It was a given and a widespread mentality in South Africa that informal settlements were legal and had to be upgraded. Informal settlements were not a housing policy. It was disorganised invasion and that was where the head ache was. It was a big challenge. The DHS had tried to improve the informal settlements but the crisis was that the shacks were reducing in numbers but the population density was increasing in these settlements.

Minister Sexwale said that there was no South African who had not been touched by the Department’s improved policies. He said that it was very unfortunate that when people travelled to new areas, they had left behind a lot of resources built by government. It was very difficult to trace what the effects of double dipping were on the services in the informal settlements.

On capacity, it was important for the deployees and employees of the DHS to be the right people. The DHS was working with universities to improve capacity. There was a need to improve human settlement capacity in South Africa. There was no country that had South Africa’s human settlements situation so it was important for a new curriculum to be created to address the challenge. 

On sanitation, the big issue was capacity. The budget vote was going to outline the progress in terms of sanitation. Municipalities and stakeholder companies and institutions were going to be brought on board in a serious way.

The DHS was going to develop a new theme which focused on ensuring quality and not chasing numbers. The widespread mentality was the insistence on the need to satisfy huge numbers of people with very little regard given to the quality of the houses and services which were actually being given. The DHS was not going to chase numbers. It was more interested in quality than in quantity. The numbers could be made to sound good but quality was more important.

Minister Sexwale said that the above outline illustrated how he wanted to approach the budget vote. It was interesting that he had to prepare the Committee to “come and deal with him” at the budget vote. He compared it to giving ammunition to an enemy before a fight although he and the Committee were not enemies. 

Discussion
The Chairperson thanked the Minister for the update and said that she was happy with the new approach of insistence on quality.

Mr S Mokgalapa (DA) said that it was always good to engage with the Minister on this level. The commitment from the Minister was very clear. The DA believed that there was no silver bullet as far as housing was concerned. Progress had been made but there was more left to be done. It was important to establish who really qualified for government assistance. The issue required political will. He encouraged the Minister for his boldness in engaging the FLISP.

Mr Mokgalapa noted that the issue of targets and spending needed to be addressed. It was important for every stakeholder to take ownership of the problems. Was there any other thing which could be done to address the issue and the backlog? Could there be possibilities of alternative housing designs.
The issue of corruption was very serious. It had to be addressed within the DHS. The rectification of houses was important but it was not supposed to take priority over the delivery of new houses. Why was rectification considered a national priority when the contractors were free and not held accountable?

Ms G Borman (ANC) said that it was important to have the Minister more often in the Committee. There was so great a need within the human settlements sector that the focus was always on the problems and not the positive progress. She was quite excited about the way forward seeing that the DHS was thinking out of the box. It was important for the DHS to start to move in a new direction. There was a lack of management in the projects carried out by the DHS. She asked if the Minister was going to talk about corruption.

Mr K Sithole (IFP) thanked the Minister for his commitment. He asked what could be done to control the growth of informal settlements. Last year the Minister had said there was need for a dialogue about RDP houses, but today he called it welfare. Why was there a sudden change and contradiction?

Mr R Bhoola (MF) said that when the Minister had called for a national audit, he was overwhelmed because he knew that there was going to be an improvement in quality. He did not doubt that the Minister was going to concentrate on improving the quality of human settlements in South Africa. India had a very good model and it was important for SA to study their model. The granting of homes was supposed to be the transfer of assets from one generation to another but the challenges were very intense and had to be examined. It was important for the Minister to look into situation where poor people had their homes auctioned.

Ms M Njobe (COPE) said that she liked the approach used by the Minister. She asked if FLISP was going to be a new hope in South Africa’s housing challenge. 20 years down the line, it was important to establish if progress was being made. She said that the previous approach was creating unintended consequences. The mentality was very bad as people who had beautiful homes were waiting for the government to come build toilets. The mentality of entitlement was very bad and had to be changed.
The budget of the DHS was very little in comparison to the task and mandate of the Department. The budget had to be increased.

Ms P Duncan (DA) asked how the DHS was going to ensure that municipalities took it seriously in its policies and new approach. The Special Development Framework (SDF) had to be taken seriously by municipalities. What was the importance of the SDF?

Ms A Mashishi (ANC) said that the Human Settlements budget vote approach was very good. What was going to be said about job creation and gender equality?

Ms N Mnisi (ANC) said that it was true that as problems were solved, more problems were noticed. What was going to be done about the under spending by certain provinces? She was concerned about the DHS sanitation programmes and asked what the real blockage and challenge was in this regard.

Ms J Sosibo (ANC) asked if the Minister was going to talk about the issue and concerns related to title deeds. It was important for the public to hear about the plans, programmes and projects of the DHS in relation to the eradication of the bucket system.

Mr M Matshoba (ANC) said that there was a lot of concentration on metros and a lot of money was being pumped into them. Why was there less focus on rural areas?

The Chairperson said that the eradication of the bucket system was very important as it was still prevalent even in metros such as in the Nelson Mandela Bay Metro. The Human Settlement team had to be firm on the issue of the bucket system.
On the issue of rural urban migration, emphasis had to be put on rural economic revival. If economic activity could be brought to these rural areas, people would not leave and migrate to informal settlements in cities. She said that it was the responsibility of the Minister to regulate and encourage spending by the provinces as there was the possibility of fiscal dumping in many of the provinces. 

Minister Sexwale said that the Members had closed the debate with their very insightful questions and comments. He had noted the various issues and these would help to enrich the debate. According to his understanding, the meeting was not a question and answer session but a forum for enlightenment where the Committee could hear what was going to be discussed in the budget vote and in return inform the Minister of issues which they felt should be included in the budget vote speech. He would respond to all the matters in the debate as the meeting was just a preparation for the debate. He said that the Members were going to hear these points raised in his speech.

The Chairperson thanked the Minister for his engagement with the Committee.

The meeting was adjourned.