DHS 2022/23 Annual Performance Plan; with Minister and Deputy Minister

Human Settlements

20 April 2022
Chairperson: Ms M Semenya (ANC)
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Meeting Summary


DHS 2022/23 Annual Performance Plan

The Portfolio Committee convened on a virtual platform to be briefed by the Department of Human Settlements (DHS) on its annual performance plan (APP) for 2022/23.

Members convened 30 minutes early to allow them to review the Committee’s second term programme. It was proposed that the Committee include oversight visits to areas affected by the recent flood and fire disasters. The programme was adopted.

The Minister began by updating the Committee on the DHS's response to the disasters in Eastern Cape and Western Cape. The Department had response teams on the ground to assess and prepare for interventions and were working on providing solutions to the high number of displaced people. This included concluding alternative accommodation and looking into the reprioritisation of funds. She highlighted the number of informal settlements that were affected, many of which were located on unsuitable land, which had brought a number of the national priorities contained in the APP. She explained how the disasters had highlighted key priorities, such as eradicating mud houses and the unblocking of blocked projects. The Department was committed to prioritising the digitisation of the beneficiary system, and the Minister acknowledged the public outcry for transparency and accountability in this regard. The DHS was also proud of its work towards stabilising its entities, having appointed all their boards, and was awaiting Cabinet approvals.

The APP contained other national priorities, including eliminating asbestos roofs across the provinces and setting aside 40% of the budget for designated groups, which were women, the youth, and people with disabilities. It provided a breakdown of contracted targets and a consolidated list of all the projects implemented across the country. There were an estimated 200 000 job opportunities and 8 000 training opportunities created.

Several Members were concerned about the mud houses and asbestos roofs that had yet to be addressed. One Member proposed that these issues be placed under a separate policy formulation so that they could be better addressed and funded. Members also shared their personal observations of blocked and unfinished projects in their provinces and raised concern about the number of projects left incomplete, the length of time they had been left incomplete, and the lack of consequence management for contractors. In some areas, houses were complete but left unoccupied, and Members raised the urgency of implementing the digitisation of beneficiary lists to ensure that beneficiaries received housing. A rising challenge that was noted concerned the illegal occupation and selling of Reconstruction and Development Programme (RDP) housing, which had resulted in a flood of foreign nationals occupying government-built housing. Context was sought over the 40% set aside for transformation, as Members wanted reassurance that this budget would benefit the designated groups.

The Department responded that it was conducting a phased-in approach in dealing with the issue of blocked projects and reaffirmed that although it was prioritising unblocking these projects, it would not complete its unblocking programme in the current financial year. This project was linked to the digitisation of the beneficiary lists. The Department wanted to ensure alignment between the provincial business plans and their APPs with its priorities. The DHS recognised the importance of ensuring that provincial departments utilised the 40% set aside budget to ensure transformation and allow contractors and developers from designated groups to participate actively and compete in the economy. This programme would also assist the Department in monitoring that transformation was implemented. The issue of mud houses came down to implementation, as the DHS had adequate frameworks to address the issue. Implementation required the Department to flag the issue and budget accordingly, especially in light of the recent floods. It did not condone the building of houses in unsuitable areas, particularly wetlands and riverbeds, but acknowledged that due to climate change, the Department would have to revise the technical standards for flood plains and flood lines addressing the occupation of such land. The eradication of asbestos roofs could also be addressed via existing policy frameworks, and the Department acknowledged its responsibility in eradicating this issue, which was affecting people’s health. There was also an emergency programme amongst the programmes established to address this issue, along with mud houses.

The Department acknowledged the increasing challenge around foreign nationals occupying RDP houses and said that the challenge was that many transactions were being conducted under the radar, beneficiaries were using the houses for income-generating reasons, and municipal enforcement agencies were struggling to address the issue. It was an area to which the Department needed to pay more attention.

Meeting report

Chairperson’s opening remarks

The Chairperson welcomed Members to the meeting, including a new Member of the Portfolio Committee, Dr N Khumalo (DA). She said the Committee would be discussing the commitments the Department would be making for the coming financial year. The Committee was looking at its programmes affected by the KwaZulu-Natal (KZN) floods. She took to opportunity to send the Members' condolences to families who had lost their loved ones and requested that those families affected be put in their prayers. A moment of silence was observed.

Adoption of Committee’s second term programme

The Chairperson went through the Committee’s second term programme. It was necessary for the Committee to visit areas affected by the floods, including a proposal to visit KZN. She highlighted the potential issue of transportation concerning the Committee's travel between the Eastern Cape and KZN. She proposed that the Western Cape also be visited due to the reported fire disasters and monitor what the Department was doing. The Committee was under pressure to finalise its report before the Budget Vote.

The programme was adopted.

The Chairperson welcomed the Minister and the team from the Department of Human Settlements (DHS).

Minister’s overview

Ms Mmamoloko Kubayi, Minister of Human Settlements, began by apologising for her network issues as she was in between meetings. She was in KZN but was also dealing with disasters in the Eastern Cape as the Department prepared for an intervention and response in that area.

There were still displaced people occupying halls in KZN, with more than 4 000 houses having been completely destroyed by the floods. Part of the Department’s responsibilities was to try and find solutions, especially because a majority of the challenges concerned how the Department was going to move people occupying halls, many of whom had come from areas where temporary shelters could not be built, so alternative land had to be determined. Through several meetings, the DHS tried to conclude and confirm alternative accommodation.

The Department, including the provincial MEC, had been on the ground working to ensure an intervention and response. With assessments done, the numbers of those affected by the disaster continued to escalate. She acknowledged that the meeting was not a briefing about the disaster, but she was taking the opportunity to assure the Committee that the Department would continue to work on the ground to help communities. It had quantified the impact and was looking at the reprioritisation of funds, working through the national disaster team and the NatJOINTS, which had been resuscitated to provide the necessary interventions. A team from the Department was also in the Western Cape the previous day, responding to fire disasters.

She highlighted these issues because as the DHS presented their annual performance plan (APP), Members needed to understand the pressures faced by the portfolio. Climate change necessitated a difference in thinking and how to implement human settlements programmes, such as whether the portfolio was responsive to the challenges on the ground and what they should be able to anticipate. There was more emphasis on proper planning going forward, and therefore the issue of illegal occupation of land would have to be discouraged and stopped by those leading it. Most of the areas affected by the disasters were informal settlements in wetlands close to riverbeds or where the land was not suitable for human settlement.

The APP would demonstrate national priorities. Some of the issues in the national priorities were informed by what had been anticipated as potential disasters. For example, in the Eastern Cape and KZN, major areas affected by the storms were comprised of mud houses unable to withstand the storms. Therefore, prioritisation of the eradication of mud houses was critical and relevant. The APP had prioritised the progressive removal of asbestos roofs based on health. Another prioritisation dealt with the issue of blocked projects. As the Department had previously committed, blocked projects would be phased out over three years, as was reflected in their APP. Another priority was the digitisation of the beneficiary system.

There had been an outcry by communities to see transparency and accountability. Non-governmental organisations (NGOs) were also publicly calling for transparency and accountability as the order of the day. Therefore, even when dealing with disaster relief funds, the Department wanted its work to be underpinned by transparency and accountability.

The Department was proud of its commitment to work towards the stabilisation of its entities. All the boards of the entities had been appointed and had started their terms. The boards were starting to do their work. The Department was approaching Cabinet with finalised appointments -- for example, the appointment of a chief executive officer (CEO) at the Housing Development Agency (HDA). As Cabinet’s recess ended, it was hoping to be able to place both the CEO and the chief financial officer (CFO) before the Cabinet for approval. It was also hoping that the Social Housing Regulatory Authority (SHRA) would be able to report on its progress in appointing a CEO. The Department had requested the National Home Builders Registration Council (NHBRC) and the National Housing Finance Corporation (NHFC) to fast-track the finalisation of the appointment of CEOs so that they were stabilised. The accounting authorities could address issues in the public domain regarding the entities, as the boards had to account for work done. The Department was confident that it was back on track to ensure stability from a governance point of view. Once governance was dealt with, the executive accounting authorities would be able to take on the responsibility and ensure implementation.

As tabled before Parliament, the Department had finalised its strategic plans and APPs. The Minister admitted that not all was well or perfect, as there were still areas for performance improvement. Acknowledging that there were still many informal settlements and unfinished blocked projects, with people talking about the need and waiting for housing, the Department believed their programmes would address these issues. A war room had been established and appointed to unblock blocked projects to improve service delivery.

In some of the programmes, the Department intended to visit the provinces, especially the metros, to deal with performance of the Urban Settlements Development Grants (USDGs) and Human Settlements Development Grants (HSDGs). That process was paused due to flood disasters in KZN that the Department was dealing with, and it was hoping to resuscitate that programme once disaster areas were stabilised.

She apologised for the absence of the Deputy Minister (DM). They were working parallel to each other. The DM was in a meeting concerning disasters in the Eastern Cape because the President was visiting the province where more than 1 000 people needed shelter that the Department had to respond to. She requested permission to leave the meeting at 11:00 to attend another meeting, as the DHS was stretched due to the various disasters. Various structures had requested the DHS to join so that they could update on what they were doing to resolve some challenges and fast track restoration and recovery. The Department needed to help move people out of halls and schools and back to their houses, particularly because schools were opening in KZN and needed to be cleared. She therefore had to attend an urgent meeting with eThekwini Municipality. She understood that this was an inconvenience to the Committee, and apologised.

The Chairperson agreed to the Minister being allowed to depart at 11:00 to fulfil her other obligations. She opened the floor for Members to ask the Minister questions.

Mr A Tseki (ANC) proposed that the Department present the APP first so Members could ask questions before the Minister departed, as she had provided a high-level summary of the APP.

Ms S Mokgotho (EFF) disagreed because it could not be predicted that the Minister would be there when she wanted to ask questions or seek clarification.

The Chairperson clarified the proposal by Mr Tseki, saying that should the presentation not be finished by 10:30, the Department would be stopped to allow Members to ask questions.

Ms N Tafeni (EFF) agreed with Ms Mokgotho that Members should be allowed to ask the Minister questions before the presentation.

The Chairperson reiterated Mr Tseki’s proposal to allow the Department to present first and then allow Members to ask questions. If the Department was not finished, the presentation would be stopped to allow Members to interact with the Minister.

DHS's Annual Performance Report presentation

Mr Mbulelo Tshangana, Director-General, DHS, provided an overview of the APP, structured into four parts.

Part A was the Department's mandate, consisting of the policies and the legislation that informed this mandate, including the Constitution. It covered some of the court rulings that had informed the Department's work, and it also covered issues around the strategies that the Department had adopted.

Part B scanned the external/internal environment -- the economic and environmental outlook. The entire external environment had a bearing on the Department's work, but a look at the internal environment highlighted strengths and weaknesses within the organisation, so a strengths, weaknesses, opportunities and threats (SWOT) analysis was conducted.

Part C contained targets and what the Department wanted to achieve in various programmes and branches of the organisation. It also had risk identification and mitigation. Entities were also included, as they were used along with provinces and municipalities as implementing agencies.

Part D contained technical indicator descriptions. Part D had to be read to understand all the indicators in part C, as it defined those targets and indicators.

Mr Xolani Xundu, Chief Director: Executive Support, DHS, led the Committee through the APP presentation and drew attention to key priorities of 2022/2023 human settlements Ministers and Members of Executive Council (MINMEC). These were:

  • The unblocking of blocked projects;
  • Eliminating asbestos roofs across provinces;
  • Eliminating (dilapidated) mud houses, especially in the rural areas (prioritising the elderly and child-headed households);
  • Digitisation of the beneficiary list to make it more reliable, transparent, easily accessible, and avoid fraud and corruption;
  • 40% set aside for designated groups

(See presentation attached for high-level APP summary)

Mr Tshangana referred the Committee to pages 130-131 of the APP for all the contracted targets. Annexure B was meant to be a consolidated list of all the projects implemented throughout the country. They had more than 12 000 projects being implemented at various stages. The Department of Planning, Monitoring and Evaluation (DPME) did not want the template the Department had provided. However, the template the DPME provided to the DHS had not accommodated their needs, so they had agreed that jointly, the DPME and the DHS would invest time and energy to perfect the reporting on the District Development Model (DDM).


Mr Tseki noted the concerning issues of mud houses and asbestos roofs in the DHS’s report. He proposed that the issues be placed under policy formulation since the Department was targeting to formulate certain policies. This would allow the Committee to hear the Department's plan on the issues, as he was not convinced about the two proposed programmes. Could the DHS explain the difference between the Inter-Governmental Relations (IGR) and the DDM? Should the Department agree with his proposals, he agreed that the report should be adopted based on the two proposed amendments.

Ms Mokgotho requested clarity regarding her understanding that Members would speak on the overview provided by the Minister first and not interact with the presentation yet. Had the Department deliberated on all the presentations meant to be presented to the Committee?

The Chairperson clarified the Department had finished presenting their APP, and Mr Tshangana had directed the Committee to pages 130-131 of the APP for the contracted targets. The Minister said that the APP had four sections that dealt with policies, their mandate, and the SWOT analysis looking at internal and external matters affecting the portfolio. The medium-term strategic framework (MTSF) targets and the contracting indicators were on pages 130-131 in the Department’s strategic plan, the report that they had tabled through Parliament. She hoped that Ms Mokgotho had received that document. Since there was still time, questions could be asked to both the Minister and the Department.

Ms Mokgotho said that in the Minister’s overview, she had been told that in the current financial year of 2022/23, all blocked projects would be unblocked. However, there was a backlog of unfinished Reconstruction and Development Programme (RDP) houses which had not been completed since 2018. There were many incomplete housing projects started since 2018 in North West, in Moses Kotane Municipality. For example, in Ward 6, contractors had left about 30 houses unfinished since 2018 and to date, those houses have been left unoccupied. Poor people were asking municipalities when their houses would be completed. Only walls and/or foundations had been built in some cases, with no roofs. Even in Dr Kenneth Kaunda Municipality in Klerksdorp, there were places where only foundations had been built. Would the Department start with the backlog of incomplete houses since 2018 or more recent blocked projects when unblocking the blocked projects? She pleaded for clarity on this issue, emphasising that poor, unemployed people did not have the money to complete these structures. In Ramokokastad in Moses Kotane Municipality, the municipality was doing nothing about the RDP houses left incomplete since 2014. There was no consequence management undertaken against those contractors or service providers that did not complete their projects.

She asked that the Department respond on the following issues:

Some of the listed priorities were not in the APP or specific in the APP targets and indicators, making them difficult to identify and track. For example, there were no clear strategies or targets for the number of mud houses to be rectified or a deadline to digitise the beneficiary list. The number of houses with asbestos roofs were not included under the target indicators. There was no number of blocked projects to be unblocked or a target for the number of serviced sites to be provided for the financial year 2022/23.

Ms N Sihlwayi (ANC) appreciated the Minister's role in all the disasters and thanked her. People were facing trauma, but the Minister gave them high hope that the government was with them. This visibility meant a lot to these people.

The APP stated that 1.19 million title deeds had been registered. She was confused about the need to prioritise the pre-1994 and pre-2014 title deeds. Was the 1.19 million outside the pre-1994 and pre-2014 title deeds? The number of title deeds registered was an exciting achievement. There was a continuous lack of understanding on the issue of the 40% set aside. There was excitement over designated groups included in the country’s economy for the first time where there were transformation issues. Were these groups women or people with disabilities? At what level were they? What exactly was the content of the benefits of the 40% set aside? She did not want to get excited over something that was not qualitative. She wanted women to be in business equally with men and not to be given projects only to be robbed by big contractors or be soldiers for them. Women needed to be able to stand alone and equally participate in the country's economy. She wished the Committee could get a presentation contextualising the role of women, youth and persons with disabilities in the various provinces in the 40% set aside. She asked Mr Tshangana to quantify this information for all provinces, which must all share and benefit from the country's economy.

Ms Tafeni requested more information on the national unblocking programme. A project in her municipality was not moving at all, but the Department was telling the Committee that it was unblocking projects. In Amatole, in the Mbhashe Municipality, houses built in 2010 have no roofs to this day. The Department had to look further into these houses. One of the three new indicators related to reporting on the implementation of the IGR programme. Could the Department provide more details on this programme? Regarding economic classification, the allocation for catering department activities increased from R1.1 million in 2021/22 to R1.4million in 2022/23, which translated to a real increase of 21.79%. What was the reason for this increase?

Ms Mokgotho said that under programme one, the allocation for consultants, business and advisory services had increased from R17.7 million in 2021/22 to R26.2 million in 2022/23 financial year, representing a real increase of 41.65%. What were the reasons for the significant increase? The allocation for machinery and equipment had decreased from R8 million in 2021/22 to R2.5 million in the 2022/23 financial year. What was the reason for the decrease? The allocation for travel and subsistence had increased from R29.8 million in 2021/22 to R33.3 million in 2022/23, representing a real increase of 6.93%. What were the reasons for this above-inflation increase? On budget allocation under programme two, in terms of economic classification, the overall allocation to goods and services had increased from R97.7 million in 2021/22 to R103.6 million in the 2022/23 financial year, representing a real increase of 1.47%. One of the drivers of this increase was the allocation to travel and subsistence, which grew from R9.3 million in 2021/22 to R11.4 million in the 2022/23 financial year, representing a real increase of 17.3%. What were the reasons for the above-inflation increase?

The Chairperson noted that there were no exact targets relating to construction's contribution to job creation. Would the Department return to quantify those numbers and provide them to the Committee? The national priorities pronounced by the Minister through MinMEC were appreciated, particularly the digitisation of the beneficiary list, which had been an ongoing problem. She appreciated the start of better management of the beneficiary lists. The importance of transparency and accountability in the spheres of government was stressed, particularly in terms of identification following policy pronouncements the Department made targeting the elderly, disabled and child-headed families. The Department was urged to finalise this project as soon as possible as it was overdue. However, it was acknowledged that it had indicated that it was still in the early conceptualisation stage.

Referring to the illegal sale and occupation of RDP houses, she said some areas in Gauteng were visited where people occupied houses illegally. What would happen to those people who deliberately occupied houses that did not belong to them? This issue would affect the Department's programme of handing over title deeds, as those people occupying did not qualify.

On the illegal occupation of land, the Department had indicated that it would rezone the land it had purchased through the HDA. What measures would be put in place to make sure that there was no illegal occupation? Regarding the issue of people building on riverbeds and wetlands where they were not supposed to, what was the government's response? This issue took government backwards, as it would have to get the money to deal with the disaster’s impact on those people. Adding to that was the issue of the DDM. Mr Tshangana had said that the Department could not follow DPME's framework regarding how they were supposed to report. What was the difficulty in following this framework?

The Committee appreciated that the Minister had prioritised the unblocking programme, as the matter had been a thorny issue. The Minister had indicated to the Committee that the unblocking programme was a three-year programme, and provinces were expected to provide numbers in this financial year and other years. Had the Department received plans from the provinces? When could the Committee and the Department expect these plans to monitor progress and understand what the provinces had done about those contractors and entities involved in those unfinished projects?

The DHS had declared 136 priority areas in the previous strategic plan, and now their focus was on 94. What had happened to the others? Reiterating Ms Sihlwayi’s question on putting 40% aside, was it still the same, or were there still difficulties? Otherwise, it would still be complained that provinces or metros were not implementing the 40% set aside. What measures would be put in place to ensure that it was implemented?

Department’s response

Minister Kubayi said that one of the Department's commitments through the Integrated Resource Plan (IRP) was to ensure a contribution to job creation. In this regard, in their APPs, the Department ensured alignment between the DHS, its entities, and the provinces. It had also ensured it was still sticking to its MTSF targets around the contribution towards its IRP.

She appreciated the feedback regarding the blocked projects. The Department was presenting a phased-in approach to address the issue of blocked projects, and not all blocked projects were going to be resolved. She acknowledged that Members were still seeing blocked projects in their communities because the Department was starting to prioritise the issue only in the current financial year. Each province would prioritise the projects in terms of areas, and then the Department would be able to monitor the implementation, which was why it was highlighted as a three-year programme in the APP. Therefore, not all blocked projects that Members saw would be completed this financial year.

On the issue of the 40% set aside, she agreed with Members that it needed to be a real-time intervention that would provide results. Members would note that there had been a court judgment in terms of the preferential procurement plan by Treasury so the Department was sorting that out while understanding the importance of ensuring transformation.

In response to Mr Tseki’s question on the IGR and the link with the DDM, she said that there was a phased-in approach and the Department was aligning to the DDM. Regarding the DDM, government was trying to have one plan across the country. Not all plans regarding the DDM across all the districts had been finalised and approved by the district teams, champions and the Minister of Cooperative Governance and Traditional Affairs (COGTA). Government would prioritise those to be finalised, but work had to continue. The DDM was still being implemented, but the Department had concerns in some areas. The DHS reported through DDGs who were allocated provinces and districts to look after. It indicated each district and what work was being done broadly so that the champions could follow up. There was no contradiction or conflict with the IGR because it was a constitutional imperative that the Department continue between the national, provincial and local levels. That was why the Department’s DDM work was led under the relevant IGR DDG to ensure alignment. Part of the IGR, as requested by the Constitution, was inter-governmental relations between sister departments, for example, or what the Department was doing through MinMEC. MinMEC remained one of the critical areas to ensure that there was one plan, with interrelated work being conducted between themselves and the three spheres of government. Therefore, the link between IGR and DDM was complementary.

Regarding Mr Tseki’s proposal, mud houses were a priority -- not under policy formulation but for implementation. She urged the Committee to agree with the Department. As highlighted, it was starting to focus and implement policies, for example, in KwaZulu-Natal. The issue of mud houses was within the policy of the HSDG, as the grant framework did speak to rural development programmes and responding to the mud houses situation fell within it. The Department was working within its policy framework and policy priorities, and it was just flagging the issues considering the recent floods and natural disasters. There was no misalignment between the issue of the mud houses and policy. In policy development and grants, it was up to the Department to flag and bring to the fore certain issues in a financial year, as they were doing with the issue of blocked projects. A new policy need not be formulated to deal with the issue of blocked projects.

On the issue of asbestos roofs, the asbestos programme was one of the longest. Asbestos roofs should have been done away with a long time ago. The policy had been agreed on a long time ago. A programme for this issue had been started and then stopped. That was why in the Free State, for example, there had been a court case because there had been an allocation of funds for the programme but no investigation. The DHS had resuscitated it as part of its five-year MTSF programme, and an HSDG grant had been allocated for the Department to implement. Therefore, the asbestos programme was not outside what had been agreed on in the MTSF nor outside of what was required and given in terms of the HSDG. Members were urged to support the Department's work.

The Minister excused herself and left the meeting.

Mr Neville Chainee, Deputy Director General (DDG): Research, Policy, Strategy and Planning, DHS, reiterated the Minister’s point that the use of asbestos had been banned based on health and safety reasons. There was a responsibility on the Department to remove it. Importantly, there had been use of asbestos primarily pre-1994 and it was something that was inherited. It had health, safety, and financial consequences. If people continued to live around it and got asbestosis, it would result in financial claims, so the Department had that responsibility.

The mud houses eradication programme was already covered in the rural housing programme and the emergency housing programme. The provinces themselves did not specify numbers. It was on an "as and when required" basis -- for example, KwaZulu-Natal, which had a specific target and outputs for eradicating mud houses. Importantly, mud houses were not suitable for human habitation, particularly in rural provinces such as Limpopo, the Eastern Cape, Northern Cape, KwaZulu-Natal and even parts of North West. The programme was also a climate mitigation strategy because when disasters occurred, the most vulnerable houses were mud houses that could not adequately withstand disasters. It was the responsibility of the Department to address this.

There had been a substantial amount of comment about settlements located on flood plains or unsuitable land. As government, it did not condone inhabiting unsafe land property. Government had adopted a standard in prescripts, policies, and regulations that did not allow it to build in such areas. All the requisite investigations and inspections needed to be undertaken where government located households. The occupation of unsuitable land was a result of unauthorised land occupation. However, the Department was learning and given the climate change, some technical standards and determinations for flood plains and flood lines had to be revised due to the increased impact of rain.

Ms Sindisiwe Ngxongo, DDG: Entities, Oversight, IGR, Monitoring and Evaluation, DHS, responding to the 40% set aside, indicated that the Department had the requirement of targeting designated groups which were women, youth and people living with a disability because they had not been accommodated efficiently under economic transformation. As a sector, this was the first time it was targeted specifically for these designated groups, and it had been emphasised that this was a percentage of the Department’s budget that had to be earmarked for women-owned businesses, youth-owned businesses, and businesses that persons with disabilities owned. This plan would assist the DHS in terms of monitoring because if it was not planned for properly, it could not be measured or monitored, and no one could be held accountable. MinMEC had also endorsed this. Part of what the sector would be doing would be to ensuring the creation of panels so that it was known in each province which women had to be targeted and at what level they were in terms of the Construction Industry Development Board (CIDB) grading and the Department’s National Home Builders Registration Council (NHBRC) grading. Across the province, they would be able to know their progress in terms of grading, how they were participating economically, and allow them to compete amongst themselves accordingly.

The DHS would require support from the Committee in terms of the Department's reports on the provinces and metros to ensure alignment with the Department on what the provinces and metros were reporting to the Committee. The Department addressed the challenges of ensuring allocations were done specifically in line with the designated groups through MinMEC. In terms of IGR, it was a legislated mandate for the Department to hold the provincial reviews, which it did quarterly to see how the sector was performing against the targets. Regarding the ministerial programme, the Department had provincial outreach programmes focusing on service delivery that was run by Ministry, involving both the Minister and Deputy Minister. The Department did have interventions taking place quarterly in provinces that covered those trying to enhance the sector's performance going forward.

Ms Lucy Bele, Acting Chief Financial Officer (CFO), DHS, referred to pages 69-70 of the APP, which provided a breakdown of the operational budget, as the presentation had provided only the budget per programme. Bearing in mind that National Treasury gave the Department the budget allocated to all the programmes, there was indeed an increase under economic classification in the operational budget, from R923 million in the 2021/22 financial year to R945 million in the 2022/23 financial year. The operational budget was 2.8% of the total R33 billion budget. Page 70 of the APP provided a breakdown.

On Ms Mokgotho’s question regarding the allocation to consultants, business and advisory services, the allocation referred to was departmental agencies and accounts. These were not consultants but entities. The amounts were sitting under transfers and subsidies because it was the money that the Department was transferring as operational grants for the Community Schemes Ombud Services (CSOS), the Social Housing Regulatory Authority (SHRA), operational investments and the Housing Development Agency (HDA). There was a decrease in the machinery and equipment budget because the Department had budgeted more last year due to staff working from home because of Covid-19. More money had to be spent on procuring laptops to enable working from home, but expenditure had decreased this financial year as the Department had already procured all the resources it needed. The equipment procured depreciated after three years, and the Department was now dealing more with maintenance. She could not see the travel and subsistence amounts referred to by Ms Mokgotho.

The line that showed an increase was goods and services, based on the allocation letter the Department had received from National Treasury. The Department’s operation budget consisted of two items: the compensation of employees, R410 million, and goods and services, R534 million in the current financial year. National Treasury agreed upon the increase in goods and services. The Department would deal with the increases and decreases in actual expenditure when it came back in the fourth quarter, as that was when they would be able to look at how much had been spent in the previous financial year and how much was spent in the financial year ended 31 March 2022. It would provide the Committee with reasons for over and under expenditures.

Ms Nonhlanhla Buthelezi, Acting DDG: Affordable Rental and Social Housing, DHS, said that the critical issue was the breakdown in terms of the targets for training. In terms of job creation by the Department, it estimated around 200 000 job opportunities were created and around 8 000 training opportunities. The Department's formula for estimating job creation was prescribed by the Council for the Built Environment (CBE) and the Department of Public Works and Infrastructure (DPWI), which calculated the budget per million rand. The same applied to training opportunities, where a framework quantified the number of opportunities for training that would be created. Whatever the Department had done in terms of the numbers was based on existing frameworks, such as the Transformation Barometer, adopted nationally and covered four aspects. One aspect spoke to the housing opportunities provided by the Department, which was at a different level. Other aspects spoke to training and job creation opportunities created. The other aspect spoke to the budgets set aside. The Department would look at a combination of professional persons, young graduates, skilled people and those who had no qualifications and compute its budget accordingly, where it would pay a specific rate as determined by the frameworks referred to.

Regarding the 40% set aside, there was a framework in the Department that the MinMEC had adopted around July in the previous financial year that had been determined or pronounced by the President. The Department's framework targeted that 40% must be allocated to women, with about 15% going to youth. Part of what the MinMEC had adopted was that there should be an analysis conducted by provinces based on the population dynamics so that if a province had a high percentage of youth that was unemployed, the percentage could be varied. However, the minimum percentage was around 15%. For persons with disabilities and military veterans, the Department had adopted a percentage of 5% each from the 40%. This was a general breakdown but for specifics per province, she requested the Department be allowed to provide those numbers in writing.

Mr Tshangana said the Department had a breakdown of the number of units to be unblocked by provinces in the current financial year. It had delayed the approval of the business plans because it wanted to make sure there was complete alignment between what it wanted to achieve in its priorities and what was in the provincial business plans and provincial APPs. That breakdown was reflected in all the provinces except the Western Cape. The Western Cape wanted to conduct data cleansing on the blocked projects because in the Housing Subsidy System (HSS), there were more than 600 blocked projects in the province. The Western Cape team told the Department that all these were projects that needed to be closed because they were slow-moving projects, not necessarily blocked projects. However, in the DHS's books, if a project was not closed in the HSS, it was a blocked project. The data cleansing exercise clearly informed the Department how many blocked projects would be implemented in the current financial year.

Pages 130-131 of the APP reflected the consolidated list concerning the blocked projects' numbers. Since there was no additional budget, the HSDA would be used to deal with these blocked projects. The same applied to the digitisation of the beneficiary list. There was the National Housing Needs Register (NHNR), but it needed to be maintained and automated properly. There was also the Provincial Housing Needs Register, but few provinces had perfected it, and the majority of provinces were struggling with the beneficiary list. Some municipalities had perfected the beneficiary list at a municipal level, but others were struggling. The bigger challenge of managing the beneficiary list was its maintenance. If it was not maintained or updated regularly, the usefulness and reliability of that data would be questioned. So, part of digitisation was about maintaining and utilising the data, which had to be done at all three levels of government. Because the input into the data was at the municipal level, digitisation needed to be perfected so that credible data could be used for the allocation of houses.

The issue of mud houses would be covered under the rural housing programme, and it would be reflected and reported in the consolidated list. KwaZulu-Natal was way ahead compared to other provinces in planning for this, and other provinces were still packaging it. Provinces were asked to address the issue in their business plans so the Department could know exactly how much was going to be done. Some provinces were at a planning level, while others would be implementing the eradication of mud houses. KwaZulu-Natal had been in that space for a very long time, with a number of programmes such as Sukuma Sakhe and One Umuzi One House.

He said it would take one smart, progressive non-governmental organisation (NGO) to take the DHS to court, and it would be in trouble if it did not have a plan to deal with asbestos roofs. The issue was not a moving target because these were houses developed during the apartheid years. Asbestos houses were not delivered post-1994, so most asbestos roofs were in the old townships. Asbestos was extremely dangerous when it was broken and not well maintained. The magnitude of the problem had to be quantified. Some provinces had gone ahead in addressing the issue and in three provinces, the magnitude of the problem could be quantified because they had municipal registers. The Department had to work with the Departments of Labour and Environment to sort out the problem. This year the bulk of the DHS's energy would be devoted to planning and packaging the project.

Ms Sihlwayi’s concern regarding the 40% set aside was valid. There was activism, advocacy and programme implementation required in the 40% set aside. Much effort was required to hold provinces, municipalities and entities accountable in this regard. The Department had been there when the 40% set aside was set under the Division of Revenue Act (DORA) in 2016. However, there had been a big noise from the provincial treasuries and heads of departments, saying that the Department was making things difficult for them. The Department only wanted to ensure that the 40% set aside was spent on women, youth and people with disabilities and not on any other programmes, so it became difficult for provincial treasuries to shift funds to other programmes. It was very difficult for the Department to win that battle in the current financial year. However, this issue had been considered a priority in the DORA, although it was not ring-fenced. In the past, it had been ring-fenced as a stand-alone budget, and it needed to be ring-fenced if the targets were to be achieved.

In the CIDB list, there was a list of professionals and contractors by province and by municipality. One of the things that the Department wanted to do was to be given that list to send a circular to the provincial heads and municipal heads of departments (HODs) to prioritise women professionals and contractors who were on the CIBD list. This list would help avoid excuses that women contractors and developers were difficult to find. In the MinMEC, the Department reported how provinces and municipalities performed on the 40% set aside. The Department named and shamed those provinces that were not doing very well. This was a standing item in the economic and social clusters of DGs. The Department reported whether provinces were green, amber or red, and that information was available. The Committee could call the DG and the Minister of Women, Youth and People with Disabilities to present and report on which department was doing very well regarding the 40% set aside and other priorities in the Department's strategic plan. The DG of the Department of Women reported monthly to other clusters about the performance of the various departments against this target.

Follow up questions

Ms Mokgotho said she needed clarity on the deadline for digitising the beneficiary list. When the Department allocated a budget for rectifying houses with asbestos roofs, they should have known how many asbestos roofs they would rectify. The Department did not indicate how many houses it would rectify during the current 2022/23 financial year in its list of targets. She was not satisfied with the answer they had provided in this regard. Which six mining communities were targeted for approved agreements? What were the reasons for the reduced allocation in the capacity building and sector support sub-programme under programme four? The allocation for the compensation of employees had decreased from R13.3 million in 2021/22 to R11.9 million in the 2022/23 financial year. This represented a real decrease of 14.38%. What were the reasons for this?

Mr Tseki said one must not fix something if it was still working. Rural development programmes dealt with the rural areas in terms of housing, not specifically mud houses. Mud houses could be included in that rural development programme instead of dealing with them separately. Coming from rural areas, he strongly believed that the issue of mud houses had to be approached in two forms. Firstly, as Mr Tshangana had said, it was part of rural development. Secondly, emergency housing funds had to be approached because of their condition after the rainy season or storms. This had worked very well in the past in terms of government response. Therefore, the removal of mud houses was not convincing.

The asbestos problem had been long ongoing, so why was the response given by Mr Chainee not given years ago? The solution to deal with asbestos had to be convincing. Previous experience showed the DHS would say they were budgeting for the asbestos issue, but the money was not used. The response to asbestos had to be part of emergency funding because where the asbestos was broken, it was mainly because of rain, wind and storms. He proposed that the programmes addressing the asbestos and mud houses be put under the emergency programme or their own policy framework to be clear what would be done. He did not agree with the Department's plan, but if other Members approved the plan for the projects as presented, he would follow democracy.

The Chairperson asked how the issue that she had raised on the illegal occupation of houses and land secured on purchase for development, would be handled. How would the illegal selling of RDP houses before the eight years, as stipulated in the RDP Act and illegal occupation in general, be dealt with? In many areas where there had been oversight by the Portfolio Committee, people had occupied houses that were not finalised, and the government was seemingly leaving them to stay in those areas without actually following the policy processes. This had become a problem for disciplined, loyal citizens who respect government processes. She wanted to understand what government would do to ensure that the issue did not progress where this had occurred. What was government doing to remove those illegal occupants, whether through court or other legal processes? What was it doing to address those perpetuating this illegal conduct?

Ms Mokgotho said the Committee needed to know which blocked projects would be unblocked, and in which provinces and municipalities this would take place. She was specifically referring to the projects that would be unblocked during the current 2022/23 financial year. If possible, could the Department provide the Committee with the wards in which the unblocking projects would occur? When would these projects be unblocked?

Ms Sihlwayi said that African foreigners well invaded the country.

The Chairperson interrupted to ask why Africans only.

Ms Sihlwayi asked that she be allowed to get to her point first. African foreigners had the potential to take over the houses in the townships. Some of them were registered on the housing list, and some were buying houses from locals. What were the Constitution and government policies saying about prioritising the citizens of South Africa? How could title deeds be taken away from these foreigners and be given to the people who belonged and were also legal citizens of the country? She understood the citizenship issue of some foreigners, but could this override the real citizens of South Africa? How was this matter being dealt with because it was becoming rife in townships?

Department’s response

Mr Tshangana said any transaction between a beneficiary of an RDP house and any undocumented foreign national was illegal. However, it could be considered a legal transaction. Documented foreign nationals did have a right to participate in the capital markets, meaning they could purchase houses legally. The Department had picked up that because there was a high rate of unemployment in the townships, beneficiaries tended to either sell the RDP houses or rent them out. An example was seen in Langa, Cape Town, where a beneficiary from the Eastern Cape was renting out two bedrooms in his RDP unit to generate income of R1 500 per room. The very same beneficiary was sleeping in the kitchen because the intention was the generate income. This was also seen in other townships where foreign nationals used RDP units as spaza shops. All that needed to be done was verify whether that transaction was legal. The Department was told about these transactions but had never verified them. It was told that there were informal transactions taking place between the beneficiaries and other buyers in most cases, not just foreign nationals. There were instances where, for example, teachers and police officers were finding it very hard to buy houses in the market because they did not earn enough to buy decent, affordable houses, so they ended up buying RDP units or a Breaking New Ground (BNG) unit, renovating them and renting them out to a number of people.

The issue was complex because the Department was not providing enough affordable housing to those who were not earning enough to get bonds from banks but were earning more than enough to get a full subsidy from the government. The other complication was that some people came to the cities not looking for a house, as they had beautiful houses in the villages where they came from. Instead, they went to the city looking for an income because they could build houses for themselves and therefore would rent houses out to generate income. A study was conducted in 2008 in Dunoon where it was picked up that almost 50% of the units that were given to the people of Dunoon in 1999 had been sold or rented out to other beneficiaries. It was important to verify beneficiaries because it could be that the Department was also passing policies that it could not implement or enforce itself. One of the pre-emptive rights clause requirements was that a beneficiary was allowed to sell their house, but it had to be sold to government first, which had the first right of refusal. If government refused, then the seller could sell the property to anyone, but the capacity to administer that process by government was a challenge on its own. A few provinces had perfected the implementation and enforcement of the pre-emptive rights clause in the Housing Act. There were instances of people going to police stations and signing affidavits to sell houses, but this was not legal due to sale restrictions. People were conducting these transactions informally and illegally.

The issue of illegal occupation of land was regulated by the Prevention of Illegal Eviction from and Unlawful Occupation of Land Act (PIE Act). The issue reflected the enforcement of by-laws because where invasions were happening, it spoke to the capacity of the municipality to enforce municipal by-laws. This area needed to be strengthened, and it could be seen which municipalities and metros were doing well and which were struggling. The courts said it must not be called "illegal invasion" but "illegal occupation." The Department had grappled with this challenge during Covid-19, with a significant number of informal settlements mushrooming in most urban centres during the Covid period. Municipal law enforcement agencies struggled to deal with this issue with provincial and law enforcement agencies, and it was an area that required the Department's attention.

The unblocking of blocked projects was a fair request, and the DHS would be able to provide that information by province. The Department had the information, and although it had not broken it down by province, the consolidated figures on pages 130-131 covered the unblocking of the blocked projects.

Responding to why the Department was not treating the issues of asbestos roofs and eradication of mud houses, he said the DHS had a programme called the Emergency Housing Programme (EHP) in the 17 programmes it was administering. The EHP was more flexible than the emergency grant that was administered when there was a disaster. The EHP could go into the provincial business plan. The Department allowed provinces to decide which programmes they would want to use. They could use the EHP or the People's Housing Process to deal with the eradication of mud houses. He suggested that the Department share the pictures of the mud houses visited in KwaZulu-Natal, because they were worse off than informal settlements found in urban areas. They were falling apart, and the Minister had pointed out that some of the mud houses affected by the floods in KwaZulu-Natal were the mud houses that were currently being prioritised. 13 000 houses were affected by the floods, most of them being mud houses.

Corrugated iron houses in informal settlements were much better than the mud houses seen in KwaZulu-Natal and parts of the Eastern Cape. However, the Department was not generalising about mud houses -- it was referring to specific ones. In some parts of the country, people did not use corrugated iron for informal settlements. The mud houses in KwaZulu-Natal were informal dwellings that required attention in the same way that informal settlements had been prioritised in urban areas. The mud houses being referred to were singular mud houses falling apart. StatsSA defined these mud houses as informal settlements. Therefore, a province could use a combination of more than one programme to deal with them, including the Informal Settlements Upgrading Partnership Grant (ISUPG). He challenged Members to visit some of these dwellings in some parts of KwaZulu-Natal to see that they required immediate attention.

He said the EHP and the Peoples' Housing Process (PHP) could be used to remove the asbestos roofs. Provinces were again not prescribed a programme to use. People could be brought together to remove the asbestos through training and an accredited company. This would create jobs, especially in townships where there was unemployment. The Department would be able to give the Committee a breakdown of figures per province, but most provinces were still at the planning stage, with only a few at the implementation stage.

The Department could list the six mining towns, as requested by Ms Mokgotho. The DHS dealt with mining towns in North West, Free State, Mpumalanga, Limpopo, Gauteng and Northern Cape. It categorised those mining operations into four categories, broadly into sunrise and sunset operations. For example, Sunset operations were those where the mining operations were dying down in Klerksdorp. Limpopo and Northern Cape could be classified as sunrise operations. There were mushrooming settlements in some of the mining towns in the various provinces. A significant number of mine workers went three kilometres into the belly of the earth but lived in un-serviced informal settlements. The Department wanted to do with big and small mining operators to get into contracting arrangements, service level agreements or memorandums of understanding (MOUs) with them to provide bulk infrastructure and housing. Sibanye-Stillwater and Royal Bafokeng were examples of mining operators where units had been developed so far. Anglo-American had also financed some of the developments in Rustenburg. The Department could share with the Committee some of the examples of the mining towns and the areas it was targeting.

The DHS would not be able to execute the entire programme of digitising beneficiary lists in the current financial year as it did not have an unlimited budget. It engaged National Treasury the previous week to allow it to top-slice a portion of the grant so that it could finance this programme once and for all. The Minister had made it clear that this was a three-year programme, so this year the Department had to get its processes right at the national level, conduct a feasibility study and budget. It had already procured the services of individual contractors and specialists in information communication technology (ICT) for this programme. The systems component would maybe be taken care of in the next financial year because the Department had to secure the budget first before implementing. Therefore, the costs would be low this year as it was a planning year. The next financial year would be budgeted for through a process starting in June. The programme was in process because the Department needed to perfect the digitisation in all nine provinces and metropolitan municipalities.

Ms Bele responded to the decrease in the compensation of employees and said that the budget needed to be looked at from programme one to programme five. There was an inverse relationship between the increase and the decrease. For example, the decrease in the compensation of employees was R1.4 million, which was probably equivalent to one chief director. But in programme three, there was an increase in the compensation of employees. Going down further and looking at capacity building and sector programmes, there was an inverse relationship. Looking at programme three, the Department prioritised informal, so the budgets for capacity building and sector programmes had increased. In programme five, under capacity building, the budget had increased because it dealt with affordable housing. The Department was putting aside funds to deal with the Finance Linked Individual Subsidy Programme (FLISP) and prioritised the gap market, with the budget there increasing. There was in an inverse relationship between all of the programmes -- when one budget moved, another moved, similar to the Department’s priorities. Where there was a decrease, which was programme four (rental and social housing), it could be seen that in that capacity, the Department was referring to the SHRA. However, there was an increase in programmes three and five, which showed where the Department’s priorities were. Goods and services and the compensation of employees were where the Department was putting more emphasis, so the priorities and budgets were interlinked.

Ms Buthelezi provided the specifics on the mining towns with mining houses that the Department would sign MOUs. Six provinces were covered. Limpopo had more mining houses -- Anglo American Platinum, Northam Platinum, Siyanda Bakgatla Platinum, Ivanplats and Sibanye-Stillwater. In the Free State, there was Sibanye-Stillwater and Harmony Gold. In the North West, there was Sibanye-Stillwater and Tharisa. In the Northern Cape, there was Kumba Iron Ore, Sishen Mine and Kolomela. In Mpumalanga, there was Wescoal Mining, Exxaro and Sibanye-Stillwater. In Gauteng, there was Sibanye-Stillwater, Harmony Gold and Gold Fields. Other provinces would differ according to what they would agree upon with the Minerals Council because there were many mining houses across the country.

Mr Tshangana said the breakdown of the unblocking of blocked projects would be in the provinces' business plans, which would be presented to the Committee and signed off on 29 April by the Minister. He reiterated that the PIE Act regulated the issue of the illegal occupation of land. The trick was to move as quickly as possible. If people invaded today, they needed to be moved within 48 hours through an eviction order, so they were not evicted illegally. If this was delayed, it would become complicated, as the Constitution called for the provision of alternative accommodation.

Ms Ipeleng Khumalo, DHS, said that there would be an annexure to the APP addressing most of the delivery targets that Members had raised regarding provincial breakdowns. The planning framework required that the APP contained what the Department would be focussing on and all delivery numbers. The Department was just waiting for all the provinces to table their APPs. It was still waiting for KwaZulu-Natal to table its APP, and then it would immediately consolidate all those breakdowns into indicators and provide them as an annexure to the APP.

Further questions

Mr Tseki asked, in areas where the Department knew about illegal invasions but did not respond, what the outcome would be. Would it be that those people were automatically in those houses legally, or could legal processes be contested to present mitigation on why the Department could not evict those people? There were so many invaded houses and land that the Department was aware of but never acted upon. Reports were received, but there was no consequence management and money was going down the drain. Many people did not qualify for houses but occupied them because the Department failed to respond to the urgency of the invasion. This was merely a comment, but Mr Tshangana could respond. It was quite worrisome because he felt that time was wasted.

The Chairperson requested Mr Tshangana to prioritise the issue of illegal occupation in the MinMEC and bring a response in terms of what they were doing to remove illegal occupants and those selling the houses illegally. That plan was needed from the Department, highlighting what provinces and municipalities were doing to ensure government was taking responsibility and that there were consequences. She proposed that the Department be given time to deal with the matter and come back to report to the Committee because the issue was evident in the Gauteng oversight report. The government had to fight legal battles if they had to and ensure that they won so that people who applied for houses benefited. There could not be a policy that encouraged criminality without consequence, and it was unacceptable and could not be accepted by anybody.

Deputy Minister’s response

Ms Pam Tshwete, Deputy Minister of Human Settlements, said she had listened to the questions, and Members had touched on issues that affected the Department. She commented on the invasion of the land, illegal occupation, government houses sold to foreigners and illegal occupants. In the N2 Gateway in the Western Cape, for example, the Department had gone door-to-door just to check the condition of the flats. Most of the people found there were foreigners, which was why there was a serious problem in informal settlements.  Government would build people houses, who then rented them out to others and joined informal settlements. The portfolio needed to work together with municipalities and departments because some land was private, and some belonged to DPWI.

Another problem was that the Department built houses without beneficiaries. She was surprised that in an office in the Free State where she had visited, the Head of Department (HOD) kept more than 2 000 title deeds. She had asked why, and the HOD had said it was because politicians had said he could not issue them. She had agreed because the title deeds had to be issued by the MEC, the mayor or any other appropriate person, but why had he not disclosed that he had such a large number of title deeds? She felt that some people were being mischievous at times and promised that the Department would go back to the Free State and issue those title deeds, even if it was 100 title deeds or they were issued for a number of days. It was a pity that the Department had previously targeted only Mangaung, where it had issued about 100 title deeds and where people were crying over these title deeds issued. In Witzenburg, people had been renting houses pre-1994, yet they said they could not get the title deeds for those houses until they paid the debt. In her understanding, no debt had to be paid, and those who had acquired houses during the apartheid era had to be given their title deeds.

Another issue concerned the number of houses sitting empty while potential beneficiaries looked on. Municipalities were supposed to call on beneficiaries and give them their houses once they were completed. Once there was a serviced site, a beneficiary had to be given ownership so that they could take care of it and ensure that no material would be stolen. The Deputy Minister said she was engaging with municipalities to implement this.

COGTA also had to deal with the issue of illegal occupants -- the issue could not be dealt with by one department alone. For example, she had wanted to sell her house in King Williams Town, had a valuation conducted, but was told that the market consisted of foreigners ready with the money. She was hesitant to sell her house to a foreigner. Foreigners had bought all the houses in the area -- her neighbours were foreigners -- and her children were saying they were not safe in the area and that it was better to leave. Unless serious steps were taken to deal with these problems, the problems would remain.

Deputy Minister Tshwete thanked the Chairperson for the time and Mr Tshangana and the DHS team for the responses. She thanked the Members for their advice. All the issues that were raised were not out of order and were the challenges being faced, and the portfolio needed to come together to resolve those challenges. 

The Chairperson called on the Department to tighten up on some of the issues and improve on the work being done so that opportunists who wanted to make government useless were dealt with. Any country which did not implement its laws would become chaotic. As Members and public servants, they were responsible for making sure that legislation that Parliament passed was implemented. They had to work with the people to ensure understanding of why certain decisions were taken in their best interests. Even when people were removed from houses, it was for the betterment of their lives because if there was no order, even for those with a house, people would not feel safe. Work had to be done with all stakeholders to ensure that the illegal occupation and selling of land were stopped. Everybody had to be secure in terms of housing.

The meeting was adjourned.

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