Five provincial Departments of Local Government and Housing, excluding
Under spending was reported in three provinces, with two provinces having made plans to resolve the problems, and having requested reallocation of funds called back by National Treasury.
The Committee provided suggestions to deal with the problems indicated, in addition to the interventions of the provincial departments. Several committee Members commented that poor planning and monitoring might have led to the problems being faced. With regard to the provinces that requested more funding and reallocation of recalled funds, the Committee indicated that it would assess the provinces’ capacity to absorb new funds. The Cmmittee indicated that it would make plans to have meeting with Eastern Cape HOD and MEC for Local Government and the Home Builders Registration Council, to resolve the problems being faced in the province. The committee indicated that tit would be visiting the
Provincial Department of Local Government and Housing: Spending on Housing Performance for 3rd Quarter
Eastern Cape Provincial Department Briefing
Mrs Tokozile Xasa, Eastern Cape MEC for Local Government and Housing, tabled a presentation to the Committee on housing projects expenditure for the first 9 months of the 2007/2008 financial year. She outlined the key challenges being faced in the province. These included poor or no planning and alignment of budgets in the housing development projects. There had thus been prioritisation of all municipalities that were facing these challenges and a turnaround plan that involved stringent approval and monitoring of projects was to be implemented in 2008/2009.She indicated that a further challenge faced by several municipalities land issues and was being resolved in cooperation with the Department of Land Affairs. There had been agreement on a moratorium on land that was being developed by the challenged municipalities and departments. However, several projects had been unblocked after intensive investigation and re-planning. These municipalities had also been facing challenges involving a lack of capacity by contractors. A memorandum of understanding had therefore been signed with the Eastern Cape Development Corporation (ECDC) on the use of established and reputable contractors. It had further been decided to award attractive contracts as a means of luring reputable contractors. The turnaround plan had so far involved R1 billion and 30% expenditure.
The Chairperson commented that it was imperative to focus on readiness to spend money, considering that more funds were to be made available in the upcoming financial year. He added that Member Mr E Sogoni would share experiences from
Mr M Goeieman (ANC,
Mr ESogoni (ANC,
The Chairperson requested to know the role that the Environmental Impact Assessment (EIA) could play in resolving the problems in the
Mr Sogoni replied that the EIA was a necessary step to be taken. He indicated that it was also necessary not to delay the implementation of programmes.
The Chairperson commented that the department responsible for the EIA needed to be brought on board, as there appeared to be a need to go to the Eastern Cape to assess the situation
Mr B Mkhalipi (ANC, Mpumalanga) commented that the housing projects should be seen in the broader context of the government’s Reconstruction and Development Programme (RDP) that was launched in 1994 and its successor Growth Employment and Redistribution (GEAR) Macro-economic strategy. The housing projects were thus a paramount feature of the government’s promise to redress previous imbalances and the democratisation of the South African society. He also indicated that the National Home Builders Registration Council (NHBRC), the Construction Development Board (CDB) and other numerous other institutions, including those mentioned in the presentation, were structures created specifically to facilitate and capacitate programmes such as housing development, and ensure quality. They however appeared to have become barriers and hindrances rather than facilitators. The problems could therefore be solved by engaging these structures and insisting that they go on outreach and awareness programmes to attract investors and contractors. Furthermore there was a need to ensure that they met the necessary standards and prevent problems similar to those being currently faced. He further stressed the gravity of the issues highlighted in the presentation, as they were essentially barriers on achieving the millennium development goals.
Ms D Robinson (DA,
Ms Xasa commented that there were further problems involving the Integrated Development Plans (IDP). She added that the NHRBC had not yet responded to several housing project proposals
Ms N Ntwanambi (ANC,
Ms Xasa replied that the R500 million had to be spent or surrendered, and thus plans had been made to utilise it. She also indicated that progress had been made with regard to the projects. The programme included the use of alternative sanitation, water supply and electricity and was part of the Integrated Development Planning (IDP). It therefore sought to integrate the department’s economic development aspects. She further indicated that ABSA Bank and several municipalities were cooperating and providing assistance to the programme. There were also areas marked as economic development nodes, which were prioritised in the programme. She added that there was a lot of commitment to meet the goal of intensifying rural housing and that the money allocated would be of great assistance.
The Chairperson commented that there was a need to convene a meeting with the National Department of Housing, the NHBRC and the Eastern Cape MEC so as to find out how they were supporting each other in the housing projects. He also requested that a list be provided of all the municipalities that did not have water and sanitation, in order to ensure that something was done.
Mrs Xasa thanked the Chairperson for suggesting the meeting. She commented that the current problems in the
Mr Sogoni proposed that the Department of Land Affairs be invited to the meeting proposed
North West Provincial Department Briefing
Mr Howard Yawa, North West MEC for Local Government and Housing, and Mr Mohamad Motala, Head of Department (HOD): North West Local Government and Housing, tabled a written presentation outlining expenditures. Mr Yawa proceeded to elaborate on the challenges being faced in the Province. He indicated that several challenges were being faced in the province, with Khutsong Resettlement Plan and Matlosana Pilot Project being the major ones. Central to these challenges was the red-tape experienced in getting approval from the NHBRC. Funding for Internal Services was a further challenge in terms of policy and impacted on the housing projects in Naledi. Nonetheless, several projects that had been delayed were now in progression.
The Chairperson indicated that there was need to have a joint meeting with the relevant Portfolio Committee and the NHBRC in order to resolve the challenges indicated. He also expressed his concern over the spending of the Municipal Infrastructure Grant (MIG). There was an urgent need to address problem of depressed municipalities not spending the MIG funds. He also stated that the
Mr Yawa commented that the challenges being faced were related to substandard work.
Mr Z Kolweni (ANC,
Mr Mkhalipi highlighted that there were housing projects in Tswaing that had resulted in substandard houses that were not fit for habitation. The toilets built were falling in. He asked to know if there was anything done to rectify the situation.
Mr Sogoni indicated that there appeared to be poor delivery by service providers, yet the government had not rectified the problem. He noted that in terms of legislation the provinces had oversight over the municipalities and were meant to resolve these problems. Parliament would therefore hold the provincial departments accountable for the activities and problems occurring in the municipalities. The problem with monitoring the activities in the municipalities had led to other problems such as the under-spending of the MIG. He added that the Municipal Finance Management Act (MFMA), sections 34(1) and 34(3) outlined issues relating to assistance and monitoring. The Act clearly addressed and stipulated the municipalities’ roles and mandate. The Committee and the provincial departments thus had the legislative mandate to monitor the municipalities and hold them accountable for their activities.
Mr Yawa replied that the problems with municipalities went beyond accounting for financial expenditures and correct usage of funds. He indicated that he had personally visited the municipalities and monitored their activities. He added that corrective actions to address problems identified were already under way and responsibility for several projects had been taken away from some of the municipalities. Nonetheless, the municipalities’ problems in generating finance led to the incorrect usage of funds.
Mr Mkhalipi asked to know the timelines for completing the housing projects after receiving funding.
Mr Yawa replied that 2007/2008 housing projects were significantly under.way, with submissions having been made to the relevant departments with regards to the Khutsong projects. He indicated that detailed information on the Tswaing project would be provided in the near future.
Mr Motala commented that responsibility had been taken away due to municipalities’ failure to get accreditation. Most Municipalities could not even attain level one in terms of accreditation. He indicated that the
Limpopo Provincial Department Briefing
Ms Maite Nkoana-Mashabane, Limpopo Province MEC, and Mr Sam Rampedi,
The Chairperson aired his concern over the ability of the province to spend the R160 million on rural housing. He asked for clarification on the 60% fund expenditure indicated, saying that Treasury had reported less spending in the province.
Mr Rampedi replied that the province’s expenditure was below 60%, as indicated by Treasury as at December 2007. However, the spending had increased and was approximately 66% as at 11 February 2008.
The Chairperson referred to page 7 of the presentation and requested clarification on the Sites and Services programme, as well as on the blocked projects mentioned in the presentation.
Mr Rampedi replied that part of the land that was being used for the housing projects was not serviced. The land had now been serviced and the contractors hadcommenced work and have been on site since December/January. He also indicated that there was close monitoring of the projects and efforts to fast track several projects. The blocked projects were basically incomplete projects that were suspended due to poor planning. There had been intensive assessment of the blocked projects and the necessary actions to rectify the problems had been identified. He added that 200 houses were expected to be completed by the end of the next financial year
Mr Mkhalipi referred to page 10 of the presentation and asked for the exact location of the training programme of ten emerging contractors. He asked why, in such a large project, there were only ten being trained. He further requested more information on the funding of the programme, as well as the involvement of the NHBRC and other institutions in the project.
Ms Nkoana-Mashabane responded that the training projects were initiated in conjunction with the National Department of Public Works (NDPW) Sector Education and Training Authority (SETA). She also noted that the training project was a pilot project, hence only ten contractors were trained initially, with an increase of the number of contractors expected in the near future.
Mr Rampedi commented that the training programme involved various stakeholders, including the Departments of Public Works, Health, Education, and Environmental Affairs. The programme essentially involved enhancing the capacity to deliver in terms of skills and finance, and other areas that had experienced poor performance. He also noted that the social cluster, which consists of the Department of Health, Education and Social Development, had assisted in building capacity.
The Chairperson indicated that the Committee would visit the
Free State Provincial Department Briefing
Mr Joel Mafereka, Free State MEC for Local Government and Housing, gave a presentation on the 2006/07 Third Quarter Performance, planned measures to improve spending, service delivery challenges and capital expenditure. He indicated that the planned housing units for 2006/2007 had been exceeded, as indicated on page 5 of the report.. As highlighted in the presentation, there was 50% spending at the end of December, which translated to approximately R400 million spent out of the R657 million budget. National Treasury took away R100 million due to insufficient spending. This would produce problems as it was budgeted for several projects involving 200 people. The spending had nonetheless increased to R410 million as at February 2008. As indicated in the presentation, measures had been put in place to address the under spending, with an expected expenditure of R60 million, out of the R87 million budgeted, by the end of March. Service delivery challenges and the necessary responses to address them were outlined in the presentation. The main service delivery challenge involved land identified for development although township registers were not in place in the municipalities. A further challenge was the disparity in the capacity of contractors, which was being resolved through a contractor development programme. Unprecedented weather conditions in April/May created a further challenge and might result in lack of water for contractors to proceed with their work. There were also financial problems being faced with regards to Municipal Housing Sector plans and thus funds had been requested from the National Department of Housing (NDOH). Specifically, land had to be serviced so the projects could continue. Given the problems that the Department was facing, the projects committed to, and the huge spending expected in March 2008, the province requested the assistance of the Committee with regards to the R100 million called back by National Treasury.
Mr Mkhalipi commented that it was disturbing to notice the disparities in the provinces regarding empowerment of municipalities, especially taking into consideration the collaborations taking place between some provinces. He indicated that there was need for agreement with regards to the cooperation to empower municipalities.
Mr Mafereka replied that there was no ambiguity in the
Mr M Goeieman asked whether the land being developed was linked to the Iintegrated Development Planning of Local Government.
Mr Mafereka replied that the
The Chairperson asked whether the plans to acquire land included private land.
Mr Mafereka affirmed that the land acquisition included private land.
The Chairperson asked whether the province was ready to absorb more funding.
Mr Mafereka replied that the province was ready to absorb more funding as well as to spend the money called back by Treasury.
The Chairperson indicated that the Committee also needed to see the quality of spending.
Northern Cape Provincial Department Briefing
A delegation from the Northern Cape Department of Local Government and Housing gave a brief presentation to Select Committee on Finance. It was indicated that the National Minister of Housing visited the
An official from the Department of National Treasury commented that Treasury only received information on the processes that were meant to take place in the
A member of the
The Chairperson indicated that the Committee would also be assessing and monitoring the provinces’ ability to spend the allocated and requested funds.
A member of the
The meeting was adjourned.
- Eastern Cape Provincial Department presentation
- Free State Provincial Department presentation
- Gauteng Provincial Department presentation
- Limpopo Provincial Department presentation
- Northern Cape Provincial Department presentation
- National Treasury Presentation
- North West Provincial Department presentation
- Department of Local Government and Housing Third Quarterly Review
- We don't have attendance info for this committee meeting