Departmental of Housing Strategic Plan and Budget 2008/11.

Meeting report

Department of Housing (DoH) briefing on the updated strategy plan 2008/11
Mr Itumeleng Kotsoane, Director-General (DG), DoH, gave an overview of the updated strategic plan for the period 2008/11. The DoH, had two most important components; namely the Seven Key Considerations, and Nine Housing Sector Priorities. He then went on to detail the key considerations. The first related to capacity and gearing up for Delivery Acceleration. The DoH was addressing the need to improve the understanding of its policies and changes, especially by practitioners across all spheres of government, with a particular focus on provinces and municipalities. There was a need to secure the sector’s delivery capacity and provide hands on support, for example with land, building and construction, to accelerate delivery. The planning process needed to be streamlined and improved to ensure effective delivery. Eradication of informal settlements would ensure the progressive and incremental realisation of the 2014 target through specific annual milestones. Therefore, the DoH must lead the in the delivery process for community basic services and infrastructure, by designing an enabling funding framework that ensured the delivery of complete settlements.

Mr Kotsoane said that the second consideration was Priority Projects. There would be an exploration and adoption of alternative approaches to better manage priority housing projects. Zanemvula and N2 projects would be closely monitored and managed, and there would be  progress on the Khutsong project. There was a need for a trouble shooting mechanism to enable the Department and its stakeholders to work smarter.

The third consideration related to Organisational Development and Integrity, which was intended to improve and uphold governance dictates and build a more inclusive approach, including close collaboration with provinces and municipalities. The fourth consideration related to monitoring and evaluation. Stakeholders needed to understand the extent and nature of DoH’s backlog, relative to the target of eradicating informal settlements by 2014.  There should be an increase of presence in the provinces, especially around project tracking and better use and reporting on the budget and resources across the housing sector.

As a fifth consideration, the DoH was in the process of establishing and bringing into operation the Housing Development Agency Bill (HDA) and the Social Housing Regulation Authority (SHRA). Housing institutions needed to account more fully on the accurate delivery of their mandates. The sixth consideration related to policy, which must provide greater clarity on rural and urban housing policy and responses, enhance and articulate housing development regulations and ensure adherence to minimum norms and standards. The DoH would focus on finalizing policy and expediting delivery. The last consideration related to communication. There were improvements in communication and relations between provinces and municipalities. There was, however, a need to manage public perception and communicate progress and successes. The DoH would engage with the public on delivery, demonstrate progress to providing adequate shelter, and demonstrate innovative technologies to advance delivery.

Mr Kotsoane went on to detail the priorities in the housing sector. These included introducing housing cover for military veterans of the struggle, interventions into the industry and residential property market to curb the costs of construction, development and supply, and development of appropriate legislation to prevent the mushrooming of informal settlements. There was a need to  use alternative housing options such as rental stock to meet the housing needs, to develop and adopt a  central planning approach to improve allocation and distribution  of resources, and to create a coordinated response to human settlements. It was suggested that a one-off injection of resources was needed to impact on the housing backlog. The funding mechanism must be restructured and housing grants consolidated to improve sustainability. The Housing Development Agency (HAD) must accelerate land acquisition, and people must be assisted with building materials to encourage self-involvement.

Mr Joseph  Leshabane, Chief of Operations, DoH, briefed the committee on the departmental programmes. He noted that the objectives included accelerating housing delivery and integrated sustainable human settlements, using housing delivery as a catalyst for job creation and economic growth, increasing access to residential property to alleviate asset poverty and create wealth, and promoting social cohesion and improving the quality of life for all in sustainable integrated human settlements. The Department would focus on main stream and alternative technologies and innovative planning.

Mr Leshabane gave an overview of the structure of the DoH. The responsibilities of branches versus programmes were highlighted and it was noted that branches were structured to expedite service delivery, whist programmes were structured according to Estimates of National Expenditure (ENE)..The alignment between branch structure and programme structure would be implemented in the 2009/10 financial year.

Mr Leshabane noted that the Department had four priority programmes. Programme 1: Corporate Services aimed to provide strategic leadership, administrative and management support services to the Department, whilst promoting and facilitating the flow of information between the Department and its stakeholders. Programme 2 was the policy and research branch and its purpose was to develop and promote sustainable human settlements and housing policies supported by a responsive research agenda. It would also monitor and assess the implementation; performance and impact of national housing policies and programmes. Programme 3 was the delivery support branch, whose purpose was to provide implementation and delivery support, build capacity, liaise and communicate with stakeholders. It would further manage intergovernmental and international relations for housing and human settlement programmes. It consisted of various sub programmes, as detailed in the presentation. Its current priority projects were set out and explained. Programme 4 comprised housing development funding, with the purpose of funding national housing and human settlement development programmes in terms of the Housing Act, and providing financial and grant management in terms of the Home Loan and Mortgage Disclosure Act. The duties were fully set out and its activities for 2008/9 would include studies into housing equity and responsibilities under the Financial Services Charter.

Mr Moses Dlabantu, Chief Financial Officer, DOH, presented the Department’s budget, explaining that this was structured around the four programmes just described.  He gave a breakdown across all programmes. He noted that the budget was dominated by transfer payments (95% of total allocation).The budget would grow from R9 billion in 2007/08 to R15.3 billion in 2010/11, at an average annual rate of 19.4%. The increases were mainly due to transfers to provinces under the Integrated Housing Settlement Development Grant. Included in the conditional grants to provinces were amounts earmarked for implementation of the N2 Gateway Project, and the Zanemvula Project. R808 million was provided for implementation of the social housing programme over the medium term economic framework. Full details in respect of each of the programmes, including the provincial figures, were given (see attached presentation)

In conclusion, Mr Leshabane reiterated that he had given an overview of the five strategic objectives of the Department. He summarised that the challenges included the need to provide strategic leadership to achieve the desired objectives. South Africa was facing some difficult times, and there was a need for awareness raising programmes and beneficiary development programmes. Shortage of skills and poaching of staff were another factor.

Discussion
Mr A Steyn (DA) stated that there was very little that was new in the presentation. According to the DG, there was a need to improve the understanding of housing policies. He said that in relation to ‘Breaking New Ground’ (BNG) the Departmental staff did attempt to give some explanations, but they were not fully satisfactory and real time progress was never addressed.

The Chairperson questioned the Department’s priority projects, particularly the reference to the need for a once-off injection of funds. She noted that the Department’s duty was to give continuous support to grants, and asked for more detail on the injection of funds, and whether it would not have the result of slackening delivery.

Ms B Dambuza (ANC) noted that the Department had made some efforts to tighten up. She noted that the State of the Nation address had spoken of “Business Unusual” but she saw no mention of this in the strategic plan. Last year the Department said their target was to build 500 000 houses per year. Once again, she thought that this should appear on the performance plan, so that this Committee was able to measure the failures and successes of the Department on these statements and plans.

Ms Dambuza then raised the issue of slum clearance and upgrading, saying that she did not see the targets set for this year on the plans. There was very little on the short term. She then queried the programmes covered by the Memorandum of Understanding and asked what specific development they made to rural development and communities. 

Mr Kotsoane responded in general to these questions, and stated that indeed some of the issues had been raised in the last presentation. He noted that the Department sharpened its focus in the sense that every time Members raised issues, the Department would have to investigate to see where there were gaps, and attempt to close them.

The Department of Housing had commenced with a communication campaign on SABC2, which aimed to educate communities about options that there were through the Department of Housing. Community radio stations, at which the Department had weekly slots, were also being used. Real time delivery plans would be made available to the Members. Some of these were tabled at the last MinMEC meeting.

Housing delivery had been part of the concerns raised at MinMEC. A report had been considered to the effect that the public sector was only able to build 270 000 houses, whilst the private sector built around 70 to 80 houses, which in total was less than 300 000. Against this delivery there was a constantly growing demand for housing. Neither this government nor the country was coping with the demand. There must be at least 500 000 houses built to deal with backlog and annual growth. The Department of Housing was committed to meet that target. The built environment consisted of various players and what was critical was to broaden the scope.

In relation to the Chairperson’s question on the once- off injection, Mr Kotsoane noted that the backlog in, for example, Northern Cape, could be settled in one year with such injection. The Department needed to focus on one area and see if a great impact could be achieved. The Department was losing skills as a result of the “brain drain”. The 2014 target of eradicating slums was still achievable.

A Member noted the amendment of the Housing Development Agency Bill was noted, but expressed concern that the Agency would recruit from the already depleted staff of the Department of Housing, by offering competitive remuneration packages.

Members also requested the Department to address the issue of waiting lists for houses and try and coordinate and consolidate this list so that people could be accounted for, even if they had been given houses in urban or rural areas.

The Chairperson noted that the strategic plan now presented to the Committee needed to be rolled out to all provinces. The Committee hoped that the Department would be able to spend its budget, and not need to shift funds from one area to another.

The meeting was adjourned.