EKURHULENI METROPOLITAN MUNICIPALITY

Department of Housing

Date: 19 December 2007

PROPOSED LEGISLATION FOR A HOUSING DEVELOPMENT AGENCY (HDA): COMMENTS

Comments on the Housing Development Agency Bill published under Notice 1252 of 2007 in the Government Gazette of 26 October 2007 are as follows:

Section 3: It is not clear from this proviso that if the Agency acquires land on behalf of a municipality or Provincial I-lousing Department will the land be registered in the name of the Agency? To facilitate the acquisition of land in a way that supplement the capacities of Government across all spheres is a function on its own and the funding thereof should be clear. The Agency hopefully can fast track the acquisition of suitable land for residential or community development. It can also bring with it more administrative processes and red tape which can delay the development process.

Section 24 (1) of the Bill provides that "the funds of the agency consist of (a) fees rendered to municipalities based on cost recovery" It is suggested that this section should also provide clarity on the source of funding to be used to pay for the services of the Agency and also for the land acquired by the agency for the municipality.

The identification and acquisition of land are addressed in the Bill. However the availability and timeous provision of bull< services is not dealt with. This could be another obstacle in the delivery of housing especially in smaller municipalities with capacity constraints. The planning and preparation of applications for MIG funding on behalf of municipalities should be included.

The Bill must also provide the details regarding the processes and terms and conditions of the contract entered into by the Municipalities and The Housing Development Agency whether project by project or for all the programmes implemented by the Municipality. Attention is drawn to the fact that the principles of the Comprehensive Plan for the Development of Sustainable Human Settlements apply which means that a range of income groups should be catered for. How will the funding for the above R 3000 per month be provided and managed? (Currently this is the income bracket that is subject to certain conditions outsourced to the financial institutions).


The Bill should allow municipalities to contract with the Agency on project or even programme basis, this will enable the municipalities to contract the agency only for projects and programmes which require more capacity or are urgent.

In this regard it should be mentioned that municipalities are allocated a share of the grant funding per annum. In order to meet the millennium development goals it is important that additional capacity and funding be made available to municipalities. In the case of Ekurhuleni additional capacity and funding will assist to reach the set target for 2014. However, the share of the grant funding per annum is set. If the Agency is appointed will the grant funding be deducted from the share allocated to Ekurhuleni? It is mentioned in section 7 that the mandate for the Agency should include service delivery targets. The provision of appropriate funding in order for the agency to meets it targets should be afforded the necessary attention.

Although the functions, roles and responsibilities for the Agency are recorded no processes and procedures are mentioned.

It is mentioned that the Agency will contract with the Municipality when acquiring land. The contract needs to be more fully discussed.

The Bill is supported because Municipalities are not compelled to make use of the Housing Development Agency. It may however contract with the Agency if serious capacity constraints are experienced and this is confirmed in Section 4 (3) indicating that "Nothing in the Act detracts from the power of the municipality to acquire hold or develop land for residential or community development, without recourse to the agency.." as this provision means that a municipality has the choice not to utilize the agency.

Yours faithfully,

MIEMIE VON MALTIZT TRP (SA) ACTING DIRECTOR POLICY AND PLANNING

For D CHAINEE

EXECUTIVE DIRECTOR HOUSING