STRATEGIC AND ANNUAL PERFORMANCE PLAN 2017/ 2018 PORTFOLIO COMMITTEE 14TH MARCH 2017

Presentation Outline Human Settlements Strategic Trajectory Departmental Priorities Plans Per Programmes and Functions Financial Information Recommendations

The Human Settlements Strategic Trajectory The human settlements trajectory propositions that is that ‘by 2050 visible results from effectively coordinated spatial planning systems shall have transformed human settlements in South Africa into equitable and efficient spaces with citizens living in close proximity to work with access to social facilities and essential infrastructure The 2030 vision is to achieve measurable progress towards breaking apartheid spatial patterns with: Significant advances made towards retrofitting existing settlements offering the majority of South Africans access to adequate housing Affordable services in better living environments And a more functionally equitable residential property market

The Human Settlements Strategic Trajectory To achieve the vision, the 2014-2019 MTSF focus on reforms aimed at achieve the following: Ensuring that poor households have adequate housing in better living environments Supporting the development of a functionally and equitable residential property market Improving institutional capacity and coordination for better spatial targeting

The Planning Process There was continuous engagement with oversight bodies (DPME, AG and National Treasury ) Comments made were considered, for qualitative targets, there were concerns on measurability which were attended to and explanation provided that the outcomes approach provides space for qualitative targets that measure: Improved living conditions in quality living environments Improved compliance to policies Enhanced institutional capabilities and coordination Improved organizational operations

The Planning Process The departmental annual performance plan was developed in line with: Provincial Performance Plans Entities Performance Plans MTSF delivery targets in the departmental APP mostly are aligned with entities and provincial plans. The department will at the end of the financial year account for the overall sector performance

Translating the MTSF Priorities into Strategic Plan Targets 2014-2019 Upgrading of 2200 informal settlements 750 000 households in informal settlements benefitting from the Informal Settlements Upgrading Programme 563 000 individual units for subsidy housing market provided 70 000 Finance Linked Individual Subsidy Programme subsidies allocated to approved beneficiaries27 000 social housing units 10 000 CRU 35 000 private rental housing opportunities 5000 non statutory military veterans housed

Translating the MTSF Priorities into Strategic Plan Targets 2014-2019 10 000 of hectares of well-located land rezoned and released for new developments targeting poor and lower middle income households 50 Catalytic Projects implemented 22 mining towns supported on human settlements interventions 818 057 pre-and post 1994 title deeds issued 340 480 of new title deeds issued 30% of the HSDG construction budget allocated to Women and Youth Contractors 30% of the USDG construction budget allocated to Women and youth Contractors

Translating the MTSF Priorities into Strategic Plan Targets 2014-2019 A policy Framework for Human Settlements developed A comprehensive human settlements legislation developed A Human Settlements Bank Established Policy compliance enforced on projects under implementation Human Settlements Code developed Seven evaluations of key human settlements strategic thrust completed Research to support policy development conducted An analysis of the functionality of the residential property market conducted Human Settlements Capacity Development Programme Implemented

Target Summary 2017/2018 Annual Performance Plan 50 catalytic projects implemented 22 mining towns supported on human settlements development interventions 400 feasibilities conducted in informal settlements 300 Informal settlement upgrading plans developed 150 000 households in informal settlements upgraded 7 Provinces and 6 Metros supported in the implementation of PHP Policy 1 700 non-statutory Military Veterans housed 112 600 individual units for subsidy housing submarket provided

Target Summary 2017/2018 Annual Performance Plan 327 300 pre-and post 1994 title deeds issued 93 200 title deeds for new subsidy houses issued 6000 Social Housing units delivered 1 915 Community Residential Units delivered 7920 private affordable rental housing opportunities delivered 5 000 Finance Linked Individual Subsidy Programme subsidies allocated to approved beneficiaries 3 000 hectares of well-located land acquired, rezoned, and released for new developments

Target Summary 2017/2018 Annual Performance Plan A Policy Framework for human Settlements Developed Housing Consumer Protection Bill 2017 The Home Loan and Mortgage Disclosure Amendment Bill 2016 Human Settlement Development Bank Bill 2017 Human Settlement Bill 2017 PIE Amendment Bill Guidelines for Human Settlements Planning and Design revised Programmes in the housing code reviewed

Target Summary 2017/2018 Annual Performance Plan Research to support policy development conducted Analysis of the functionality of the residential property market conducted 5% of projects under implementation assessed for policy compliance Human Settlements sector Capacity audit conducted 7 Provinces and six Metros supported on the implementation of PHP Policy 100 youth supported through a bursary Programme 500 practitioners trained on Sustainable human settlements skills development programmes Guideline Framework for Testing Project Readiness implemented Operational integration of the 3 DFI’s implemented

Target Summary 2017/2018 Annual Performance Plan 30 per cent of the total HSDG construction budget allocated to women and youth Contractors 30 per cent of the total USDG construction budget allocated to women and youth Contractors Framework for to improve DFI lending developed Framework to achieve private sector investment leveraging developed Assessments on the volume of loans granted by DFIs for the affordable housing market conducted Assessment of the current financing model on grants conducted Employers’ contribution towards Employer Assisted Housing assessed

Target Summary 2017/2018 Annual Performance Plan 9 municipalities assessed for accreditation 8 municipalities in secondary cities supported on the implementation of the Human Settlements Master Plan 6 initiatives on international cooperative aligned to human settlements priorities serviced 24 Intergovernmental fora coordinated in line with human settlements priorities 40 Partnerships, mobilised towards Human Settlements 100% of projects under implementation monitored and verified (HSDG and USDG) 1 evaluation study (UISP three year impact)

Target Summary 2017/2018 Annual Performance Plan All valid invoices paid within 30 days Approved internal audit plan implemented Approved risk management plan implemented Approved Departmental anti-fraud and corruption plan implemented Unqualified audit report 2016/17 with no matters of emphasis Human Resource Plan implemented Approved communication strategy implemented

Proposed Audit Outcomes Material under spending of the vote (Programme 3) by the department Material misstatements on the reported performance information of Programme which were subsequently corrected The financial statements submitted for auditing were not prepared in accordance with the prescribed financial reporting framework as required by section 40(1)(b) of the Public Finance Management Act Contractual obligations and money owed by the department were not settled within 30 days, as required by section 38(1)(f) of the Public Finance Management Act and Treasury Regulation 8.2.3.

Priorities for 2017/2018 Scaling up the delivery on Affordable/ Gap Housing Accelerate upgrading of informal Settlements Improved issuing of title deeds for new subsidy houses on occupation Eradication of the title deeds backlog by 2019 Establishment of the Human Settlements Development Bank

Programme Delivery Support MTSF SUB-OUTCOME MTSF Target 2014- 2016 Progress 2017/2018 Targets 2018/2019 Targets Adequate housing and improved quality living environments 50 Catalytic projects implemented Technical due diligence assessments of 64 projects completed IGR protocols with spheres of Government and sector departments being finalized 50 Catalytic Projects Implemented (This refers to various stages of implementation) Guideline Framework for Testing Project Readiness implemented in 9 provinces Guideline Framework for Testing Project Readiness implemented in 9 provinces 22 mining towns supported on human settlements development interventions 22 mining towns supported on human settlements development interventions

Programme Delivery Support MTSF SUB-OUTCOME MTSF Target 2014- 2016 Progress 2017/2018 Targets 2018/2019 Targets Adequate housing and improved quality living environments 2 200 informal settlements upgraded 1 424 informal settlements in 98 Municipalities assessed or in the process of assessing. 400 informal settlements assessed (Feasibility Studies conducted) 477 informal settlements assessed 603 detailed settlement plans completed 300 Informal settlement upgrading plans developed 500 Informal settlement upgrading plans developed 750 000 households benefitting from from informal settlements upgrading 226 459 households in informal settlements upgraded 150 000 households in informal settlements upgraded 5000 non-statutory Military Veterans housed 1 700 non-statutory Military Veterans housed 1 700 non-statutory Military Veterans housed

Programme Delivery Support MTSF SUB-OUTCOME MTSF Target 2014- 2016 Progress 2017/2018 Targets 2018/2019 Targets Adequate housing and improved quality living environments Single Support Programme for self-built completed by March 2015 In the process of establishing an interface between the Informal Settlements Upgrading Programme and the People’s Housing Programme 9 Provinces and 8 Metros supported in the implementation of PHP Policy 9 Provinces and 8 Metros supported in the implementation of PHP Policy 563 000 individual units for subsidy housing submarket provided 255 351 individual units for subsidy housing submarket provided 112 600 individual units for subsidy housing submarket provided 1150 000 individual units for subsidy housing submarket provided Affordable housing loans for new houses in the affordable-gap housing submarket DFIs issued ‘219 249 loans To be confirmed by entities plans as part of the MTSF broader target

Programme Delivery Support MTSF SUB-OUTCOME MTSF Target 2014- 2016 Progress 2017/2018 Targets 2018/2019 Targets Adequate housing and improved quality living environments Affordable rental housing opportunities provided through government programmes: 27 000 Social Housing 10 000 : CRU 35 000 affordable rental (private) 6 233 Social Housing Units 2) 5 036 :CRU 3) NHFC facilitated 15 465 private rental units through disbursements and leveraged funds 7 583 Social Housing units delivered 1 915 Community Residential Units 7921 private affordable rental housing opportunities 7583 Social Housing units delivered 2 000 Community Residential Units 7 500 private affordable rental housing opportunities 10 000 of hectares of well-located land rezoned and released for new developments 13 466.0 ha of land released 2) 1 786.3 ha rezoned. 3000 hectares of well- located land acquired, rezoned, and released for new developments To be confirmed with the HDA plan

Programme Delivery Support MTSF SUB-OUTCOME MTSF Target 2014- 2016 Progress 2017/2018 Targets 2018/2019 Targets A functionally equitable residential property market 563 000 title deeds issued to new homeowners in the subsidy submarket 60 740 title deeds registered for new developments (shortfall of 249 239 title deeds over the MTSF ) 93 200 title deeds for new subsidy houses 93 200 title deeds 818 057 for pre- and post-1994 properties 176 423 title deeds registered for pre- and post-1994 properties 327 300 pre-and post 1994 title deeds 314 334 pre-and post 1994 title deeds A single DFI established A draft Bill developed Operational Integration implemented

Policy and Research MTSF SUB-OUTCOME MTSF Target 2014- 2016 Progress 2017/2018 Targets 2018/2019 Targets Adequate housing in quality living environments A functionally equitable residential property market Policy for Coherent and Inclusive Approach to Land for Human Settlements developed The regulations and incentives for housing and land use management revised Human Settlements White Paper approved A draft White Paper developed Policy Framework for Human Settlements developed Policy Framework for Human Settlements developed Cooperatives Policy approved Policy developed Human Settlements Code developed Programmes reviewed Programmes for the Code reviewed Draft programmes for the Human Settlements Code developed

Policy and Research MTSF SUB-OUTCOME MTSF Target 2014- 2016 Progress 2017/2018 Targets 2018/2019 Targets Adequate housing in quality living environments A functionally equitable residential property market Enhanced institutional capabilities for effective coordination Conduct research to support sector planning and policy development Research to support policy development conducted Research to support policy development conducted Quarterly reports on trends in the residential property market published Analysis of the functionality of the residential property market conducted Analysis of the functionality of the residential property market conducted Projects under implementation are compliant with policies 5% of projects under implementation assessed for policy compliance 5% of projects under implementation assessed for policy compliance 20 Municipalities accredited to perform Housing function (8 Metropolitan Municipalities and 12 Secondary Cities) 9 municipalities assessed for accreditation 12 municipalities assessed for accreditation

Legal Services MTSF SUB-OUTCOME MTSF Target 2014- 2016 Progress 2017/2018 Targets 2018/2019 Targets Adequate housing in quality living environments A functionally equitable residential property market Enhanced institutional capabilities for effective coordination Comprehensive Human settlements legislation developed: Housing Act amended and Human Settlements Legislation approved Human Settlements Development Bank Bill Human Settlements Bill Property practitioners Bill PIE AMENDMENT BILL 100% of received litigation matters attended to 100% of received litigation matters attended to 100% of contracts processed within reasonable time frame

Technical Capacity, IGR and Stakeholder & Human Settlements Planning MTSF SUB-OUTCOME MTSF Target 2014- 2016 Progress 2017/2018 Targets 2018/2019 Targets Enhanced institutional capabilities for effective coordination Technical support programmes developed and implemented Human Settlements sector Capacity audit conducted Human Settlements sector Capacity development programme implemented 50 community-based organizations, civil society organizations, NGOs, etc. participating in human settlements development 329 Organizations were participating in human settlements developments 40 Partnerships, mobilised towards Human Settlements 40 Partnerships, mobilised towards Human Settlements 32 Intergovernmental fora coordinated in line with human settlements priorities 32 Intergovernmental fora coordinated in line with human settlements priorities 6 initiatives on international cooperative aligned to human settlements priorities serviced 6 initiatives on international cooperative aligned to human settlements priorities serviced Guidelines for Human Settlements Planning and Design revised (Red Book)

Programme 1 2017/2018 Targets 2018/2019 Targets Responsibility: 100% of valid invoices paid within 30 days 100% of valid invoices paid within 30 days CFO Unqualified audit report with no matters of emphasis Unqualified audit report with no matters of emphasis (All Programme Managers :Contributors) 100% Implementation of the HR Plan DDG: Corporate Services 100% implementation of the approved internal audit plan 100% implementation of the approved internal audit plan Internal Audit (ODG) 100% implementation of the approved risk management plan COO 90% availability of HSS Database Systems & IT support services 90% availability of HSS Database Systems & IT support services Departmental and entities plans aligned to MTSF priorities (Regulatory Compliance and EA) 8 public participation campaigns implemented in support of the key priorities of the Department 8 public participation campaigns implemented in support of the key priorities of the Department

Programme 4 2017/2018 Targets 2018/2019 Targets Responsibility: 4 HSDG & USDG quarterly performance assessments conducted CFO Framework for to improve DFI lending developed Implementation of the Framework for to improve DFI lending 30 per cent of the total HSDG construction budget allocated to contracts awarded to women and youth service providers. 30 per cent of the total HSDG construction budget allocated to contracts awarded to women and youth service providers 30 per cent of the total USDG construction budget allocated to contracts awarded to women and youth service providers. Number of Finance Linked Individual Subsidy Programme (FLISP) subsidies allocated to approved beneficiaries) 5 000 Finance Linked Individual Subsidy Programme (FLISP) subsidies allocated to approved beneficiaries) Framework to achieve private sector investment leveraging developed Implementation of Framework to achieve private sector investment

Budgeting Process Internal budget preparatory session was held including the Departmental entities. Preparatory session was held with National Treasury MinTop was consulted on the Departmental 2017 draft MTEF submission. Departmental 2017 MTEF submission was submitted to National Treasury Departmental representation and motivation to NT on the 2017 MTEF submission MTEC process concludes: Recommendations tabled to MINCOMBUD Tabling of Medium Term Budget Policy Statement and Preliminary allocation letters issued Submission of draft 2017 ENE chapter and database Cabinet approved final allocations Department submit final ENE chapter and database

Summary of the Priorities and Funding Needs Programme R`000 2017/18 2018/19 2019/20 Comments SHRA Restructuring Capital Grant 768 715 1 006 064 1 062 404 The RCG indicative allocation is inadequate the difference is funding pressure Institutional Subsidy 660 000 1 375 880 Reallocation from the HSDG Catalytic Projects Programme 2 000 000 3 500 000 4 000 000 Ring-fenced for the Catalytic Projects Programme from HDSG Centralizing of FLISP 1 100 000 2 200 000 3 300 000 DFI Consolidation & Capitalization 3 253 259 3 433 398 3 625 668 Reallocation from the HSDG and USDG Asset verification project 19 000 11 000 - Northern Cape Backlog Eradication 800 000 500 000 348 412 To be determined within the HSDG in current cycle GEHS Operational Requirements 49 000 52 300 55 900 New funding pressure as no increase allocation within COE and G/S Total 8 649 974 12 078 642 13 768 264  

Departmental Budget Proposals To National Treasury

CONSOLIDATED SOCIAL AND RENTAL HOUSING FUND Proposal that the Social and Rental allocations, Institutional subsidies and the Restructuring Capital Grant (RCG),be consolidated and disbursed as one funding stream to Municipalities and Social Housing Institutions; This will enhance the integrated process between the planning, funding and implementation arrangements, thus expediting delivery outcomes; Crowding and leveraging of private sector funding and contributions The Medium Term Strategic Framework (MTEF) target for the delivery of social and rental housing is 30 000 units; Actual delivery of social and rental housing units, as facilitated through the Social Housing Regulatory Authority (SHRA), is 8 452 as at 31 March 2016; The remaining number of units required to achieve the target is therefore 21 548.

CONSOLIDATED SOCIAL AND RENTAL HOUSING FUND The available data shows that the average cost of a one (1)-bedroom unit has increased by 47% over the seven years while the RCG has remained static; To address the challenge, the Department is currently considering a proposal to increase the RCG quantum to R155 000 per unit. To improve performance and accountability the Department is considering proposals to improve checks and balances in the sector and this includes separation of the regulatory, grant making and allocation and investment functions

FINANCIAL IMPLICATIONS: CONSOLIDATED SOCIAL AND RENTAL HOUSING FUND Programme 2017/18 R’000 2018/19 2019/20 Total RCG 768 715 1 006 064 1 062 404 2 837 183 Institutional Subsidy (Reallocation from HSDG) 660 000 1 375 880 3 411 760 Consolidated Social and Rental Grant Total 1 428 715 2 381 944 2 438 284 6 248 943 The calculation is based on R155 000 per unit which brings the shortage on RCG to R1.9 billion over the MTEF. For 2017/18 – R161.2 million, 2018/19 – R932.6 million and for 2019/20 – R876.3 million The institutional subsidy has already been adjusted to R110k

CATALYTIC PROJECTS PROGRAMME There is an agreement between DHS and Housing Development Agency (HDA) to align, streamline and integrate programme and project functions; Proposal for HDA to function as an developer and/or implementation agent and/or facilitator to reduce inefficiencies in Provinces and Municipalities in respect of key programmes focusing on the catalytic projects; The HDA will undertake development facilitation and project structuring, development implementation in conjunction with the private sector; The assessment of the projects indicates the catalytic projects will include the implementation of the Informal Settlements Upgrading Programme, Affordable Rental Housing and FLISP.

FINANCIAL IMPLICATIONS: CATALYTIC PROJECTS PROGRAMME 2017/18 R’000 2018/19 2019/20 Total Catalytic Projects 2 000 000 3 500 000 4 000 000 9 500 000

CENTRALIZATION OF FLISP The FLISP is not performing as expected in Provinces and Municipalities; The proposal is to top-slice both the HSDG and USDG to allow the FLISP to be managed by the department and/or entity; The Department to agree on the programme delivery vehicle.

FINANCIAL IMPLICATIONS: CENTRALIZATION OF FLiSP Programme 2017/18 R’000 2018/19 2019/20 Total FLISP 1 100 000 2 200 000 3 300 000 6 600 000

DFI CONSOLIDATION AND CAPITALIZATION The recapitalisation of the consolidated human settlements DFI’s is proposed to ensure that the Department adequately responds to the NDP guideline to “lessen the developmental load” for provision of adequate housing and integrated human settlements This will promote improved leveraging and multiplier benefits from partnership funding It is projected that an amount of R10.3 billion or 10% be “shaved” off, from the HSDG and USDG, and used to recapitalise the Human Settlements Development Bank with agreed targets, outputs and outcomes, which will benefit households

FINANCIAL IMPLICATIONS: DFI CONSOLIDATION AND CAPITALIZATION Programme 2017/18 R’000 2018/19 2019/20 Total DFI Programme Equity Fund 3 253 259 3 433 398 3 625 668 10 312 325

ASSET VERIFICATION PROJECT Proposal to compile asset registers of the HSDG and USDG funded projects (deliverables) implemented in 2015/16 and 2016/17 that set the basis for monitoring human settlements projects for the remainder of the 2014/19 MTSF period The aim of the project is to have an effective M&E system that contains credible and verifiable information, which is consistent across various reports and information platforms The NHBRC will also be expected to assist in asset verification exercise on HSDG funding.

FINANCIAL IMPLICATIONS: ASSET VERIFICATION PROJECT Programme 2017/18 R’000 2018/19 2019/20 Total Provincial and Municipal Verification 19 000 11 000 Nil 30 000

NORTHERN CAPE BACKLOG ERADICATION The Human Settlements MinMec has taken a decision to target the Northern Cape to eradicate the housing backlog Total backlog in the Northern Cape is 52 000 units, and there will be a pooling of resources from the Provincial grants to co-fund the eradication The targeted output over the 3 years is 11 384 units costing R1.6 billion The additional amounts required for 2017/18 is R800m for 5 525 units, for 2018/19 it is R500m for 3 453 units and for 2019/20 it is R348.4m for 2 406 units

FINANCIAL IMPLICATIONS: NORTHERN CAPE BACKLOG ERADICATION Programme 2017/18 2018/19 2019/20 Total Current Indicative Allocation 412 682 439 419 463 587 1 315 688 Additional Funding Requirement 800 000 500 000 348 412 1 648 412 1 212 682 939 419 811 999 2 964 100

GOVERNMENT EMPLOYEES HOUSING SCHEME (GEHS) The GEHS provides housing access support services to government employees and is administered by the State to ensure that employees have access to adequate housing on a sustainable basis The Department is expected to undertake the function of service provider to the GEHS

FINANCIAL IMPLICATIONS: GOVERNMENT EMPLOYEES HOUSING SCHEME (GEHS) Programme 2017/18 R’000 2018/19 2019/20 Total GEHS Operational Requirements 49 000 52 300 55 900 187 300 52 000

UPSCALING INFORMAL SETTLEMENTS UPGRADING The number of informal settlements in South Africa grew from an estimated 300 in 1994 to approximately 2700 in 2010. As a result, the upgrading of informal settlements was already prioritized during 2004 in the Comprehensive Plan for the Development of Sustainable Human Settlements (BNG) which was approved by Cabinet.

UPSCALING INFORMAL SETTLEMENTS UPGRADING The upgrading of informal settlements was introduced as a target under Outcome 8 and targets were set for Provinces based on the Human Settlement Development Grant (HSDG) Allocations. With the introduction of the Urban Settlement Development Grant (USDG) to the eight (8) metropolitan municipalities, particular targets were also set for these municipalities.

UPSCALING INFORMAL SETTLEMENTS UPGRADING Feasibility studies for 1 100 informal settlements completed, Municipal upgrading strategies completed for 43 municipalities and 400 settlement upgrading plans have been completed for implementation by municipalities.  At March 2016, 185 731 households were upgraded which represents 25,9% of the MTSF target. A total of 8 879 households were upgraded, a total of 555 390 households remain to be upgraded in 3 years at an average of more than 185 130 households per annum.

UPSCALING INFORMAL SETTLEMENTS UPGRADING At a cost of R43 696 per unit the approved subsidy amount for a fully serviced site, an amount of R8.1 billion per annum is required to deliver 185 130 units, or alternatively, a total amount of R24,3 billion over the 3 remaining years of the MTSF to deliver the 555 390 units. A total of 185 130 sites required to be delivered per annum are serviced to level 2 services, an annual amount of R4.35 billion will be required which equates to R13.06 billion for the remaining 3 years of the MTSF.

UPSCALING INFORMAL SETTLEMENTS UPGRADING Programme 2017/18 R’000 2018/19 2019/20 Total Informal Settlements UPgrading 8.100 000 24.300 000

PROGRAMME ON TITLE DEEDS BACKLOG ERADICATION The Department has initiated a programme for the eradication of the pre and post-94 title deeds backlog. The programme will be continued and intention is the current programme will result in the eradication of the backlog as at July 2014. In order to ensure that the resultant backlogs are not recreated the Department is of the view that allocations must be dedicated, managed and monitored.

Outcome of the MTEC Process Net Effect on Departmental Budget 2017/18 2018/19 2019/20 Total MTEF Departmental Baseline from 2016 MTEF 34 566 326 36 620 027 38 678 373 109 864 726 Net reduction on the Department's budget -1 102 026 -1 205 308 -1 230 871 -3 538 205 Revised Baseline allocation 33 464 300 35 414 719 37 447 502 106 326 521 The two grants were reduced by R3.7 billion over the MTEF. R3.4 billion on the Human Settlements Development Grant; R282.2 million on the Urban Settlements Development Grant as follows.

Outcome of the MTEC Process Compensation of employees was further reduced by R20.6 mill over the MTEF. The goods and services net increase over the MTEF is R22.2 million. The increase is attributed to the R31.7 million reallocated from the Institutional Investment managed by Social Housing Regulatory Authority to fund Department programme and project management activities as well as monitoring, evaluation and reporting.

Outcome of the MTEC Process Entities R`000 MTEF Allocation Reduction Revised MTEF Allocation Social Housing Regulatory Authority: Operational 121 332 32 664 153 996 Social Housing Regulatory Authority: Institutional Investment 93 654 (31 773) 61 881 Social Housing Regulatory Authority: Restructuring Capital Grant 2 837 183 396 529 3 233 712 Social Housing Regulatory Authority: Regulations 28 560 - Community Schemes Ombuds Services 93 352 Housing Development Agency 621 295 46 505 667 800 National Housing Finance Corporation 317 525 (87 525) 230 000 Rural Housing Loan Fund 158 762 (108 762) 50 000 Total 4 271 663 247 638 4 519 301

Impact of the Reduction on the Human Settlements Development Grant Provinces 2017/18 2018/19 2019/20 DORA 2016 Published Allocation Revised Allocation Reduction DORA 2016 Published Allocation Total Allocation by Province EASTERN CAPE 2 460 660 2 339 371 -121 289 2 477 121 2 347 420 -129 701 2 483 385 FREE STATE 1 226 608 1 162 658 -63 950 1 306 077 1 237 692 -68 385 1 309 380 GAUTENG 5 967 208 5 656 103 -311 105 6 353 813 6 021 130 -332 683 6 369 878 KWAZULU-NATAL 3 843 228 3 642 858 -200 370 4 092 224 3 877 957 -214 267 4 102 571 LIMPOPO 1 368 289 1 296 952 -71 337 1 456 938 1 380 653 -76 285 1 460 622 MPUMALANGA 1 394 636 1 321 925 -72 711 1 484 992 1 407 238 -77 754 1 488 746 NORTHERN CAPE 412 682 391 167 -21 515 439 419 416 411 -23 008 440 530 NORTH WEST 1 926 133 1 825 712 -100 421 2 050 923 1 943 538 -107 385 2 056 109 WESTERN CAPE 2 460 899 2 332 597 -128 302 2 620 336 2 483 136 -137 200 2 626 961 Total 21 060 343 19 969 343 -1 091 000 22 281 843 21 115 175 -1 166 668 22 338 182 Please provide budget cut info over MTEF as per the HSDG same as you did with USDG

Impact of the Reduction on the Urban Settlements Development Grant Provinces Metros 2017/18 2018/19 2019/20 DORA 2016 Published Allocation Revised Allocation Reduction Total Allocation by Province EASTERN CAPE Buffalo City 774 202 768 128 -6 074 813 335 806 857 -6 478 852 385   Nelson Mandela 918 970 911 761 -7 209 965 421 957 731 -7 690 1 011 773 Sub Total 1 693 172 1 679 889 -13 283 1 778 756 1 764 588 -14 168 1 864 158 FREE STATE Mangaung 767 326 761 307 -6 019 806 113 799 692 -6 421 844 816 GAUTENG Ekurhuleni 2 000 706 1 985 010 -15 696 2 101 836 2 085 094 -16 742 2 202 750 Jo'burg 1 879 476 1 864 731 -14 745 1 974 478 1 958 751 -15 727 2 069 277 Tshwane 1 629 196 1 616 415 -12 781 1 711 548 1 697 914 -13 634 1 793 723 5 509 378 5 466 156 -43 222 5 787 862 5 741 759 -46 103 6 065 750 KWAZULU-NATAL eThekwini 1 995 766 1 980 109 -15 657 2 096 646 2 079 946 -16 700 2 197 311 WESTERN CAPE Cape Town 1 506 605 1 494 786 -11 819 1 582 760 1 570 152 -12 608 1 658 751 Grant Total 11 472 247 11 382 247 -90 000 12 052 137 11 956 137 -96 000 12 630 786

Allocation Per Programme for the 2017 MTEF 2017/18 R`000 2018/19 2019/20 1. Administration 457 665 450 169 479 843 2. Human Settlements Policy, Strategy and Planning 93 573 89 807 95 741 3. Programme Delivery Support 217 302 216 398 229 720 4. Housing Development Finance 32 695 760 34 658 345 36 642 198 Total 33 464 300 35 414 719 37 447 502

Operational Allocation PEr Programme 2017 MTEF 2017/18 R`000 2018/19 2019/20 1. Administration 457 619 450 119 479 790 2. Human Settlements Policy, Strategy and Planning 90 801 88 461 94 320 3. Programme Delivery Support 207 480 206 006 218 746 4. Housing Development Finance 27 139 27 999 29 994 Total 783 039 772 585 822 850

Allocation For MTEF By Economic Classification – Current Allocation Letter Total allocation R`000 2017/18 2018/19 2019/20 Departmental Operational 933 039 852 586 872 851 Compensation of employees 383 257 376 945 405 680 Goods and services 394 097 389 663 410 868 Payment for Capital assets 5 685 5 978 6 303 Payments for financial assets 150 000 80 000 50 000 National Housing Finance Corporation 100 000 Rural Housing Loan Fund - Grants and transfer payments 32 531 261 34 562 133 36 574 651 Grants 31 351 590 33 071 312 34 968 968 Human Settlements Development Grant 19 969 343 21 115 175 22 338 182 Urban Settlements Development Grant 11 382 247 11 956 137 12 630 786 Entities 1 167 031 1 479 034 1 593 236 Social Housing Regulatory Authority: Operational 46 815 51 980 55 201 Social Housing Regulatory Authority: Institutional Investment 20 490 20 132 21 259 Social Housing Regulatory Authority: Restructuring Capital Grant 851 658 1 143 640 1 238 414 Social Housing Regulatory Authority: Regulations 8 000 10 000 10 560 Community Schemes Ombuds Services 29 400 31 105 32 847 Housing Development Agency 210 668 222 177 234 955 Departmental Transfers 12 640 11 787 12 447 Bursaries Scheme 9 822 10 392 10 974 UN Habitat 1 272 1 346 1 421 Council for Scientific and Industrial Research (CSIR) 1 500 Transfer to Households 46 49 52 Total 33 464 300 35 414 719 37 447 502

“We have come a long way – Celebrating 20 Years of Freedom!” THANK YOU “We have come a long way – Celebrating 20 Years of Freedom!”

Recommendations It is recommended that the executive approves and sign off on the final draft of the APP