Presentation to the Select Committee on Cooperation between Departments and progress on the audit of land and property that belongs to Government Presentation to the Select Committee on Public Services 11 February 2014

Outline of the Presentation Introduction Problem Statement What needed to be done? What has been done? Strategic and Operational Collaboration Policy and Legislation Reform Collaboration State Land Audit Progress State Land Audit Data Key next steps

Introduction The Select Committee has requested a briefing from the Departments of Public Works (DPW), Rural Development and Land Reform (DRDLR) and National Treasury with the Offices of the Accountant-General and the Chief Surveyor-General (CSG) on cooperation between the departments and the Accountant-General and Chief Surveyor-General (CSG) in accelerating progress with the audit of land and property that belongs to government.

Introduction cont. Whilst both DPW and DRDLR are currently engaged in a number of processes that seek to resolve uncertainties regarding the identification and confirmation of custodianship of State immovable assets, this presentation has only been limited to the two issues of cooperation between departments and progress on the State land audit. In order to contextualise the briefing, the presentation begins by defining the State immovable assets problem that necessitates this cooperation and audit.

Problem statement There has been continuous lack of clarity on the nature and extent of State immovable assets as a consequence of a variety of historical and current factors. The said factors include: Existence of multiple landholding institutions pre 27 April 1994, Organizational complexities in the management of the transition post 1994 elections, which resulted in the loss and misplacement of some land record as well as the control of some State immovable assets being placed in the hands of private parties, Incomplete surveying of State land, Incomplete confirmation of vesting of State immovable assets, and Magnitude of the State immovable assets portfolio in relation to existing capacity to manage and maintain it.

What needed to be done? Identification of all registered State immovable assets, Identification of relevant ownership records, Determination of custodianship of State immovable assets in accordance with legislation, Desktop and physical verification of State immovable assets, Confirmation of vesting (ownership) of all State land, Enhancement of State immovable asset registers, Capacity enhancement to manage and maintain portfolio, Identification of State immovable assets controlled by other parties, Improved management and reporting requirements for State immovable assets.

What has been done? DPW and DRDLR, as the main national custodians, have assumed a collective leading role in the identification and correct classification of government immovable assets. In view of the existence of legislation which empower other authorities in the national and provincial sphere to control State immovable assets, mechanisms had to be devised to bring all the actors together towards determining, amongst other things, the extent of State immovable assets. DPW and DRDLR created an intergovernmental structure, currently known as the Provincial State Land Vesting and Disposal Committee (PSLVDC) with a view to coordinate immovable asset disposal processes as well as confirmation of vesting of all State immovable assets in the national and provincial spheres.

What has been done? cont. The original idea was to prevent the possible disposal of an immovable asset controlled by one department whilst it may be required by another for its service delivery purposes. The PSLVDC also serves to achieve consensus amongst all State immovable assets controlling departments on whether an immovable asset vests in the respective national or provincial sphere. In 2009 Cabinet set up an Inter-Ministerial Committee (IMC) on Immovable Assets. This IMC is chaired by the Minister of Public Works and includes the Minister of Finance and that of Rural Development and Land Reform as members. Changes in DPW’s leadership affected the momentum of the IMC, however, attempts are being made to resuscitate it.

What has been done? cont. A national surveying programme was initiated in 2011 under the leadership of the Chief Surveyor General. The plan was aimed at identifying and surveying all un-surveyed State land and State Domestic Facilities. The surveying has practically been completed except for minor ‘gap areas’ and ‘slithers’ of State land between river bank boundaries. Though surveying has been done correctly in terms of the Land Survey Act, there are some few challenges relating to the separation of provincial facilities from larger national land parcels. This issue is currently being addressed. As can be appreciated from the above slides, the magnitude of State immovable assets challenges has necessitated a multifaceted collaboration approach at various levels.

What has been done? cont. Progress on DPW’s Immovable Asset Register programme from October 2011 to 31 March 2013: Deeds download, desktop cleansing for registered land parcels and portfolio of evidence completed, Reconciliation of Provincial DPW’s and Human Settlements completed, Linking of structures to land parcels significantly completed, Sourcing of other information sources, UAMP’s, external databases, etc., Created repository in iE-Works for cleansed IAR data to be placed, Procured physical verification tool and software, Formulated Custodian Framework for National, Capitalisation Policy, Global State Land reconciliation completed.

Analysis of registered land parcels by custodian What has been done? cont. State land reconciliation: (Registered, Unregistered, Sec 42 land parcels) Analysis of registered land parcels by custodian Total NDPW DRDLR Other Custodians Human Settlements 9 Provinces Total State Land 182,345 45,150 25,258 85,503 26,434 Adjustments for: Not considered to be state land -3,379 -2,593 -786 Subsequent deeds download and other 5,045 1,298 -56 167 3,636 Deemed provincial properties -10,743 10,743 Revised Total – Deemed State Land 184,011 33,112 25,202 40,027 Allocation of custodianship in progress- thus disclosed by National 1,459 -1,459 Total deemed State Land 34,571 38,568 Unregistered Land - National DPW 3,127 - Deemed provincial land (Unvested) – disclosed by National 13,703 -13,703 Deemed provincial land (Surveyed not Registered) – disclosed by National 4,125 Amounts to be disclosed in the Annual Financial Statement ending 31 March 2013 55,526 188 24,865 NDPW is currently busy resolving Section 42 transfers from National to Provinces for 2014 AFS

What has been done cont. Custodian summary # of user departments # of users who are also custodians Public Works or DID Human Settlements/ Local Government & Housing Office of the Premier Eastern Cape 13 1  Free State 12 2 Gauteng Kwa-Zulu Natal 16 Limpopo Mpumalanga North West 11 Northern Cape Western Cape 14 National 52 6 National custodians Public Works Defence Endowment Environmental & Water Affairs Rural Development & Land Reform Agriculture and Forestry International Relations Provincial DPW – Cabinet resolution dated 13/06/2007 Provincial Housing – Act 4 of 2001, Housing Amendment Act

What has been done? cont. Physical verification of DPW immovable assets as at 17/1/2014

What has been done? cont. Land parcels vested (National & Provincial custodians) as at December 2013: Custodian - Statistics according to LAW EC FS GP KZN LP MP NW NC WC TOTAL National DPW 1,386 2,438 2,791 1,920 664 1,429 443 1,761 2,468 15,300 DRDLR 2,165 623 128 640 3,102 1,868 693 374 9,593 Provincial DPW 2,635 1,126 3,409 6,033 675 1,563 808 756 3,375 20,380 Human Settlements / DLGH 506 46 552 Total 6,186 4,187 6,834 8,639 4,441 4,860 1,944 2,891 5,843 45,825

Strategic and Operational collaboration Specific areas of collaboration between DPW and DRDLR as well as other entities are of a Strategic and Operational nature and include collaboration on Policy and Legislation Reform. In view of the historical impediments in the identification of State immovable assets, DPW and DRDLR have undertaken detailed coordinated processes towards identification of State immovable assets. Such processes include: Extraction of land registration records from the Office of the Chief Registrar of Deeds for reconciliation purposes; Coordination of Deeds data analysis and sharing of outcomes in order to eliminate possible data entry errors; Securing asset registers of other national and provincial custodians and analysing them for reconciliation purposes;

Strategic and Operational collaboration cont. Identification and surveying of all un-surveyed State land and all State domestic facilities by the Chief Surveyor-General; and Development of an operating model for immovable asset register management within national and provincial public works departments. Coordination of immovable assets vesting processes through the National Vesting Task Team (NVTT). The NVTT is chaired by DRDLR and comprises of DPW, DRDLR, Water Affairs and all provincial State land custodian departments. Its main responsibilities are to monitor progress on vesting targets, review vesting guidelines and with any matter that impacts on the efficiency of vesting processes.

Strategic and Operational collaboration cont. Following the establishment of the IMC on Immovable Assets, an Immovable Assets Task Team (IATT) was established as a technical structure under the leadership of the Office of the Accountant General. It initially comprised of Office of the Accountant-General, DPW and DRDLR but was later expanded to include provincial State land custodians. The IATT has reviewed the Minimum Requirements for Immovable Asset Registers and has also developed a Sector Specific Guide on Immovable Assets to inform reporting requirements. There’s just one challenge that it takes the Accountant General a bit longer to determine the final guide, which tends to affect the preparation of Annual Financial Statements. Bilateral discussions led by the Directors-General of DPW and DRDLR are regularly convened to address immovable asset register related matters. No less than 3 of these engagements occur per year.

Policy and Legislation Reform collaboration The two departments have, in the past three years, been engaged in elaborate policy development processes in the fields of land reform (including land expropriation), land valuation and immovable asset register management. The above mentioned processes have resulted in the production of the Expropriation Bill, Property Valuation Bill and Land Commission Bill. The Land Commission Bill requires particular emphasis since it seeks to: Set up an institution that will establish and maintain a database of all registered and unregistered State land. This will resolve the possibility of unaccounted for immovable assets;

Policy and Legislation Reform collaboration cont. The Land Commission Bill seeks to: Create mechanisms for adjudication of all land ownership disputes; Compel disclosure of all immovable assets controlled by a government department; and Compel disclosure of any immovable asset movements in the form of acquisitions and disposals.

State Land Audit progress In 2010 the Department of Rural Development and Reform, through the Chief Surveyor General, initiated a Land Audit Project. The physical audit was conducted on State and Public land whilst only a desktop analysis was conducted on privately owned land. The purpose of the audit was to determine how much land is owned by State and what is it used for and who are the occupants or users. The audit was based on registered land parcels as at 2010 hence surveyed unregistered State land did not form part of the audit. A desktop analysis was completed in 2011.

State Land Audit progress cont. Field verification commenced in 2011 and completed in March 2013. A report was compiled and presented to Parliament in September 2013. A report and the data was made available to other government departments for further analysis and use. Data clean-up of source databases (Deeds and Cadastral) is in progress to improve the quality of data. The detailed findings of the State land audit are available and can be presented in future, should the Select Committee so direct.

State Land Audit data

State Land Audit data cont.

Key next steps: Finalise surveying requirements for State land, Capacitate DRDLR to deliver on vesting requirements, Finalise the Operating Model for DPW IAR’s, Finalise national and provincial DPW IAR enhancement programmes and ensure on-going maintenance, Finalise vesting of all State land, Intensify engagement with all national, provincial, municipal and other custodians on the management of State immovable assets, Compilation of an integrated register of State immovable assets. Major issue that needs to be highlighted here is that provinces will need to disclose unvested properties once such custodian has agreed that this property belongs to them. Where there is still uncertainty, DPW (e.g. +- 5000 properties currently being resolved) / DRDLR (SG diagram and related information not provided pre Sept each year) are required to still disclose such.

Thank you