Recovery Plan 2017/18 Financial Year: Status Report to Parliament presented by DG NORTH WEST PROVINCE 13 November 2017

Contents Background Performance Recovery Plan Way-forward Challenges Shortage of Beneficiaries Budget allocation Performance Expenditure Summary Delivery Summary Recovery Plan Strategy for recovery Status of infrastructure projects Special Intervention: 21 Elders Way-forward Recovery implementation Cessions concluded Key interventions

Background Challenges; Shortage of beneficiaries Budget allocation

Challenges Housing delivery slower than planned due to the following Poor performance by contractors and developers. Lack of serviced sites from Municipalities. As a result the Department has to plan and provide serviced sites. Shortage of beneficiaries from Municipalities. Projects for site and services did not deliver service sites as anticipated. Community unrests and volatile areas. Municipalities do not have functioning SPLUMA Tribunals: This delays the Township establishment for new projects; Negative impact on installation of infrastructure; Construction of top structures put on hold; and Also affects Title Restoration Project.

Challenges (contd) Province is predominantly dolomitic and developing on such areas is expensive– about 67% of the province has this conditions which is not costed prior to implementation and it takes time. Other key projects experienced demonstrations/protest action for instance in Rustenburg – Bokamoso and Matlosana Alabama Ext 4 & 5. H3 clay conditions need additional funds for the relevant design and rock-infested areas pose a challenge. Projects in volatile areas Implementation of projects not ready – poorly planned projects as a legacy of tranche projects. Old historical projects Poor performance of projects

Summary: Shortage of beneficiaries per municipality. Beneficiaries Allocated Approvals Shortage Kgetlengrivier Total 957 946 11 Madibeng Total 2045 1368 677 Moretele Total 600 315 285 Moses Kotane Total 1900 1793 107 Rustenburg Total 7741 3980 3761 Bojanala Total 13243 8402 4841   Maquassi Hills Total 654 631 23 Matlosana Total 6621 4712 1909 Tlokwe/Ventersdorp Total 5760 2749 3011 Dr KK Total 13035 8092 4943 Greater Taung Total 3575 3516 59 Kagisano-Molopo Total 3423 2875 548 Lekwa-Teemane Total 5260 3344 1916 Mamusa Total 1114 489 625 Naledi Total 591 589 2 DR RSM Total 13963 10813 3150 Ditsobotla Total 3948 3857 91 Mahikeng Total 4367 4229 138 Ramotshere Moiloa Total 1644 1195 449 Ratlou Total 2484 1731 753 Tswaing Total 1408 1284 124 NMM Total 13851 12296 1555 GRAND TOTAL 54092 39603 14489

Shortage of beneficiaries: Remedial action Political intervention by with Mayors where projects are affected by lack of beneficiaries. Deploy Departmental team to projects to fast track subsidy applications. Target approved beneficiaries on HSS that have not been assisted. Substitution of approved beneficiaries from older blocked projects to current projects where beneficiaries cannot be located. Training of officials from Municipalities for the National Housing Needs Register (NHNR) completed. Implementation of NHNR in progress.

Budget Allocation Approved allocation R 2 186 679 260 Roll over Total R 2 379 679 260

Performance Expenditure Summary Delivery Summary Status of infrastructure projects

ACTUAL EXPENDITURE AND REVISED CASH-FLOW PROJECTIONS Expenditure Summary ACTUAL EXPENDITURE AND REVISED CASH-FLOW PROJECTIONS Months Original Cash Flow Actual Expenditure Revised Cash Flow Variance April R 161 052 496 R133 493 204 R27 559 292 May R 178 983 276 R 117 908 389 R117 908 389 R61 074 887 June R 196 317 546 R 83 278 396 R83 278 396 R113 039 150 July R 201 703 666 R140 179 784 R61 523 882 August R 210 083 966 R 109 106 342 R109 106 342 R100 977 624 September R 205 352 866 R 198 412 000 R198 412 000 R6 940 866 October R 187 050 846 R 123 353 550 R255 459 667 R132 106 117 November R 179 805 146 R 23 866 943 R245 564 047   December R 155 301 476 R212 098 818 January R 145 096 116 R198 161 122 February R 169 554 906 R231 565 057 March R 196 376 954 R268 196 549 Total R2 186 679 260 R929 598 608 R2 193 423 375 R503 221 818 The revised cash flow is the actual expenditure for the first six months and the remaining six months includes original plus recovery. The variance for October is calculated on the revised amount.

Expenditure Summary: Graph

Delivery Summary per month QUARTER MONTH SITES UNITS PLAN. Rev Plan Actual Q1 1260 3066 882 Apr 392 896 154 May 420 1023 229 Jun 448 1147 499 Q2 1455 975 3565 1721 Jul 497 1158 301 Aug 483 1216 168 Sep 475 1191 1252 Q3 1313 1621 1726 3017 5053 879 Oct 461 466 310 1075 1804 768 Nov 440 743 1039 1740 111 Dec 412 674 903 1508   Q4 1221 2082 2970 4962 Jan 414 658 828 1394 Feb 411 697 967 1628 Mar 396 727 1175 1941 Total 5249 3817 7625 12618 3482 The delivery stats above excludes the CRU in Mafikeng, Matlosana and Moses Kotane. 300 Rooigrond The units are at practical completion stage but not handed over due to the lack bulk services. The Department has approved funds and good progress had been recorded in the installation of the bulk. 436 Tswaing 998 Grand Total 5216

Delivery Summary per month: Graph Sites Units

Recovery Plan Strategy for recovery Status of infrastructure projects Special Intervention: 21 Elders

Strategy For Recovery Continue to target incomplete structures for completion. Poor performing contractors will only be allowed to complete their incomplete structures and the balance of the subsidies to be allocated to capable contractors . Intensify project management with special emphasis on: Rescheduling of expenditure and delivery from non performing projects; Placing non and under performing contractors on terms; Facilitate ceding of contracts from under performing contractors to contractors with capacity; Facilitate cessions with material suppliers. Project and programme management has been enhanced with the secondment of officials from other units.

Strategy For Recovery (contd) Military veterans Contractor has been appointed for 84 units in Ramotshere Moiloa and Mahikeng; Incorporate remainder into existing contracts nearby. Unlocking delivery in blocked projects: The professional service provider (PMU) has been tasked to conduct an audit and quantification of completion of blocked projects; The projects will be consolidated and closed at the number of units last delivered; Consolidate unused subsidies into one project per region called “Blocked Projects Programme”; and Appoint reputable contractor/s who is able to deliver at scale per region. Serviced Stands: Fast track top structure construction on serviced land as per infrastructure projects (see next slide).

Status of infrastructure projects Mamusa Glaudina: 310 sites have been servicesd and handed to municipality. 310 Matlosana Alabama Ext 5: Contractor is on site and is expected to complete by end of February 2018. 2255 Rustenburg Bokamoso: Work on site is completed. Close out is being finalised to be reported in November 2017 458 Naledi Stella: Appointment is being finalised. Expected delivery by end of March 2018. 600 Catalytic Project: services are being installed on 1000 sites. 1000   Total 4623

Way-forward Recovery implementation Cessions concluded Key interventions

Recovery Implementation Intensive interaction with the developers and contractors per region led by Hon MEC and HOD. Regional Directors convene status and progress meeting with contractors every Monday. Departmental Management report to Principals every Tuesday. Revised delivery schedules concluded with contractors. Non performing contractors placed on terms. Some non performing contractors ceded contracts to contractors with capacity. Additional bid committee sittings over and above scheduled sittings in place. Political intervention by with Mayors where projects are affected by lack of beneficiaries.

Cessions Concluded Cessions Concluded No From To 1 Thumo Gape Rekhuditse 2 Fikile Tirhani Construction 3 Renanao Build It (Vryburg) 4 Siyanda Agang Trading 5 OPT Lerato Trading Cape Gannet 6 White Leopard Blue moon 7 Ntepang Trading Tigane Developers 8 Seboifeng Moleah Construction 9 Pace Setters Kent Civils 10 Tholo Holdings Marabe 11 Sun success Delcarn cc t/a Rock Building Suppliers

Key Interventions Intensify monitoring of the revised delivery schedules. The developing trends in the delivery and expenditure statistics for September must be maintained and improved upon for October and November. Need to capitalise on the normal peak that is expected during November to enhance performance. Intervention team to intensify monitoring of milestones per stand to achieve targeted delivery. Contractors with capacity to accelerate delivery. All new projects that are in planning are to be correctly packaged, (ie town planning design, surveyor general approval, deeds register, engineering designs, etc) so that no delays are experienced when a contractor is appointed to build houses Standardised house plans and foundation designs to be implemented. Identify and implement innovative alternate solutions to challenges, obstacles and bottlenecks.

Key Interventions: Projects with a potential to deliver Stella 700 sites to be serviced – which is a quick process to install internal services infrastructure with machinery Coligny 500 sites to be serviced Mafikeng Rooigrond 1000 top structures – to enable reporting on non-financials when bulk infrastructure is commissioned Rustenburg Bokamoso – 4 contractors with capacity to develop a combined 1330 units are being relocated to ready areas i.e. Madibeng, Moses Kotane villages and Kgetleng Derby and Borolelo which are still under mining towns and will not reduce figures under this programme. The entire costing is R171m including standard geotechnical allowance. Alabama Ext 5 (2255) internal services – issues resolved and contractor is on site working. Alabama Ext 4 (948) top structure contractor is taking site to construct houses.

Key Intervention: 21 Elders The project was approved in 2008 to be implemented by the Municipality via the tranche funding method. When the project was taken back by the Department there were 34 elderly beneficiaries who had not benefited. The Municipality lodged a request to have these 34 houses constructed for them, expenditure was incurred under the tranche payment against these 34 beneficiaries and there were no geotechnical investigations conducted in the areas they were residing. For these beneficiaries to benefit, the Municipality was required to sign an acknowledgement of debt letter. The acknowledgement of debt was not communicated resulting in unfortunate delay. During this period 13 of the 34 elderly had passed on. Only 21 are remaining. The Department has appointed Ikaheng Developers to build these 21 units. We anticipate that all 21 units will be completed by December 2017. Fourteen beneficiaries are approved and the foundations are being constructed. The remaining 7 will be approved within the week.

THANK YOU!