DEPARTMENTAL PRESENTATION TO THE PORTFOLIO COMMITTEE ON HUMAN SETTLEMENTS (24 MARCH 2015) DIRECTOR- GENERAL: T. ZULU Confidential

PURPOSE To present the departments: Strategic plans for the coming Medium Term Expenditure Framework (MTEF) period and Annual Performance Plans 2015-16

TABLE OF CONTENT Background Strategic Plan APP Budget Delivery Targets Macro Performance Indicators Strategic Goals by Programme APP Delivery Agreements Budget Delivery Targets

BACKGROUND The National Development Plan (NDP) places a responsibility on government on the need to fast track the delivery of housing and improving the living conditions of citizens. In response to the Constitutional mandate and the call by the NDP to integrate settlements and develop in strategic and well located areas, the department has prioritized the delivery of houses using different tenure types with special emphasis on integration and densification. The 2014 -2019 Medium Term Strategic Framework prioritizes the delivery 1,5 million housing opportunities in partnership with the private sector, all stakeholders and communities.

BACKGROUND The human settlements development programme will in the next five years (2015-2020) be a catalyst for transforming the national space economy in order to achieve measurable results by 2030. The delivery approach will focus on mega projects of integrated housing mix to cater for different incomes levels and needs, These will include houses for: the indigent, gap housing, rental units, social housing and serviced stands and will ensure integration of different income groups, different races and lead to the building of a South Africa that truly belongs to all.

STRATEGIC PLANS

MACRO PERFROMAMNCE INDICATORS Macro Indicators Strategic Goal or Programme Most Closely Linked to the Achievement Indicator Target Estimates 2015/16 2016/17 2017/18 Clean Audit Programme 1: Administration   Purpose: Provide strategic leadership, governance oversight and essential support and promote a compliant and well-functioning department & agencies 1 Revised Housing Act and Housing Code Programme 2: Human Settlements Strategy, Policy and Planning Purpose Manage the development of human settlement policies, strategies & planning

MACRO PERFROMAMNCE INDICATORS Macro Indicators Strategic Goal or Programme Most Closely Linked to the Achievement Indicator Target Estimates 2015/16 2016/17 2017/18 Delivery Programme 3: Programme Management Support   Purpose Build, oversee, support & monitor the sector institutional capability & capacity to deliver human settlement programmes& projects .3 mill opportunities  Financing the Delivery Programme 4: Housing Development Finance Provide funding for the delivery of all human settlements programmes in line with approved policies, planning and strategies R30.9 bill R33.2 bill R35.2 bill

STRATEGIC GOALS BY PROGRAMMES Programme & purpose Programme 1: Administration Purpose: Provide strategic leadership, governance oversight and essential support and promote a compliant and well-functioning department & agencies Strategic Goal Provide strategic leadership, governance oversight and essential support and promote a compliant and well-functioning department & agencies Strategic objectives Consolidation of the Development Finance Institutions (DFI) Intensify homeownership education programmes for the affordable housing market Establish transactional support for affordable housing market Monitor and reporting transactions in the secondary housing subsidy submarket Collect, analyse and disseminate information on property trends and values in the affordable housing market Issuing of title deeds form part of housing development process Analysis of new housing units constructed in the entire residential property market Fast track release of well-located land for housing and human settlements targeting poor and lower middle income household Utilize various communication platforms to communicate about the strategic thrust of human settlements

STRATEGIC GOALS BY PROGRAMMES Programme & purpose Programme 2: Human Settlements Strategy, Policy and Planning Purpose Manage the development of human settlement policies, strategies & planning Strategic Goal Development of human settlements policies, strategies & planning towards promoting adequate housing and improved quality living environments Strategic objectives Develop policy and administrative systems that support individual transactions in the affordable secondary housing market Strengthen programme for the accreditation of municipalities Increase the supply of housing opportunities using different tenure types to ensure the diversity necessary to address social, economic and cultural needs Mining Towns Strategy (A special Strategy for mine worker housing) Increase Participation of stakeholders in housing development Strengthen current mechanism to mobilize private sector to contribute to human settlements development Develop horizontal and vertical consultative mechanisms among spheres of government Review Planning System to achieve better spatial targeting

STRATEGIC GOALS BY PROGRAMMES Programme & purpose Programme 3: Programme Management Support Purpose Build, oversee, support & monitor the sector institutional capability & capacity to deliver human settlement programmes & projects Strategic Goal Ensure that human settlement programmes and projects are executed in a manner that provide access to adequate housing in improved living environments for all Strategic objectives Build & ensure institutional capabilities and capacity for execution & delivery of transformed human settlements & better spatial targeting Develop bolder measures to execute & implement sustainable human settlements provide access to adequate housing in improved living environments for all Implement projects that ensures spatial, social and economic integration Monitor & evaluate the execution & delivery of human settlement projects & programmes to assess and report on the extent of access to adequate housing in improved living environments for all

STRATEGIC GOALS BY PROGRAMMES Programme & purpose Programme 4: Housing Development Finance Purpose Provide funding for the delivery of all human settlements programmes in line with approved policies, planning and strategies Strategic Goal Strategic objectives Develop minimum standards and finance options for investment in public spaces Diversify finance options and products for the affordable gap market in particular Increase in the number of properties in the subsidy housing submarket entering the municipal rates roll

ANNUAL PERFORMANCE PLANS

4. DELIVERY AGREEMENT (OUTCOME 8) Background Objective of Outcome 8 is to manage a comprehensive human settlements programme with multiple projects that covers extensive geographical spread aiming to improve the workings of the space economy. This will be achieved by: Providing poor households with adequate housing in better living environments; Supporting the development of functionally and equitable residential property market; Improving the institutional capacity & coordination for better spatial targeting Confidential

DELIVERY AGREEMENT (OUTCOME 8) Housing delivery: In terms of the Outcome 8 MTSF for Human Settlements, a total number of 1,5 million housing opportunities will be delivered over the MTSF period of five years. The 1,5 million housing opportunities will consist of: 750 000 households in informal settlements upgraded; 563 000 individual units for subsidy market; 110 000 loans (70 000 FLISP plus 40 000 DFIs) 27 000 social housing; 10 000 CRU; 35 000 affordable rental Other targets 2 200 informal settlements will be assessed, 10 000 ha of well-located land will be rezoned and released for new developments targeting poor and lower to middle income households, Confidential

DELIVERY AGREEMENT (OUTCOME 8) 50 catalytic projects will be implemented, 563 000 title deeds will be issued to new homeowners in the subsidy market; and The title deeds backlog of 900 000 will be eradicated. For purposes of the Delivery Agreements, the targets of each Provincial Department in terms of the various objectives will have to be formally agreed and approved by Human Settlements MINMEC; Provincial Departments need to revise their business plans to focus on the priorities as set out in the MTSF; 30% Houses delivered by Women 1956 House per Province for Women delivery 10% Houses delivered by Youth (The Youth Brigade Programme) 5000 Housing Units for Military Vets Hosting Provincial Social Contracts Forums Hosting of Provincial Govan Mbeki Awards Confidential

BUDGET

Allocations over the 2015 MTEF period Net Effect on Departmental Budget MTEF Total R`000 2015/16 2016/17 2017/18 Departmental Baseline from 2014/15 MTEF 32 842 362 34 452 580 36 181 009 103 475 951 Plus Additional Allocation (Consolidated) 261 000 200 000 250 000 711 000 Minus Reduction in Allocation (Consolidated) (2 159 981) (1 446 616) (1 184 399) (4 790 996) Revised Baseline 30 943 381 33 205 964 35 246 610 99 395 955

Additional allocations (Consolidated) Additional Allocation (Consolidated) 2015/16 R`000 2016/17 2017/18 Total MTEF Housing Development Agency 100 000 300 000 National Urban Reconstruction and Housing Agency 61 000 - Rural Housing Loan Fund 50 000 National Housing Finance Corporation 261 000 200 000 250 000 711 000

Reduction in Allocation (Consolidated) 2015/16 R`000 2016/17 2017/18 Total Departmental Operational (81 244) (99 982) (108 102) (289 328) Compensation of employees (54 726) (58 052) (63 947) (176 725) Goods and services (6 398) (21 605) (23 797) (51 800) Payment for Capital assets (120) (325) (358) (803) National Upgrading Support Programme (Moved to HDA) (20 000) (60 000)   Grants (630 329) (881 560) (655 033) (2 166 922) Urban Settlements Development Grant (100 428) (155 984) (85 331) (341 743) Municipal Human Settlements Capacity Grant (200 000) (600 000) Human Settlements Development Grant (329 901) (525 576) (369 702) (1 225 179)

Reduction in Allocation (Consolidated) cont. 2015/16 R`000 2016/17 2017/18 Total Entities (263 528) (257 185) (202 398) (723 111) Social Housing Regulatory Authority: Restructuring Capital Grant (200 000) (600 000) Social Housing Regulatory Authority: Operational (21 617) (10 457) (2 398) (34 472) Community Schemes Ombuds Services (13 479) (4 080) - (17 559) Housing Development agency (28 432) (42 648) (71 080)   Sanitation moving to Department of Water and Sanitation (1 184 880) (207 889) (218 866) (1 611 635) Sanitation Operational (91 153) (83 290) (88 037) (262 480) Human Settlements Development Grant: Indirect (975 399) Rural Households Infrastructure Development: Indirect Grant (67 328) Rural Households Infrastructure Development: Direct Grant (51 000) (124 599) (130 829) (306 428) (2 159 981) (1 446 616) (1 184 399) (4 790 996)

Net impact on the Department’s budget over the MTEF period 2015/16 R`000 2016/17 2017/18 Total MTEF Departmental Baseline 2014/15 MTEF 32 842 362 34 452 592 36 181 011 103 475 965 Revised Baseline 2015/16 MTEF 30 943 381 33 205 964 35 246 610 99 395 955 Increase/(Reduction) (1 898 981) (1 246 628) (934 401) (4 080 010) At It must be noted that the R 4 billion reduction on the baseline includes an amount of R1 6 billion in respect of the Sanitation function.

Allocation over MTEF by Programme 2015/16 R`000 2016/17 2017/18 Total MTEF 1. Administration 435 115 462 786 490 131 1 388 032 2. Human Settlements Policy, Strategy and Planning 74 337 79 252 83 760 237 349 3. Programme Delivery Support 169 800 176 252 182 239 528 291 4. Housing Development Finance 30 264 128 32 487 674 34 490 481 97 242 283 Total 30 943 380 33 205 964 35 246 611 99 395 955

Allocation over MTEF by Branch 2015/16 R`000 2016/17 2017/18 Total MTEF Ministry 47 867 52 105 57 049 157 021 Management 85 757 91 048 95 952 272 757 Corporate Services 198 316 210 099 221 608 630 023 Property Management 37 677 39 900 41 895 119 472 Human Settlements Delivery Frameworks 39 961 42 533 44 996 127 490 Human Settlements Strategy and Planning 43 108 45 980 48 565 137 653 Programme and Project Management Unit 120 292 123 455 126 481 370 228 Housing Development Finance 30 311 614 32 538 197 34 543 876 97 393 687 Chief of Operations 58 789 62 647 66 188 187 624 Total  30 943 381 33 205 964 35 246 610 99 395 955

Allocation over MTEF by economic classification Total allocation 2015/16 R`000 2016/17 2017/18 Total MTEF Departmental Operational 690 941 731 068 769 721 2 191 730 Compensation of employees 322 239 344 790 365 662 1 032 691 Goods and services 364 719 382 085 399 659 1 146 463 Payment for Capital assets 3 983 4 193 4 400 12 576 Payments for financial assets   Grants and transfer payments 30 252 440 32 474 896 34 476 889 97 204 225 Grants 28 857 020 31 059 868 32 883 466 92 800 354 Human Settlements Development Grant 18 202 675 19 883 991 21 060 343 59 147 009 Urban Settlements Development Grant 10 554 345 11 075 877 11 708 123 33 338 345 Municipal Human Settlements Capacity Grant 100 000 115 000 315 000 Entities 1 385 507 1 404 416 1 582 283 4 372 206 Social Housing Regulatory Authority: Operational 34 560 36 392 38 212 109 164 SHRA: Capital Restructuring Grant 932 307 1 036 409 1 110 513 3 079 229 Housing Development Agency 176 183 167 512 215 668 559 363 Community Schemes Ombuds Services 39 521 23 920 29 400 92 841 National Housing Finance Corporation 300 000 Rural Housing Loan Fund - 50 000 National Urban Reconstruction and Housing Agency 61 000 SHRA: Institutional Investment Grant 41 936 40 183 38 490 120 609 Departmental Transfers 9 913 10 612 11 140 31 665 Bursaries Scheme 8 719 9 355 9 822 27 896 UnHabitat 1 150 1 211 1 272 3 633 Transfer to Households 44 46 136 Total 30 943 381 33 205 964 35 246 610 99 395 955

Human Settlements Development Grant Provinces 2015/16 R`000 2016/17 2017/18   EASTERN CAPE 1 962 372 2 167 156 2 332 862 FREE STATE 1 057 284 1 210 630 1 285 972 GAUTENG 4 979 843 5 473 336 5 769 301 KWAZULU-NATAL 3 235 475 3 414 957 3 632 106 LIMPOPO 1 283 877 1 311 709 1 362 651 MPUMALANGA 1 265 162 1 419 973 1 488 961 NORTHERN CAPE 380 408 402 276 427 374 NORTH WEST 2 063 132 2 297 286 2 435 403 WESTERN CAPE 1 975 122 2 186 668 2 325 713 Total 18 202 675 19 883 991 21 060 343

Urban Settlements Development Grant Provinces Metros 2015/16 R`000 2016/17 2017/18 EASTERN CAPE Buffalo City 713 132 748 370 791 090   Nelson Mandela 846 480 888 308 939 015 Sub Total 1 559 612 1 636 678 1 730 105 FREE STATE Mangaung 693 847 728 133 769 697 GAUTENG Ekurhuleni 1 842 887 1 933 951 2 044 347 Jo'burg 1 731 220 1 816 766 1 920 473 Tshwane 1 500 683 1 574 838 1 664 734 5 074 789 5 325 554 5 629 554 KWAZULU-NATAL eThekwini 1 838 336 1 929 176 2 039 299 WESTERN CAPE Cape Town 1 387 761 1 456 336 1 539 468 Grant Total 10 554 345 11 075 877 11 708 123

Municipal Human Settlements Capacity Grant Provinces Metros 2015/16 R`000 2016/17 2017/18 EASTERN CAPE Buffalo City 9 253 10 640 Nelson Mandela 9 847 11 324 Sub Total   19 100 21 964 FREE STATE Mangaung 9 206 10 587 GAUTENG Ekurhuleni 14 313 16 460 Jo'burg 16 505 18 981 Tshwane 12 831 14 755 43 649 50 196 KWAZULU-NATAL eThekwini 14 342 16 493 WESTERN CAPE Cape Town 13 703 15 758 Total 100 000 115 000

2015-16 DELIVERY TARGETS

Summary of Consolidated Planned Provincial Delivery per Programme Sub-Programme Rectification/repairs Other Sites Budget (000") Units Total Annual Budget (000") Financial Interventions 4 790 11 632 2 191 R 460 749 459 4636 R 2 354 926 375 R 2 815 675 834 Incremental Housing Programmes   10227 47 102 R 2 401 445 618 60 852 R 7 359 251 806 R 9 760 697 424 Social & Rental Housing 1209 281 R 90 293 122 5602 R 1 603 205 245 R 1 693 498 367 Rural Housing 6148 R 30 066 500 25504 R 2 517 272 351 R 2 547 338 851 Priority Projects 2250 2430 R 258 824 032 4 057 R 569 314 292 R 828 138 324 Provincial Specific Projects 3500 105 R 45 659 000 2 025 R 511 667 201 R 557 326 201 GRAND TOTAL 28 818 58 257 R 3 287 037 731 102 676 R 14 915 637 270 R 18 202 675 001

Planned Provincial Delivery in Mining Towns Gauteng Towns Sites Budget Unit Overall Budget Westonaria 1 120 57 188 630 Randfontein 400 316 63 248 211 Merafong 615 54 922 735 TOTAL 1 520 931 175 359 576 Mpumalanga Towns Sites Budget Units Overall Budget Emalahleni 3 000 130 878 823 114 445 245 323 Steve Tshwete 732 50 482 76 10 431 60 913 Thaba Chweu 1 000 43 626 220 32 408 76 034 TOTAL 4 732 224 986 1 119 157 284 382 270 Northern Cape Towns Sites Budget Units Overall Budget Tsantsabane 8 630 Gasegonyana 100 4 500 13 635 18 135 Gamagara 9 805 TOTAL 13130 23440 36 570

Planned Provincial Delivery in Mining Towns Limpopo Towns Sites Budget Units Overall Budget Lephalale 26 006 922 188 619 214625 Burgersfort / Steelpoort 390 9 634 450 34 070 100 259 Fetakgomo 200 4 920 92 9 811 14 731 Elias Motsoaledi 800 19 680 294 26 547 46 227 Thabazimbi 32 665* 195 20 663 53 328 TOTAL 1390 60 240 1 953 279 710 429170 * Rectification North West Towns Sites Budget Units Overall Budget Kgetleng 866 119 957 550 118 641 550 Madibeng 1 042 194 353 215 Rustenburg 402 17 537 652 1129 241 881 797 259 419 701 Moses Kotane 484 131 949 656 130 633 656 TOTAL 3521 688 142 218 703 048 122

4.2 MTSF ACTIONS The Departments Structure is being revised to match strategy. The department is now reporting on 25 Strategic Objectives and 59 high-level Targets Programme 1 10 Objectives 15 Targets Programme 2 9 Strategic objectives 21 Targets Programme 3 3 Strategic objectives 14 Targets Programme 4 9 Targets The sharper focus from the current 163 targets to 55 will bring much needed efficiencies in performance and Monitoring. A much extensive process will be undertaken during the Budgeting period to align budgets against strategy. Confidential

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