BUFFALO CITY METROPOLITAN MUNICIPALITY – URBAN SETTLEMENT (USDG) PERFORMANCE REPORT 19 SEPTEMBER CAPE TOWN -

PRESENTATION OUTLINE Part 1 : Strategic Overview Part 2 : Service Delivery Context Part 3 : Financial Performance Part 4 : Non Financial Performance Part 5 : Conclusions

STRATEGIC OVERVIEW PART 1 3

STRATEGIC OVERVIEW MAJOR CHALLENGES IN HOUSING AND REMEDIAL ACTIONS Limited land in close proximity to the city centre; Land invasions and uncontrolled growth of informal settlements; Limited capacity of bulk services to meet the demands of new developments (roads, water, sewerage, electricity and storm- water); Complex and time-consuming procurement processes; Illegal occupation of serviced sites and top structures; Slow progress of allocating housing to those with special needs; Relocating beneficiaries from informal to formal housing posses various challenges; 4

STRATEGIC OVERVIEWS LAND ACQUISITION Acquisition and preparation of land is considered a vital component of housing delivery. As a component of achieving integrated sustainable human settlements, the Municipality is committed to embark on a high density housing initiative to manage urban sprawl. The initiative proposes to position higher density housing in precincts close to transport nodes, along corridors and economic hubs. INTEGRATED HUMAN SETTLEMENTS Pro-actively manage land use & set appropriate levels of service to achieve sustainability in urban, peri-urban & rural areas. Focus on creating Integrated Sustainable Human Settlements which would include considerations as to how the metro can be made more compact; efficient and more equitable. To have the Integrated Sustainable Human Settlement Plan (ISHSP) approved by Council. Land Audit has been established in order to unlock / identify land and assets owned by BCMM. Make more land available to Social housing institutions in order to establish rental accommodation for those who do not qualify for BNG houses. STRATEGIC GOALS & PRIORITIES Priorities that will focus the Metro on its strategic goals, priorities, and performance measures, with particular reference to: Priority areas relating to Creation of Sustainable Human Settlements development, and Outcomes 8 Priorities Improve and develop infrastructure to meet the demand for housing and economic growth. Manage the urbanisation process i.e. planned and serviced land to accommodate newcomers to the city at higher densities to avoid urban sprawl Consolidate and integrate spatial development by developing land in proximity to public transport facilities and existing services. 5

BCMM Future Spatial Development Urban renewal zone Township Regeneration Key land parcels Strengthen the Urban Core Upgrade the informal settlements Densification and Infill Human Settlements Upgrade urban nodes and transport corridors Strengthen rural nodes Spatial Patterns 6

OVERVIEW OF THE HOUSING NEED Housing Demand & Projections Estimated population over 1,000, informal settlements within urban areas. 40,000 free standing informal dwellings in urban area. Total housing need in BCMM of 121,000 units. 75,000 units including all levels of income and housing types. 46,000 units in rural areas comprising of 230 rural settlements. Supporting Infrastructure Need Water services coverage at 97%, backlog is currently being addressed. Sanitation services coverage at 76%, rural backlog eradication currently being addressed. Roads and Bridges reaching their life span and needing for major investment. Electricity network backlog based on deferred maintenance, due to funding constraints, also need major investment. 7

BACKLOGS SERVICE BACKLOG (HOUSEHOLDS) BACKLOGS (BULK) DEFERRED MAINTENANCE WATER 7000 = R28,000,000 R1,3 billion over 20 years R447 million SANITATION = R66,000,000 R2,1 billion over 20 years R550 million ELECTRICITY None (informal dwellers linked to housing delivery) estimated at R1 billion) ESKOM = 2500 hh R450 million R690 million ROADS AND STORMWATER Rural internal streets to be defined by current study. Upgrades of gravel roads: R1,2 Billion Provincial, National and District roads R136 million(re-paved) R88 million (re-gravel) HOUSING R2,6 billion over 20 years R 2,9 billion over 20 years 8

National Outcome Buffalo City 5 year Housing Delivery Plan will fit into the targets as identified by the PDoHS. The bulk of informal settlements in Buffalo City are identified in the Mdantsane area and in the central East London / Beacon Bay / Gonubie area The programmed development of infrastructure capacity and the roll-out of housing development in the DVRI priority areas (including Reeston), Mdantsane, and in the identified Restructuring Zones will enable BCMM to address the demand manifest in informal settlements. Providing a range of accommodation types in different localities that are all favourably located either in relation to areas of opportunity in Central East London or in relation to main public transportation routes in terms of the BRT system Support from National Upgrading Support Programme (NUSP) for informal settlement upgrading in BCMM with target of ± 20 settlements (i.e. ± households) over 3 year period

OUTCOME 8: SLUM UPGRADING USDG PlannedUSDG Delivery SitesFunds Allocated RSites Expenditure R Expenditure % 2011/12 Serviced Sites = 218 P3 = R42,156,161 Serviced Sites = 0 P3 = R9,923,295 24% 2012/13 Serviced Sites = 1850 P3 = R43,818,600 Serviced Sites = P3 = R00% 2013/14 Serviced Sites = 2220 P3 = R59,704,764 Serviced Sites = P3 = R0 2014/15 Serviced Sites = 1500 P3 = R66 7,608 Serviced Sites = P3 = R0 TOTAL Serviced sites = 5788 P3 = R168,822,352 Serviced sites = P3 = R9,923,295 10

OUTCOME 8: BASIC SERVICES USDG PlannedUSDG Delivery SitesFunds Allocated RSites Expenditure R Expenditure % 2011/12 Serviced Sites = 218 P3 = R42,156,161 Serviced Sites = 0 P3 = R9,923,29524% 2012/13 Serviced Sites = 1850 P3 = R43,818,600 Serviced Sites = P3 = R00% 2013/14 Serviced Sites = 2220 P3 = R59,704,764 Serviced Sites = P3 = R0 2014/15 Serviced Sites = 1500 P3 = R66 7,608 Serviced Sites = P3 = R0 TOTAL Serviced sites = 5788 P3 = R168,822,352 Serviced sites = P3 = R9,923,295 11

OUTCOME 8: BASIC SERVICES SANITATION USDG PlannedUSDG Delivery Number of new sanitation service points (toilets) installed for informal settlements Funds Allocated R Number of new sanitation service points (toilets) installed for informal settlements Expenditure R Expenditure % 2011/ R36m3722R16,710,000m46% 2012/ R37,5m- 2013/ R37,854m- 2014/ R27,854m- TOTAL 11650R139,208m 12

OUTCOME 8: BASIC SERVICES WATER USDG PlannedUSDG Delivery Number of new households connected to basic water service Funds Allocated R Number of new households connected to basic water service Expenditure R Expenditure % 2011/ R16million1 628R10,870,04268% 2012/ R18million- 2013/ R21,276, / R18million- TOTAL 5 163R73,276,293 13

(Cities Network, 2011) 14

LAND OWNERSHIP IN BCMM 15

Summary of Demographic Information 16

USDG 2011 / 2012 FINANCIAL PERFORMANCE PART 3 17

OVERALL FINANCIAL PERFORMANCE End of financial year performance including legal commitments is 80% as at 30 June 2012 Spending as per payment as at end of 2011/12 was 36.9% of the total 2011/12 USDG allocation of R423 million. Spending Levels The budget was adjusted downwards by R48.5 million due to projects under spending. Adjustments 18

2011 / 2012 FINANCIAL PERFORMANCE BCMM has spent 36.9% of the total 2011/12 USDG allocation of R423 million. The budget was adjusted downwards by R48.5 million due to projected under spending The internal review done, attributed the poor expenditure performance to the following factors: Poor Planning as informal settlement upgrade projects were budgeted for prior approval of Environmental Impact Assessment (EIA), Multi-year projects that were budgeted for in one financial year. 19

2011 / 2012 FINANCIAL PERFORMANCE Legal challenges around some of the major projects. Disjointed USDG project coordination. Ineffective project planning (late design work, long procurement process etc.) Inadequate project monitoring. 20

ALLOCATED FUNDING REVISED BUDGET ACTUAL EXPEND-ITURE COMMIT- MENTS FUNDING TO BE REDIRECTED FOR LAND ACQUISITION Informal Settlements Upgrade Bulk Infrastructure and Internal Services Transport Facilities Upgrading Economic Infrastructure Health and Public Safety Public Amenities TOTAL USDG / 2012 FINANCIAL PERFORMANCE 21

USDG 2011 / 2012 NON- FINANCIAL PERFORMANCE PART 4 22

2,400 rural toilets provided 25 km of roads surfaced and 15km in progress at end of financial year 50 km of roads re-gravelled and 20 km in progress at end of financial year Bulk water and sanitation infrastructure projects committed, awards made in May/June 2012 Rural households in Ncera provided with new and upgraded infrastructure to ensure sustainable water supply Upgrade of Mzonyana Bulk Water Treatment Works Upgraded Bulk Sewer capacity for informal settlements in progress (Bufferstrip Corridor) BCMM achieved 4 Blue Drop Awards for its plants Awards have been made for all infrastructure projects except for Reeston Bulk Sewer Project of R23 million which is being re-advertised. BULK INFRASTRUCTURE 23

INFORMAL SETTLEMENT UPGRADE 833 Housing units constructed in the following areas: Potsdam Unit P, Dimbaza Phase 2, Ilitha South Phase 1, Tyutyu Phase 1, Mekeni Rd (DVRI Pilot Project) Professional Teams have been appointed for designs on the following 18 projects in April 2012: Cluster 1 = Chris Hani phase 2, Ilinge, Winnie Mandela, Francis Mei, Mahlangu Village, Deluxollo Village, Sisulu Village Cluster 2 = Masibumbane, Masibulele, Velwano, Gwentshe Village, Mathemba Vuso 24

INFORMAL SETTLEMENT UPGRADE Cluster 3 = Fynbos 1 – 2, Ndancama, Sunny South, Reeston 3 Stage 3, Ilitha Wooden Houses, Contractors on site for the following 7 projects: Reeston 3 Stage 2, Manyano and Thembelihle, Second Creek (Legal Dispute), DVRI Block Yard (Legal Dispute), DVRI Haven Hills, Potsdam Unit P (Non performance of main contractor), Ilitha South phase 1. Currently 1670 sites are at excavation level; 1377 at roof level and 1327 sites are practically completed but not handed over as yet. This should be done in the 2012 / 2013 Financial Year. Committed funding of R18,7 million. 25

TRANSPORT PLANNING AND OPERATIONS Taxi Ranks Upgrading of the KWT Central Taxi and Bus Ranks (Phase 1) Concept and Viability completed and Civil Engineering Consultants have commenced with designs. Appointment of an Architect is at final procurement stage R14 mil 2011/12 funding is committed and roll-over will be utilized to complete the project. Gonubie Main Road Consultants appointed - detailed designs for widening are complete. Procurement process for construction of the road upgrade commenced in July 2012 R10mil from 2011/12 funding is committed and roll-over will be utilized to complete the project. 26

HUMAN SETTLEMENTS BULK INFRASTRUCTURE Bulk water and sanitation infrastructure projects committed, awards made in May/June 2012 Upgrade of Mzonyana Bulk Water Treatment Works Upgraded Bulk Sewer capacity for informal settlements in progress (Bufferstrip Corridor) BCMM achieved 4 Blue Drop Awards for its plants Awards have been made for all infrastructure projects except for Reeston Bulk Sewer Project of R23 million which is being re-advertised. INTERNAL SERVICES 2,400 rural toilets provided 25 km of roads surfaced and 15km in progress at end of financial year 50 km of roads re-gravelled and 20 km in progress at end of financial year Rural households in Ncera provided with new and upgraded infrastructure to ensure sustainable water supply INFORMAL SETTLEMENTS 833 BNG Housing units constructed. Professional teams appointed for designs on 13 projects in April Contractors on site for 7 projects. Committed funding of R18,7 million. SOCIAL HOUSING 344 Social Housing Rental units delivered in the 2011 / 2012 FY. 27

TRANSPORT PLANNING AND OPERATIONS COMMUNITY SERVICES 60 Drop-off points completed 1 Community Hall constructed ECONOMIC INFRASTRUCTURE Economic infrastructure projects completed and funding fully utilised: Hydroponic Project in Mdantsane NU 15 and NU18 Steve Biko Centre Ginsberg 28

UTILIZATION OF ROLL-OVER FUNDING Application was made to National Treasury on 30 August 2012 to request for the roll-over of R182 million unspent conditional grant funding for committed projects. 29

Due Diligence on Programme Planning for Future EIA approvals BCMM only budgeted for projects with EIA approvals. Where EIAs have not been sort, feasibility and planning budget was reserved Planning & Budgeting Multi-year budgeting has been properly appropriated for multi-year projects. Budgeting based on programme instead of projects. Capacity Procurement processes have commenced early and it is targeted that bids will be awarded within 90 days after the closure of the tender advertisement. Additional Project Planning, Monitoring and Evaluation capacity currently being augmented under the City Manager’s Office. 30

2011/2012 USDG CAPITAL EXPENDITURE PER PROJECT :30 JUNE

PROJECT DESCRIPTION APPROVED BUDGET BUDGET ADJUSTMENTYTD EXP VARIANCE AGAINST APPROVED BUDGET Mdantsane Zone 18 CC Phase 2-P Manyano & Thembelihle Phase 2-P Second Creek (Turn Key)-P Masibambane-P Masibulele-P Velwano Chris Hani Park Phase 3-P /2012 USDG CAPITAL EXPENDITURE: 30 JUNE

PROJECT DESCRIPTION APPROVED BUDGET BUDGET ADJUSTMENTYTD EXP VARIANCE AGAINST APPROVED BUDGET Ilinge -P Gwentshe Village- P Fynbos Informal 1-P Fynbos Informal 2-P Ndancama-P Mathemba Vuso-P Deluxolo Village-P /2012 USDG CAPITAL EXPENDITURE: 30 JUNE

PROJECT DESCRIPTION APPROVED BUDGET BUDGET ADJUSTMENTYTD EXP VARIANCE AGAINST APPROVED BUDGET Francis Mei-P Mahlangu Village-P Sisulu Village-P Winnie Mandela-P Dacawa-P Sunny South-P Block Yard Potsdam Unit p : Stage 2 P /2012 USDG CAPITAL EXPENDITURE: 30 JUNE

PROJECT DESCRIPTION APPROVED BUDGET BUDGET ADJUSTMENTYTD EXP VARIANCE AGAINST APPROVED BUDGET West Bank Restitution Rural Roads Upgrade Upgrading and Rehabilitation of BCMM Roads - Duncan Village Upgrading and Rehabilitation of BCMM Roads - Zwelitsha Upgrading and Rehabilitation of BCMM Roads - Phakamisa Upgrading and Rehabilitation of BCMM Roads - Dimbaza /2012 USDG CAPITAL EXPENDITURE: 30 JUNE

PROJECT DESCRIPTION APPROVED BUDGET BUDGET ADJUSTMENTYTD EXP VARIANCE AGAINST APPROVED BUDGET Upgrading and Rehabilitation of BCMM Roads - Scenery park / Reeston Upgrading and Rehabilitation of BCMM Roads - Nonkcampa Upgrading and Rehabilitation of BCMM Roads - Upper Mngqesha Upgrading and Rehabilitation of BCMM Roads - Tsholomnqa /2012 USDG CAPITAL EXPENDITURE: 30 JUNE

PROJECT DESCRIPTION APPROVED BUDGET BUDGET ADJUSTMENTYTD EXP VARIANCE AGAINST APPROVED BUDGET Mdantsane Roads Rehabilitation of Rural Roads Upgrade Nord Avenue Pump station Quinera Treatment Works Waste Water Treatment Capacity (Zwelitsha) Reeston Phase 3 Bulk Services Sewer Bufferstrip Sanitation - Mdantsane /2012 USDG CAPITAL EXPENDITURE: 30 JUNE

PROJECT DESCRIPTION APPROVED BUDGET BUDGET ADJUSTMENTYTD EXP VARIANCE AGAINST APPROVED BUDGET Mdantsane Sewers - Refurbishment Diversion of Amalinda and Wilsonia effluent to Reeston Augmentation of Water Treatment Capacity - Umzonyana/Raising Upper weir Inland Rural Sanitation (Dimbaza Villages,Ngxwalane and Kwalini) Eastern Beach Sewers Chemical toilets Sludge handling facility /2012 USDG CAPITAL EXPENDITURE: 30 JUNE

PROJECT DESCRIPTION APPROVED BUDGET BUDGET ADJUSTMENTYTD EXP VARIANCE AGAINST APPROVED BUDGET Winterstrand Water Supply Bulk Water Supply Newlands and other areas Augmentation of Water Treatment Capacity - Umzonyana/Raising Upper weir Ward 33 Bulk Water Supply Scheme Bulk Water Supply Coastal Areas Amahleke Relocation of Miblocks - Mdantsane /2012 USDG CAPITAL EXPENDITURE: 30 JUNE

PROJECT DESCRIPTION APPROVED BUDGET BUDGET ADJUSTMENTYTD EXP VARIANCE AGAINST APPROVED BUDGET Coastal & Midlands Infrastructure Rehabilitation of underground stormwater - Storm water Management System Rehabilitation of underground stormwater - Amalinda forest Rehabilitation of underground stormwater - Duncan village Rehabilitation of underground stormwater - West Bank /2012 USDG CAPITAL EXPENDITURE: 30 JUNE

PROJECT DESCRIPTION APPROVED BUDGET BUDGET ADJUSTMENTYTD EXP VARIANCE AGAINST APPROVED BUDGET BCM Urban Agriculture Infrastructure Development Taxi Ranks Gonubie Main Road Economic Infrastructure Fire Station - KWT Clinics Development of Community Parks(Mdantsane, Potsdam, Reeston) /2012 USDG CAPITAL EXPENDITURE: 30 JUNE

PROJECT DESCRIPTION APPROVED BUDGET BUDGET ADJUSTMENTYTD EXP VARIANCE AGAINST APPROVED BUDGET Development of 3 New Cemetries(Inland, Midland and Coastal) Scenery Park Community Hall Solid waste management Planning of designs of Third Cell Sport Facilities TOTAL /2012 USDG CAPITAL EXPENDITURE: 30 JUNE

ALIGNMENT WITH HSDG Alignment of 2012/13 to 2014/15 targets BNG Units is funded from HSDG (R126,5 million) and the internal services (R46,6 million)and other bulk infrastructure upgrade is funded from USDG (R164,6 million). 43

2012 / 2013 USDG ALLOCATION SERVICES2012/2013 CAPITAL BUDGET Water Infrastructure Waste Water Infrastructure Roads and Storm water Informal Settlement Upgrade (Internal Services) Transport Planning & Operations Waste Management Public Amenities Public Safety Support Services Economic Infrastructure TOTAL

OUTPUTIMMEDIATE RESULTS INDICATORS TARGET 2012/13 TARGET 2013/14 TARGET 2014/15 1.Roads Upgraded  Kilometres of roads built/constructed (Surfaced /Gravel) 50  Kilometres of gravel roads tarred  Kilometres of roads resurfaced (maintained) Housing programmes  Number of households upgraded (formalised) living in informal settlements with basic services such as water, sanitation 1,198 = Households 1,636 = Service sites (USDG) 214 = Service sites (HSDG) 1,783 = Households 1,910 = Service sites (USDG) 310 = Service sites (HSDG) 1,771 = Households 1,200 = Service sites (USDG) 300 = Service sites (HSDG) BCMM OUTPUTS 2012/2013 AND OUTER YEARS 45

OUTPUTIMMEDIATE RESULTS INDICATORS TARGET 2012/13 TARGET 2013/14 TARGET 2014/15 2. Housing programmes  Number of stands serviced 1,636 (USDG) 214 = Service sites (HSDG) 1,910 (USDG) 310 = Service sites (HSDG) 1,200 (USDG) 300 = Service sites (HSDG)  Number of households allocated affordable social housing units BCMM OUTPUTS 2012/2013 AND OUTER YEARS 46

BCMM OUTPUTS 2012/2013 AND OUTER YEARS OUTPUTIMMEDIATE RESULTS INDICATORS TARGET 2012/13 TARGET 2013/14 TARGET 2014/15 3. Basic services Water  Number of new households connected to basic water service  Number of new water service points (taps) installed for informal settlement dwellers 1,1981,7831,771  Number of new households (RDP)provided with water connections Sewerage  Number of new sanitation service points (toilets) installed for informal settlement dwellers  Number of new households (RDP) provided with sewer connections Electricity  Number of high mast lights installed in informal settlements 010  Number of new households (RDP) provided with electricity connections

OUTPUTIMMEDIATE RESULTS INDICATORS TARGET 2012/13 TARGET 2013/14 TARGET 2014/15 6. Refuse removal  Number of new households with access to refuse removal  Number of informal settlement dwellings with access to refuse removal Land development programme: Land availability, purchasing, acquisition, planning, servicing &titling  No of hectares of land portions identified3000  Number of title deeds transferred to eligible households BCMM OUTPUTS 2012/2013 AND OUTER YEARS 48

OUTPUTIMMEDIATE RESULTS INDICATORS TARGET 2012/13 TARGET 2013/14 TARGET 2014/15 8. Job creation  Number of jobs created using Expanded Public Works guidelines Social Facilities  Number of community halls planned/ under construction/developed Collective total  Number of parks and gardens planned/ under construction/developed. Collective total  Number of sports fields and stadia planned/ under construction/developed. Collective total  Number of community swimming pools planned/ under construction/developed 200 BCMM OUTPUTS 2012/2013 AND OUTER YEARS 49

INDICATORS FOR THE PERFORMANCE MATRIX OUTPUTIMMEDIATE RESULTS INDICATORS TARGET 2012/13 TARGET 2013/14 TARGET 2014/15 9. Social Facilities  Number of bus terminals or taxi ranks planned/ under construction/developed 399  Number of Fire safety and emergency facilities planned/ under construction/developed 111  Number of cemeteries planned/ under construction/developed

CONCLUSION In addressing the challenges raised in this presentation, the city is undertaking to implement the following recovery actions to improve its ability and capacity to spend the Grant funding: Focus on creating Integrated Sustainable Human Settlements which would include considerations as to how the metro can be made more compact; efficient and more equitable by becoming systems based institution. In the execution of the BCMM’s capital investment programme in the next five years, focus will be placed on the maintenance, land acquisition, upgrade and improvement of the infrastructural network of the Metro. 51

CONCLUSION... BCMM requires support from various key national and provincial departments to enable the successful development of sustainable human settlements for its future development trajectory. A multi year budgeting approach has been mainstreamed in our project planning for the current financial year. 52

As part of a turn around, the Metro has resolved to establish Enterprise Project Management Office (EPMO) to drive, unlock high impact projects, coordinate, support, monitor, evaluate and report on the Grant Funded Projects. CONCLUSION... 53

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