1. DEPARTMENT OF HOUSING PRESENTATION TO THE PORTFOLIO COMMITTEE FOR HOUSING - 2005 BUDGET 2005/06 TO 2007/08

2. STRUCTURE OF THE PRESENTATION 1.Budget overview 2. Key activities and Budget per Programme 3.Conclusion

3. BUDGET OVERVIEW Programme2005/062006/072007/08 1 Administration83,73792,24697,948 2 Policy Planning and Research 24,63426,11227,418 3 Programme Management95,06169,89396,887 4 Housing Sector Performance 130,607190,258211,620 5 Housing Equity5,9496,3066,621 6 Housing Development Funding 4,851,7245,668,6486,927,081 Total 5,191,7126,053,4637,367,575 Net Increase to baseline 19,629569,5351,609,451

4. BUDGET OVERVIEW

5. Additional funding: –R50 million in 2005/06 for institutional reform, capacity building and accreditation activities –Decrease of R28,8m as a result of transfer of Loans for the previous Housing Boards –R600 million in 2006/07 (R500 million for various aspects of the new plan, R50 million for institutional reform and capacity building and R50 million for finalising the portfolio of Servcon Housing Solutions) –R1,6 billion 2007/08 (R1,5 billion for various aspects of the new plan, R80 million for institutional reform, capacity building and accreditation activities, and R60 million for Servcon).

6. BUDGET OVERVIEW

8. PROG 1: ADMINISTRATION

9. BUDGET SUMMARY

11. PROG 1: ADMINISTRATION Purpose is to provide strategic leadership and administrative and management support services to the department. Promote and facilitate the flow of information between the department and its stakeholders. The key strategic objectives include the following –Provision of strategic corporate communication services to all stakeholders; –Provision of Strategic Financial Management Services; –Provision of Corporate Services (such as HRM, Transport, Security and IT) to ensure corporate efficiently; –Provision of strategic support services for the Minister and Accounting Officer; –Implementation of the department's anti corruption initiative and investigative programme.

12. BUDGET OVERVIEW MTEF Allocation: –2005/06 – R83,737,000; –2006/07 – R92,246,000; and –2007/08 – R97,948,000. A real average increase over the MTEF at 7,3 % Increase over MTEF mainly as a result of the increase in staff component for enhanced service delivery and aligning of functions to strategic objectives This include the expansion of the Director-General office and the creation of security function.

13. PROG 2: POLICY PLANNING AND RESEARCH

14. PURPOSE To develop sound national human settlement and housing policies, supported by research and underpinned by an appropriate legislative framework

15. Key Measurable Objectives Develop and manage sustainable human settlement policy Promote and maintain human settlement integration Establish effective national housing policy and strategy Develop, coordinate and monitor the implementation of housing framework legislation

16. STRUCTURE Human Settlement Policy and Integration focuses on sustainable urban and rural human settlement development policy and is responsible for international cooperation on human settlement policy. National Housing Policy and Strategy develops national housing policy and strategies. It also maintains the national housing code, manages the integrated multi-year housing development plans, and guides the design of appropriate institutional frameworks for implementing housing policy and strategy.

17. STRUCTURE Housing Framework Legislation drafts housing legislation required to implement approved policy and strategies monitors the implementation of housing legislation and assesses the impact of other legislation on the housing function.

18. BUDGET SUMMARY

20. KEY ACTIVITIES OVER MTEF HUMAN SETTLEMENT POLICY AND INTEGRATION: Housing land policy – Dec 2005 Guidelines for farm worker housing – July 2005 Densification, integration and inner city renewal programme – Sept 2005 Aligning IDPs and housing sector plans – July 2005 Energy efficient housing – July 2005

21. KEY ACTIVITIES OVER MTEF NATIONAL HOUSING POLICY AND STRATEGY: Special Housing needs assistance policy – April 2006 Medium density housing policy investigation – July 2005 Developing guidelines for sustainable housing development – by revising the National Housing Code – October 2005 Revisit rural subsidy programme – April 2006 Back yard rental policy intervention – April 2006 Guidelines for informal settlement pilot projects – June 2005 New housing typologies and designs – April 2006

22. KEY ACTIVITIES OVER MTEF FRAMEWORK LEGISLATION : Social Housing Act – Dec 2005 Regulations to the Social Housing Act – Feb 2006 Less Formal Township Establishment Act – Dec 2005

23. KEY ACTIVITIES OVER MTEF FRAMEWORK LEGISLATION : Amendments to various Acts administered by the Department in accordance with need and in order to achieve the following:- - An efficient and implementable Housing Act that complies with DORA and PFMA – Dec 2005 -An equitable PIE Act that is constitutional and unambiguous and allows for the orderly eviction of unlawful occupiers – August 2005 -An efficient Housing Consumers Protection Measures Act that is unambiguous and serves the interests of housing consumers – Dec 2005 -An efficient and implementable Rental Housing Act that gives Rental Housing Tribunals the power to enforce their rulings – April 2006

24. CHIEF DIRECTORATE RESEARCH The Research sub-programme initiates, undertakes and manages research on human settlements and housing.

25. STRATEGIC OBJECTIVE RESEARCH To establish internal and external research networks and foster a research culture within the Department to progressively improve the relevance, alignment, quality, and usefulness of research activities so that the Department is able to maintain a leading role in national, and international, debates around human settlements and influence practice to more efficiently and effectively fulfil the housing mandate.

26. KEY ACTIVITIES OVER MTEF PRODUCE RESEARCH ON: –Informal settlement upgrading and support –Promoting alternative technologies and improved housing design –Level of socio-economic and ethnic integration in SA –International experience in densification and integration Holding of an international research seminar on Human Settlements – Mid 2005

27. PROG 3: PROGRAMME MANAGEMENT

28. PROGRAMME 3 : PROGRAMME MANAGEMENT Purpose –Manage National Housing and Human Settlement Programmes to enable, support and promote the implementation of projects Measurable Objectives –Increase access to and improve the delivery of adequate housing in sustainable Human Settlements by effectively providing officials, structures and systems with knowledge, skills, guidance and funding

29. BUDGET SUMMARY

31. BUDGET OVERVIEW MTEF allocation: –2005/06 – R95,061,000; –2006/07 – R69,893,000; and –2007/08 – R96,887,000. Reason for fluctuation over MTEF is due to the integration of the Human Settlement Redevelopment Programme grant into the Integrated Housing and Human Settlement Development Grant. Commitments on projects for 2005/06 amounts to R24,395,000 Additional funding for capacity building

32. KEY DELIVERABLES : 2005/06 “OLD BUSINESS” – Enhanced Phasing Out Programme (March 2006) –First Time Home Buyers Interest Subsidy Scheme (Monthly) –NHBRC Warranty Cover (October 2005) –Human Settlement Redevelopment Programme (Monthly) –Presidential Pilot Project on Rental Housing (Monthly/Ongoing)

33. OLD BUSINESS (CONT) –Housing Professional Body (Dec 2005) –Housing Practitioners Skills Audit (Oct 2005) –Consumer Education (Roll-out : May 2005) – Housing Policy Workshops/seminars (Continuously) – Accredited train-the-trainer programme (March 2006) –Housing Education and Training Standards (March 2006)

34. “NEW BUSINESS” New Procurement Regime (Oct 2005) Rural Housing enhancement (Dec 2005) Guidelines for new subsidy bands (Dec 2005) Accreditation : Framework and Promotion (Ongoing) EPWP : Regulating Framework (Completed) Rectification of houses : pre/post 1994 (Post : completed) (Pre- Oct 2005)

35. NEW BUSINESS (CONT) HIV/AIDS assistance programme (March 2005) New Hostels Programme (Dec 2005) Farmworker Housing guidelines (March 2005) New PHP guidelines (Nov 2005) Guidelines for a phased development approach (Oct 2005) Framework for social/econ amenities (Completed) Alignment of infrastructure policy (Ongoing with sector Depts)

36. NEW BUSINESS (CONT) Training Programme for Accreditation (Ongoing) Social/Econ facilities training/awareness (June 2005) Informal Settlement Capacity building (Ongoing) Roll out of Consumer Education Strategy (May 2005) Training/Capacity Building Programmes –Social Housing (May 2005) –Phasing Out (March 2006) –Procurement (Jan 2006)

37. PROVINCIAL ALLOCATION (HSRDP) PROVINCE 2005/06 R`000 EASTERN CAPE FREE STATE9,475 GAUTENG4,129 KWAZULU-NATAL LIMPOPO1,418 MPUMALANGA NORTHERN CAPE NORTH WEST WESTERN CAPE 9,373 TOTAL24,395

38. PROG 4: HOUSING SECTOR PERFORMANCE

39. Purpose: –Monitor the performance and assesses the impact of housing delivery, manages housing information, and monitors and analyses the impact of government’s housing policy and programmes on the construction sector, the financial sector and the economy, and the housing institutions.

40. STRATEGIC OBJECTIVE To monitor, evaluate and assess: –The implementation, performance and impact of Government’s national housing programmes; –The impact th1ereof on the construction sector; –The oversight management of the Housing Support Institutions; and –The provision of IT systems and its management in relation to the distribution of housing subsidies

41. STRUCTURE There are five subprogrammes: –Policy and Programme Monitoring assesses the implementation of national housing policy and programmes, and the impact of these on beneficiaries, the environment and the roles of the three spheres of government. –Information Management maintains national housing databases and information systems. –Industry Analysis and Development Finance monitors and analyses the impact of government’s housing policy and programmes on the construction sector, the financial sector and the economy. –Housing Institutions monitors the performance of the following housing institutions: National Housing Finance Corporation, Servcon Housing Solutions (Pty) Ltd, Peoples’ Housing Partnership Trust, Social Housing Foundation, National Home Builders’ Registration Council, Thubelisha Homes, National Urban reconstruction and Housing Agency, and the Rural Housing Loan Fund.

42. SUB PROG : INFORMATION MANAGEMENT Strategic Objective: To provide human settlement information to support Government’s housing provision process Deliverables MTEF: –Manage and maintain housing information systems –(HSS, HUIS, NHSDB); (4 quarterly reports) –Maintains an effective library and Information resource centre; –Implement the IT infrastructure required to link DOH and PHD with accredited Metropolitans and and municipalities –Maintain highest data quality to ensure accuracy of reporting and data usage.

43. SUB PROG : POLICY AND PROGRAMME MONITORING Strategic Objective: To monitor, evaluate and assess the implementation, progress and impact of national as well as entrepreneurial development and job creation programmes Deliverables MTEF: –Develop monitoring, evaluation and impact assessment system based on the BNG; (4 reports) –Maintain regular publications of housing delivery information to advise all stakeholders in housing; (4 publication per issue p.a) –Provide direct oversight of project implementation at Provincial and local levels, through regular deployment of staff. (continuous) –Attend to all beneficiary/ community concerns about implementation of projects, and other housing related problems experienced by citizens (continuous)

44. SUB PROG : INDUSTRY ANALYSIS Strategic Objective : To monitor and evaluate Government’s programmes in the construction sector, accessibility of development finance and impact of economic indicators Deliverables MTEF: –Effective monitoring of the construction sector, quality of houses, alternative building technologies and capacity; –Monitor and evaluate the housing finance sector, effectiveness of housing finance products and the impact of the economy on the housing sector; –Liaise with all major industry player and material suppliers

45. SUB PROG : HOUSING INSTITUTIONS –Monitor the performance of Housing Support Institutions against the BNG Housing Plan, founding mandates and products offered –Ensure that all institution do submit budgets for approval by Minister not alter than October of each financial year in line with PFMA (October 2005) –Ensure that all institution do submit Corporate Plans for approval by Minister not later than March of each financial year in line with PFMA (March 2006) –Ensure that all institution operate within approved business –Ensure that all four reports from institutions are submitted to Minister (June ’05, September ’05, December ’05, March ’06)

46. BUDGET SUMMARY

48. BUDGET OVERVIEW MTEF allocation –2005/06 – R130,607,000; –2006/07 – R190,258,000; and –2007/08 – R211,620,000 million. Average increase of 22% over the MTEF Mainly as a result of increases in allocation to SERVCON as a result of SERVCON concluding its work. Fairly stable over MTEF period

49. PROG 5: HOUSING EQUITY

50. Purpose: –To promote and support the creation of a properly functioning single residential property market

51. BUDGET SUMMARY

52. BUDGET OVERVIEW MTEF allocation: –2005/06 – R5,949,000; –2006/07 – R6,306,000; and –2007/08 – R6,621,000. Average increase of 5% over MTEF

53. STRATEGIC OBJECTIVES To promote transformation in financial services associated with housing finance to low to medium income households; To facilitate and ensure the availability and accessibility of affordable housing finance instruments/products and savings schemes to low to medium income households.

54. STRATEGIC OBJECTIVES ( continued ) To identify possible discriminatory lending patterns in housing finance to low to medium income households by implementing the Home Loan and Mortgage Disclosure Act. To monitor that financial institutions meet the targets they set in terms of the financial services sector charter.

55. MEASURABLE OBJECTIVES Engage with financial institutions to : –ensure that they transform the way in which they engage with the target market ( immediate and on-going ) –develop affordable housing finance instruments ( 31 st December 2005 ) –Explore risk sharing mechanisms to enable mobilising credit at scale ( 31 st December 2005 ) –Identify and resolve impediments to a properly functioning property market ( immediate and on-going ) –ensure appropriate consumer education programmes (31 st August 2005 ) –ensure expanding points of representation ( 31 st December 2005 )

56. MEASURABLE OBJECTIVES ( continued ) finalise and gazette regulations to implement the Home Loan and Mortgage Disclosure Act (31 th August 2005); receive, capture & analyse information disclosed by financial institutions (31 st December 2005); submit annual reports to Minister and other stakeholders. (31 st March 2006 )

57. PROG 6: HOUSING DEVELOPMENT FUNDING

58. Housing Development Funding manages the funding of national housing programmes. The programme comprises three sub-programmes: –Fund Management administers payments of the conditional grant to provinces. –Integrated Housing and Human Settlement Development Grant reflects the conditional grant allocation that is transferred to provinces –Interest and Redemption on Private Loans administered the interest payments on liabilities held by the National Housing Development Board and the SA Housing Trust, all of which have been transferred to National Treasury.

59. BUDGET SUMMARY

61. BUDGET OVERVIEW MTEF allocation: –2005/06 – R4,851,724,000; –2006/07 – R5,668,648,000; and –2007/08 – R6,927,081,000. Accounts for the bulk of the department’s expenditure Average increase of 15,6% over MTEF

62. BUDGET OVERVIEW The Integrated Housing and Human Settlement Development Grant is the amalgamation of aspects of the Human Settlement Redevelopment (which previously fell under Programme Management) the previous Housing Subsidy conditional grants; To accommodate the funding required for implementing the new comprehensive plan for the development of sustainable human settlements; Will in the first year fund the current business and new pilot projects across the country;

63. KEY ACTIVITIES OVER MTEF Transfer of funds according to payment schedule; Monitoring of expenditure on provincial & local authority level; Amending Housing subsidy grant framework; To provide a effective and efficient debtor system.

64. PROVINCIAL ALLOCATIONS (IHHSDG) PROVINCE 2005/062006/072007/08 R`000 EASTERN CAPE581,218679,194 830,154 FREE STATE398,618465,814 569,347 GAUTENG1,340,6761,566,674 1,914,887 KWAZULU-NATAL799,659934,457 1,142,153 LIMPOPO397,650464,682 567,963 MPUMALANGA321,123375,255 458,660 NORTHERN CAPE79,91793,389 114,146 NORTH WEST467,880546,751 668,274 WESTERN CAPE456,740533,733652,362 TOTAL4,843,4815,659,9486,917,946

65. THANK YOU