1. SOCIAL HOUSING REGULATORY AUTHORITY’S ANNUAL REPORT 2015-16
Presentation to the Portfolio Committee

2. Table of Contents Foreword by the Chairperson
Chief Executive Officer’s Overview
Performance of the SHRA
Achievement towards the MTSF Target
Accredited Entities per Province
Social Housing Delivery Per Province
Highlights of the Period
Annual Financial Statements
External Auditor’s Report
Irregular Expenditure
Financial Statements
Upscaling Social Housing Delivery

3. Foreword by the Chairperson
One of the key milestones in the period under review was the appointment of a Chief Executive Officer (CEO). This position had been vacant for just over two years and the filling of this vacancy was of critical significance to the entity and sector as a whole. After a rigorous recruitment process, a new CEO was appointed and commenced work at the SHRA on 1 February 2016.

4. Chief Executive Officer’s Overview
Planning for the turnaround of the entity commenced, greater impact is expected in 2016/17.
Chief Executive Officer’s Overview
The resultant performance of the entity against the predetermined objectives at the close of the period was a promising 55%.

5. Performance of the SHRA
Achievement towards MTSF target
The Medium Term Strategic Framework (MTSF) target for the SHRA is the delivery of 27,000 social housing units by 2019.

6. Performance of the SHRA
Accredited Entities per Province
Province
No. of accredited SHIs
No. of pre-accredited SHIs
Eastern Cape 9 2
Free State 1 -
Gauteng 19 4
KZN 6 3
Limpopo
Mpumalanga
North West
Northern Cape
Western Cape 8
TOTAL 49 12

7. Performance of the SHRA
Social Housing Delivery per Province
Province
MTSF target
Actual Delivery in MTSF period
% achievement
Eastern Cape
1 960
518
26%
Free State
1 935
696
36%
Gauteng
9 905
1846
19%
KZN
3 086
1143
37%
Limpopo
1 050 0%
Mpumalanga
1 545
104 7%
North West
565
Northern Cape
2 850
Western Cape
4 108
800
TOTAL
27 004
5 107

8. Highlights of the period

9. Fairview Link
Fairview Link Project in Nelson Mandela Bay won the Govan Mbeki Award for the Best Social Housing Project

10. Breaking New Ground Episode showcasing Social Housing
George Stokes, a pensioner, was born in Fairview but his family were forcibly removed under the Group Areas Act. He has now returned to the area.

11. Breaking New Ground Episode showcasing Social Housing
Francois van Heerden is a resident of Walmer Link (also in Nelson Mandela Bay) and is visually impaired. He works in the area and is raising his young family in the estate.

12. Annual financial statements

13. External Auditor’s Report
Audit opinion
Unqualified
Emphasis of matter
Going Concern (not qualified) - the Minister’s pronouncement in 2014 about the SHRA being placed under Administration however since that time a new Council has been appointed and the entity anticipates its continued operation for the foreseeable future.
Compliance with laws and regulations
Material findings in respect of expenditure management - the entity did not take effective steps to prevent irregular expenditure
Predetermined objectives
Material findings on the reliability of the reported performance against the predetermined objectives of the Investment Management Programme.

14. Irregular Expenditure
In terms of the Social Housing Act, No. 16 of 2008, the Council must consist of between seven and twelve non-executive members. During March 2014 to February 2015 and March 2015, the Council only comprised of six and five members respectively. Decisions taken by the Council during this period have been rendered invalid and the new Council was required to remedy these. The Council have since condoned this irregular expenditure.
There was no fruitless and wasteful expenditure during the period under review.

15. Statement of Financial Position

16. Statement of Financial Performance

17. Cash flow Statement

18. Statement of Changes in Net Assets

19. Upscaling social housing delivery
Province
No. of Accredited SHIs
Units delivered up to end of 1st Quarter 2016/17
No. of units under construction / approved for RCG
TOTAL
Eastern Cape 9
568
2955
3523
Free State 1
763
292
1055
Gauteng 19
1986
3906
5892
KZN 6
1263
1720
2983
Limpopo -
Mpumalanga 4
104
North West
2545
Northern Cape
Western Cape 8
880
1087
1967
5564
12505
18069

20. Upscaling social housing delivery
Issue
Planned interventions
Limited number of units each accredited SHI can take on board each year
Investigating alternative methods to target private sector involvement, possible PPP
Intergovernmental arrangements to support social housing delivery
Including Provinces and NHFC in Technical Evaluation Committee meetings whereby RCG applications are assessed. Need to ensure Provinces cascade their delivery targets to Metros and other Local Authorities.
Viability of financing model for social housing
Currently refurbishments are to be targeted until such time as the viability of the model has been researched and proposals tabled.

21. Northern Cape
No projects have been submitted to the pipeline from the Northern Cape;
There is 1 accredited SHI in the Northern Cape, South African Swedish International Housing Company (previously Sol Plaatjie) which manages 123 units; and
This is an SHI in distress, the SHRA met with them in August 2016, and plans on intervening.

22. Thank you