1. Presented By Ms MB MONAMA 24 NOVEMBER 2006
PUBLIC HEARING ON CONDITIONAL GRANTS AND CAPITAL EXPENDITURE – 2nd QUARTER 2006/2007
Presented By Ms MB MONAMA
24 NOVEMBER 2006

2. CONTENT Departmental priorities till 2008/9
Data trends, allocations and expenditure
Budget Allocations
Second Quarter Expenditure Profile
MTEF Budget Allocation
Overview of the organisational environment
Constraints hampering delivery
Interventions to deal with challenges
Monitoring and Evaluation
Conclusion

3. DEPARTMENTAL PRIORITIES TILL 2008/9
The Department of Housing has refocused its plan and the following has been prioritised
Formalisation and Eradication of Informal Settlement
Development of Social and Mixed Income Settlements
Regeneration of Twenty Old established Townships
Affordable Rental Accommodation
Urban Regeneration

4. DEPARTMENTAL PRIORITIES TILL 2008/9 (Cont)
This will be achieved through:
Fast tracking of top structure delivery
Provision of Housing in targeted areas in line with Growth and Development Strategy and Global City Region approach.
Renewal of 20 prioritised townships
Social Housing program to be refocused to include affordable rental – low and middle income earners
Job Creation through housing development
SMME/ BBBEE - Empowerment and Participation

5. Planned Transfers 2nd Quarter Actual Expenditure 2nd Quarter
Trend in Allocations, Transfers and Actual Expenditure i.r.o. Conditional Grant
Name of Conditional Grant
Amount Transferred 2005/06
R’000
Planned Transfers 2006/07
Planned Transfers 2nd Quarter
Actual Transfers
2nd Quarter
Actual Expenditure 2nd Quarter
R'000
% Deviation from target
Housing Fund
1,117,463
1,757,666
510,822
468,644
-8%
Human Settlement
30,353 0%
Land Distribution: Alexandra
6,335
8,000
TOTAL
1,154,151
1,765,666

6. Trend in Allocations, Transfers and Actual Expenditure i. r. o
Trend in Allocations, Transfers and Actual Expenditure i.r.o. Conditional Grant
Name of Conditional Grant
Planned Transfers 2006/07
R’000
Planned
Transfers
2nd Quarter
Actual
Expenditure
R'000
% Deviation from target
Housing Fund
1,757,666
510,822
468,644
-8%
Land Distribution: Alexandra
8,000 0%
TOTAL
1,765,666

7. YEAR TO DATE EXPENDITURE
Programmes Payments
Audited 2005/06 R’000
Projected Payments 2006/07 (R’000)
Projected Payments 2nd quarter (R’000)
Actual Payments 2nd quarter (R’000)
% Deviation from target
Administration
78.017
74,918
20 727
28 727
138%
Housing Planning and Research
7,513
10,284
2 486
2 004
81%
Housing Performance/ Subsidy Programme
1,195,267
1,550,152
99,9%
Urban Renewal and Housing Settlement Redevelopment
326,992
380,630
92 625
44 543
48%
Housing Asset management
65,513
65,478
16 206
61 029
499,9%
Total
1,673,302
2.081,462
100,7%

8. Conditional Grant/s and Capital Expenditure
Data on trends in allocations, transfers and actual expenditure of conditional grants and capital expenditure of the Department as well as a brief assessment on this departments monitoring capacity for the financial year: 2006/07 is captured in the next few slides i.t.o. a tabular format.

9. BUDGET ALLOCATION (2006/2007) Particulars Amount R’000 Total
Particulars of the financial resources available funding of the activities of the Department are summarized in the Table hereunder:
Particulars
Amount
R’000
Total
Integrated Housing and Human Settlement Conditional Grant [Note 1]
Provincial Allocation for Urban Renewal [Note 2]
Administration [Note 3]
Goods, Services & Machinery [Note 4]
87 150
37 146
Total : IHHSCG, Dedicated & Operational Budget

10. BUDGET ALLOCATION (2006/2007) cont.
Note 1: This represents the capital allocation to the Gauteng Housing Department in terms of the Division of Revenue Act [DORA] for the funding of the implementation of National Housing Programmes and Provincial Housing consistent therewith
Note 2: This is an allocation from the Provincial Revenue Funds towards the funding of the Urban Renewal Programme in Gauteng Province.
• Note 3: An allocation with the Operational Budget of the Department for the funding of compensation of employees during the 2006/07 financial year.
Note 4: The available funding for expenditure in terms of Goods & Services with the Operational Budget of the Department.

11. Second Quarter Expenditure Profile: 2006/2007
Conditional Grant
GRANT
BUDGET
Projected Expenditure
Actual Expenditure
Variance
Integrated Housing and Human Settlement Development
1,757,666
510,822
468,644
42,178

12. Second Quarter Expenditure Profile: 2006/2007 cont.
Current and Capital Expenditure
Economic Classification
Budget
Projected Expenditure
Actual Expenditure
Variance
Compensation of employees
93,378
24,215
24,055
160
Goods and Services
32,700
7,907
11,749
-3,842
Buildings and other fixed structures
53,925
13,580
8,977
4,603
Machinery and equipment
4,446
2,077
302
1,775
184,449
47,779
45,083
2,696

13. Second Quarter Expenditure Profile: 2006/2007 cont.
Urban Renewal
GRANT
BUDGET
Projected Expenditure
Actual Expenditure
Variance
Urban Renewal
369,433
89,787
42,930
46,857
Payments made for projects that concerned previous financial year

14. Service Delivery Statistics for the 2nd Quarter of the2006/07 Financial Year
Programme
Unit of Measure
Projected
Actual delivery
Essential Services
Houses -
693
Stands
3,287
10, 433
PHP / CBP
1,935
450
Project Linked
1, 340
2.573
4,627
4,155
Individual
877
112
Relocation assistance 17 7
Upgrading of Hostels
Beds
1.100
264
TOTAL
STANDS
5,521
13,125
HOUSES
7,403
5,417
BEDS
18,697
2 790
Institutional Subsidies
units
605

15. Reasons for Variance
A deliberation of the reasons for the variance in expenditure in comparison the allocation In terms of DORA is as follows:
Certified Claims to the value of R 32 million for work completed during and prior to 30 September 2006 could not be paid in time and had to be effected in October 2006 of which should have been accounted for in terms of actual expenditure incurred during the 2nd Quarter.
Similarly, an amount of R30 Million of which was accounted for during the seconded quarter of which relate to the 1st quarter.

16. Payment Summary – MTEF Baseline 07/10
Medium-Term Estimates
PROGRAMME
 2007/08
 2008/09
 2009/10
1. Administration
84,595
91,770
2. Housing Planning and Research
12,432
12,154
3. Housing Development Implementation
2,361,356
2,562,652
4. Housing Property Management
62,149
61,869
Total Programmers
2,520,532
2,728,445
Economic Classification
Compensation of Employees
127,513
134,366
Goods & Services
39,573
44,369
Households
2,387,223
2,589,079
Machinery & Equipment
5,796
5,000
Total

17. Overview of the organisational environment
During the second quarter the Department implemented it’s revised organisational structure.
The implementation of it’s Regional Offices took effect in terms of negotiations around the office accommodation and other related infrastructure requirements, had taken place.
The Department has rearranged its expenditure management processes and delegations have been finalised.
Newly appointed Professional Resource Teams (PRT’s) to replace the Regional Professional Team’s whose contract ended on the 30th of June 2006 had been finalised.
Regrouping of established developers and improve on the procurement system.
The Department also appointed contractors on the procurement rooster who will assist in implementing projects. The contractors have been appointed in two categories which are the established and emerging contractors

18. Constraints hampering delivery
Submission of insufficient information and supporting documents for payments
Fast track the enrolment of projects with NHBRC
Improvement of contract management processes
Submission of trench payments by Municipalities on quarterly basis.
Improvement of house inspections by the Department and Municipal inspectors
Improvement of quality as well as meeting specified targets by contractors and developers.
Slow pace of delivery by emerging developers
Inability to provide guarantees by appointed developers and contractors within specified time frames
Dealing with illegal land and buildings invasions
Inability of municipalities to implement by Laws to deal with erection of illegal structures in newly built subsidized houses.

19. Interventions to deal with challenges
Established a task team with NHBRC to deal with approvals – change information on weekly basis on all projects submitted and feedback on those approves and not approved.
Established an Inspectorate within department to deal with quality issues as well as inspecting of houses regularly
Established working protocols between department, municipalities and NHBRC inspectors to coordinate and manage inspections process
Regular site visits by Project Managers and Senior Managers to deal with identified challenges per project
Provided professional support to emerging developers to be mentored
Simplified payment process drafted and improvement now realised
Interaction with Executive Directors of Housing to agree on payment processes and service delivery improvement mechanisms for each Municipality.
Executive Management monitoring projects and able to shift budget on slow project in favor of those best performing.

20. Monitoring and Evaluation
A Monitoring and Evaluation Unit has been established to evaluating progress in the implementation of the strategy against the targets set.
It will further recommend intervention mechanisms in areas where there is little or no progress.
A draft monitoring and evaluation framework has been developed and will be finalised by end of financial year 2006/07.
Departments submits various reports as prescribed by the PMFA to various institutions such as Provincial Treasury and Legislature.

21. Conclusion
Our delivery processes are starting to yield results and there's hope amongst communities that government is addressing housing their needs.
We are putting proper plans and re-prioritizing our approach that must always adhere to the principles of the Breaking New Ground policy.
Better coordination with municipalities and developers
Improved management and monitoring systems within the Department
Department providing leadership and guidance in all aspects of housing development
Political support from all spheres of govrnment

22. THANK YOU