1. DEPARTMENT OF HOUSING VOTE: 29
PRESENTATION TO THE AD HOC COMMITTEE ON HOUSING
02 JUNE 2004
STRATEGIC PLAN & BUDGET
2004/05 TO 2006/07

2. Presentation Index Aim, Vision and Mission of the Department
Our Values
Our Mandates
Housing Legislation and Regulations
Our Policy Framework
Strategic overview and policy shifts
Housing environment since 1994 white paper
Challenges facing Housing
Linkages to Government Policy Priorities
Strategic Policy: Shifts
Budget overview
Conclusion

3. Department Of Housing
AIM: The aim of the Department of Housing is to determine, finance, promote, coordinate, communicate and monitor policy in respect of housing and human settlement.
Vision: A nation housed in sustainable human settlements
Mission: To establish and facilitate a sustainable process that provides equitable access to adequate housing within the context of affordability of housing, services, and access to amenities and economic opportunities

4. Our Values Our values, based on the constitution, are:
Human dignity,equality, advancement of human rights and freedom;
Non-racialism and non-sexism;
Supremacy of the constitution and the rule of law;
Accountability, responsiveness and openness.

5. Our Mandate SA CONSTITUTION
Section 26: Access to adequate housing a basic human right; Govt. to ensure environment conducive to the progressive realization of the right
Schedule 4: Housing is a concurrent national and provincial legislative function
Botshabelo Housing Accord (1994) Signed by all housing stakeholders
UN Habitat Agenda

6. Our Policy Frameworks
Our overall policy framework is determined by the White Paper on a new Housing Policy and Strategy for South Africa, 1994

7. Housing Legislation
Housing development programme continues to operate in the following legislative framework.
Housing Act 107 of 1997
Prevention of Illegal Eviction from and Unlawful Occupation of Land Act No. 19 of 1998
Housing Consumers Protection Measures Act 95 of 1998
Rental Housing Act 50 of 1999
Home Loan Mortgage Disclosure Act 63 of 2000

8. Regulations and Guidelines
National Housing Code
Sets out National Housing Policy in detail including a user friendly guide
Contains the detail prescripts pertaining to the Housing Subsidy Scheme
National Norms And Standards For Permanent Residential Structures
Sets amount of the subsidy which may be used for infrastructure and top structure
Sets the minimum size of houses

9. Regulations and Guidelines continued
Guidelines For Human Settlement Planning And Design (“Red Book”)
Planning – movement networks, transport, open space, subdivision layouts, design to reduce crime
Engineering services -stormwater, roads, water supply, sanitation, solid waste, energy
Guidelines For Environmentally Efficient Low Cost Housing
Energy and water efficient planning and design for low cost housing; and
Urban greening guidelines

10. Regulations and Guidelines continued
Regulations under the Housing Consumers Protection Measures Act, 1998
Regulations under the Home Loan and Mortgage Disclosure Act will be finalized shortly

11. Strategic Overview Housing environment since 1994 white paper
More than 1,6m houses have been built or under construction and 2,4m subsidies approved benefiting more than 6,1m people
Early focus was on quantity, rather than quality housing to address housing needs and backlogs
Focus was on development of policies and legislative instruments
Introduction of the Housing subsidy scheme consisting of seven subsidy instruments
Special subsidy dispensation for the disabled
Procurement regime compliant to constitution

12. Strategic Overview continued
Current challenges facing the housing programme  
Lack of private sector investment and resource constraints
Moving towards medium density housing as a priority and integrated development
Creating higher quality housing and living environments
Reducing dependency and promoting a culture of savings
Need for interventions to deal with emergency situations resulting from natural disasters and other incidents - Grootboom case.
Growth in number and size of informal settlements
Building capacity of municipalities to implement and manage housing projects

13. Strategic Overview continued
Current policy developments
Housing Finance - Contributions required from Government, the financial sector, and ultimate beneficiaries
Extension of the NHBRC Housing Warranty Scheme to all subsidy instruments
More emphasis on monitoring of policy impact, expenditure and delivery
More emphasis on oversight of housing institutions
Promoting of alternative and traditional/indigenous building technologies

14. Strategic Policy Shifts
Policy emphasis
Increased focus on quality and environments
Medium density integrated housing programme
Increased emphasis on PHP;
Social and rental housing;
Informal settlements upgrading;

15. Strategic Policy Shifts continued
Promotion of social responsibility, beneficiary participation and a culture of savings through:
Own contribution to access housing subsidies and the NHBRC warranty scheme
Increased emphasis on community participation and compacts
Improving access to housing credit:
Engagement in the Financial Services Charter proces;
Operationalization of Office of Disclosure

16. Strategic Policy Shifts continued
Improving human settlement environments:
Programme to main stream environmentally efficient housing;
Dissemination of good practice;
Measures to cater for needs of special groups (eg. Differently-abled, people living with HIV, elderly,youth and children, farm worker)
Emergency housing programme

17. Strategic Policy Shifts continued
Improving integration in service delivery:
Multi-year national and provincial housing development plans linked to Integrated Development Plans (IDPs)
Identification of and access to centrally located land for integrated medium density housing developments
Contributions to Urban Renewal and Integrated Rural Development Programmes
Addressing social amenities

18. Strategic Policy Shifts continued
Improving service delivery:
New demand led procurement regime;
Capacity building programmes for stakeholders, including government and industry;
Framework for the accreditation of municipalities.

19. Strategic Policy Shifts continued
Improving international cooperation on human settlement development:
Lead Ministry for UN Habitat (Habitat Agenda) – World Urban Forum, WSSD;
Cities Alliance – “cities without slums” initiative;
Supporting NEPAD regarding sustainable human settlement development in the African region is concerned;
Bi-lateral and multi-lateral cooperation programmes with donor countries.

20. Government Priorities
Housing activities are focused in the following broad Government priorities areas
Urban renewal (informal settlements upgrading, Medium Density, Social Housing)
Integrated Sustainable Rural Development - through Rural Housing policy and provision of Rural housing credit through RHLF
Black Economic Empowerment – Creation of a cadre of Housing Entrepreneurs
Engendering a culture of saving
Fast tracking delivery;
Reducing social crime and improving security;
Capacity building of all stakeholders;
Dealing with corruption and maladministration – Appointment of Investigative Task team and establishment of increased and dedicated capacity to deal with corruption

21. Priorities of incoming government
Accelerated Service delivery;
Capacity building;
Fraud, Corruption and Mal administration
Social crime prevention
Medium Density Housing

22. Budget Overview Programme 2004/05 2005/06 2006/07 1 Administration
66,833
76,737
84,896
2 Policy Planning and Research
22,139
24,634
26,112
3 Programme Management
152,477
160,437
170,063
4 Housing Sector Performance
92,240
121,878
128,923
5 Housing Equity
5,612
5,949
6,306
6 Housing Development Funding
4,509,640
4,782,448
5,067,628
Total
4,848,941
5,172,083
5,483,928
Change to baseline
277,850
323,142
311,845
Growth % 6% 7%

23. Programme 1: Administration
Programme overview
Programme 1: Administration

24. Programme Strategic Overview
Programme 1: Administration
Purpose of this Programme is to provide strategic administrative and management support services to the Department
The key strategic objectives include the following
Provision of strategic 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.

25. Budget Overview

26. Budget Overview continued
MTEF Allocation:
2004/05 – R million (Growth at 34%);
2005/06 – R million (Growth at 15%); and
2006/07 – R million (Growth at 11%).
Increases in this programme are mainly attributable to:
Transfer of previous Communication programme into programme 1
Strengthening of capacity of the office of Accounting Officer and provision of Security

27. Programme 2: Policy Planning and Research
Programme Overview
Programme 2: Policy Planning and Research

28. Programme Strategic Overview
Programme 2: Policy Planning and Research
The purpose of this programme is to develop and manage sound national human settlement and housing policies and legislative frameworks, supported by a responsive research agenda.
In addition, the programme makes a contribution to the United Nations Habitat Foundation.

29. Key Activities Over MTEF
Legislation :
Drafting of new legislation
Social Housing Bill
Amendments to current legislation
Rental Housing Amendment Bill
Housing Amendment Bill
Housing Consumers Protection Measures
Prevention of Illegal Eviction from and unlawful Occupation of Land Amendment Bill (PIE)

30. Key Activities Over MTEF
Legislation :
Drafting of Regulations under HLAMDA, and Social Housing Act
Audit of all legislation impacting on housing
Outreach programme to provincial departments and local authorities for training and monitoring of implementation of legislation

31. Key Activities Over MTEF continued
Policy Development :
Develop housing policy agenda for the next two decades
Medium Density policy
Social Housing policy and guidelines
Informal Settlement Upgrading Policy
Farm worker Housing Strategy
Housing land policy

32. Key Activities Over MTEF continued
Other :
All Africa Housing Minister’s Conference
Research :
Research projects to support policy and programme development

33. Budget overview

34. Budget overview continued
MTEF allocation
2004/05 – R million (Growth at 35%);
2005/06 – R million (Growth at 11%); and
2006/07 – R million (Growth at 6%).
2004/05 and 2005/06 increase mainly due to the creation of capacity for the Research component and restructuring within the programme and for 2006/07 it is a inflation related increase.
Fairly stable over the MTEF period.

35. Programme 3: Programme Management
Programme Overview
Programme 3: Programme Management

36. Programme Strategic Overview
Programme 3: Programme Management
The purpose of this programme is to manage national housing and human settlement programmes, including managing the national housing subsidy scheme and phasing out the housing subsidy programmes of the previous government, the Human Settlement Redevelopment programme and the presidential Pilot Projects on Rental housing, building capacity in municipalities and provinces and developing professionalism in the housing sector.

37. Key Activities Over MTEF
Manage of the implementation of the Human Settlement Redevelopment Programme and the Presidential Pilot Project on Rental Housing;
Manage of the programme for the phasing out of old business including the First Time Home Buyers Interest Subsidy Scheme;
Develop of guidelines and report for the extension of the Warranty cover to PHP and other subsidy instruments;
Produce report on outcome and lessons from implementation of the Presidential Pilot programme;

38. Key Activities Over MTEF continued
Refocus the HSRP to provide for informal settlement upgrading and the provision social amenities;
Building capacity of housing stakeholders;
Develop an appropriate housing finance course for housing functionaries;
Develop and implement a framework for the accreditation of municipalities;
Develop guidelines for the improvement of sub standard houses;
Develop enhanced/revised guidelines for the Housing Subsidy Scheme to provide for and support the EPWP;

39. Budget overview
2004/05
2005/06
2006/07
7,896
7,795
8,563
22,471
26,469
27,907
117,882
125,762
133,593
4,228
411 –
152,477
160,437
170,063
26,018
7,960
9,626
21% 5% 6%
Growth %
Medium-term expenditure estimate
Special Programmes Support
Capacity Building
R thousand
Subprogramme
Total
Change to baseline
National Housing Subsidy
Scheme
First Time Home Buyers Interest
Subsidy Scheme

40. Budget overview continued
MTEF allocation:
2004/05 – R million (Growth at 21%);
2005/06 – R million (Growth at 5%); and
2006/07 – R million (Growth at 6%).
Mainly dominated by transfer payments: 90%
Major increase conditional grant Human Settlement Redevelopment Programme
From 2004/05 :R116m; 2005/06: R122m and 2006/07: R130m
New emphasis on informal settlement upgrading will require substantial additional funds over the coming years

41. Provincial Allocation (HSRDP)
PROVINCE
2004/05
2005/06
2006/07
R`000
EASTERN CAPE
11,660
14,697
15,578
FREE STATE
9,010
10,079
10,684
GAUTENG
22,260
33,900
35,934
KWAZULU-NATAL
27,560
20,220
21,433
LIMPOPO
10,055
10,658
MPUMALANGA
7,420
8,120
8,607
NORTHERN CAPE
3,180
2,021
2,142
NORTH WEST
WESTERN CAPE
8,480
11,831
12,541
14,310
11,549
12,243
TOTAL
115,540
122,472
129,820

42. Programme 4: Housing Sector Performance
Programme Overview
Programme 4: Housing Sector Performance

43. Programme Strategic Overview
Programme 4: Housing Sector Performance
The purpose of this programme is to monitor the performance and assess the impact of housing delivery, manage housing information; monitor and analyse the impact of government’s housing policy and programmes on the construction sector, the financial sector and the economy, and support housing institutions.

44. Key Activities Over MTEF
Monitoring the implementation of housing policy & programmes
Monitoring the performance of Housing Support Institutions
assessment of impact of impact of policy and pragrammes
Monitor identified economic and financial variables as well as Construction Industry trends & reciprocal impacts
Maintenance of Housing information systems.

45. Budget overview
2004/05
2005/06
2006/07
5,794
6,577
6,749
24,427
27,031
29,658
4,781
5,681
5,450
1,689
2,020
1,963
55,549
80,569
85,103
92,240
121,878
128,923 69
29,638
7,045 0%
32% 6%
Medium-term expenditure estimate
Growth %
Change to baseline
Total
Contributions to Housing institutions
Housing Institutions monitoring
Industry Analysis and
Development Finance
Information Management
Policy and Programme
Monitoring
Subprogramme
R thousand

46. Budget overview continued
MTEF allocation
2004/05 – R million;
2005/06 – R million (Growth at 32%); and
2006/07 – R million (Growth at 6%).
Average increase of 13% over the MTEF
Mainly as a result of increases in allocation to SERVCON in the 2005/06 financial year as a result of SERVCON concluding its work
2006/07 increase is mainly inflation related

47. Programme 5: Housing Equity
Programme Overview
Programme 5: Housing Equity

48. Programme Strategic Overview
Programme 5: Housing Equity
Housing Equity aims to eradicate discrimination and unfair practices to do with access to housing finance, by implementing and administering the Home Loan and Mortgage Disclosure Act and its regulations

49. Key Activities Over MTEF
Establishment of a fully functional Office
Receipt, analysis and interpretation of home loan data disclosed by financial institutions to identify any possible discriminatory lending patterns.
Utilize legislative framework to ensure achievement of fair lending practices
Take steps to achieve equitable access of home loans to all

50. Key Activities Over MTEF continued
To support the achievement of an effective housing market
Management of relationship between the financial institutions and the Department
Monitor achievements of financial institutions relative to the Financial Sector Charter
Capacity of all stakeholders

51. Budget overview

52. Budget overview continued
MTEF allocation:
2004/05 – R5 612 million (Growth at 5%);
2005/06 – R5 949 million (Growth at 6%); and
2006/07 – R6 306 million (Growth at 6%).
Average increase of 6% over MTEF

53. Programme 6: Housing Development Funding
Programme Overview
Programme 6: Housing Development Funding

54. Programme Strategic Overview
Programme 6: Housing Development Funding
The purpose of this programme is to managed the funding of national housing programmes;
Consist mainly of Transfer payments to provinces in terms of DORA,2004 as conditional grants;
Consist of personnel and admin related costs for the monitoring of compliance to DORA;
Provides also for payments related to repayment of loans and interest that were raised by the former Housing Boards;

55. Programme Strategic Overview
Allocation of funds to provinces is based on the Housing Allocation Formula that was approved in 2001;
The formula takes into account needs of each province as measured by the housing backlog;
takes into account factors such as homelessness, shack dwelling, caravan dwelling, tents, backrooms, rooms in flats;
A poverty indicator measured by households earning less than R3,500 in each province;
Population share factor as measured by each province’s share of total population.

56. Budget overview

57. Budget overview continued
MTEF allocation:
2004/05 – R5 612 million (Growth at 5%);
2005/06 – R5 949 million (Growth at 6%); and
2006/07 – R6 306 million (Growth at 6%).
Average increase of 6% over MTEF

58. Provincial Allocations (SAHF)
PROVINCE
2004/05
2005/06
2006/07
R`000
EASTERN CAPE
598,900
569,448
603,615
FREE STATE
385,641
390,547
413,980
GAUTENG
1,117,463
1,313,528
1,392,340
KWAZULU-NATAL
748,463
783,466
830,474
LIMPOPO
369,818
389,598
412,974
MPUMALANGA
296,457
314,620
333,497
NORTHERN CAPE
89,442
78,299
82,997
NORTH WEST
WESTERN CAPE
421,378
458,406
485,910
446,035
447,492
474,341
TOTAL
4,473,597
4,745,404
5,030,128

59. Provincial Performance

60. Analysis of Transfer Payments

61. Conclusion
Need to improve access to housing credit by the low income group therefore outcomes of the Financial Services Charter on Housing are crucial;
Need to address dysfunctional secondary low cost housing market;
Need for more communication with beneficiaries;

62. Conclusion continued
Addressing unresolved housing land issues through the policy development process;
Addressing the Housing backlog – additional financial implications;
Improvement in delivery capacity;
New Informal Settlement Upgrading Programme and Social Housing – additional funding.

63. Thank You