1. DEPARTMENT OF HUMAN SETTLEMENTS ANNUAL PERFORMANCE REPORT FOR THE PORTFOLIO COMMITTEE FINANCIAL YEAR 2013/14 DIRECTOR-GENERAL: T ZULU

2. STRUCTURE OF THE PRESENTATION
Overview of Departmental Performance (April 2013 – March 2014
Performance of the National Department as per Approved Annual Performance Plans 2013/14
Departmental Expenditure vs Performance (Targets/Outcomes)
HS Sector Performance
4.1 Communication and Outreach key
4.2 Delivery Agreement (Outcome 8)
4.3 Job Creation
4.4 Accreditation of Municipalities
5. Financial issues
Responses to Audited Outcomes / Action Plan

3. Overview of Departmental Performance (April 2013 – March 2014)
The 2013/14 financial year marks the coming of age of the South African Democracy. While on the other hand it marks the ongoing process of government’s efforts to provide shelter as a socio-economic right.
Provinces as guided by the National Department, embraced principles of integrated planning, project implementation and synergy in deploying funding. Through collaboration and coordination, Provinces as delivery agents were brought in the outcomes based approach as they discharge their responsibilities to change the Human Settlements space.
The department has also revised the finance linked individual subsidy programme to improve the ability of households in the income category R3 501-R to access mortgage finance for housing thus increasing access to housing finance and the provision of shelter and basic services

4. Overview of Departmental Performance (April 2013 – March 2014)
Engagements were held with the private sectors such as Pathfinder Development Company as well as employers such as Harmony Golden to encourage investments and encourage access to affordable housing finance.
The NSPU planned to monitor 144 Municipal Infrastructure Grant (MIG) projects and a total number of 152 MIG projects were monitored across 9 Provinces
The RHIG Business Plans were received from 24 benefitting municipalities and funds were transferred to municipalities to implement RHIG.
The management of the Urban Settlement Grant continued to receive attention in the devolution of powers to the local sphere of government.
South Africa is a prominent member of UN HABITAT and continues to advocate and play an instrumental role for the support of human settlements programmes in Africa.

5. Overview of Departmental Performance (April 2013 – March 2014)
The Department of Human Settlements hosted a delegation from Angola’s Ministry of Construction in March 2014.South African and Angola signed a Memorandum of Understanding (MoU) on Co-operation in the field of Human Settlements
The Rental Housing Amendment Bill, 2014 has been formally introduced into Parliament on the 20th November 2013, and subsequently referred to the Portfolio Committee on Human Settlements for deliberations
New Policy for Backyard Rental Programme was developed and approved by Task Team
The CRU policy was adjusted in regard to the grant quantum levels.
The Department embarked on filling all the vacant positions to address the challenge of skills. The strengthening of inward and capacity development initiatives is aimed to achieve the mandate of the department of human settlements.

6. Performance of the National Department as per Approved Annual Performance Plans 2013/14
The overall achievement by the National Department of Human Settlements during the financial year 2013/14 is seventy nine (79%).
Out of one hundred and twenty-six (126) targets which were planned for the period under review, ninety nine (99) targets were achieved whilst twenty seven (27) targets were not achieved.

7. DEPARTMENTAL EXPENDITURE VS. PERFORMANCE (TARGETS / OUTCOMES)
Branch
Final Allocation
(Operational)
Expenditure
Variance %
Spent
Planned
Targets
Achieved
Variance/ Targets
Not achieved
% Achieved Targets
1: Administration
71% 25 24 1
96%
2: Human Settlements Delivery Frameworks
98% 13 11
54%
3: Human Settlements Strategy And Planning
76% 17 8 9
47%
4: Programme Management Unit
41% 12 5
5: Office Of The Chief Financial Officer
85% 30 29
97%
6: Office Of The Chief Operations Officer
80%
100%
Total
70%
126 99 27
79%

8. HS SECTOR PERFORMANCE

9. COMMUNICATION AND OUTREACH
The Chief Directorate participated in all Ministerial outreach programmes and face to face communication was done with communities with the help desk was set up and individuals queries were logged in for further investigation or solved on site. This was done in collaboration with Municipalities and Provincial Departments of Human Settlements. Public engagements included exhibiting during the annual Rand Show, Pretoria Show, South African Housing Foundation, BRICS Conference. About 4500 generic publications were distributed to GCIS library in Parliament and Thusong Service Centres in Mpumalanga and Limpopo in their regional languages.

10. COMMUNICATION AND OUTREACH CONT
Door to door campaigns were done and publications were handed over to members of the communities during the campaign like on 06 August in Oudtshoorn and 02 October in Lerato Park in Kimberley. Community Imbizos hosted by the Minister and Deputy Minister were held across the country. Other outreach programmes were done by officials during Youth And Women Builds.

11. COMMUNICATION AND OUTREACH CONT
Sanitation Week held in Ward 5 at Makhaza in Khayelitsha - 25 April 2013 Launched Walmer Link FLISP project - 09 May 2013 Community engagements on the Budget Vote in Du-Noon – 22 May 2013

12. STRATEGY Draft Terms of Reference for the Green Paper developed
Rental Housing Strategy Framework developed; the discussion paper about the affordability of rental housing and discussion paper about object subsidies in rental housing
Draft sector wide reporting indicators developed
Consultation on Draft Strategic Plan across the sector
Draft evaluation report submitted to the Technical Working Group for comments

13. PLANNING
Draft ToR for the review of the Programme for Human Settlements Chapter of Municipal IDPs developed
Progress report on the support rendered to municipalities on the assessment of the Housing Chapters of the IDPs drafted.

14. ENHANCED PEOPLE HOUSING PROCESS
Finalisation of the Human Settlements Policy on community based housing Cooperatives
Engaged the Service Provider developing the Policy
Engaged SEDA to explore possible collaborations and funding mechanisms for Human Settlements Cooperatives
Participates in the DTI Inter-governmental Coordination Committee on Cooperatives to provide an update on Human Settlements Cooperatives
Advancement of the self-built methodology
Oversight visits conducted in the Western Cape, KZN and North West Provinces to evaluate the implementation of the programme and deliver the required PHP capacity development workshops
Support to Provinces in the upgrading of informal settlements through PHP
KZN Province and eThekwini Metro to evaluate progress regarding the upgrading of informal settlements through PHP
Assessing the M&E assignment of evaluating the impact of the UISP
Engaged the CPUT to discuss Human Settlements Summit with focus on alternative building technology

15. INTERNATIONAL RELATIONS PROGRAMME
The Department led a team of South African government officials and academics to the 7th World Urban Forum (WUF 7) in Medellin, Colombia. Outcomes from WUF 7 will support the concept of the long-term planning approach to urban policy and implementation and management thereof. i.e. National Development Plan (NDP) – Vision 2030, as well as respective city visions, which can look as far ahead as 2055
Leading the country preparations for the Third United Nations Conference on Human Settlements and Sustainable Urban Development (Habitat III) in 2016
Finalising the National Report on achievements in the last 20 years, what our remaining challenges are and what we hope to have included in the New Urban Agenda to be adopted at Habitat III

16. STAKEHOLDER AND IGR PROGRAMME
The Department successfully launched the Cornubia Integrated Project in April 2014.
The Graskop Project was successfully handed over from the China Government to the South African Government
A Memorandum of Understanding was signed with Council of Science and Research.
Preparations for the National Govan Mbeki Awards well underway with several successful provincial awards already hosted.

17. STAKEHOLDER AND IGR PROGRAMME
The following Stakeholders were engaged-:
Sector engagements through a national workshop on 26 June and have further solicited written inputs to be included in the report before it is submitted to Cabinet for approval in Q2.
Held the 4th Quarter Provincial, Municipal and Entity Performance Review Sessions at the end of May and have followed up on the matters arising from the reviews with the relevant provinces, metros and entities

18. STAKEHOLDER AND IGR PROGRAMME
On the Each one settle one campaign the Department has secured a total amount of R for the Youth Build Special Project including the following items:
250 construction work-suits, 50 protective shoes, 150 T-shirts, 200 blankets, a course for the Youth volunteer on skills, enterprise and cooperate training, a business management course, training on plumbing, electrical, general construction, geo-technical and mentorship program, as well as a one week catering for the volunteers.
The sponsorship benefited the elderly, the destitute and child headed households.
The secured funds paid for furniture, tools and other building materials through the Departmental NHBRC’s sponsorship special account

19. OUTCOME 8 – CREATE SUSTAINABLE HUMAN SETTLEMENTS AND IMPROVED QUALITY OF HOUSEHOLD LIFE

20. UPGRADING OF INFORMAL SETTLEMENTS
Upgrading of households in informal settlements with access to secure tenure rights and basic services:
Target for 2014 achieved
2013/14: Total number of households assisted:
Total number of households assisted to date: households
Represents 111,9% of 2014 target

21. NATIONAL UPGRADING SUPPORT PROGRAMME
Performance 2013/14 : Progress from 35 Municipalities to 50 Municipalities;
Achieved 96% of the 2014 target -Technical assistance in place in 47 of 49 NUSP Municipalities plus additional 3 Municipalities that requested support;
The 50 Municipalities represents more than 700 informal settlements;

22. INCREASED PROVISION OF WELL-LOCATED RENTAL ACCOMMODATION
PROVINCE
TOTAL DELIVERY (1 April 2013 To 31 March 2014)
TARGET FOR 2015/
2016
% OF 2015
TARGET EC 74
2636
2.8 FS
574
1745
38.9 GP
1 083
1200
90.2
KZN
660
865
76.3 LP 61
683
8.9 MP
206 79
260.7 NC
332 NW WC
2 714
1139
238.3
Total
5 704
8347
68.3

23. ACTIONS TAKEN TO ADDRESS CHALLENGES
Revision of current Social and Rental Housing Policies in process;
Development of back yard rental policy receiving attention;
Declaration of additional restructuring zones being attended to;
Monitoring tool for private rental to be put in place;
National Department will also undertake the design and costing of higher density housing typologies;

24. ACCREDITATION AND ASSIGNMENT OF MUNICIPALITIES
The annual target of undertaking 6 Workshops to capacitate the municipalities about the Accreditation Implementation Protocol was achieved.
The annual target of conducting 6 workshops to capacitate provinces and municipalities on the assignment of human settlements functions to municipalities was achieved.
The annual target of assessing 6 municipalities for accreditation at level 2 was not achieved, instead an assessment for the readiness of the 6 Metro municipalities to receive level 3 accreditation was conducted namely : City of Johannesburg, City of Tshwane, Ekurhuleni Metro, City of Cape Town, City of Tshwane and eThekwini Metro.

25. ACCREDITATION AND ASSIGNMENT OF MUNICIPALITIES
To assist the 6 Metros with capacity and subsidisation of the operational costs at the conclusion of the assignment of housing functions, the Municipal Human settlements Capacity Grant to the tune of R900 million was introduced over an MTEF period starting at the 2014/2015 financial year.
74% of 2014 target achieved with:
Level 1: 8 District/ Local Municipalities; and
Level 2: 20 Metros/ District Municipalities/ Local Municipalities;
4 implementation protocols still outstanding, namely Mangaung Metro, Nelson Mandela Metro, Tlokwe and Rustenburg;
No Metro was assigned. National Treasury in the process to resolve the funding procedures and transferring of assets and projects.

26. OUTPUT 3: EFFICIENT UTILISATION OF LAND FOR HUMAN SETTLEMENTS DEVELOPMENT
An additional hectares of land was released by the HDA for future human settlements development.
Over the four year period of Outcome 8, a total number of ha (both donated and acquired) of land was released representing 180,9% of the 2014 target.
Land Assembly Strategy developed and will be submitted to Human Settlements MINMEC - land pipelines with selected Provinces have been developed to facilitate forward planning and budgeting.
HDA commenced with discussions with relevant Provinces and Municipalities to assist with packaging of released land for development

27. OUTPUT 4: IMPROVED PROPERTY MARKET
Mortgage Default Insurance Scheme:
Although various discussions were held between the National Department, National Treasury and the Reserve Bank an agreement could not be reached and approval of MDI is still outstanding.
Finance Linked Individual Subsidy:
Revised Policy implemented in April 2012 – need for additional amendments identified and are receiving attention;
An additional 24 projects and subsidies were approved in the 2013/14 financial year;
Long term fixed interest rate instrument
In view of the low interest rate environment and without immediate steep inflationary expectations at the time, the instrument will not benefit households and will therefore be reconsidered when the market environment has changed 3

28. PERFORMANCE : DEVELOPMENT FINANCE INSTITUTIONS: LOANS GRANTED
TOTAL DELIVERY
(1 APRIL 2013 TO 31 MARCH 2014
2015 TARGET
NHFC (Mortgage Loans)
149
NHFC (Incremental Loans)
4 000
4 761
NHFC (Value of approvals: Strategic Investment)
72 000
96 499
NHFC (Leverage)
85 439
11 478
RHLF
44 610
49 667
NURCHA
1983
2 800

29. IMPROVED PROPERTY MARKET
During the same period the total number of loans made available by Banks to the GAP market was
Total contribution by the DFIs and Banks towards the 2014 target:
loans by the NHFC (mortgage loans, incremental loans, wholesale funding and leveraging);
loans by RHLF;
Construction of units financed through 54 loans granted by NURCHA; and
loans to the affordable market by the Banks; and

30. CONSOLIDATION OF DFIS
Phase 2 of the rationalisation process commenced. Phase 2 makes provision for the development of a business case and draft enabling legislation for a consolidated Entity.

31. TOTAL EMPLOYMENT CREATED
JOB CREATION
The delivery of,48,193 serviced cites and 105,936 houses during the 2013/2014 financial created 53,278 employment opportunities.
National
TOTAL EMPLOYMENT CREATED
Direct
Indirect
Induced
Total
Serviced Stand
6,010
603
2,796
9,408
Top Structure
22,492
3,746
17,632
43,869
28,502
4,349
20,427
53,278

32. ENHANCING SERVICE DELIVERY VIA PROFESSIONALISATION
Fledgling Scholarship programme benefiting some 347 beneficiaries since inception. Annual investment by Department is at R 9 million p.a.
Bachelor of Human Settlements Development Degree (BHSD) offered via Nelson Mandela Metropolitan University (NMMU).
Chair for Human Settlements Development and Management hosted by Nelson Mandela Metropolitan University (NMMU) to develop the body of knowledge in the sector.
Cabinet Approval for the Degree and the Chair.

33. SELECTED PERFORMANCE INDICATORS AS PER 2013/2014 STRATEGIC PLAN: PROGRESS STATUS BY PPMU BRANCH
The Klarinet Project, located in the Mpumalanga Province, within the jurisdiction of the Emalahleni Local Municipality, has to date, delivered 1788 housing units while 62 foundations, 67 wall plates and 186 roofs are in the process of being constructed.
5500 units in the first phase of the Khutsong Project, are complete, 4976 foundations have been laid and 4428 wall plates constructed.
In the Sweetwaters Project in the City of Johannesburg, 1000 units have been completed and occupied in the adjacent Tulamtwana project.
In the Drommedaris Project in the Drakenstein Municipality, 974 housing units have been completed and handed over while in the Duncan Village Project in the Buffalo City Municipality, 5354 housing units have been completed in this project.
On the N2 Gateway project, situated, within the jurisdiction of the City of Cape Town, a total of 11,400 units have been completed of the planned units that were planned in Phase 1 of the project.

34. SELECTED PERFORMANCE INDICATORS AS PER 2013/2014 STRATEGIC PLAN: PROGRESS STATUS BY PPMU BRANCH
Construction of houses in the Zanemvula Project, situated in the Eastern Cape, within the jurisdiction of the Nelson Mandela Bay Metropolitan Municipality, is ongoing and to date, 6181 new units have been completed and 1970 units rectified
Lerato Park Project, situated in the Sol Plaatje Local Municipality, 491 units have been completed.
In so far as the mining towns was concerned, it was firstly necessary to request funding from National Treasury and R1,1billion was subsequently approved for informal settlement upgrading in the identified mining towns
The donation of land (with 850 serviced sites) by the Lonmin mining company will assist in providing subsidized housing for the mining community in Rustenburg.

35. ANNUAL REPORT PRESENTATION AS AT 31 MARCH 2014 FINANCIAL PERFORMANCE

36. MTEF Allocation
Rand thousand
Medium term estimates
2013/14
2014/15
2015/16
Indicative
2016/17
Administration
422,399
Human Settlements Policy, Strategy and Planning
84,055
89 396
94 299
Programme Delivery Support
226,922
Housing Development Finance
27,377,087
Total
28,110,463
Grants and transfers to entities constitute 97% of the total allocation.

37. Allocation MTEF: Transfer payments
2013/14
2014/15
2015/16
Indicative
2016/17
Conditional Grants
Human Settlements Development Grant
Urban Settlements Development Grant
Municipal Human Settlements Capacity Grant -
Rural Households Infrastructure Development: Direct Grant
47 624
51 000
Human Settlements Development Grant: Indirect Grant
Rural Households Infrastructure Development: Indirect Grant
65 500
67 328
Sub Total
Entities
Social Housing Regulatory Authority: Operational
32 151
33 480
34 560
36 392
Social Housing Regulatory Authority: Capital Restructuring Grant
Housing Development Agency
97 497
Community Schemes Ombuds Services
20 000
40 000
53 000
28 000
Total

38. Summary of Adjustment Budget
Programme
Original Budget
R`000
Roll-overs Approved R`000
Other
Adjustment Disaster Relief
Declared Unspent Funds
Adjusted Allocation
1. Administration
2. Human Settlements
Policy, Strategy and
Planning
84 055
3. Programme Delivery
Support
4. Housing Development
Finance
44 454
Total

39. Adjustment Estimate Rollover approved
R100.5 million Rural Household Infrastructure Grant
R20 million for Community Schemes Ombud Service startup funding.

40. Adjustment Estimate Other adjustments Declared Unspent Funds
R44 million to the Human Settlements Development Grant for Disaster relief
Declared Unspent Funds
R20 million National Upgrading Support Programme

41. Virements after adjustment estimate
Programme
Adjusted Allocation
R`000
Virements
Revised
Allocation
1. Administration
(17 800)
2. Housing Policy, Research and
Monitoring
84 055
2 190
86 245
3. Housing Planning and Delivery
Support
(12 500)
4. Housing Development Finance
28 110
Total -

42. Virements after adjustment estimate
A virement of R28.1 million from other programmes to programme 4: Housing Development Finance was approved to fund the prepayments of the Rural Household Infrastructure grant amounting to R33 million.
A virement of R2.1 million from Programme 1: Administration to Programme 2: Housing Policy, Research and Monitoring was approved to partially fund the Govan Mbeki awards.

43. Annual Expenditure per Programme as at 31 March 2014
Programmes
Final Allocation
R`000
Expenditure
Variance %
Spent
1. Administration
74%
2. Human Settlements Policy, Strategy and Planning
86 245
73 327
12 918
85%
3. Programme Delivery Support
90 797
47%
4. Housing Development Finance
99%
Total
98%

44. Reasons for underspending
Funds provided for the Special Investigation Unit (SIU) were not fully utilized.
Under spending is due to the SIU not invoicing the Department or not providing the department with supporting documentation on work performed and invoiced.
The Department held various meetings but could not resolve the matter.
Funds provided for the leasing of additional office accommodation have not been fully utilised.
The unspent portion of the Property Management portfolio is in respect of leasing of both 240 and 260 Justice Mahomed Street buildings.
The Department of Public Works (DPW) entered into a seven year lease agreement on behalf of the Department for these buildings, effective from 01 January 2011 to 31 December 2018.
A dispute arose between the DPW and the landlord that led to a delay in planned building refurbishment and tenant installation as well as the subsequent occupation of the additional office accommodation. i.e. (260 Justice Mohamed Street building)
Delay in the implementation of the National Upgrading Support Programme (NUSP).

45. Reasons for under spending cont.
Other major contributing factor applicable throughout the Department is under spending on compensation of employees which amounted to R38.4 million and can be attributed to the following:
Delays experienced in qualification verification by the South African Qualifications Authority (SAQA) for candidates who have been recommended. A meeting was arranged between the Department and SAQA in the 3rd Quarter and improvement has since been seen.
Posts that had to be re-advertised due to the fact that no suitable candidates could be found.
Problems were experienced with non-disclosure of criminal records on applications disqualifying selected candidates

46. Transfer payments as at 31 March 2014
Total Allocation
R`000
Expenditure
Variance
% Spent
Human Settlements Development Grant -
100%
Urban Settlements Development Grant
Disaster Relief Grant
44 454
Rural Households Infrastructure Development
25 060
90%
Social Housing Regulatory Authority: Operational
32 151
Social Housing Regulatory Authority: Capital Restructuring Grant
65%
Housing Development Agency
97 497
National Urban Reconstruction and Housing Agency
Nelson Mandela University
3 949
Bursaries Scheme
4 220
4 553
(333)
108%
UNHABITAT
1 100
1 075 26
98%
Community Schemes Ombud Service
17 000
Total
99%

47. Human Settlements Development Grant (HSDG)Expenditure: 31 March 2014
Provinces
DoRA Allocation 2013/14
Additional / Disaster relief
Reallocation/ (Stopped)
Total Available
Actual Transfer
Amount Received by Province
Amount Spent by Province
% Spent
R'000
Eastern Cape
2,523,803 -
100%
Free State
1,120,936
230,000
1,350,936
Gauteng
4,108,399
4,095,445
KwaZulu-Natal
3,235,428
40,156
57,000
3,332,584
3,333,979
Limpopo
1,324,742
1,368
(644,000)
682,110
303,449
44%
Mpumalanga
1,124,332
1,764
1,126,096
1,014,826
90%
Northern Cape
395,724
207,900
603,624
577,450
96%
North West
1,224,537
117,000
1,256,637
1,341,523
107%
Western Cape
1,925,971
1,166
32,100
2,044,137
1,959,237
Total
16,983,872
44,454
17,028,326
16,500,648
97%

48. Delivery Performance of HSDG as at 31 March 2014
Province
Annual Delivery Targets
Delivery Performance as at 31 March 2014
Variance Delivery sites
Variance Delivery Top Structure
Total Variance Delivery
Sites (units)
Top Structure (units)
Total Delivery Targets
Total Delivery Performance
Eastern Cape
15,316
20,341
35,657
11,720
12,646
24,366
3,596
7,695
11,291
Free State
5,028
8,341
13,369
7,203
6,920
14,123
-2,175
1,421
-754
Gauteng
13,173
30,351
43,524
8,959
22,352
31,311
4,214
7,999
12,213
KwaZulu-Natal
3,362
25,377
28,739
2,790
29,151
31,941
572
-3,774
-3,202
Limpopo
493
7,382
7,875 68
3,080
3,148
425
4,302
4,727
Mpumalanga
3,319
16,404
19,723
7,578
8,126
15,704
-4,259
8,278
4,019
Northern Cape
4,734
1,735
6,469
2,875
2,464
5,339
1,859
-729
1,130
North West
2,110
14,092
16,202
305
9,362
9,667
1,805
4,730
6,535
Western Cape
6,629
13,414
20,043
6,695
11,835
18,530
-66
1,579
1,513
Total
54,164
137,437
191,601
48,193
105,936
154,129
5,971
31,501
37,472

49. Performance of the USDG as at 31 March 2014
YEAR TO DATE (01 JULY - 31 MARCH 2014) EXPENDITURE
Municipality
Allocated Funds National
Rollovers
Total Available
Transferred Funds
Spent by Municipality
Variance Spent vs Transferred
Variance Spent vs Total Available
Spent as % of Total Available
Unspent as % of Total Available
R'000
Buffalo City
613,305
176,875
790,180
409,323
203,982
380,857
51.8%
48.2%
Nelson Mandela Bay
727,986 -
341,504
386,482
46.9%
53.1%
Mangaung
596,719
129,450
726,169
333,054
263,665
393,115
45.9%
54.1%
Ekurhuleni
1,584,912
69,509
1,654,421
906,707
678,205
747,714
54.8%
45.2%
City of JHB
1,488,877
70,347
1,559,224
607,204
881,673
952,020
38.9%
61.1%
City of Tshwane
1,290,611
791,087
499,524
61.3%
38.7%
eThekwini
1,580,999
1,007,292
573,707
63.7%
36.3%
City of Cape Town
1,193,497
66,276
1,259,773
486,797
706,700
772,976
38.6%
61.4%
Total
9,076,906
512,457
9,589,363
4,882,968
4,193,938
4,706,395
50.9%
49.1%

50. Urban Settlements Development Grant (USDG) Expenditure as at 30 June 2014
YEAR TO DATE (01 JULY - 31 MARCH 2014) EXPENDITURE
Municipality
Allocated Funds National
Rollovers
Total Available
Transferred Funds
Spent by Municipality
Variance Spent vs Transferred
Variance Spent vs Total Available
Spent as % of Total Available
Unspent as % of Total Available
R'000
Buffalo City
677
100%
99.9%
0.1%
Nelson Mandela Bay -
100.0%
0.0%
Mangaung
75 032
89.7%
10.3%
Ekurhuleni
69 509
87.3%
12.7%
City of JHB
70 347
92.1%
7.9%
City of Tshwane
44 830
96.5%
3.5%
eThekwini 0%
City of Cape Town
66 276
77.3%
22.7%
Total
92.3%
7.7%

51. What USDG was used for as at 30 June 2014
Description
Total Available Funds
Expenditure on Total Available Funds
Variance on Total Available Funds
% Spent on Total Available
R'000
Spatial Development and the Built Environment
89.7%
Transport
89.2%
Water
92.2%
Sewerage
( )
110.1%
Solid Waste Management
16 244
90.1%
Electricity
81.5%
Socio-Economic Amenities
40 592
90%
Local Economic Development and Job Creation
44.2%
Vat
89 402 -
100%
Total
92.3%

52. Financial Performance - BCM
Buffalo City
Services
2013/14 Adjusted budget
YTD Expenditure %
Water
78,537,212
78,537,213
100%
Sanitation (waste water)
190,031, 698
190,031,698
Electricity
38,667,450
Roads & Storm Water
314,288,283
314,156,492
Human settlements programme
141,031,375
140,430,865
Transport
23,999,295
23,999,294
Solid Waste Management
3,684,205
3,680,008
TOTAL
790,179,608
789,503,174

53. Non-financial Performance - BCM
The 100% expenditure of the Metro was on the following:
1 729 serviced sites
3,7 ha of land procured
56 km of roads resealed
406 km roads rehabilitated
56 km storm water drainage installed
8 km pedestrian walkways constructed
143 water service points (taps) installed for informal settlements dwellers
622 households (RDP) have been provided with access to free basic level of potable water connections
1 082 new households (RDP) with sewer connections
448 sanitation service points installed
connections for backlog in the provision of basic sanitation services

54. Non-financial Performance - BCM
The 100% expenditure of the Metro was on the following:
households have been provided with kerb-side waste removal services in formal areas
1 500 street lights installed
517 households(RDP) provided with electricity connections
7 project of waste minimization projects have been initiated
10 community halls have been developed
6 sports fields developed
8 parks developed
13 cemeteries developed
1 fire safety and emergency facility developed
669 jobs created through EPWP and other municipal programmes

55. Financial Performance - NMBM
Nelson Mandela Bay
Services
2013/2014 Adjusted Budget
YTD Expenditure %
Servicing of sites
171,261,100
171,758,447
100%
Upgrading of gravel roads and provision of stormwater
64,227,488
64,227,469
Provision of bulk sanitation services
224,698,222
224,262,039
Provision of bulk water services
178,397,400
178,397,334
TOTAL
727,986,000

56. Non-financial Performance - NMBM
The 100% expenditure of the Metro was on the following:
43.73 ha of land procured for Greenfields development
4 012 sites serviced
10 informal settlements upgraded (in-situ)
1 informal settlements upgraded - relocation
3.31 km graveled roads
20.45 km tarred roads rehabilitated
1.46 km storm water drain installed
3.58 km pedestrian walkways constructed
773 households (RDP) connected to water
773 households (RDP) connected to sanitation
2 459 households (RDP) connected to electricity
77 new street lights
366 high mast lights installed
1 sport field developed
jobs created through EPWP

57. Financial Performance - Mangaung
Services
2013/2014
Adjusted Budget
YTD
Expenditure %
Engineering Services (Sanitation, Roads and Waste)
343,686,390
326,112,472
95%
Water Services
199,223,636
180,577,383
91%
CENTLEC (Electricity)
52,631,580
31,383,501
60%
Planning
44,189,512
53,416,081
97%
Social Services
35,129,154
28,029,606
80%
Corporate Services
28,806,892
27,017,899
94%
Human Settlements and Housing
11,502,078
4,599,615
40%
TOTAL
726,169,242
651,136,557
90%

58. Non-financial Performance Mangaung
The 90% expenditure of the Metro was on the following:
2 181 title deeds transferred to eligible beneficiaries
3 informal settlements upgraded - relocation
1 km of paved road
55 km of roads resurfaced
1 km of storm water drainage installed
18 km pedestrian walkways constructed
1 475 formal domestic consumers receiving water services
1 500 water service points (taps) installed for informal settlements
500 households (RDP) provided with water connection
3 625 units provided with access to free basic water
1 550 formal domestic consumers receiving sewerage services
450 households (RDP) provided with sewer connection

59. Non-financial Performance Mangaung
The 90% expenditure of the Metro was on the following:
households with weekly-kerb waste removal services
households in informal settlements with access to waste removal
26 high mast lights installed in informal settlements
552 households (RDP) were connected to electricity
households provided with access to free basic electricity
1 community hall constructed
3 sports fields constructed
2 parks developed
1 swimming pool developed
6 cemeteries developed
1 687 jobs created through EPWP

60. Financial Performance - Ekurhuleni
Services
2013/2014 Adjusted Budget
YTD Expenditure %
Disaster & Emergency
27,054,350
26,194,227
97%
EMPD
13,650,000
7,407,380
55%
Energy
214,300,000
208,774,774
Environmental Resources Management
1,110,000
1,106,922
99%
Human Settlements
64,066,538
29,333,380
46%
Roads and Storm water
573,721,860
87%
Health and Social Development
66,860,000
65,849,994
98%
Economic Development
35,650,000
33,872,192
95%
SRAC
127,975,000
123,394,311
96%
Transport Planning and Provision
35,700,000
29,257,363
81%

61. Financial Performance - Ekurhuleni
Services
2013/2014 Adjusted Budget
YTD Expenditure %
Water & Sanitation
182,200,000
151, 837,290
83%
Erwat- Wastewater treatment
50,000,000
100%
Interim sanitation services (Chemical toilets)
160,916,650
154,349,245
96%
Waste Management (land fill sites)
31,
29,217,417
92%
Real Estate
37,600,000
31,306,050
Human Settlement USDG (Opex)
31,566,282 - 0%
TOTAL
1,654,420,680
1,444,715,157
87%

62. Non-financial Performance - Ekurhuleni
The 87% expenditure of the Metro was on the following:
48 serviced sites
1 486 title deeds transferred
283 KMs of roads paved
374 KMs of graveled roads
350 KMs of roads surfaced/ rehabilitated
107 KMs of storm water drainage installed
64 KMs of pedestrian walkways constructed
1 bus terminal constructed
7 bus stops constructed
2 148 formal domestic costumer receiving water and sanitation services
154 water services points (taps) installed for informal settlements dwellers

63. Non-financial Performance - Ekurhuleni
The 87% expenditure of the Metro was on the following:
households in informal settlements with access to refuse removal
households (RDP) with access to refuse removal
12 waste minimization projects initiated
55 high mast lights installed in informal settlements
households (RDP) provided with electricity connections
1 sports field and stadia developed
5 clinics developed
1 fire safety and emergency facilities developed
jobs created using the EPWP

64. Financial Performance – City Of Johannesburg
USDG Projects – FY 13/14
2013/2014
Adjusted Budget
YTD
Expenditure
% Expenditure
R’000
Formalisation of Informal Settlements
254,524
303,873
119.4%
Bulk , Link and Internal Infrastructure(water, sewer, Electricity; Roads & Storm-water)
899,162
796,075
85.3%
Electrical (Substations & Streetlights)
125,715
117,341
93.3%
Mixed Rental / Hostel Upgrade
96,138
85,657
89.1%
Land Acquisition
20,000
19,654
98.3%
Upgrade of Community Centres & Sport fields
50,090
49,306
98.4%

65. Financial Performance – City Of Johannesburg
USDG Projects – FY 13/14
USDG Budget
Quarter 4 Expenditure
% Expenditure
R’000
Upgrade Of Clinics
30,730
23,247
75.6%
Upgrade Of Landfills
46,865
34,143
72.9%
Upgrade Of Parks & Cemeteries
36,000
35,726
99.2%
Total
1,559,224
1,465,022
94%

66. Non-financial Performance – City Of Johannesburg
The 94% expenditure of the Metro was on the following:
20 ha of land procured for greenfield development
35 ha procured for brownfield development
1 440 km of roads graveled
242 km of roads resurfaced
18 km of roads resealed
formal domestic consumers receiving water and sewerage services
3 069 households (RDP) provided with water connections
967 households provided with access to potable water
783 sanitation services points (toilets) installed for informal settlements dwellers

67. Non-financial Performance – City Of Johannesburg
The 94% expenditure of the Metro was on the following:
households with weekly-kerb waste removal in formal areas
households in informal settlements with access to refuse removal
4 waste minimization projects initiated
formal households with access to basic electricity
1 610 high mast lights installed in informal settlements
1 562 households (RDP) connected to electricity
3 846 households provided with access to free basic electricity
1 Parks and 1 Garden constructed
2 clinics constructed
1 cemetery completed
34 markets developed
7 Fire and safety emergency facilities developed
jobs created through EPWP

68. Financial Performance – City Of Tshwane
City of Tshwane Municipality
Services
2013/2014 Adjusted Budget
YTD Expenditure %
Agriculture and Environmental Management
24,000, 000
7,604,390
31.68%
Housing & Sustainable Human Settlements
469, 824, 650
445,971,291
94.92%
Water and Sewer
491,735,544
489,558,668
99.56%
Electricity
56,150,000
55,157,133
98.23%
Sports and Recreation(SRAC)
10,000,000
9,700,270
97.00%
Transport
198,190,806
198,611,555
99.85%
Project management and design (technical assistance)
40,000,000
39,177,936
97.94%
Total
1, 290,611, 000
1,245,781,243
97%

69. Non-financial Performance – City Of Tshwane
The Metro has spent 97% on the following:
221 ha. of land procured for human settlements development
160 ha. of land proclaimed (township establishment completed)
KMs roads paved
1 555 KMSs of storm water drainage installed
water service points (taps) installed for informal settlement
households (RDP) provided with water connections
of formal domestic customers receiving sewerage services
households with weekly kerb-side waste removal services in formal areas
158 households in informal settlements with access to refuse removal
households (RDP) with access to refuse removal

70. Non-financial Performance – City Of Tshwane
The Metro has spent 97% on the following:
formal households with access to basic electricity
45 high mast lights installed
households provided with access to Free Basic Electricity
14 libraries developed
fire safety and emergency facilities developed
jobs created using the EPWP

71. Financial Performance – Ethekwini
Service
Budget 2013/14 R’000
Expenditure
R’000 %
Built Environment
1,388
1 510
109%
Fully Subsidies Housing
150
179
119%
Ablution Blocks, Interim Services
293
558
190%
Sanitation
198
135
68%
Water
411
223381
93%
Roads and Storm water Control
117
116
99%
Electricity
247
141
65%
Social facilities 2 0%
LED and Job Creation
157 71
37%
Zone Plans 90 64 7%
Township Renewal
103
71%
TOTAL
1,581
1, 581
100%

72. Non-financial Performance – Ethekwini
The 100% expenditure of the Metro was on the following:
ha. of land acquired for human settlements development
715 ha. of land procured for green field development
ha. of land procured for brown field development
21 informal settlements with upgrading plans
sites serviced
904 title deeds transferred
119 pedestrian walkways constructed
26 KMs of paved roads
1 bus terminals constructed

73. Non-financial Performance – Ethekwini
The 100% expenditure of the Metro was on the following:
1 129 water services points (taps) installed for informal settlements dwellers
households (RDP) provided with water connections
consumers provided with access to a free basic level of potable water
1 129 sanitation service points (toilets) installed for informal settlement dwellers
households (RDP) provided with sewer connections
households in informal settlements with access to refuse removal
households (RDP) provided with access to refuse removal
formal households with access to basic electricity
households (RDP) provided with electricity connections
households provided with access to free-basic electricity
jobs created using the EPWP

74. Financial Performance – City Of Cape Town
Service
Budget 2013/14
Expenditure %
Electricity Services
82.8%
Solid Waste services
100%
Water services
78.2%
Parks
85%
Sport, Recreation and Amenities
51, 268, 300
66%
Library services
77%
Infrastructure and maintenance
88.3%
City of Cape Town Transport
98.6%
Health Services
48.1%

75. Financial Performance – City Of Cape Town
Service
Budget 2013/14
Expenditure %
Existing Settlements
31,914,023
15,560,693
48.8%
New Settlements
190,053,601
132,733,507
69.8%
HS Strategy & Planning
60,000,000
53,828,338
89.7%
Urbanisation (incl. in-situ upgrades)
95,476,811
49,031,433
51.4%
Urban Regeneration
5,000,000 0%
Spatial Planning and Urban Design
354,209
100%
Project Pre-Planning
38,536,344
20,188,339
52.4%
Project management Fees
17,714,963
Province Allocation (Metro Projects)
19,923,120
Total
1,259,772,794
973,226,147
77.3%

76. Non-financial Performance – City Of Cape Town
The 77% expenditure of the Metro was on the following:
8 120 sites serviced
6 151 title deeds of sale agreements signed with identified beneficiaries
12 KMs roads resealed
123 roads rehabilitated
10 KMs pedestrian walkways constructed
1 bus terminal constructed
80 bus stops constructed
formal domestic customers receiving water services
4 827 service points (taps) installed in informal settlements
toilets installed in informal settlements

77. Non-financial Performance – City Of Cape Town
The 77% expenditure of the Metro was on the following:
consumer units provided with access to free basic water
formal domestic consumers receiving sewerage services
households provided with solid waste removal
households provided with access to basic electricity
job opportunities created through EPWP

78. RESPONSE TO AUDITED OUTCOMES 2013-14

79. AUDITOR’S OPINION
Unqualified opinion with emphasis of matters

80. EMPHASIS OF MATTERS IN THE AUDIT REPORT
Material underspending of the vote
The department has materially underspent the budget on programme 2 , spent R12 433 000 of its allocation of R 87 773 000 in respect of Programme Implementation Facility.
The department spent R108  of its allocation of R133  pertaining to implementation of the RHIG. The department was also allocated an amount of R106 721 000 to be transferred to municipalities; however these transfers were only transferred in March 2014 and a significant portion of these grants were unspent at 31 March 2014.

81. EMPHASIS OF MATTERS IN THE AUDIT REPORT CONT.
Predetermined objectives - Programme 2, 3 and 4
Changes to objectives, indicators and targets not approved
Material changes were made to indicators and targets reported in the annual performance report without these changes being approved by the Minister
Consistency of indicators and targets
Reported indicators and targets were not consistent with those in the approved annual performance plan.

82. EMPHASIS OF MATTERS IN THE AUDIT REPORT CONT.
Measurability of indicators targets
Departmental target were not specific.
Auditor General could not measure the required performance.
Reliability of reported performance information
Significantly important targets were not reliable when compared to the source information or evidence provided.

83. EMPHASIS OF MATTERS IN THE AUDIT REPORT CONT.
Non-Compliance with laws and regulation
Strategic planning and performance management
Effective, efficient and transparent systems of risk management and internal control with respect to performance information and management was not in maintained as required by section 38(1)(a)(i) of the PFMA.
Annual financial statements, performance and annual reports
The financial statements submitted for auditing were not prepared in accordance with the prescribed financial reporting framework as required by section 40(1) (b) of the Public Finance Management Act.

84. EMPHASIS OF MATTERS IN THE AUDIT REPORT CONT.
Human resource management and compensation
Funded vacant posts were not filled within 12 months as required by Public Service Regulation 1/VII/C.1A.2.
A human resource plan was not in place as required by Public Service Regulation 1/III/B.2(d).
Asset management and liability management
Proper control systems to safeguard and maintain assets were not implemented, as required by section 38(1)(d) of the Public Finance Management Act and Treasury Regulation (a).

85. MANAGEMENT’S REPONSE REGARDING AUDIT OUTCOME
An action plan has been developed as a tool to address all the findings raised by the Auditor General.
An action plan was populated with all the findings and circulated to responsible Deputy Director Generals and the Chief Directors for planed actions that are aiming at addressing the findings and mitigating/eliminating the risk of the similar audit finding being raised again in future.

86. MANAGEMENT’S REPONSE REGARDING AUDIT OUTCOME CONT.
Planned actions are monitored on a monthly basis by the CFO branch, whereby managers are required to provide progress and evidence to support what has been done. The progress is reported to the Auditor General, Audit Committee and EMT.
Auditor General provides a feedback on a quarterly basis in a form of a Dashboard Report whereby the Director General is expected to come up with commitments that will address discrepancies identified during the assessment.

87. “We have come a long way – Celebrating 20 Years of Freedom!”
THANK YOU
“We have come a long way – Celebrating 20 Years of Freedom!”