1. THUBELISHA HOMES CLOSURE REPORT Presented to the Portfolio Committee on 8 July 2009

2.  Thubelisha’s Closure Plan prepared in Sept 08.  Approved by the Minister of Housing on 15 Dec 08  Delay in approval resulted in: Revised closure timeframe Updated closure cost estimates  Updated Closure Plan submitted to NDoH on 28 Jan 2009  Steering Committee request for commitment from NDoH to fund closure costs received on 3 March 2009  Implementation of closure process commenced on 9 March 2009 with a guarantee of closure costs by NDoH Background

3. The Closure Steering Committee established the following Task Teams: Human Resources Projects Facilities & Assets Finance & Accounting Closure Task Teams

4. The following processes have been completed: H D A confirmed all staff in WC offered positions Firm undertaking from North West Province to absorb 5 staff; 2 still to be redeployed Northern Cape Province will absorb 2 staff; 1 staff being offered a position by the H D A Voluntary severance package taken up by 30 staff Staff where no commitments have yet been made (40): (See table attached) Human Resources Task Team …

5. ProvinceNumber of Staff VSPsBoarded/ Died/Resig HDAProvince Certain Balance Head Office 30131115 Gauteng20812 Eastern Cape 11 Zanemvula131120 Western Cape 10280 N2 Gateway 231220 Northern Cape 52120 North West 102152 Limpopo44 Kwazulu Natal 8116 Total12430344740

6. Redeployment of staff to Gauteng & KZN is dependent on NDoH to funding these staff placements for the balance of the financial year Good progress made i.t.o. staff changes in provident funds and medical aid. Consultants made available to all staff All Stannic garage cards cancelled at the beginning of June; Nashua 3G contracts have yet to be cancelled Human Resources Task Team … (con’t)

7. Way Forward: Approval by NDoH regarding the payment of subventions particularly to Gauteng & KZN Alternate to above, commitment by NDoH to take over 40 remaining staff if not employed Meetings with Limpopo/KZN/Gauteng Provinces to have follow up meetings Finalisation of VSP, including application for tax directives Finalisation of offers of employment from H D A & Provinces where redeployments have been arranged Human Resources Task Team … (con’t)

8. The following processes are underway / have been completed: All rental agreements have been cancelled or agreed to be paid to lease termination. Negotiations with Nasdhua have been finalised and settlement agreed Negotiations with Telkom finalised; letters sent to Telkom cancelling remaining contracts; transfer of certain contracts for telephone and data lines to H D A All furniture for transfer to H D A from HO and Gauteng branch identified. Balance of furniture to be auctioned to staff or disposed of per Closure Plan with treasury approval Western & Eastern Cape assets will be transferred to the H D A with treasury approval Transfer of assets to N Cape and N West Provinces proposed along with transfer of staff with treasury approval Assets in Limpopo/KZN/E London with be dealt with at meetings with the Provinces Facilities Task Team

9. All loan contracts such as coffee and water machines cancelled from 31 July 2009 Way Forward: Cancellation of Nashua 3 G cards to be formalised by no later then 31 July 2009; Timing of collection of unused Nashua printers to be handled by Thubelisha staff Thubelisha Management undertakes to facilitate auction of Head Office and Gauteng Offices assets Facilities Task Team ….(Cont)

10. Way Forward: Response from Thubelisha regarding status of projects in EC/WC/Mpumulanga/Limpopo Meetings planned as follows: Eastern Cape-30 June Limpopo-30 June Western Cape- 8 July Mpumulanga- still to be determined Draft contracts i.r.o. cessions to be approved by Legal Notification to all creditors to be sent out by 31 July 2009 notifying them of closure of operations Key focus of project closure team will be financial reconciliation of all projects after discontinuation of operations on 31 July 2009 Project Task Team ….

11. NHFC loan repaid MIG debtors of approximately R60 M still not received VAT verification process is almost complete which will enable further negotiations with SARS regarding recovery Claim submitted to NDoH for first portion of Closure Cost (VSP & contract terminations). No amount received from NDoH yet Way Forward Bring financial records up to date Analyze and collect all debts Meet with NHFC regarding settlement of Interest of loan Negotiate with H D A regarding future of MIG debtors Progress the VAT refund Finance & Accounting

12. Thank you