Department of Housing

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Department of Housing

• PRESENTATION TO THE SELECT COMMITTEE ON PUBLIC
  SERVICES
• ON CHAPTER 9 HOUSING
• TRENDS IN INTERGOVERNMENTAL FINANCES
• 2000/01 TO 2006/07
• 05 October 2004

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Index

• Introduction
• Policy Framework
• Policy developments
• Housing Conditional Grants
• Service delivery and expenditure trends
• Challenges facing Housing
• The new housing plan key elements
• Conclusion

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Introduction

• The report deals mainly with policy and trends
  relating to two housing conditional grants namely
• Housing Subsidy Grant
• Human Settlement Redevelopment Grant
• Acknowledge achievements, shortcomings and
  challenges
• Deals with service delivery and spending trends
  concentrating on the period since 2000

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Policy Framework

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

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Policy Framework continued

• Institutional arrangements
• Constitution makes housing a concurrent schedule
  4A function between National and Provincial
  government
• No explicit role for local government
• Housing Act defines the National and Provincial
  roles
• Provides for accreditation of local government
• Provides for assignment of housing
  administration to local government that are
  accredited

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Policy Frameworks continued

• Institutional arrangements
• National government is responsible for
  establishing and maintaining a sustainable
  national housing development process through
• Developing of policy and strategy
• Sets goals for delivery
• Monitoring and evaluation of housing sector
  performance
• Establishment of national funding framework for
  housing development, and
• Allocation of the funds to provincial government

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Policy Frameworks continued

• Provincial government promote, coordinate,
  implement housing development programmes within
  the national policy framework
• May develop provincial housing policy which must
  be consistent with national policy
• Administer housing subsidy and projects approval
  processes
• Monitor implementation of projects by local
  governments

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Policy Developments

• Housing environment since 1994 white paper
• More than 1,6m houses have been built or under
  construction and 2,4m subsidies approved
• Early focus was on quantity at the expense of
  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

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Policy Developments continued

• Recent 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
• Increased emphasis on monitoring of policy
  impact, expenditure and delivery
• More emphasis on oversight of housing
  institutions
• Promoting of alternative and traditional/indigenou
  s building technologies
• Social Housing policy to promote development and
  maintenance of sustainable Social Housing
  Institutions

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Housing Conditional grants

• Housing administers two conditional grants
• Housing Subsidy grant finances housing
  development under the national housing programme
• Human Settlement Redevelopment Grant funds
  projects which are meant to improve the quality
  of urban environment by addressing the legacy of
  dysfunctionalities caused by Apartheid
  settlements

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Housing Subsidy Grant

• Past performance
• By March 2004 more than 1,6m houses have been
  built or under construction and 2,4m subsidies
  approved
• Subsidies approved in the last 4 years average
  305 000 p.a. allowing for lead times to improve
  spending trends
• Housing units delivered in the last 4 years
  average 182 782 p.a. and expected to accelerate
  as projects reach full implementation stage.
• Approvals include projects to be implemented in
  future

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Housing Subsidy Grant (cont.)

• To date the programme has achieved a 51 to 49
  split in allocation between female and male
  headed households
• Between 1994 and March 2004 programme has made an
  investment and creation of assets of R27,6bn by
  into low income communities

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Allocation

• Provincial allocations are currently made
  according to a formula determined by MinMec and
  approved by Cabinet
• The formula provides for weighting in order of
  priority of the elements as defined below
• A HN(50) HH (30) P (20), where
• A Allocation
• HN Housing Need
• HH Households earning less than R3 500 per
  month (affordability indicator)
• P Population

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Allocation

• Housing need used in the formula is defined on a
  weighted formula that takes into account the
  following
• HN HL(1.25) SE(1.2) SBY(1.0)
• TC( 1.0) FR(0.5) WHERE
• HN Housing Need
• HL Homeless People
• SE Shacks Elsewhere
• SBY Shacks In Backyards
• TC Tents and Caravans
• FR Flat/rooms on shared property

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Spending trends
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Spending trends
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Spending trends
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Spending trends
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Spending trends
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Delevery trends
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Delivery trends
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Human Settlement Redevelopment Grant

• The human settlement redevelopment grant (HSRD)
  funds projects aimed at improving the quality of
  the environment and correcting dysfunctionalities
  in urban communities, by
• Identifying and addressing the nature and
  underlying reasons for the dysfunctionalities
• Providing a source of funding to correct
  dysfunctionalities and serving as a catalyst to
  gear other funding and resources
• Co-ordinating sources of development funding to
  ensure co-ordinated development and
• Adding value to projects that can be funded
  through other processes and programmes.

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Spending trends
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Current challenges

• 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.

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Current challenges cont.

• Growth in number and size of informal settlements
• Building capacity of all spheres of government to
  meet challenges of accelerated quality housing
  delivery especially local government
• Accelerating transformation of the apartheid
  settlement patterns and dysfunctionalities caused
  by that system
• Fraud, corruption and mal administration

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Key issues emanating from report

• Some positive
• Recognition of the alignment of key strategic
  shifts with the rights based approached namely
• Housing policy emphasis on coordination and
  policy alignment
• Improving of quality of end product and urban
  environment
• Increasing the delivery rate, and
• increased impact of the People Housing Process
• Recognition that the housing policy minimum norms
  and standards for permanent residential
  structures generally exceed suggested
  international norms

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Key issues emanating from report

• Some negatives
• Raises concerns about lack of emphasis to ensure
  participation of citizens and civil society in
  housing related discussion making process
• Other shortcomings are raised relating to
• Insufficient delivery to meet backlog of adequate
  housing
• Lack of integrated development leading to
  unsustainable settlement
• insufficient programme to deal with specific
  housing needs
• Absence of a rapid national land release
  programme
• Absence of an informal settlement upgrading
  programme suitable for needs of the poor.

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Policy response

• Recently Housing has developed a comprehensive
  plan which addresses the issues that have been
  identified as challenges and the negative areas
  identified in the report
• It provides of stakeholders and provides for a
  broad range of choices to beneficiaries
• Deals with whole communities at a time Informal
  Settlement upgrading programme and Emergency
  Housing programme
• Introduces a phased development approach

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Policy response

• Provides for the fast tracking of the development
  of the housing Chapter of the IDPs
• Provides for increased Capacity at all levels of
  government and enhances monitoring and evaluation
  processes
• Provides for the harnessing of private sector
  recourses and creates a conducive environment for
  increased participation in the programme

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Thank You