Housing Development Agency & NHBRC & CSOS & EAAB Annual Performance Plan

Meeting report

The Chairperson welcomed Members and delegates from the National Home Builders Registration Council (NHBRC) and the National Department of Human Settlements (DHS). She said it was the third and last day of the meeting for deliberation on the Annual Performance Plan (APP) of the 2018/19 financial year.

Presentation by NHBRC

Mr Mziwonke Dlabantu, CEO, NHBRC, said the strategic objectives of NHBRC were covered in the five programmes in the APP. The delivery of the mandate was important to protect the housing consumers and to regulate the home building environment. There was a need for NHBRC to strengthen relationship with all related stakeholder as a means of achieving its mandate.He explained that the future demands and supply of homes will be driven by developments in the economy and trends such as growth in the GDP, stability of the interest rate, household debt management and the affordability of property and the accessibility of mortgage finance.

The issue of drought was been considered because it had impacted negatively on the affordability of homes, especially in the Western Cape. In the light of global economic crisis, measures had been adopted to ensure that NHBRC is effective.  The NHBRC had looked into what element of its APP can be restructured for purpose of effectiveness and NHBRC has identified 10 areas of priorities. The 10 priority areas are: to improve the visibility and accessibility of the NHBRC to housing consumers, leveraging the NHBRC’s research and development capabilities; expand products and services; conduct the legislative review; review operating model; finalize and stabilize SAP implementation; review investment strategy; promote good governance; develop and implement social transformation strategy and to improve strategic capacitation of the NHBRC.

Programme 1

All the targets under Programme 1 recorded between 95% and 100% achievements. Some of the targets under Programme 1 are; uptime for business critical ICT systems, stabilisation and enhancement of the core business system and the achievement of a clean audit.  The entity achieved a clean audit outcome for the year under review.

Programme 2

Most of the targets in Programme 2 are far from being achieved, because most of the targets in Programme 2 are sensitive to market situation and national economy, hence their achievements are driven by market conditions.

Programme 3

Under Programme 3, 81% of targets were achieved while others completely achieved. The targets were: hearing of prosecutable matters before disciplinary committee, review of issued notices of non compliance, suspension of homebuilders on prosecutable matters, giving instruction to attorneys to apply for interdicts on prospective issues respectively.

Programme 4

NHBRC trained 9 829 home builders, 9 181 youth women and veterans, 1 500 artisans, 9 181 people with disabilities, and 18 00 home inspectors previously. Also, it planned to train 2 000 home builders, 2 000 youths, 1 800 women, 400 artisans, and 300 people living with disabilities, 450 military, and 500 technical professionals in the 2018/19 financial year.

Programme 5

The strategic target for Programme 5 was the achievement of an operating profit that was above budget and to sustain the warranty fund. A key issue under the Programme was the number of days in which supplies are paid. NHBRC plans to achieve the payment of suppliers within 30 days by the end of 2018/19.

Mr Shafeeq Abrahams, CFO, NHBRC, said the budget was crafted with a sense of low economic growth and low disposable income and drought, especially in the Western Cape which was the second biggest client of NHBRC in terms of building development. This led to the adoption of measures for fiscal prudency.  The planned revenue for 2018/19 was R838 million which was a reduction from the previous revenue of R896 million which motivated the reduction of the budget to R762 million.

The largest part of the budget was allocated to the visibility and accessibility of NHBRC, inspection outsourcing, social transformation strategy (women empowerment) and knowledge creation with budgets of R22 million, R20 million, R10 million and R8 million respectively.  

Discussion

Ms B Mabe (ANC) said R1.5 million was allocated to capacity building, while R20 million was allocated to outsourcing of inspection. She would like to know the beneficiary of the inspection budget in terms of race and location.  There was an amount that was budgeted to achieve a clean audit and she asked if the ‘clean audit’ would be bought. She complained about the coverage of NHBRC, because certain incidences still occur which could have been avoided if NHBRC was present. The CEO complained about marketing and visibility of NHBRC but only R22 million was budgeted for it and she asked if it was sufficient. She said the presentation dwelt on the future plans but the Committee would like to know what are the achievements and challenges of the entity based on the last targets.

Mr S Malatsi (DA) said there was a target on registration and inspection. He asked if the NHBRC have information on the number of home builders that are not registered and what creative interventions the entity was working on to ensure registration. It was possible that some home builders are not aware of the entity and improving awareness may increase the number of registered home builders so as to reduce and ultimately eliminate unregistered home builders. The target for prosecutable matters (80%) speaks to a broader issue of the need to be proactive than being involved in prolonged cases.  Base on the presentation the insurance figures doubles every year. He asked what NHBRC was doing to reduce the cost of contracting inspection. He requested that NHBRC shared with Members why it decided to outsource the inspection and what was its plan for increasing its internal capacity.

Mr K Sithole (IFP) said there was no time frame attached to the achievement of the top ten priority projects; the report indicated that they are all in progress. He asked if there are enough inspectors in the organistions. He asked if the trainings listed had been done or if it was a plan and asked to know where NHBRC intends to place the trained youths, if they had been trained.

Mr L Khoarai (ANC) asked how NHBRC plans to strengthen the relationship between itself and the municipalities as it seemed that municipalities are not doing their work. This would be needed to cover the rural areas. He asked for the timeframes for targets that were indicated to be in progress. He asked what the vacancy rate of NHBRC was and how much NHBRC had spent on BEE in the past.

Mr M Bara (DA) asked for the progress report on implementation of SAP in NHBRC because it is important and a priority. Also, if the APP talks to the broader strategy for five years (2014 -2019), he asked how far NHBRC had gone in achieving these 5-year targets.

The Chairperson asked if NHBRC was complying with 30 days payment of suppliers. She asked how NHBRC ensured that the training was incorporated within its mandate and how it would ensure that the training has a fair coverage of the nation when i selecting trainees. She asked how it would achieve a sufficient capacity to eliminate outsourcing because it has been discussed that the entity should adopt a hybrid approach; a combination of outsourced and trained inspectors, so that outsourcing was systematically eliminated. She asked if it has dealt with the issues highlighted by the Auditor-General (AG) and if it was in the process of resolving Human Resources issues identified earlier.

Response

Mr Abrahams said R5.2 million out of the R5.5 million was the AG audit fees and the R300 000 was internal audit expertise withdrawal from time to time. He said the AG is been paid by the entity for its audit. R1.5 million was budgeted to build internal control and address issues raised by AG in the previous year. The R20 million on outsourcing came about because the NHBRC realised the need for more inspectors in order to increase compliance and because there was no capacity within NHBRC, hence the outsourcing. The R20 million was still a budgeted allocation and no contractor because there is no complete tender on it. The insurance charge in the report was a difference between actual warranty fund and the fluctuation in value due to inflation. It covered the fluctuation in liability value; it was a risk management tool and not a typical insurance cost. The average days to pay was 19 days.

Mr Dlabantu said there are targets that would be met at the end of the MTSF; example was that the entity had achieved 95% for the five-year target for home enrolment, left with 5% to achieve in the next year. He said some of the targets are not determinable because they are not dependent on the entity but driven from outside; unlike the finance environment where contributory factors are indicated when targets are set. This was not done in the performance environment. This should be addressed so that there was an alignment between the budget and the delivery. NHBRC has requested that its marketing unit ensures that its activities are linked to the expenditures and outcomes focused by NHBRC and NHBRC would continue to make adjustment in this regard.

He said NHBRC would like to explain the targets and achievement in full details. An advertisement had been issued for the placement of self support resource that was requirement, left with implementation of three or four items to be implemented of which one is critical to the information that leads to enrollment. He said NHBRC fired the service providers in December, because of non performance and this necessitated the need to replace them. He said NHBRC does not know the process of evaluation but NHBRC had a direct discussion with SAP and had charged them with the responsibility of assessing the cause of the problem and the result of this was the basis for the terms of reference.

Ms Busi Nzo, Council Member, NHBRC said a lot of work had been done on the registration of home builders. NHBRC had eliminated the restriction placed on the registration of home builders concerning credit issue. Through the trainings provided by NHBRC the home builders are able to ensure that their registrations are up to date. NHBRC was working so that training and capacitating through the transformation charter is successful.

The Chairperson asked for information about the AG findings.

Mr Abraham said significant improvement had been made particularly around the ICT governance framework.

Chairperson thanked delegates from NHBRC.

Mr Neville Chainee, COO, DHS, said extreme weather destroyed about seven houses. The strength of the wind was about 200 km per hour. Also, some of the houses have unapproved plans and structures. NHBRC engaged with the supplier and contractors and the families were accommodated. The houses were bonded houses with insurance claims. Some work was still ongoing at the forensic department to establish if it was due to change in climate condition or substandard quality; as well as investigations on how to build more sustainable buildings in the light of changing weather conditions.

The Chairperson asked if the task team between the NHBRC, the City and province had concluded its work.

Mr Chainee said the City had concluded some of its work. DHS has given information that was needed but the work continued individually on different paths.

The Chairperson said the City of Johannesburg would be coming to present at a later time and the issue can be raised then. She thanked the delegates from NHBRC and they were discharged from the meeting. She welcomed the delegates from Community Schemes Ombud Services (CSOS) and requested that they give their presentation.

Presentation by CSOS

Adv Seeng Letele, Acting Chief Ombud, CSOS, said the strategic goal of CSOS was to regulate 120 000 community schemes registered with CSOS by 2019, to resolve all the disputes logged with CSOS, to ensure compliance and adherence to the CSOS Act by all community scheme, to reach all stakeholders through awareness of community schemes and to be self sustaining by 2019 through CSOS levies and other income streams.

Strategic Objective 1

This objective was to ensure that all community schemes are registered, to create a database of community schemes and ensure that community schemes complied with legislation. Under this objective 30 000 schemes were registered in 2017/18.

Strategic Objective 2

The second objective was intended to provide quality assurance on documentations received by CSOS, implement record management and documentation system, implement scheme governance records management and documentation system and to ensure that documents are secured. Quality assurance was carried out on 5 000 documentation; 5 000 certificates were issued in 2017/18.

Strategic Objective 3

The objective was to provide dispute resolution services to all community schemes in South Africa and maintain an effective professional and transparent dispute resolution services. Under this objective 60% of the disputes received by CSOS were resolved in 2017/18 and a target of 80% of the disputes was set for 2018/19.

Strategic Objective 4

The fourth objective was focused on education and training. However, she noted that education and training was a new target because in 2017/18 there were no funds allocated to the functions of education and training. CSOS took a trip to Australia in order to develop an appropriate training manual for the issue. The bench marking for training had been done and the training manual would be developed based on learning experience from the trip. The training would also address the issue of transformation in the public sector. There are newsletters that are transmitted electronically and it was intended to create awareness of CSOS and its functions to the community. CSOS expects that more schemes would register. Two facilities were opened in 2017/18 and there was a plan to open three more in 2018/19.

Mr Themba Mabuya, CFO, CSOS, said the sustainability of CSOS depended on it sources of revenue. The two major sources are: government grant and levy payment by committee schemes. There was a projection of R31m as government grant and levies of R200m in the 2018/19 Financial Year. A total income budgeted was R245m. The staff cost (was previously about R56m but now R105m) had doubled because of expansion through the opening of 3 new facilities and the training and development of internal staff intended within the year. R6.1m was budgeted for marketing communications, travelling for staff and board members about R8m and about R7.5 on office rental and relocation because the lease had expired. There was a query on the completeness of revenue and the remedial action by the entity was the introduction of the revenue management framework which had been approved and would be implemented. Another intervention was the introduction database which would address the incompleteness of revenue. He said there was the issue of the contingent liability which came as a result of the non disclosure of the R22m surplus but this had been addressed between CSOS, AG and the Department. He said there was an issue of irregular expenditure of R9m; because CSOS spent more than the budgeted amount.

The Chairperson welcomed the presentation and requested that members should ask questions based on the presentation.

Discussions

Mr Bara said it was important for CSOS to increase the public’s awareness of the entity and its services; consumer rich awareness and stakeholder engagement. CSOS could partner with the State Information Technology Agency (SITA) in its plan for education and training. He asked CSOS to tell the Committee if there is a possibility of having offices in all the provinces. CSOS told the Committee about its surplus last year and he wanted to know how the surplus was utilised.

Mr Sithole said he would like to know if CSOS has plans to have offices in all other provinces and if there are timeframes allotted to that plan; and if it has budgeted for the expansion. Also, that CSOS should explain what it meant by contingent liabilities. There was no targeted Programmes indicated to reach community schemes, when would these Programmes be defined? 

Mr Malatsi observed that there was a significant increase between the last budget and the recent budget but the report did not show a significant impact made by the entity relating to expenditure. Also, the report showed a spike in travelling cost which was not linked to outcomes in the report. Another concern was that there was no clarification for differences between the costs of office equipment leasing which was stipulated as R330 000 and the furniture rental of the same amount. Also, he said, professional and consulting fees were not tied to any outcome.

Ms Mabe proposed that the R8 million budget as travelling cost should not be approved by the Committee. R300 000 was paid to the AG for external audit and she would like to know what informed the amount paid as it varied from the payment made by the NHBRC.

The Chairperson said the report presented by CSOS was the same as presented in January. The repetition of the presentation showed how the entity was being managed. She asked for the reason that the number of the certificates issued was less than the number of community schemes registered by CSOS.

Responses

Ms Letele said CSOS was in the process of collaboration with SARS for the management system. CSOS was waiting on the Department to facilitate the collaborationon its behalf. Some community schemes were registered before CSOS was established, although the community schemes were re-registered with CSOS, they were not issued new certificate of registrations, only newly registered community schemes are issued certificates. This explained why there were more registrations than the number of issued certificates.

CSOS has three offices and adjudicators must fly to settle disputes, this was an expensive process. Flying in adjudicators and requirement cost of flight ticket and accommodation, added to this are international trips like the learning visit made by CSOS officials to Australia. She said though not every matter can be settled out of the court, CSOS tries to resolve disputes through mediation and staffs have to travel to where the disputing parties are. All these explain why R8 million was budgeted as cost of travelling. CSOS was exploring different channels to create awareness; it has used the e-newsletter, SABC, and radio stations to create awareness. Members were right on the need to improve marketing by the entity. CSOS had realised that the use of print media had not been explored to capacity and it intends to use the print media to create more awareness subsequently. Benchmarking for education and training had been done and CSOS was waiting for its educational materials to be accredited.

She suggested that entities under the human settlement portfolio can collaborate in their transformation plan for higher impact. There was a need at some of the current offices used by CSOS because there are needs for boardrooms where people can sit for dispute resolutions, and in environment where the lifts are maintained because some of the clients are older people that may not be able to climb the stairs; as well as an office environment with parking spaces for CSOS clients

Mr Mabuya said the R22 million surplus would be used for expansion and this has been approved by National Treasury (NT). The 22 million was not disclosed because CSOS was waiting for approval from the Treasury. The issue caused by the non-disclosure of the R22 million had been addressed in a meeting between CSOS, Treasury and the AG.

The travelling cost of R8 million was an aggregate cost. CSOS often negotiated the cost of audit with the AG and there was no stipulated cost for the audit, although AG would always argue that CSOS revenue was increasing.

Ms Funaneng Matlasi, CFO, DHS, said all financial concerns must be disclosed even when CSOS was waiting on the AG - it was not right for it not to disclose the surplus.

Mr Chainee said entities have decided to circumvent the established government processes by submitting documents directly to the Ministers without going through the Director-General. In the sector report, governance issues were raised against CSOS. Although, there are differences in opinion and accountability is a difficult process but circumventing the accounting process would not be of help to anyone. He added that money received from the public by entities must be accounted for.

The Chairperson said CSOS should work together with the Department to work on correcting the problems without belaboring the issues.

Briefing by the Estate Agency Affairs Board (EAAB)

Mr Nikita Sigaba, Acting CEO, EAAB, said 5 912 out of a total of 7 390 complaints were resolved in 2018/19. A total of 7 237 certificates were issued. Certificates of registration were issued to new 95% of newly registered compliant estate agents within 21 days and 100% of estate agents that enrolled for qualifying examination, wrote and have received their results. Also, 4 000 estate agents registered for the Continuing Professional Development (CPD) and it had a total number of 74 156 estate agents on its database. It was discovered that there are not enough Principals, especially black Principals. Only one Principal was found in the Free State. The entity was working at fast tracking the process of qualification as a Principal and it was targeting mostly black women.

Transformation Programme

Under the transformation Programme, he said the number of estate agents from previously disadvantaged backgrounds were 4 500. It was able to place 2 000 youth with host employers, rehabilitated 500 illegal estate agents, set up three billboards, and addressed 90% of social media queries within 48 hours.

Fidelity Fund Programme

The Fidelity Fund Asset value had grown by 1.25% with a net value of R636 675 645 and the annual growth on the Net Asset value was R17 649 012. He said 128 of the 160 claims received were finalised for payment within six months. The fund will be used to reimburse people who might lose money to estate agents. He said the entity would focus on print in the current year as opposed to radio advertisements.

EAAB Budget

The entity expects to break even in 2018/19. The capital expenditure of R30 million was above the norm; R10 million of this was budgeted for new ICT system (SAP) which had been affecting the service delivery of EAAB. The Fidelity Fund budget was in surplus. Other income recorded includes R45 million received from SITA for the One Learner one Estate Agent budget.

Discussions

Mr Khoarai said he was not happy that the One Learner one Estate Agent has not been implemented and the Committee was not informed of the challenges faced by EAAB on the implementation of the Programme. He asked why EAAB outsourced its internal auditing. The information in the presentation indicated the transformation plan from 2018/19, but the entity did not give information on the targets for previous years. He said three billboards in three provinces are not enough.

Ms N Hlonyana (EFF) noted that Mr Sigaba was in an acting position and he asked when the position will become permanent. She asked how many board members EAAB had if R3 million was being spent on the board. She asked how the entity intended to increase the number of black Principals to 250 and what informed the number. It was good that the entity would be targeting women but she recommended that it should also target people with disabilities and the youth. EAAB achieved a target of 17% out of a target of 30% in its transformation agenda - the target was low and even at that the entity could not make the target.

Mr Bara recalled that the Committee has always been displeased with presentations made by EAAB. Clarifications are required on the number of black men, women and people living with disability are targeted and the information should not be lumped together under the subject of ‘previously disadvantage people’. It had been highlighted in previous meetings that the One Learner one Estate Agent was not enough. The Committee would appreciate a proper breakdown of figures which would help to understand the issues better. The IT systems issue was raised as a challenge last year not much had been done to improve on it.

The Chairperson said the Committee would like to have a breakdown of the 74 000 registered estate agents in EAAB’s database, because the Committee knew that the bulk of the estate agents are from advantaged communities. This breakdown would help the Committee to be able to monitor the transformation agenda. The issues with One Learner one Estate Agent should be addressed. She The placement with employers used to be a different Programme from the One Learner one Estate Agent Programme but nothing was said about the latter Programme. She said there had been a discussion on the need to amalgamate the Programmes. She asked if the majority of the unregistered estate agents are from previously disadvantaged areas. She asked what will be done to assist these unregistered housing agents. She wanted to know why R3 million was set aside for the board meeting and how often the board met to need so much money.

Responses

Mr Sigaba said the entity was preparing for a presentation on the transformation programme on the 29th of May and it would bring a bigger team with detailed information to the meeting. There was a Programme on the placement of learners in the sector and he also said the One Learner one Estate Agent strategy was started in 2015 and it targeted 11000 learners and EAAB measured both. He said 300 learners have completed training and have started working within the sector under the ‘One Learner one Estate Agent Programme. The AG preferred external auditor to internal auditors. The Billboard programme started last year and there was a plan to cover all provinces, but was this was being done gradually due to limited resources. The position of CEO would be made vacant soon and it will be filled by a permanent staff member. He welcomed the suggestion to include people with disabilities in the principalisation plan.

There are 15 board members and five committees. The board and committee meetings are held once every quarter and about two other meeting can be arranged for the committees if they need to engage. He explained that the cost of the meetings had been properly done. 

EAAB had installed upgraded servers, but found that the IT system was not compatible to EAAB businesses processes, so the board decided to conduct a research on business processes and needs by engaging stakeholders. It was decided that the old system should be scrapped and EAAB should start with a new system. A human resources organisation had been commissioned to look into the processes of staff training and organisational culture.

He added that illegal estate agents are unlicensed estate agents who are not registered with EAAB. He said they can be divided into two; those unaware and those that do not care to register. There was a group of 250 estate agents that have applied to look into the process of compliance.

The Chairperson said in 2014 EAAB targeted 10 000 learners under the One Learner one Estate Agent but it succeeded in training only 300 learners.

Mr Chainee said EAAB did not share the view that it has a responsibility to fund the transformation agenda. He emphasised that entities cannot be self-regulated and EAAB should be aware that the Department will not fund the transformation agenda, because EAAB was expected to prioritise and utilise its funding.

The Chairperson thanked Mr Sigabu and encouraged him to come with more delegates in future to allow the Committee to engage better with the entity and to ask questions from relevant authorities within the entity.

Presentation by the Housing Development Agency (HDA)

Mr Pascal Moloi, CEO, HDA, said HDA was mandated to facilitate the acquisition of land and landed property; objects, roles, powers and duties of the agency and fast tracking land acquisition and housing development services for the purpose of creating sustainable human settlement. He said it was not qualified in its mandate that appropriation without compensation can happen, but would rely on Parliament to provide guidance on this.

The board has identified specific areas as priorities for the rest of the year. The first was to align policies and to intensify capacity with the entity to get more resources for expected functions. He said there was a need to ensure direct funding by revising the fiscal framework and intergovernmental fiscal relations to be able to invest in capacity for development project. The entity had exceeded the MTSF target to get 10 000 hectares of land, but just a little part of this land had been zoned and needs to be upgraded. Planning within the human settlements portfolio are currently in silos and there was a need for more collaboration with provinces, municipalities other stakeholders of human settlement. Land and legislation are important and HDA was proposing a new funding approach.

He said the priority interventions are: the need to identify and prioritise housing development areas; project packaging and housing development; facilitation and completion of the inter-ministerial agreement on the release of state land; the establishment of a project management office within the HDA and targets on transformation and empowerment. He said 39 priority housing areas were identified by the entity, which included Knysna, Duncan Village.

Some of the baselines under macro performances are new. These targets were included to stretch the ability of the entity to perform beyond its previous achievements. The new targets added are related to gender equality, the inclusion of people living with disabilities, empowerment of black owned enterprises and military veterans. The national priority projects are: 50 catalytic projects and 365 informal settlements which had been assessed, plans had been drawn for 22 mining towns.

He said 3 000 hectares which helped to meet the target for MTSF period of 10 000 hectares of well-located land targeting the poor and middle income household were acquired. Services are being rolled out in some of the mining towns. Five informal settlements would be upgraded per annum; 48 out of the 50 catalytic projects had been achieved and two more were waiting for the approval by the MINMEC.

The actual number of units serviced was 5 203 service sites and 6 518 housing units. He promised that these numbers would be doubled in the 2018/19 financial year because there was a projected increase in transfers from provinces.

He said the work of the entity was not only assessment and spatial transformation, but it will also ensure that areas that have been assessed would be upgraded. There are 17 projects at implementation stages and the number will increase as funding increased. There was a proposal to deliver 6 000 housing units and 5 000 service sites for this year.

Some of the support proposed for mining towns are: installation of 6km bulk sewer in Madibeng; to assist Knysna with land acquisition for the rehabilitation of the victims of fire disaster; development of a comprehensive business plan; financial model and funding approval for Southern Cape Corridor; a redevelopment project in Imizamo Yethu and to package a redevelopment plan for Duncan Village - all in the 2018/19 financial year.

The entity had been meeting the targets for women, black-owned enterprises and can improve on employing military veterans. HDA received an unqualified audit opinion in 2017/18 and he concluded by saying that the budgeted expenditure for 2018/19 was R425 505 480.

Discussion

Mr Sithole appreciated HDA for its presentation and asked why there was no support indicated in the report for mining towns for year 2019/20. He asked what the agreement was between the municipalities and the provinces on assembling and rezoning of lands, because it was sometimes difficult to determine the ownership of certain properties.He asked how many informal settlements had been capacitated in the municipalities and provinces.

The Chairperson appreciated the presentation, because it reflected consideration of most of the issues the Committees had raised in previous meetings; especially the project in Duncan Village. She asked in where the two new catalytic projects would be implemented and what was meant by ‘unblocking’ in the report. She asked which task team was dealing with identifying land ownership.

Responses

Mr Moloi thanked said there was a task team called the Joint Coordinating Committee that worked with the Departments of Public Works and Public Enterprises and the HDA played a significant role. Transnet intended to dispose its non-performing assets and HDA was in conversation with T Transnet.  The entity has plans laid out for the next 10 years for the mining towns. The first stage was to put up a spatial transformation plan which had been done. Secondly the Department had set aside about R1 billion for the upgrade. A lot of work had been identified in some of the mining towns; there are five projects in the West of Gauteng. The omission of this information from the report was an oversight and it would be corrected.

Land identification was a municipal-provincial function and the entity has provincial offices around the country. The addresses of the offices would be made available to the Committee so it can direct people to the office should the need arise. Also there was an online platform to find out the ownership of any piece of land across the country. The land identification function was shared at provincial level by provinces, municipalities and HDA.

He said there was a requirement to produce a land acquisition strategy annually which should be submitted to National Treasury; the entity had not been doing that efficiently in the past but would work at improving its performance on this function in the current year. About 3 000 hectares of land had been identified and it would cost an estimate of about R1.3 billion which would be included in next year’s budget. The entity targeted 275 but it had assessed 365. Each of these assessments was often more than one community. After the assessment there are recommendations which could be either to upgrade the community or to move the community. HDA planned to upgrade five of the communities per year. The two remaining communities for catalytic projects would be located in the Free State. ‘Unblocking’ indicated in the report referred to an intervention for up-scaling, township establishment or planning.

The Chairperson said they learnt that provinces dispensed funds to the HDA towards the end of the year when it becomes obvious that they can no longer spend the money. She asked if HDA was comfortable with that arrangement.

Mr Moloi said HDA was not comfortable with this; it was understandable but not preferred. The practice was due to poor planning and happened because HDA was not always involved during planning, but the situation was changing as HDA got involved at the planning stage.

The Chairperson thanked HDA, Committee Members and the Department. She said there would be a meeting on the Tuesday, the  24th of April to approve the report.

The meeting was adjourned.