Hon Chairperson, hon Minister, hon Deputy Minister and hon members, in his latest report on the performance of national and provincial audit outcomes, the Auditor-General observes a general regression in financial management for government departments. He notes that there is stagnation and slow progress towards clean financial administration.
He goes on to urge senior government leaders to deal decisively with corrupt individuals in the Public Service. The leaders, he continues, must ensure that internal control measures are not only in place but that they are implemented. Competent staff must be hired and capacity on information technology beefed up. He strongly suggests that officials who perform poorly, and I quote, "should be dealt with decisively".
He concludes by putting a challenge to the national and provincial legislatures to play a more active role in their oversight. My observation is that the portfolio committee, under the able leadership of the hon Nomhle Dambuza, does, and I quote her, "take its oversight work very seriously". [Applause.] It plays an active role in following the funds allocated to the department and the implementation of legislation that guides its functioning.
Witness to this is the director-general himself and his entire senior staff.
Baphekwa besophulwa kula komiti mihla le. [They are grilled daily in that committee.]
However, problems persist in spite of that. This week's Mail & Guardian reports one such incident in the North West, Vryburg Naledi Local Municipality, where 3 000 RDP houses were budgeted for, but only four were completed. The contractor billed the municipality for construction of roads, storm water drainage and other structures - that is work not even undertaken. The council paid R86 million for only R20 million's worth of work actually done. Where was the NHBRC? That is not value for money.
Of concern, hon Minister, is that the municipality did pay the contractor. The question is: Why? However, the deep concern to Cope is that nothing has been done in spite of the abundant evidence uncovered by the investigation. Could it be that a member of the council received a kickback? We will never know. Instead, the provincial government has taken over the procurement and a new contractor has been appointed. This is what the Auditor-General is referring to: lack of decisive action by government leaders. Numerous contractor deficiencies with regard to the spending of grants have been cited before.
The Department of Human Settlements contributes to Outcome 8, which seeks to create sustainable human settlements and improve the quality of household life. In the current financial year the department seeks to achieve the objectives of Outcome 8 through a budget allocation of R28,1 billion. This is an increase from the last financial year allocation.
The main expenditure is on Programme 4, which provides finance for various housing development activities through the transfer of three main grants. The human settlements development grant of R16,9 billion is transferred to all nine provinces for construction and completion of RDP houses and servicing of sites; the urban settlements development grant of R9,1 billion is transferred to metros to ensure instalment of bulk infrastructure related to human settlements; the Rural Household Infrastructure Grant, RHIG, of R106,7 million is for reducing backlogs in rural water and sanitation. This year this grant is transferred directly to identified municipalities.
As can be seen, policy implementation and spending on these grants are located at provincial and municipality level. The task of the national department is to co-ordinate and monitor implementation and ensure collaboration in planning. However, this is where the problems lie. For example, the national department, this year, is prioritising the upgrading of 400 000 informal settlements by 2014, spending R19,2 billion - quite a big budget, mind you - but the provincial and metro business plans tend to put emphasis on the construction of more RDP houses. Therefore, they continue to chase numbers while the department emphasises quality rather than quantity when providing basic services.
The department intends to expand development of affordable rental housing stock, but the metros have allocated insufficient funds for this programme, thus their business plans are not aligned to national priorities. The department intends to increase finance of affordable housing covering the gap market. However, some provinces and metros have not even budgeted for this priority; others have no budget for land purchasing or its development. Cope welcomes steps taken by the department to review provincial and metro business plans and to advise on amendments. This will go a long way in aligning programmes at all levels and reducing the rampant underspending, especially by metros, which had spent only 45% of the USDG by the end of January this year. We fear that there is going to be fiscal dumping here. This collaboration approach is long overdue.
However, there is more to the problem of informal settlements than just upgrading them. The time has come to put more emphasis on encouraging and facilitating home ownership. Provision of free RDP houses has had complex unintended consequences for our people.
The line between the poor and the poorest, deserving government intervention, and those in the lower margin of the gap market has become blurred. This is exacerbated by the dominant mentality of entitlement among our people and more so by corrupt contractors and councillors who continue to manipulate beneficiary lists.
Recently, we watched in dismay on SABC TV news as women-headed families listed as beneficiaries in an RDP project that had just been completed were unable to occupy their houses. They remained with house numbers in their hands while the keys were issued to illegal occupants. All that the beneficiaries received were threats that they were going to be killed should they interfere. The question we ask is: Who is responsible for this and what is being done about it?
Such a situation could have been avoided if the legal beneficiaries had been issued with title deeds to their allocated houses. This incident and many other such situations call for the department to seriously address the issue of access to title deeds by potential occupants. I thank you. [Time expired.]