APPROPRIATION BILL

Debate on Vote 38 - Human Settlements, Water and Sanitation

The MINISTER OF HUMAN SETTLEMENTS, WATER AND SANITATION: Hon

House Chairperson, I would like to greet hon members in their presence, Chairperson of the Portfolio Committee on Human Settlements, Water and Sanitation, hon Semenya and members of the portfolio committee, members of the executive council who

are here, leaders of our financial sector up there in the gallery, land owners and developers, representatives of civil groups and non-governmental organisations, members of the academia and research bodies, members of boards and council of Human Settlements entities, public service managers and Members of Parliament, good afternoon.

It is at this point that, no doubt, I am expected to say it is good to be back.

IsiXhosa:

Kukhona amageza phaya andibiza ngokuba ndinguBuyelekhaya.

English:

It is fine. It is good to be back to be able to complete what one started and that is certain. It is good to be able to complete the work we started as far back as 2009 and be able to take stock of where we are and what needs to be done. I must confess, with the few interruptions over the year, some of them unfortunately negative; we have done extremely well in this sector. This is most probably one of the most difficult Budget

Vote speeches I will have to deliver because I actually do not know where to begin. Where to begin to tell the story of this long journey we have travelled together with the department and the portfolio committees and our entities. It is wonder story not often told because of the impediment we still face in our backlog but it is a story that we should tell more often so we can assure our people that we spend every working hour working to provide them with accommodation.

Let me begin in 2004 when we consolidated our Human Settlements policy. It won us world claim and was recognised by the United Nation Human Habitat as best practice. We have been through a golden era of innovation and housing policy. We call it Breaking New Ground and I urge hon members to acquaint themselves with it. This is our policy and this is what we are busy with. This is our programme of integrating communities that were divided by class and racial lines. This is our programme of providing free housing to all who qualify as indigent and affordable housing for low-income earners. It is a comprehensive policy that we have now encoded. What we are dealing with now is ironing out the glitches while rolling out this massive programme.

We did indeed break new ground in our policy of integration and providing greater variety and better quality. We have been fine- tuning our policies as the need arose and up scaling our delivery because we realized that we are facing a whole sea of people coming into the urban areas. As we tested our new policy, we created several new pilot projects. These were called catalytic projects. Catalytic because, not only did they serve the purpose of providing us with the objects of our policies, while they were also aimed at generating private sector support and partnerships that we required from them. We used this as a model to build on scale and ensure that all elements of our policy were catered for.

We chose a number of sites; amongst them is Cosmo City, Fleurhof, Olievenhoutbosch and Savanna City in Johannesburg, Zanemvula in Port Elizabeth and Cornubia in Durban and many more. We endorsed them to test our policies; to test the market whether the private sector had the appetite for joint projects with government. The results were simply amazing. Hon members would have seen in the exhibition areas and if you have not, I urge you to have a look at the exhibition. But as we walk

together on this, I would like us to visit some of these projects because they have matured incredibly. Some of these are, for instance, Cornubia and Cosmo City which we will showcase on a regular basis and I want to showcase them to you. It shows what is possible to do when we are catering primarily for our major client; the indigent and make sure that we are catering also for the entirety of the social ladder.

We used the concept of catalytic projects because, starting from a low base of resources, we worked to partner with the private sector to fund our projects and to turn these into integrated living spaces, consisting of all the amenities required by our communities, including business centres and industrial zones and all of those areas that are necessary for recreation. I believe one of our biggest shortcomings has been our inability to fully communicate our many successes to our people, because if we did, South Africa would know what has been provided in the space of human settlements. These catalytic projects are our cities in the making and in the process we have provided more than four million houses and housing opportunities. This consists of more

than one million and one thousand serviced sites and more than three million and two hundred housing units completed.

Despite these achievements, we remain with a registered backlog of two million three hundred thousand people who are still waiting for housing and it is growing. It is growing because urbanisation is one of those unstoppable phenomenons of our time, especially on the African continent. I have yet to learn of a government that has been able to provide as much for the poorest of society, within the context within which we have had to operate to remove the indelible Apartheid Spatial Pattern and put pressure and expectations on ourselves to meet the expectations of our people.

When we delivered our first million houses, to a disbelieving world, the United Nations gave us an award as the first developing country to achieve a mark of a million houses. We have now provided four million, so they have given up on us. [Applause.] These were delivered by a free government and we are leading a country in a developing world. Our vision and policies

are being gradually updated to ensure that our rate of delivery meets the expectations of our people.

However, of course the problem remains with increased urbanisation and the breaking up of households into smaller units. There is a lot more that we need to cover. South Africa has been instrumental in the conceptualisation of Human Settlements and we have a responsibility to stay ahead in our implementation. It is working for us because it caters for the injustices of our spatial patterns. Success is in sight. Our biggest challenge remains the demand for housing that far outstrips delivery and the stubborn separateness of our past. Our catalytic projects, which are our new cities, cater for that in some small measure. In the next five years we are determined to declare 94 priority development spaces for human settlements development, multipurpose programmes of an integrated delivery to fully transform our spatial patterns.

The identification of these areas has already been completed with the initial 58 already gazetted for consultation. Municipalities and Provinces must be commended for embracing and

supporting the proposed priority development areas. Those that have not done so, I invite you to engage with this and accept our proposals to you. We do not have much time.

The transformation and consolidation of our human settlements can no longer be deferred nor excuses be made. We are building new, integrated, functional and inclusive settlements. These settlements may vary in size and complexity, but all share a similar common element. For instance, there is no reason why Thabazimbi or Emalahleni and Mahlosana cannot become a new town, instead of the ghost cities that they are distressed from long term mining. [Applause.] These are perfect spaces of opportunity to be transformed and consolidated as vibrant thriving urban centres offering the best of the 21st century we are living.

Our inner cities of Johannesburg, Pretoria, Germiston, Durban, East London and Bloemfontein cannot and must not be allowed to decay. These are priority spaces that represent the finest opportunity for spatial transformation and consolidation through renewal programmes and harnessing the inherent economic momentum within the cities. Similarly our townships that include

Khayelitsha, Soweto, uMlazi, Seshego and Kanyamzane must be transformed from dormitory settlement status to vibrant economic hubs that point the way towards future city precincts where properly values are competitive in a fully functional property market.

We have long accepted that settlements in their variety as villages, towns and cities must be changed to attract economic activity and growth. As we proceed to build new settlements and consolidate existing neighbourhoods, we are inspired by the Special Economic Zones and Re-industrialisation programmes that are aimed at economic growth throughout our country.

In the development of these priority areas, our partners stand ready to co- invest and see the blending of public investments with private capital and equity to ensure increased and rapid delivery. We are resolute. We are building new neighbourhoods, new towns and new cities. We are consolidating our urban spaces. As we build new settlements we must also renew existing neighbourhoods and precincts that are dilapidated and suffer ravages of neglect and poor maintenance. Our budget, although

limited compared to the housing and settlements needs facing us, will be directed towards our delivery priorities and priority development areas.

We are glad to note that draft legislation on the expropriation of land has already been published and we hope that the process will be fast-tracked. If the Bill is adopted as it currently stands, we would like to take advantage of the following proposed clause dealing with abandoned property. I will quote the Draft Bill and I am very glad to recognise Minister Thulas Nxesi who made this possible in his previous dispensation. It says:

Where the owner of the land has abandoned the land, we would seize that land. [Applause.]

We would like this definition to include hijacked buildings. Where we have hijacked buildings, we will expropriate those buildings. [Applause.] We would like to expropriate these in order to create social housing and secondly, where land is owned by the state or state-owned enterprises; we would like to

expropriate that. We will however follow the correct route and make sure that all the necessary steps are followed. We would like to be the first to be given the advantage to choose land because our people need to be settled in the most comfortable areas possibly. [Applause.]

I am glad that Parliament has finally got to this point where we are able to expropriate land and I would like to be the first taker. I thank Parliament for the opportunity that they have afforded me. [Applause.] The draft legislation determines that no land would be expropriated for any other reason, except for the public interest. I cannot see that there is any greater public interest than what we represent at Human Settlements. It should therefore be possible for us to be the first to benefit from this legislation.

In 2009 the Housing Development Agency, HDA signed an agreement of alienation of ownership with the Provincial Government of the Western Cape to transfer land that belonged to them to the HDA so that human settlements could be created for the people of the Western Cape. As soon as the DA took control of the Western

Cape, they reversed that legal agreement. I am giving notice today that we will expropriate the land that was legally transferred to us in 2009 and make sure that it is given back to the HDA. [Applause.]

During my Budget Vote address in 2017, I proudly announced the launch of the Human Settlements Development Bank, HSDB. The Bank was set up as an apex level financial institution catering for the housing sector needs across the Human Settlements supply chain. Once fully established the HSDB will be central to all financing activities and market making activities across the housing supply chain. At a wholesale level the bank will participate directly in risk and funding of large scale development projects and programmes as well as facilitate and fund the requirements of housing finance intermediaries operating in the social and gap markets. The bank already supports a number of specialised asset based social housing finance entities.

This model is not new. In the not so distant past building societies performed much of this work as we intend to take over in the bank...

UIDENTIFIED SPEAKER: (Inaudible.)

The MINISTER OF HUMAN SETTLEMENTS, WATER AND SANITATION: ... not

at all. After the expropriation, I am very relaxed. This provided for much of the liquidity needed to extend into mortgages and the building of new homes. We will follow this enhancement to our work. The approach ensured much needed focus and support for housing. Today our people our confronted on the streets of the townships and cities with branches belonging to micro lenders. This has created a culture of consumption borrowers and spenders at a great cost to themselves. I think these are called ooMashonisa, for your information. The new bank that we have will play an active role in developing the models for Housing Banks that will address these challenges at both national and local level.

We are attending to the challenges of the South African residential market with its dualistic form. One part is functioning well and well-resourced, the other one completely dysfunctional, which is where we live. This is the township housing market with its nearly four million houses, undervalued, underleveraged economic assets and we need to turn this around. While much work is being done towards the vision of a single residential market in the future, an immediate, opportunity is available to us to ensure that we can provide our people with the necessary resources to lever themselves out of their situation. At a replacement cost of approximately R350 000 per unit, the total market value of the township housing market that we have built is approximately R14 trillion. This is what we have contributed to the economy of this country. This is the value we could leverage.

To illustrate the enormous benefit of the construction industry and we are part of that construction industry, we could refer to the 2007 Global Financial Crisis. Contrary to the debilitating effects that the global economy experienced in many countries following the 2007 Financial Crisis the South African economy

was completely unaffected. The main contributory factor being the investment in infrastructure supporting the 2010 Fifa World Cup which not only averted a financial crisis in South Africa it created tens of thousands of jobs in the construction sector and attracted billions of rands of foreign investment. We have now finished building our stadia and we are now building our catalytic projects and we will cushion our economy in the same way that it was cushioned in 2007.

Having reached this point, we want to take a different direction from what we have concentrated on in the last 15 years. Now that Parliament has agreed on the need for expropriation of land and a draft Bill has been put on the table, we want to ensure that we can ask those South Africans who are able-bodied to take the opportunity and work with us and join us in our projects so that they can build their own houses. We are open to the idea that has been bandied about by the young people that what they want is land so that they can build their own houses. This we are very open to it and we are going to do that.

In the past the process where people built their own houses was called the People's Housing Programme, PHP. We decided to rename these programmes so that they are self explanatory because PHP does not appeal to anybody. Therefore, I am making a suggestion that those people who are going to be joining us in building their own houses, the programme would be called Zenzeleni, which means do it yourselves. We believe this is a much more empowering tool and will bring greater yield. What is more? This is the answer many of our young people have been waiting for.

As part of this approach to encourage people to take up the "do- it yourself" concept, I urge people to come together to assist each other to build a house. It has occurred to me that in most developing countries where, unlike us, the state does not play a vital role in providing housing, a number of innovative ideas have been emerged and have been tested and used. I was therefore excited to come across the use of the stokvel idea - a traditional Black urban practice of pooling resources together to make better of the little income that they have.

I have come across an idea which is working very well and I am told here in Cape Town which is called Masakhe Ladies of Phillipi, Crossroads, Khayelitsha, Strand, etc. It has been established as a stokvel to build houses and it will have of course to be ladies. Men sit there and they know that somebody will provide them with a meal in the evening. [Interjections.] It is true and I am expecting the ladies to cheer and applaud. [Applause.]

I have decided that I will find these ladies and I will contribute to their fund. I will contribute to any fund where people come together and build their own houses. [Applause.] I will contribute to make sure that they are successful. The Fourth Industrial Revolution ...

Why is the ANC Caucus cheering their failure to build houses for our people? Why did they cheer the failures? You are useless. [Interjections.]

Hon member take your seat.

The MINISTER OF HUMAN SETTLEMENTS, WATER AND SANITATION: We are

taking advantage of the 4IR to overcome some of our problems. We will for instance embrace this to ensure that we use satellite technology and as such to make sure that have real time information on the ground. This will be a design for purpose which we can measure the quality of the work of the projects that we are dealing with. It will also reduce the incidents of bad workmanship and we will be able to see where land is invaded and act decisively on time. [Interjections.] No, you are not going to invade no where.

I am therefore establishing a fully fledged and skilled and capacitated ICT Management Unit with the required innovative software and technology that will assist me to do this and assist the municipalities to ensure that their land is not invaded. Within the next year, we will ensure that we have digitalised our entire platform of projects in order for persons to access all relevant information and we will make this available. We will ensure that we place the details of beneficiaries in the public domain, in a similar way as the matric results were once done, so that anybody who is on the

list is able to check how far they are. This will help us reduce corruption which is part of the problems that we have been experiencing, especially in the awarding of housing units.

We would be able to cut down on our turnaround time by 50% if we increase the use of this technology. We want our municipalities to be responsible to issue notices of illegal invasions and follow the law even when we have discovered invasions. We will partner with the private sector to assist where land is available for people to build their own houses. This will ensure that the programme is properly managed and that due skills assistance and training is given to people who are willing and able to build their own houses. This is a programme we would like to work on an urgent basis to assure our people that we are making an attractive proposition to them. We want to renew our social compact with the Banks to revitalise the Finance Linked Individual Subsidy Programme, Flisp programme and I have been informed that the Minister of Finance has asked us to stop using these acronyms and make our terminology more user-friendly. The Flisp is, help me buy a house.

We want to revitalise this programme that helps people to buy their houses. This is largely meant to help first time buyers and will benefit greatly government employees, a sector very much in need of our support. The Human Settlements Development Bank should be part of the banks supporting the housing market. The HSDB will be failing in its responsibility if they do not do so. I give them six months to ensure that the bank is fully functional and accessible for all those who require loans to build or buy houses. [Applause.] Just a few days ago I handed over some title deeds at Cornubia in Durban and I resolved that my Deputy Minister and I will spend every Friday as a special day to hand over title deeds. [Applause.] I am sure that in this way, between me and Deputy Minister Pam Tshwete we would be able to clear the backlog in the next two years. [Applause.] After the event on Friday I received a message through social media that has helped me to refine my thoughts around the title deeds. The message was that it would be important for people with title deeds to be assisted to write a will to ensure that the asset that they are given is assisted by creating a will to be attached to it. Remember, when the owner of the house dies, there is a great deal of disputes within the families and our

courts are not geared to deal with these family housing problems.

These are our successes and our successes continue. We have had serious failures, fraud, corruption and slow delivery. You read about these on a regular basis. We are daily experiencing protests. This is where we need the support of everybody to help keep us constantly accountable. This is why I am here very happy to report to you our successes and say to you we are ready and able to account for any of our failures.

Because of the huge pressure we have around housing, people sporadically go out in protests out there. We will take it to the media and assure them that we have taken a decision and sesifikile. We will create an environment very similar to the Fifa World Cup to make sure that we take them out of their misery

Members of Parliament, thank you very much. Chairperson, thank you very much for the opportunity. [Applause.]

Hon Chair, the ANC rises in support of Budget Vote No 38 on Human Settlements. We would equally like to take this opportunity to commend our predecessors, under the stewardship of former Chairperson, the hon Mafu and to equally congratulate her on her new responsibility as the Deputy Minister of Sports, Arts and Culture.

On the same note, we would like to welcome our new and returning public representatives to this legislative arm of the state and encourage that irrespective of party lines, we commit to working together in performing our function of executing enhanced oversight over the Department of Human Settlements, and all its entities, with the ultimate goal of improving the quality of life for our people.

Sepedi:

Re rata go t?ea le sebaka se re leboge batho ba Afrika-Borwa ge ba re file taelo re le ANC gore re t?wele pele ka go kaonafat?a maphelo a bona.

English:

Providing decent housing and shelter for our people has been a long- standing mission of the ANC. Since 1994, the ANC has focused on people who cannot afford to provide for themselves, built basic free homes, upgrade houses and services in the informal settlements and work towards restoring dignity and improving the livelihood of our people.

The Freedom Charter captured the ANC's commitment to provide houses, comfort and security. The ANC did not only stop at committing safety and comfort but also mandate itself with dismantling segregationist spatial patterns to create integrated and sustainable communities where our people live close to socioeconomic activity. The social contract remains our inspiration and strategic guide to realising a better life for all and realise a South Africa that truly belongs to all who live in it, as stated in our election manifesto.

The fifth administration made commendable strides in achieving the following objectives within the human settlements sector: Increasing housing units in better located mixed income projects, especially in social, co-operative and rental housing;

focusing on catalytic projects, such as integrated residential programmes and directing investment and overcome apartheid spatial geography;

These achievements are crucial to revitalising inner cities, mining towns and developing cities. However, the impact of the dire consequences of the segregationist spatial configuration of South Africa by the colonial apartheid state is still massive today. In his state of the nation address, our President Cyril Ramaphosa highlighted that significant work still needs to be came to ensure that colonial apartheid spatial patterns are unravelled to ensure that our people live in integrated human settlements with socioeconomic and do not spend a large portion of their income and time commuting to their place of work. Dismantling apartheid spatial patterns is not going at a desired pace and requires he delivery of a significant number of catalytic projects which will play a huge role in recreation of new and integrated communities.

Having integrated sustainable and economically active human settlements is important as we journey behind the President's

call to growing the economy of our country. It is based on the reason hat spatial integration, human settlements and local government form part of the priorities hat will receive focus from this new administration.

The ANC welcomes this prioritization and the merger the Departments of Human Settlements and of Water and Sanitation to ensure that indeed, better life for all is realised.

The Portfolio Committee on Human Settlements will continue to provide oversight over the Department of Human Settlements in order for it to fulfil its responsibility of ensuring that dignity, housing and access to social and economic activity is not a privilege, but a lived reality for all our people in South Africa.

Government expenditure on housing has grown faster than any other budget since 1994 and South African is world renowned its housing delivery efforts. The Portfolio Committee on Human Settlements emphasises its support for the 2019-20 budget for

the department so that it can continue in delivering on its task of changing the lives of our people.

With the world fast approaching the Fourth Industrial Revolution, the role of development finance institutions in terms of ensuring that Africa is not left behind will be crucial. To this regard, we welcome the Human Settlements Development Bank that was announced by the Minister of Human Settlements. As reflected in her budget speech, the bank will facilitate the increased provision of finance across the human settlements value chain, and the specific priority for the bank in this respect is the mobilisation of this respect is the mobilisation of and the provision of finance for all planned catalytic projects.

The 2019-20 budget of R33,8 billion allocated to the Department of Human Settlements is a crucial instrument in achieving some of the salient objectives of the National Development Plan of transforming human settlements and the spatial economy and securing a well-located land for affordable housing and

increasing the performance of the lower end of the property market through the supply of affordable housing.

The bulk of this budget will go towards Programme 4: Human Development Finance. This programme is instrumental for housing projects and ensuring infrastructure development to support the upgrading of informal settlements.

Through the Urban Settlements Development Grant and the Human Settlements Development Grant, the Department of Human Settlements is empowered towards providing sustainable and integrated human settlements and ensuring that our economy grows by including the participation of youth, women and people with disabilities through the 30% set asides within the housing value chain. There is a very important matter of the economic value chain that is associated in the grants aimed at building sustainable humans settlements.

We call on the department to ensure that women, youth and people with disabilities find expression in the economic value chain to such projects as this will play a pivotal role in curbing the

increasing unemployment rate of the country and we will upskill the masses of our people with the necessary skills required for them to enter into the market and be active participants in the economy.

The budget is also focused on providing affordable houses to our people who are excluded and cannot access housing opportunities through banks. The Auditor-General of the Republic of South Africa has been generally pleased with the Department of Human Settlements which has constantly received unqualified audit opinion and has commended the department's financial health, oversight and monitoring mechanism as well as its procurement and contract management processes - I know you don't like to hear this one.

We further urge the national department to support municipalities and ensure that our provincial counterpart have the ability to exercise effective monitoring of conditional grants so as to realise their respective mandate. This performance has, in term, made the work of the department much more meaningful and impactful and confronted with fewer problems

and allowed it to closely focus on advancing and delivering on its mandate.

However, spending of the Urban Settlements Development Grant and Human Settlements Development Grant requires attention. Some metros and provinces experience challenges and struggle to perform at a satisfactory level in terms of spending, which translates to an inability to deliver decent housing, particularly on the upgrading of informal settlements, which is a crucial commitment of the ANC.

In conclusion, we are confident that the committee and the department will work together in monitoring and providing oversight regarding the financial performance and the expenditure patterns of metros and provinces so that they should not fail to spend money that is appropriated by this Parliament

Chairperson, the lack of affordable housing in South Africa is a well-documented problem. The housing backlog stands at 2.3 million houses and is growing with approximately 180 thousand houses per year.

The Socio-Economic Rights Institute estimated that between 2.9 million and 3.6 million people still live in informal settlements in South Africa today.

Chairperson, Section 26 of the constitution stipulates that everyone has the right to adequate housing. In the ANC's first election manifesto, in 1994, the party stated and I quote:

"A roof over one's head and reasonable living conditions are not a privilege. They are a basic right for human beings".

Chairperson, millions of South Africans are still deprived of this "basic right" in 2019. People continue to live in appalling conditions where a "home" is often nothing more than a shack made from whatever materials are available, with no running water, no proper sanitation or electricity.

In 2014 Minister Lindiwe Sisulu boldly declared that the Department of Human Settlements would create 1.5 million new housing opportunities by 2019. This amounts to 300 thousand build units per year!

Given the fact that the number of build units decreased, this was nothing more than a pipe dream. At its peak in 1999, the government delivered 235 thousand build units per year. In 2018 this number had dropped to a Shocking 90 thousand build units per year.

It is clear that under the ANC government we will never resolve the housing backlog. Government can no longer follow the narrow strategy as outlined initially by the Reconstruction and Development Programme (RDP) and then Breaking New Ground (BNG) programmes for addressing the housing backlog as these have patently failed.

Firstly, because many South Africans still do not have houses, but also because the approach has not worked to create integrated cities and towns.

Chairperson, the DA believes that there is no single solution that will eradicate the housing backlog, but what is essential is a basket of solutions which can address the issue and give

South Africans more choice and a better quality of life when it comes to finding a place to call "home".

The DA recommends we take a new approach: giving more South Africans safe and dignified living spaces; creating more diverse and inclusive cities and towns; bringing more people closer to the economy and educational activities; densifying existing towns and cities; and providing more options that allow South Africans greater choice when it comes to housing.

To do this, we need to give recipients of RDP and BNG houses ownership of the land they live on by giving them title deed. Thank you Minister I appreciate you going to that on a Friday but it is not good enough.

Furthermore, to do this, we need to create a single national housing database which each province and local government will have to cross- reference to prevent beneficiaries from benefitting more than once and launch a national housing audit to verify the current ownership of RDP and BNG houses to

identify where houses have been allocated through corruption or have been sold illegally.

THE HOUSE CHAIRPERSON: Hon Basson, would you just take your seat. Why are you rising, hon Deputy Minister?