Chairperson, thank you for giving us the time to brief you about our Budget Vote. In a way this is my maiden address, but I think I have been here before. Let me start by saying as a former Premier of Gauteng ... [Laughter.] ... one can honestly say that it is great to be back here in the National Council of Provinces to share with you as representatives of your provinces as well the thinking that drives our new mandate as Human Settlements.
This Budget Vote covers what is still defined as the Housing Vote in terms of the Medium-Term Expenditure Framework. Our presentation will consist of three parts: firstly, the concept of human settlements; secondly, the current housing situation; and, thirdly, the consequential challenges of our new mandate.
In understanding our approach, we need look no further than the Constitution of our own Republic, where the very first value referred to in the very first line of the first chapter is that of human dignity.
The concept of human settlements, which recognises the centrality of human dignity, may be a new one to many South Africans. Yet it has been part of the global developmental lexicon for many years, having been first adopted at the United Nations global habitat summit in Canada in 1976. It gained ground at another UN conference, this time at the World Summit on Sustainable Development, held in Johannesburg in 2002. The 52nd national conference of the ANC in Polokwane in 2007 took this concept further, where several resolutions committed the new government to the promotion of human settlements.
Ultimately, in both his state of the nation address and Budget Vote, President Jacob Zuma formalised this concept with the establishment of the new Ministry of Human Settlements. He said, and I quote:
... housing is not just about building houses. It is also about transforming our residential areas and building communities with closer access to work and social amenities, including sports and recreation facilities.
Chairperson, this concept was also referred to by the last Minister of Housing, Dr Lindiwe Sisulu - we say "last" because that department has now gone - in what we call the Breaking New Ground policy, which outlines the need for a human settlements plan.
But what is the letter and spirit of this concept? This is actually contained in the Freedom Charter, long before the Vancouver conference in Canada or the world summit, and long before Polokwane. That Congress of 1955 demanded: "There shall be houses, security and comfort."
Mindful of the consequences of apartheid social engineering, the Congress demanded that, "All people shall have the right to live where they choose, to be decently housed, and to bring up their families in comfort and security." It went on: "Slums shall be demolished, and new suburbs built where all have transport, roads, lighting, playing fields, crches and social centres."
In this respect, our task, in terms of the government's Medium-Term Strategic Framework, is clear: that is to restore human dignity in line with the Constitution, to address spatial inequalities and to provide comfort and security for all in our country, black and white.
This we shall achieve by planning and building human settlements in an integrated, co-ordinated and holistic way. These must be places where people can play, stay and pray. They should be pleasant, landscaped communities where people live, learn and have leisure.
To achieve all this requires a new approach, a paradigm shift beyond housing. It is about homes. It is not just about a change of name from Housing to Human Settlements; it is about a change of mind-set, taking us from a concept to concrete reality. Let me briefly reflect on the work of the Department of Housing as it stands. Some of the key developments are the following. Expenditure on housing service delivery has increased from R4,8 billion in the year 2004- 05 to R10,9 billion in the last financial year, increasing at an average rate of 23%. Funds allocated to national pilot projects for this financial year include R400 million for the N2 Gateway, R120 million for the Zanemvula Housing Project and R150 million for disaster relief in KwaZulu- Natal.
The roll-out of housing delivery is a key function of provincial government and our department's main cost driver is the integrated housing and human settlement development grant to provinces. This accounts for 92,6% of the total budget allocation of R13,5 billion in the current financial year. It should be noted that expenditure in this area during the year 2008-09 exceeded the allocation in view of the fact that the Mpumalanga provincial treasury allocated the provincial housing department R100 million to facilitate the acceleration of housing delivery and to finalise prioritised incomplete projects. The leadership in that province needs to be commended.
Regrettably, the national department had to reduce the Eastern Cape's allocation and reallocate it proportionately to three provinces. We reallocated R270 million: Gauteng received R152 million, the Free State R68 million and Mpumalanga R50 million. This was to avoid a situation in which appropriated funds have to be sent back. This underspending is an issue which concerns us and we intend to keep in close contact with the various MECs to ensure spending stays on track.
At the same time, we will be engaging with our members of executive councils around the number of qualified audit reports which are emerging both at provincial and local government level. We all should understand what qualified reports mean: unspent funds - they go back; no projects on the ground whilst people are suffering.
Going forward, additional funds are being allocated to provide for large- scale upgrades of informal settlements and the alignment of the national housing grant with inflationary price increases. Although the housing grant allocation has been increased over the 2009 MTEF period, we remind you once again that the previous studies by the department concluded that continuing with the current trend in the housing budget would lead to a funding shortfall of a very staggering amount: R102 billion by 2012. At the same time, if this trend continues to 2016, it will amount to a backlog of R223 billion.
We have also strengthened our resolve to provide housing assistance to people living in shacks, who constitute the bulk of the housing backlog. The rural housing programme remains a key housing intervention, and new initiatives are in the pipeline to accelerate the development of quality rural human settlements.
Let me now turn to the question of corruption. This remains a major challenge across the housing delivery environment. To ensure we identify and act against criminals, we have strengthened our partnership with the Special Investigating Unit, SIU, and taken stern action against offenders.
To date, a total of 772 public servants have been charged, of whom 554 have been convicted. More than 1 600 acknowledgements of debt have been signed in respect of nonqualifying government employees, with a total value of R19,8 million of public funds. Millions have already been collected by the SIU from nonqualifying illegal beneficiaries.
Let us now come to the question of the consequential challenges of our new human settlements mandate. From the outset, let me emphasise that ours is effectively a brand-new Ministry with, for the first time - and there she is - a brand-new Deputy Minister, the hon Zoe Kota-Fredericks. [Applause.] And much of what we are undertaking in terms of human settlements is also brand-new.
In addition, all the provincial MECs are new to their portfolios. However, they are nonetheless a dynamic team of men and women, with whom we have already held two successful meetings or lekgotla, otherwise called Minmecs. These meetings have played an invaluable role in shaping our thinking as Team Human Settlements, together with our senior management team in the department, led by director-general Itumeleng Kotsoane and our partners in the various housing institutions.
Internally, as the Ministry and the Department of Human Settlements, we are examining the implications of the broader definition of human settlements in terms of our mandates, policies, procedures and programmes, as well as the capacity that we have.
We also have several legislative proposals in the pipeline to accelerate the achievement of the ideal of human settlements - for people as well as to strengthen the legal environment. These will include the following four: amendments to the Housing Act; the Sectional Titles Schemes Management Bill; the Community Schemes Ombud Service legislation to establish a dispute resolution mechanism for all community housing schemes; and, in addition to the above-mentioned, the Land Use Management Bill is being piloted by the Department of Land Affairs. That is quite critical for us. At the same time, we will be tabling a new national housing code, which is required in terms of the Housing Act of 1997. The housing code of 2009 was approved by the Minmec in February of this year.
It must be clear by now that, as much as we aim to address the housing needs of all South Africans and build integrated communities, our chief focus is the needs of those South Africans who are on the receiving end of economic negativities. That is the poor, as well as the poorest of the poor, where the former qualify for government subsidies and the latter, who live in shantytowns, qualify for nothing.
Shantytowns exist throughout South Africa, where townships or "slaapdorpe" (dormitory towns) were built under apartheid far away from urban areas. This was taken to horrific extremes in many places such as Ekangala, where people depart for the city of Tshwane as early as 4am, spending hours on the road. Heaven only knows what time such people had to get up to travel to work.
This government has made tremendous gains in breaking the housing backlog and the number of new homes built is second only to China. But this must not mean that houses should be of a poor standard or that quality is compromised in the interests of merely chasing numbers.
Consequently, it is crucial that we work closely with the planning and monitoring Ministries in the Presidency. In our department we already have our own monitoring unit to assess the quality and quantity of homes as well as the National Home Builders Registration Council, NHBRC, and we will be collaborating with the relevant Ministries within the Presidency. That is the National Planning Commission as well as the Ministry in charge of performance monitoring and evaluation.
Similarly, we will focus on heightening co-operative governance with provinces and municipalities to harmonise the national, provincial and local government in order to continue working together. We will also work closely with the SA Local Government Association, Salga, as well as with the SA National Civic Organisation, Sanco.
Increased interaction with local government will, for example, enable us to redress existing developmental gaps in more established communities such as Soweto, Langa and so on, where apartheid spatial planners deliberately neglected the need for community services and facilities. It is important that we avoid perpetuating the same apartheid spatial development strategies.
A golden thread runs through all our initiatives: that is, consultation and community involvement for community development. We plan to work closely with communities, contractors, regulators, and other stakeholders.
The corporate sector is a key partner in ensuring we meet our objectives. We will be engaging with captains of industry as well as high net-worth individuals towards consolidating new partnerships with the private sector. This would be in recognition of the fact that working together we can do more. A consultative meeting will be held with business in the coming months to explore ways and means of addressing the dire situation of the unbanked and people who do not qualify for credit.
It is well known and appreciated that many players within the corporate sector are committed to social investment as well as responsibility, but our new engagement with them will be about going the extra mile for the sake of our people. We trust and believe that the corporate sector will come on board.
In the current situation, the global economic downturn is of fundamental and critical concern to us as Human Settlements, as it negatively impacts on our endeavours, now and in the foreseeable future. This situation is worsened by the current economic recession in the South African business cycle.
This does not paint a rosy picture. In revenue collection terms, this situation has had a serious effect on the fiscus, which could lead to decreases in budget allocations, with potentially harmful consequences for all departments of government in the future.
In our own sector we are already feeling the pinch in the prices which are increasing on the property market, in building materials, and in access to housing finance. Many people have lost their jobs or are in the process of losing their homes and household contents. On a broader level, an ongoing global slowdown in spending and investment is likely to impact on the government's ability to meet some of the targets of the 2014 United Nations Millennium Development Goals.
The other global phenomenon we need to factor in - and this is important - is that of planning for urbanisation. UN-HABITAT has pointed out that this century, the 21st century, is in fact the Urban Century when, for the first time in history, the world's population will predominantly be living in cities. We must be prepared for this eventuality and identify its problems as well as its opportunities.
Yet, there must be no equivocation that the 21st century must also be seen as the one in which South Africa must grow from being a developing to a developed country. There must be an active realisation that this is what our government is working towards as we develop human settlements, because Human Settlements is not about upgrading squatter camps. It is about putting up new cities. A question we can ask is: How many cities have been built in South Africa since Nelson Mandela was released? It's a challenge.
Lastly, but most importantly, let me emphasise that we will require the support of the hon members of the NCOP, as well as the Select Committee on Human Settlements in particular, if we are to succeed in our mission. Chairperson, I began this presentation by explaining the concept of human settlements in the context of the Freedom Charter. Let me conclude my presentation by telling you what I was doing last week, together with a team of us, on 26 June 2009, the 54th anniversary of the signing of the Freedom Charter. On that day we were privileged to hand over certificates to a number of youths - volunteers - who had taken part in our annual Youth Build programme which encourages young people to get involved in home construction. In this case the youth volunteers were members of the Eshowe community in KwaZulu-Natal who participated in new home building schemes in a suburb called Sunningdale. The houses they built, 76 for that week, were for the elderly. [Applause.]
Because of good corporate governance we were able to celebrate the creation of a new community - a community with trees, grass, and vegetables - thanks to collaboration with the Department of Agriculture, Forestry and Fisheries and the Department of Water Affairs. We urge you to contribute in getting this message across. We believe that the NCOP has a duty, not only to hold this Ministry accountable for the development of human settlements as well as budgetary expenditures, but to also join us in educating beneficiaries on the importance of taking care of and maintaining the assets that we provide people and the environment within which such assets are located. When you provide people with a house, that becomes an asset and the people can use it for all sorts of things.
In doing so, we are asking you to echo our message - and we said that yesterday to the National Assembly - to address the pervasive and negative entitlement mentality that exists among some individuals within society, who only see government as something that gives handouts. It is important for people to also begin to assume responsibility.
Finally, as Team Human Settlements we know the difficulties that confront us. We understand our mission. We foresee the challenges. It is not going to be an easy task, particularly given the current economic constraints. And we know we have to be extremely careful with every cent we spend. After all, it is public money, contributed by South African taxpayers, both rich and poor.
We know and trust that we shall have the support of this House, both for our activities and for the expenditure that is outlined in our Budget Vote. The commitment that we make in return is that as accountable political leadership, together with our MECs and our management team, we will put our shoulders to the wheel on the basis of sound principles and good governance to ensure success, knowing quite well that this calls for hard work, diligence and serious commitment. Chairperson, I thank you. [Applause.]