RDP housing failure as provinces grossly underspend their budgets

Gauteng, North West, Northern Cape and Free State have been stripped of a good chunk of their human settlements budgets because they could not spend the funds they were allocated on building houses for the poor and military veterans.

Minister of Human Settlements Lindiwe Sisulu recently took the unspent funds from the four provinces and redirected them to Western Cape, KwaZulu-Natal, Mpumalanga and Eastern Cape.

Those provinces had been delivering well, with some of them even exceeding their targets.

The trend of nondelivery by Gauteng, North West, Northern Cape and Free State emanates from the 2018/19 financial year and continues to the current financial year.

Gauteng targeted to build 41,992 units but delivered 21,357, Free State 17,439 but built 6,610, Northern Cape planned 4,760 but 2,720 were constructed, and Free Stated budgeted for 15,447 but built 10,687.

Had Gauteng, North West, Northern Cape and Free State used the more than half of estimated total of R8 billion they were allocated, they could have built at least a total 40,000 RDP houses, if calculated at the cost of R110,000 per RDP house.

The underperformances by the four provinces and their failure to spend their funds forced Sisulu to act.

Sisulu, who is said to be strongly opposed to having funds returning to the National Treasury, recently issued a directive at the regular meeting with the MECs for human settlements.

Sisulu appealed for provinces to accelerate the pace of their spending in the provision of houses to indigent people. She decided to reallocate the funding from underperforming provinces to those that performed well.

“This is to make sure a sector performs and, most importantly, we do not return money to National Treasury while we have such a backlog in the country when it comes to matters of human settlements, water and sanitation,” Sisulu said.

The minister gave a strict instruction that provinces that were negatively affected by the reallocation would have to improve their performance over the next few months.

However, there were strict conditions for the receiving provinces. Sisulu said the funds allocated to the Western Cape should solely benefit the poorest of the poor, while in the Eastern Cape this should be channelled to the Duncan Village Priority Development Project.

An attempt by Democratic Alliance (DA) MPs to question the failure of the four provinces to spend their funds was blocked by the chairperson of the parliamentary portfolio committee on human settlements, water and sanitation, Machwene Semenya, who abruptly called a halt to the meeting before its scheduled close.

Semenya did this after she realised that DA parliamentarians wanted to question the gross underspending by the four provinces.

DA MP and spokesperson for human settlements Emma Louise Powell said Semenya adjourned the meeting 30 minutes before it was set to conclude in an attempt to prevent DA MPs from asking the department’s director-general, and Deputy Minister David Mahlobo, follow-up questions on the department’s failures.

Powell said they were going to ask Mahlobo and the director-general about the department’s failure to table their end-of-year report; a plan to resolve ongoing water shortages in district municipalities across the country; and the wholescale failure of a number of provinces to spend their allocated second-quarter budgets.

Powell said it was not the first time that Semenya refused opposition members the opportunity to ask officials questions.

“The DA will now escalate this issue to Cedric Frolick, the chair of chairs,” she said.

Sisulu’s office could not be reached for comment.

Budget cuts hit us – Sisulu

In response to her department’s budget vote on July 25, Minister of Human Settlements Lindiwe Sisulu said grants were allocated to the provinces and metropolitan municipalities based on fair and equitable formulae which took into account, among other factors, population, and the severity of backlogs.

“I must highlight that the department of human settlements has been affected by the expenditure cuts, totalling R85 billion, over the medium-term expenditure framework period.

“R53 billion of this has been cut at national level,” Sisulu said.

She announced total budget of R33.8 billion allocated to her department would be used for:

• R18.7 billion as grants to the nine provinces for the creation of sustainable human settlements that enable improved quality of household life and access to basic services. Linked to this, funds will be reprioritised for the priorities set out in the 2019-2024 framework for human settlements.
• R12 billion as grants to the eight largest metropolitan municipalities to co-fund bulk infrastructure, water, sanitation, refuse removal, roads and storm water, as well as fire stations, libraries and community halls. It further funds acquisition of land and buildings for inner-city improvement precincts and densification.
• R149.1 million as a grant to municipalities in respect of emergency housing, while R276.9 million will go to provinces for emergency housing.
• The title deeds restoration grant has been allocated an amount of R547.7 million.

Meanwhile, Democratic Alliance (DA) Gauteng shadow MEC for cooperative governance, traditional affairs and human settlements, Kate Lorimer, said Gauteng had failed to meet all of its housing targets.

It fell short on its targets for service stands in Cosmo City, Savanna, John Dube, 3D Tswaing Soutpan and 3D Sebokeng Extension 28.

– ericn@citizen.co.za

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