DIVISION OF REVENUE: HOUSING FUNDS
- SA Housing Fund
- Human Settlement DeveIopment Programme

SA HOUSING FUND
PURPOSE
- finance national and provincial housing programmes
- housing subsidy scheme
- national housing code

OBJECTIVES
- RDP target 1 million houses in five years
- fiscal constraints
- delivery started slow
- peak 1997-98: 322 638 units
- current delivery 188 000 per annum
- normal growth
- current backlog 2,8 million units
- provincial housing development plans
- set new targets

CONDlTlONS
- Housing Act and National Housing Code
- national expenditure priorities
- contingency fund
- roll-over 5%

ALLOCATION FORMULA
- previous formula urban bias
- new formula 2000/2001
- equal weighting for urban and rural
- number of households earning less than R3 500 p.m.
- households in each income category

MONITORING MECHANISMS
- monthly reports
- transfer of funds
- actual expenditure
- cash flows
- project progress
- housing subsidy system (HSS)
- auditing arrangements

RATIONALE FOR CONDITIONAL GRANT
- housing concurrent function
- national and provincial housing budget
- provincial accountability
- dedicated funds
- priority housing needs (Minister)

PAST PERFORMANCE
- 1999/2000 R3, 026 billion
- transfer to Provinces R2,57 billion
- roll-over R4 56,2 million
- 2000/2001 R3, 453 billion
- transfer end February R2, 728 billion
- expected roll-over RI66,6 million

LIFE OF GRANT
- SA Housing Fund statutory fund (Housing Act)
- strict financial and accounting procedures
- DG accountable
- annual audit
- financial statements
- Surplus cash invested
- interest earned Exchequer
- roll-over
- nature of housing projects
- ideal mechanism
- eradication of backlog (twenty years
- lifespan long term

PAYMENT SCHEDULE
- confirmation of budget amount
- letter of allocation
- transfer process
- Provinces: expected cashflows
- basis for payment schedule
- advance requests deviate from payment schedule
- nature of housing projects
- possible options
- cashflow management
- payment schedule

CAPACITY
- originally capacity constraints
- restructure establishment
- capacity build-up
-more personnel
- better functional structures
- training
- systems

HUMAN SETTLEMENT REDEVELOPMENT PROGRAMME
PURPOSE
- improve the quality of the urban environment
- disfunctionality
- identify/address reasons
- provide source of funding
- gear other funding
- co-ordinate sources of funding
- Add value to other projects

OBJECTIVES
- general focus on existing residential environments
- address adverse physical conditions
- projects must be specific
- upgrading of infrastructure
- land intervention initiatives
- re-plan/re-develop existing residential areas
- enhancement of unsafe, inappropriate and substandard developments
- enhancement of projects where products are not of acceptable standards
- investigations in respect of specific developmental needs

CONDITIONS
- linked mostly to funding focus
- detailed financial management and reporting
- letter of allocation
- business plan
- Public Finance Management Act (monthly reports)
- Division of Revenue Act (monthly and quarterly reports)
- audited Certificate of Revenue and Expenditure
- prescribed tender procedures
- maintain and recurrent costs (local authorities/end-user beneficiaries)

CRITERIA
- pilot projects
- 1999/00 to 2000/01 deserving project submissions
- 2001 2002 allocation formula SA Housing Fund
- priorities Social Cluster

MONITORING MECHANISMS
- programme steering committee
- monthly progress reports (progress and expenditure)
- qualitative monitoring
- auditing on level of implementing agency

RATIONALE CONDITIONAL CRANT
- pilot programme
- need national involvement in approving, monitoring and evaluating

ADMlNlSTRATIVE COSTS
- existing capacity
- limit towards consultant/management fees
- recurring costs local authority

POST PERFORMANCE
- commenced January 2000
- roll-over R19 million
- fourteen projects financed

PROJECT LIFE-SPAN
- approved MINMEC Housing
- MTEF run to end of 2003/04
- national Department believe permanent sustainable programme

PAYMENT SCHEDULE
- approved project business plans
- closely monitored
- utilised to withdraw funds

CAPACITY
- dedicated Directorate