2015/16 Human Settlements Budget Vote speech by MEC Jacob Mamabolo, at the Gauteng Provincial Legislature
Madam Speaker,
Honourable Premier David Makhura, Hon Chief Whip,
Hon MECs,
Chairperson of the Portfolio Committee on Human Settlements, Hon Phuthas Tseki and PC Members,
Hon Members,
MMCs of Human Settlement and Councillors,
The Head of Department,
Our distinguished guests,
All Officials,
Ladies and gentlemen.
Hon Members, allow me to dedicate this Budget Debate to the Cuban Five revolutionaries who are arriving in our country this coming Sunday as guests of the African National Congress (ANC) and its Alliance partners.
The Cuban Five were wrongfully arrested by the Imperialist USA sponsored acts of terrorism for their principled fight against the peace loving people of Cuba. The Cuban Five sustained discipline and revolutionary militancy till the last moment inspired by the fighting spirit of Jose Marti, Maximo Gomez, Antonio Maceo known as the Bronze Titan.
They were inspired by the fighting spirit of Simon Bolivar, the Liberator of Latin America. I am pleased to welcome the Cuban Five to our country.
Honourable Members, this all-important budget speech takes place just before the 60 anniversary of the Freedom Charter, which was democratically adopted few kilometres away from here, in Kliptown in 1955.
This 60th anniversary affords us an opportunity to reaffirm and to demonstrate to our people that we are still guided by this revolutionary document and master-plan for freedom.
Having created over 1 million housing opportunities in the first 20 years of democracy, we still affirm the fact that ‘There shall be houses, security and comfort!”. As President Jacob Zuma would say, no country in the world has achieved this much for its people.
Honourable Members, let me upfront make a profound call to Members to support and firmly stand behind the R5, 9 Billion budget allocated to the Department of Human Settlements.
In his inaugural State of the Province Address last year Premier David Makhura announced the Transformation, Modernisation and Reindustrialisation (TMR) as the vision of the Gauteng City Region.
In this well-articulated vision that found overwhelming support, popular expression and resonance with the people of our province, two of the Ten Pillars speak directly to Human Settlements and these are, decisive spatial transformation and modernisation of human settlements and urban development.
In addition to this strategic vision, Premier directed us to go back to communities to establish trust, to reassure them of our unwavering commitment to serve them, to respond promptly, decisively and consistently to their needs.
Just this year, Premier David Makhura, in his State of the Province Address took this vision further and articulated a strategic perspective of Five Development Corridors correctly and properly aligned to the development path of the various Municipalities. In her well-articulated and deeply inspiring Budget Speech, MEC Barbara Creecy placed firmly in each of the Development Corridor, the breakdown of the R5.9 Billion
of the Department of Human Settlement. Thanks MEC Creecy for making my task very easy.
I am therefore pleased to announce that since Premier David Makhura outlined the vision last year, we immediately went to the people to interact with them, building a relationship of trust.
Just yesterday, in his Budget Speech, Premier confirmed that indeed as the collective leadership of the province, and in line with the character of the provincial government of an activist government, we have done very well in this regard. Gauteng is a stable province.
We have built good relations with our communities. Our communities trust us. No single protest is sustained over two days. No protest is repeated. Let me say in case there is any that repeated or sustained a protest beyond two days, it is not a trend but an exception. Let me thank our revolutionary people.
With respect to the TMR vision anchored on the Five Development Corridors, we have since last year September formally launched a platform of dialogue and conversation with Members of Mayoral Committees of Human Settlements and those of Infrastructure, Eskom and Rand Water. This dialogue was based on our interaction and meeting with the people, with communities. We developed a strategic response and our direct contribution to the TMR.
In this conversation, that took place in Sedibeng, in the town of Vereeniging, where we were joined by the Premier. It was in this meeting that we resolved that Spatial Transformation and Modernisation of Human Settlements required fundamental break with the current Human Settlements delivery trajectory.
We agreed to do away with the current RDP housing development paradigm, which does not transform and alter Apartheid spatial legacy, does not create non-racial settlements, locate our people far from employment and does not create job opportunities, lacks government facilities and advanced infrastructure. Allocation of houses is marred by acts of corruption and manipulation of housing waiting lists.
The current RDP trajectory is inadequate compared to the massive demand and backlog of housing in our province, the biggest economy that attract many people to our province. As reported by non-governmental research organizations, Gauteng is the best province to live in, thus potentially attracting more people including those from outside our province.
Honourable Members, I am deeply pleased that we have adopted a decisive and radical vision for Human Settlement, in line with the strategic articulation of the African National Congress of a Second Radical Phase of the NDR and the TMR.
I am pleased that even the DA Club, I mean the DA Club of Hendrick Verwoerd, remnants of Die Hersigtige Nationale Party and National Party as clarified by a certain Mr Allister Sparks speaking at the DA Club's Conference to huge applause.
This conservative doubting remnants of Verwoed, used to issue a series of press statements saying we lacked a Human Settlements strategy.
Honourable Members as you know, this chorus is now dead. This is because we have presented to the Portfolio Committee our vision of Human Settlements. This, we did on the 12th March in the City of Tshwane at St George’s Hotel. All parties, without exception, welcomed the vision, but as I know, they might change tune today as they more often do.
At this meeting, the permanent doubting Thomases then choreographed a new tune, changing the goal posts. They then said, good plan MEC but you lack capacity to implement. On Human Settlements Plan, matter resolved. A vision exist. It’s accepted.
Honourable Members, the Vision we are talking about is that of Mega Human Settlements Projects underpinned by the slogan of Human Settlements Turnaround. In this new vision, we stated two objectives notably, building post-apartheid cities, secondly, completing current legacy projects, or RDP housing development trajectory. We also linked new cities and current cities, with human settlements projects of more than 15 000 housing units.
We said that in building new cities that cut across and impact beyond municipal and provincial boundaries, we will make land available for various economic precincts, notably, residential, retail and office parks, light Industrial and Manufacturing precincts, government precincts as the leading key government investment in each city. We will also ensure that our human settlements have sports and recreational facilities that promote social cohesion.
Premier Makhura mentioned that in the new human settlements paradigm we will work with the private sector and various partners. I am pleased that Minister of Human Settlements, Honourable Lindiwe Sisulu, in delivering her Budget Speech this year, called for such partnerships.
Remember, Honourable Members, that the DA Club of Verwoed was upset that ANC government is becoming the only source of hope for the private sector.
I am therefore pleased that in assessing our capacity to drive and lead the delivery of Human Settlements, we must not wear the old spectacle, and only look narrowly at Human Settlements Department.
We have created a Mega Human Settlements Committee as a governance structure to drive Mega Human Settlements working with the private sector.
Following preliminary engagements with the private sector and our Municipalities, i am pleased to announce that on the 7th of April this year at the Gordon Institute of Business of Science (GIBS), where we were led by the Premier.
We signed a Declaration of Intent with our Municipalities and received a total of 43 Pledges by the Private Sector - pledging their support to work with government. In total, and working with these partners, we will be working together with these key partners to deliver human settlements opportunities totalling more than 700 000.
When we mention this 5 year target, the Verwoedian DA Club immediately jumped and said, “You don't money and capacity to deliver on this target”. This, they say, first, because they narrowly and conservatively look purely at Human Settlements Department.
They refuse to accept that now we work with our municipalities and private sector to achieve this objective. They deliberately and consciously resist the truth about the fact our new approach include integrated planning, budgeting and implementation.
This approach allows us to leverage and access the R5 Billion Urban Settlements Development Grant managed by the three Metros. Honurable Members, through this new vision, we now also have access to the Municipal Infrastructure Grant managed by the soon to be Metro Municipalities.
Let me also say, we have pledges made by private sector organizations that are directly involved using their own resources to deliver human settlements. They require government support and we have committed to help them.
Honourable Members we are aware that the housing market and construction are currently depressed. Following the world economic recession, many of the private sector players in the housing and construction market experienced a decline.
We are going to use Mega Human Settlements Vision to resuscitate and rejuvenate economic growth, to create jobs, to empower the housing and construction sector.
We are fully aware that in order to create a positive sentiment and confidence in this sector, we need to work on a long term planning.
We need to avoid short term quick fixes and crisis management. We fully understand that the housing and construction sector is different from other commodities and sectors that get easily influenced by short term market sentiment and risk exposure. This sector relies on long term planning to make a proper forecast and appropriate investments.
Honourable Members, it is in this context that we have planned our Mega Human Settlements Projects and building of new cities over a 10 to 15 year time horizon. That is why our target of 700 000 housing targets is spread over 5 years to contribute to the 1.5 million housing opportunities set out in the ANC Election Manifesto.
To put it differently, we will use government contribution of more than ten billion made up of the Human Settlements Development Grant, the Urban Settlement Grant and the Municipal Infrastructure Grant to propel and turbo-charge the economy of the province.
In addition to this, we will also leverage resources available to Eskom, Rand Water and the Department of Water and Sanitation to create massive infrastructure to deliver post-apartheid cities and Mega Human Settlements Projects. Gone are the days when we build human settlements without planning and integrating bulk infrastructure.
As you are aware, Premier David Makhura did outline in detail some of the key Mega Human Settlements, and this, we presented during our launch in April this year. Financial details of each Corridor of Development were presented by MEC Barbara Creecy.
l Let me just add that already in the Southern Development Corridor, we have formally launched the private sector led initiative of River City, founded on exploring the economic potential of Vaal River City. We have just concluded key and strategic processes on government led initiative of Boiketlong node, and we will formally launch before the end of July. Both of this initiatives, will give us a completely and new spatially transformed development corridor. In this corridor, we have to consolidate and speedily improve the construction of Savanna City.
I have already had extremely good discussions with the developers of Savanna City. Again, in the area of Vishkuil in Lesedi Local municipality, we will develop a mini city for the benefit of the farm dwellers. We have already met with the various key players to put in place a plan for this area.
l In the Western Corridor, we will soon finalise our plans for massive government led New City in the area of Syverfontein. Working with CoJ and the West-rand District and Westonaria Municipality, we will, before end of this year, formally launch this new city led by government.
In this corridor, following my visit to Merafong Local Municipality last week and Blyvoor mine, agreed with the Mayor, to urgently explore changing the current Mega Human Settlements in South of Khutsong into a New City developed around Carletonville. Given problems of poor quality and dolomitic conditions of Khutsong, we need to re-establish
Khutsong and create a city around Carletonville. This will be a major intervention in Khutsong since its re-integration from North West.
In the Central Development Corridor, and linking to the Western Corridor and Northern Corridor, we have a great opportunity of a new city in Lanseria Airport, supported by the Mega Human Settlements Project of Lion Park, Diepsloot East and Stein City. This new city, to be led and driven by government has the great economic opportunity of fully exploring the potential of the Cradle of Human Kind and those offered by the development and growth of Lanseria Airport.
In the Eastern Corridor, we have a great potential of a new Mega Human Settlement that will radically transform the space in the Southern node of this corridor, integrating private sector initiatives and those of the state in-and-around Alberton, linking with the Mid-Vaal alongside the R59. In the Northern node of this corridor, there is a great potential of a radically altered landscape in areas around Clayville, thus positively impacting the whole of Tembisa and Midrand, linking with the Northern Corridor and City of Tshwane.
In the Northern Development Corridor, we will consolidate the areas around Soshanguve and Winterveldt, and create new human settlements with better opportunities for the people.
Honourable Members, allow me to outline some of the key interventions that are absolutely necessary to deliver Mega Human Settlements and post-apartheid cities. This will also update you about the new critical steps and where we are, currently. I hope this will not sound technical or technocratic.
Following and based on a best practice of a Project Live Cycle, the following are critical and is clustered in phases:
In Phase 1, we have adopted a vision and this has been adopted and supported by key stakeholders, the private sector, municipalities, Eskom, Rand Water and the people of our province. This is done.
Phase 2, this is the period since May this year to the end of August. During this phase we will be focused on technical planning, integrated planning using construction, engineering and build environment best practices. The key activity of this phase will be to conduct a detailed analysis and profiling of each of the 5 Development Corridors.
The key outcome will be to present to the provincial government a proper business case for each of the Mega Human Settlements Projects. This is critical to manage risks associated with Mega Projects, such as high costs over-run and project failure as well as performance shortfalls.
Phase 3, will run in September and end of November this year. We will engage in massive procurement process based on proper business cases and integrated planning to procure the necessary capacity to drive and deliver Mega Human Settlements Projects and transition out of the current trajectory. In our Vision we have articulated the Transition Phase between current Legacy Projects and New Mega Human Settlements Projects.
As we prepare for the final phase or the fourth phase of implementation, which will commence effectively next year February and moving forward, the following concurrent activities cutting across each phase will be implemented:
Firstly, we will in each quarter of the year improve and upscale output and performance of housing opportunities. Performance of output will be improved in the next quarter ending in September this year. This quarter is the last of under- performance. The graph of the Department in the next quarter will be that of an upward trend, thus ending the current downward trend of the Department. This will achieve by improving the management of the current projects.
Secondly, we are improving leadership and management capacity of the department in the short and medium term. This, we are doing thorough a centrally managed Programme Management Office or PMO. We have completed the baseline and design of the technical functioning of the PMO. As we speak, the PMO is being rolled out to our Regions and the process is going on very well.
As part of strengthening management and leadership of the department, we have made good progress to fill in the key leadership posts. In this regard and as promised in the last Budget Speech, we have filled the post of Chief Finance Officer (CFO) and that of DDG responsible for Regional Management. We have also filled the position of Chief Director Supply Chain Management. We have just advertised the last post of DDG Property Management.
Once this post is filled, we would have stabilised top management and this would be a major achievement. I am also pleased to announce that since the Department of Human Settlements and Cogta were split in February 2014, we now have a new Organisational Structure of the Department, thus formally splitting the two Departments.
As part of strengthening institutional capacity in the short term, we are strengthening legal capacity for contractual management. This will help us to enter into legally sound, fully compliant, effective and efficient negotiations with our private property development partners taking time factor into account.
Immediately following next week, we will engage in a series of consultation processes with colleagues in the Executive Council to finalise as part of the business case development process, a number of Precincts content. In other we answer the question what is the essential content of the look and feel of the different precincts.
For example, we urgently met with MEC Mayathula-Khoza and all MECs in the Social Cluster to finalise Government Precincts that brings together all core infrastructure for Social Services, Health, Education, Safety and Security, Police Stations, Home Affairs, Sports and Culture. This will also include Municipal services.
We will meet with MEC Maile to discuss and finalise content relating to Economic development precinct, such as light manufacturing, retail, commercial and industrial parks and food production precincts. This will ensure that we don’t build poverty stricken Human Settlements with no revenue and income for our people.
We must create new job opportunities where we build houses. People must not travel long distances to current existing cities to look for job opportunities. That will perpetuate apartheid spatial development. New cities must create massive job opportunities for the people. Research and development must help us to decide the core and leading business activities and investments for the new cities.
We will engage MEC Vadi to finalise content relating to Transport and Logistics support for the new cities. This will depend on the type of infrastructure and economic opportunities for the new cities.
We will review the current operating model and philosophy of the Gauteng Partnership Fund, currently allocated R140 Million to ensure that we are able to engage various players with resources as partners in the delivery of Mega Human Settlements. This will include engaging banks and other financial institutions to invest in Mega Human Settlements. For example, the paradigm of Mega Human Settlements projects is high rise buildings.
Gauteng is currently a flat province, and yet we do not have land. The little land we have is severely damaged by the history of mining activities, and is therefore dolomitic. Land is very expensive in our province as a result of high pricing speculation.
The solution is to build not just high but very high. We need to educate our people and overcome cultural concerns on high rise buildings. We need investor appetite for high rise buildings. GPF without engaging in borrowing as it falls
outside its scope, must help us mobilise investor funding for high rise buildings. In line with this we are considering creating an effective and efficient Property Management Unit to manage Sectional Title units and common property, especially in the Inner City as part of transforming and densifying inner cities.
We need to ensure that the common property in Sectional Title units is properly managed by well trained and legally accountable Body Corporates to ensure proper maintenance of the high rise buildings, payment of rates and taxes, and to also ensure that this high rise buildings are not hijacked by criminals and syndicates evicting people.
Our repositioning of GPF will also help us to develop a proper funding model and formula, and appetite to fund service stands for people to build for themselves in what is known as the Gap Market. Gauteng Province has a high number employed people, but they do not meet the strict and conservative bond requirements by set by the banks.
Most of them, if given land with bulk services, can actually build for themselves at cheaper and affordable rates. A service stand, if properly researched, and with good feasibility studies, will significantly lower housing costs and thus greatly reduce the risk of default on banking loans.
Honourable members, the concept of Fully Serviced Stands with affordable bond funding, with bankable houses that are based on high quality standards, has a great potential to radicalise the housing bond market and financial sector. This will unleash the high demand for housing that is currently suppressed and or depressed by hostile and conservative bond market requirements.
We have many of employed people, including civil servants with long term employment security and contribution to Pension Fund currently living in Backyard dwellings, and Informal Settlements. Some, I have discovered, are living in hostels in the West-rand.
There are many of people who are renting extremely expensive flats and townhouses, with no security of tenure, simply because they can’t get land or qualify for a housing bond but can afford it, if given a chance.
I wonder what would we find, if we were to conduct a survey of where Honourable Members and Councillors live?
Honourable Members, as you are aware public servants and many private sector employees contribute to Pension Funds that are sitting with massive liquidity, using it for speculation in various markets with high risks, but with no positive impact on quality of life of workers.
We will also engage banks on the increased spate of housing repossessions, which is currently rendering many people homeless in the Townships. We need. views and ideas from as many people as possible to make sure that housing repossessions and evictions do not leave behind a trail of pain.
Processes and legal framework for housing repossessions need to be seriously looked into to the vulnerable from syndicates that manipulate court processes to evict and repossess housing without proper transparency and openness to affected people. This should include evictions from rented and social property. This are matters that we need to look at urgently.
Honourable Members, we will urgently look at the complete Turnaround of Urban Renewal Township such as Bekkersdal, Evaton, Winterveldt and Alexandra. We have already agreed add Kliptown the fifth area of Urban Renewal. We have already started to work with CoJ to plan both Alexandra and Kliptown.
Just on Alex, we will be holding a two-day Lekgotla with critical role players to agree on Turnaround of Alex. As you know, we have started with some urgent basic service interventions in Bekkersdal, and we also engage on key and strategic planning of how to turnaround this areas.
Let me announce that on the 26th of June we will together with COJ present and formally launch model and design of the New Kliptown, with a detail of how to radically transform spatial architecture and modernise Kliptown. We are not referring to small, isolated and less impact activities.
As you may be aware, we have completed our assessment of the current 70 hostels across our province. We are currently preparing for a political engagement and consultation with our municipalities and key stakeholders on the future plans on hostel. We will include the urgent need to handover completed hostels especially in Soweto and other areas. This will take into account the state of development and status on hostels. We will give effect to Minister Sisulu's policy announcement on this matter.
Honourable Members, we have a total number of 400 Informal Settlements in our province. We will develop a clear and detailed plan to be formally launched in November on how to develop proper housing plans on those informal settlements located on good and quality of land. This plan will include measures to formalize them as township establishments. This has a great potential to reduce the total number of informal settlements in our province.
We will engage the Portfolio Committee and Municipalities on the need to strengthen policy to manage illegal housing extensions and structures that end up turning our Human settlements into slums. We need to seriously look at regulating backyard dwelling market. Whilst we understand that many people generate revenue from this activity, if not properly planned and regulated, our new cities will turn into slums, causing all sorts of problems such as malfunctioning infrastructure and general chaos. Best example in this regard is Cosmo City.
As you may be aware, we have completed high level designs of the operating model of our Provincial Housing Security Services, which is a fully integrated and end-to-end solution and system for beneficiary management and waiting lists.
This, we announced as a biometric system, and we have since realized this may narrow and limit the type of solution that is required. We need a full security system to end corruption in housing allocation, to deal with problems of double parking on housing stands, to eliminate cases of people with more than one stand number, to deal with cases of illegal sale of stands and houses to non- deserving people.
In conclusion, we will continue to improve the living conditions of our people to ensure that we give effect to the clauses of the Freedom Charter and Manifesto of the ANC as the ruling party.
