
=====================================================================
Policy Speech 2001/2002  by MEC Nkwinti
=====================================================================

Speeches and Media Releases
 Housing, Local Government, Traditional Affairs

[         w

 EASTERN CAPE PROVINCIAL GOVERNMENT
POLICY SPEECH 2001/2002 FOR PROVINCIAL HOUSING, LOCAL GOVERNMENT AND
 TRADITIONAL AFFAIRS
 BY MEC NKWINTI
 ON 14 MARCH 2001

INTRODUCTION

Mr Speaker, allow me to formally appreciate the address of the Premier on the occasion of the official opening of this House on the 16th 
February 2001, for its expansiveness and explicitness with respect to what has to be done during the next financial year. Our colleague, 
the MEC for Finance and Provincial Expenditure set a beautiful trend during his Budget Speech when

he built it around the four short-to-medium term government priorities, namely:

1. Integrated Sustainable Rural Development Strategy;
 2. Social Security;
 3. Public Sector transformation; and,
 4. HIV/AIDS.

In addition to these, or, perhaps, a broader context for these four priorities, are the two national developmental frameworks, namely:

1. building the economy; and
 2. alleviating poverty.

In the Department of Housing, Local Government and Traditional Affairs we have the added duty and responsibility of establishing 
developmental local government, on a wall-to-wall basis, as well as continuing the national project of housing the nation.

The challenge is how, through these department - specific mandates, could we best address the provincial and national developmental 
objectives set out above. How could we use the two flagship programmes of the Department, namely, Housing Development and Local Government, 
to contribute to building the economy and alleviating poverty? How could we achieve this goal in a manner that is sustainable?

In this Budget Speech we seek to address these questions, and would, humbly, submit a budget proposal for approval by this House in order 
to enable us to service and resource our effort towards addressing these questions.

DEVELOPMENTAL LOCAL GOVERNMENT

Developmentalism is a fundamental departure from the traditional perspective on local government. The developmental local government, 
unlike its traditional counterpart, is not just a service provider. It is a service authority. According to the White Paper on Local 
Government (1998), "Developmental local government is local government committed to working

with citizens and groups within the community to find sustainable ways to meet their social, economic and material needs and improve the 
quality of their lives."

It posits four inter-related characteristics of developmental local government, namely:

1. maximizing social development and economic growth;
 2. integrating and co-ordinating;
 3. democratizing development; and
 4. leading and learning.

Section 153 of the Constitution sets out the developmental duties of municipalities. A municipality must :

a) structure and manage its administration, and budgeting and planning processes to give priority to the basic needs of the community, and 
to promote the social and economic development of the community; and
 b) participate in national and provincial development programmes.

Clearly, Mr Speaker, the local government that we are actively building is well defined, with clear objectives, in both the White Paper and 
the Constitution. The laws governing local government have been enacted, being the:

* Local Government: Municipal Demarcation Act
* Local Government: Municipal Structures Act
* Local Government: Municipal Systems Act

The Demarcation Act deals with the inner and outer boundaries of municipalities; the Structures Act deals with the 'who' and form of 
municipalities; and, the Systems Act deals with the 'how' of municipalities. All these laws are detailed and written in simple English. It 
is important to note that the legal definition of a municipality is inclusive of the community.

Against this background, the Department has crafted a Developmental Local Government Model, with two derivative models on finance and 
organizational form. The core business of the Developmental Local Government Model has six (6) elements:

1. Social development;
 2. Infrastructure development;
 3. Sustainable service delivery;
 4. Sustainable environment management;
 5. Community empowerment; and
 6. Economic development.

In support of this core business of the Developmental Local Government the following strategic administrative and technical functions have 
been identified as being central, irrespective of the size or type of the municipality:

* Generic management capacity;
* Finance management capacity;
* Human resources management
* Engineering and planning capacity; and
* (Internal) legal services.

Further to this model, the Department has developed guidelines on Staff Establishment, which are currently a subject of discussions by 
stakeholders. In collaboration with the Department of Provincial and Local Government, Interim Integrated Development Plan (IIDP) 
Guidelines have been crafted and distributed to all municipalities, with a deadline of 31st March 2001; and, overviews of both the 
Structures and Systems Acts have been distributed to all municipalities. On all these instances, capacity-building workshops have been 
conducted with both councillors and staff. Several further workshops have been scheduled. Achieving the goal of a developmental local 
government will be time-consuming, requiring adequate and dedicated resources as well as a concerted effort by all those involved.

HOUSING DEVELOPMENT

We remain steadfast in our commitment to building technical and managerial skills, creating jobs and improving the quality of the end 
product. We are continuing to seek creative solutions in this regard. Recently, two such solutions have emerged, one in October 2000 and 
the other in February of 2001.

1. Rapid Land Development Programme (10/2000)

In terms of this programme, the housing subsidy has been split into two phases.

* Phase one is that of building serviced land stock through established
 housing developers;
* Phase two is that of following up with top structures through emerging
 contractors.

In this way it is envisaged that the best of both in terms solid infrastructure services and a satisfactory top-structure will be achieved. 
This is a public-private partnership. It is the intention that in the medium-to-long term, the managerial skills training will enable some 
emerging contractors to graduate into fully-fledged developers.

2. Integrated Housing Development Strategy (Feb 2001).

This is a strategy that addresses most of the Progress Payment regimes at the same time, that is, in an integrated manner, instead of the 
rigid straight-line sequencing which is historically the case.

* This is essentially a partnership between the municipalities and the Department, and, as such, a public-public partnership.
* We are piloting this strategy out during the 2001/02 Financial Year, and the results will be realised during the next Financial Years.
* The current project is based on the People's Housing Process, which has more flexibility in the short term.

In terms of this strategy, the municipality will not only be the developer, it will, also, be the Support Organisation and the Account 
Administrator. Through this partnership the following will be achieved:

* Integrated planning, which reduces planning time drastically;
* creative solutions will come easily resulting in a drastic reduction of
 blockages;
* skills and information exchange will improve significantly between the
* Department and affected municipalities;
* administrative costs (in respect of account administration), will accrue
 to the municipality, adding to sorely needed revenue; and
* effective monitoring and evaluation of progress, and relatively easy
 resolution of problems which could, otherwise, have delayed progress.

TRADITIONAL INSTITUTION

This is another area of our work which will continue to receive our attention, both in terms of development work as well as issues relating 
to the participation of traditional leaders in local municipalities.

There are critical questions, which must be addressed by all of us with regard to the institutions of tradition. Amongst these questions 
are the following:

* What is the traditional role of traditional leaders?
* How is that role to be exercised in a modern democratic state?
* What is the traditional duty and responsibility of traditional communities towards their traditional leaders?
* How are such duties and responsibilities to be expressed in a modern democratic state?


These are fundamental questions which may not be dodged for long. We would like to explore these questions during the coming financial 
year.

With respect to development, we will continue with what we have started during the 2000/01 Financial Year. We will engage traditional 
leaders in rural development, through the Rural Subsidy Programme. In this regard, we will facilitate a tripartite engagement involving the 
traditional leaders and mayors of district municipalities.

ORGANISED LOCAL GOVERNMENT: SALGA-EC

This very strategic statutory body deserves more support and assistance from
 the Department. It is a strategic partner which has the responsibility to co-ordinate and capacitate municipalities, yet it does not have 
the necessary financial resources. The South African Local Government Association (SALGA) has trained a number of councillors across the 
country,

including our Province, so that they could train councillors in their life skills. Our Department, on the other hand, has got the financial 
resources, but lacks the capacity that SALGA-EC has. It is our considered view that the law of comparative advantage should come into play 
here. During the next financial year (2001/02) we intend entering into a partnership with SALGA-EC in respect of capacity building. We will 
jointly work out the modalities, including monitoring and evaluation.

DMINISTRATION AND FINANCE

One of the priorities of the Provincial Government is the transformation of the public sector. During the last financial year we introduced 
a two-pronged approach to certain aspects of the work of the Department :

* a project approach; and,
* cross - functionalism.

It is this two-pronged strategy which helped the Department emerge with the Integrated Housing Development Strategy to deal with the threat 
of a huge roll-over in the housing development fund. But, a lot more has still to be done to entrench this strategy and turn it into an 
organizational culture. The unending R293 staff problem is partly due to the failure of the Administration to co-ordinate strategy with 
Finance and Local Government sections. It is only recently that they have started co-ordinating strategy.

The opportunity created by the Public Finance Management Act (PFMA), with respect to the imperative to employ a Chief Finance Officer is 
greatly welcome. It is one which we will grasp with both in order to enhance our financial management capacity.

SPECIAL PROJECTS

After consultation with the Provincial Youth Commission, a number of special
 projects have been catered for in this year's budget :

1. Marginalized sectors:

* Youth; and,
* Disabled or physically challenged persons.

The youth and physically challenged persons join women and rural communities to collectively earn a 35% share of the housing development 
budget:

* Women in construction: 10%
* Youth in construction: 10%
* Physically challenged persons: 5%
* Rural communities: 10%

Together with the Provincial Youth Commission and the Disabled People of SA we will work out strategies, with respect to the youth and 
physically challenged persons. The thrust of our programme with respect to physically challenged people will be integration and access, 
especially where they live.

Another Youth Commission initiative is that of engaging municipalities to establish youth development programmes as part of their budget 
plans. The Department is setting aside an amount of R500 000-00 to pilot this initiative. The Deputy Director of the Special Programmes 
Unit in the Department will interact with the Youth Commission with regard to which municipalities will pilot the initiative:

2. Integrated Sustainable Rural Development Strategy

The Department has been mandated by the Provincial Government to lead a government programme on integrated development in the Emalahleni 
Municipality. This initiative is already underway involving provincial departments, the Office of the Premier, ECSECC, ESKOM, IDC, DBSA, 
DWAF, DLA, SALGA-EC and IDT. An integrated management model for this so called Rural Economic Development Zone (REDZs) is in place, and a 
multi-sectoral Steering Committee is guiding the project. Work being done at present includes:

* infrastructure audit;
* needs assessment; and
* state land identification.

A special task team has been charged with the infrastructure audits. The following persons constitute the task team :

* L. Mcwabeni (ECSECC)
* J Peires (Economic Affairs)
* D. du Plessis (DHLGTA)
* K. Manzi (convenor: DHLGTA)
* S. Bartlett (IDC)
* C. Burger (DHLGTA)
* Strydom (DHLGTA)
* Soga (DHLGTA)

The needs assessment is the responsibility of Community Development Officers of the DHLGTA and Extension Officers of the Department of 
Agriculture and Land Affairs.

The Department of Agriculture and Land Affairs (Province) and the Department of Land Affairs (National) are responsible for rural land 
administration.

The Rural Livelihoods Programme, located in the Premier's Office, is ready to kick dust there any moment. It is already in contact with the 
relevant municipality.

The value of integrated action is already visible in the Emalahleni Pilot Area. The work could have been outsourced had only one department 
been engaged therein. The Department of Housing, Local Government and Traditional Affairs provides the secretarial service, as a lead 
department. This is a pilot project with a time-line spanning three years. The Department has set aside at least R2m to kick-start 
infrastucture development as soon as prioritization has taken place. We have, also, budgeted for building the institutional capacity of the 
municipality of Emalahleni.

CONCLUSION

The last year was extremely challenging, more especially with respect to housing development. The department has had to dig deep into its 
intellectual reservoir to find creative solutions to unblock some of the blockages. The greatest challenge for the next financial year will 
be to deliver the goods. We have identified strategic priorities, key performance areas and expected outcomes for each functional area in 
pursuit of government objectives. We request this House to assist with rigorous monitoring of progress, as it has often done. A summary of 
the proposed budget allocation is attached this Policy Speech. I request this House to approve it.

Finally, Mr Speaker, may I thank members of the Standing Committee for Housing, Local Government and Traditional Affairs for their support 
throughout the year. The political direction provided by the Premier alone, and in-council, cannot be fully measured. I thank the staff of 
my department, and promise them that the struggle continues.

I thank you.

MEC for Housing, Local Government & Traditional Affairs

HOUSING ADMINISTRATION - STRATEGIC PRIORITIES

1. SYSTEMATIC ELIMINATION OF THE HOUSING BACKLOG.

This is the first strategic priority of the Housing programme and the following Key Performance Areas for this strategic function have been 
identified as follows: -

* Quantification of housing backlogs;
* Isolation of potential beneficiaries who qualify for housing subsidies out of that backlog;
* Development of a Provincial Five Year Plan to eliminate the backlog;
* Development of a strategy to move to middle income housing consumers in three (3) years time;
* Development of the multi-pronged strategy to respond promptly to political and administrative blockages to housing development.

The Expected Outcome of the above are the following:

* The existence of a Provincial database of the housing backlog, reflecting all market segments;
* Quantifiable annual housing output plus measurable performance;
* A proper funding strategy based on reliable information;
* Appropriately motivated personnel and housing development projects.

2. ENCOURAGE PRIVATE BONDHOLDERS TO RESPOND POSITIVELY TO GOVERNMENT INITIATIVES IN ASSISTING THEM.

The main Key Performance Areas in relation to the Strategic Objective, has been identified as :

* To persuade bondholders to make use of the Servcon Programme which facilitates a relationship with financial institutions.

The Department will therefore further facilitate processes so that the necessary interaction between the financial institutions and 
community structures could take place and that bondholders are persuaded to service their bonds.

The Expected Outcome from the above are:

* That more bondholders will benefit from the schemes; and
* More bondholders will be servicing their debts.

3. FINALISING THE TRANSFER OF STATE RENTED HOUSES TO OCCUPANTS.

The following Key Performance Area has been identified in respect of this Strategic Priority :

* Review of the current contracts with service providers engaged in the process of transfer of rental stock;

The Expected Outcome of the above Strategic Objective is :

* Termination of existing non-performing contracts or improvement of contractual terms so as to ensure speedy delivery;

4. ENSURING THAT PEOPLE EARNING A REGULAR INCOME PAY FOR SERVICES RENDERED TO THEM BY MUNICIPALITIES.

The following Key Performance Area has been identified :

* To facilitate the establishment of a properly packaged Masakhane Campaign
 which is politically led.

Expected Outcomes from the above are as follow :

* Improvement in the municipal revenue collection;
* Progressive breakdown in the culture of entitlement and non-payment;
* Mutual respect and understanding between municipalities and members of
 their communities;
* The ability of municipalities to deal with individual customers regarding
 their debt.

5. IMPROVING THE QUALITY OF THE HOUSING PRODUCT DELIVERED

The Key Performance Areas in relation to this Strategic Objective are :

* Promote building of strategic partnerships with all housing stakeholders;
* Ensuring adherence to Provincial minimum standards, including security of
 tenure;
* Stricter adherence to the provisions of the Housing Implementation Manual;
* Encouraging participation in the People's Housing Process;
* Facilitation of training of builders before embarking on housing projects;
* Independent and proper inspections of housing construction before a certificate of completion is issued;
* Implementation of the Housing Consumers Protection Measures Act.

The Expected Outcomes in respect of the above mentioned Key Performance Areas are :

Spacious erven - a minimum size erf in urban areas of 300 square metres; minimum top structure size of 40 square metres;

* Smooth project flow and cash flow;
* A more skilled labour force which becomes more mobile and serves as labour
 at competitive prices;
* Builders assuming builder responsibility in respect of the end product;
* Improvement in the local economy.

6. IMPROVING HOUSING SUBSIDY MANAGEMENT

In respect of this Strategic Objective the following Key Performance Area has been identified:

* Introduction of a different fund allocation strategy by the year 2002/2003 (through the newly established municipalities in the 
Province).

The Expected Outcomes of the above Strategic Objectives are :

* An encouraged consolidated political authority over the housing subsidy programme;
* A single cheque route to municipalities to be followed for multi-purpose projects by the financial year 2002/2003.

7. RESEQUENCING OF THE HOUSING PROJECT DELIVERY PROTOCOL

Key Performance Areas in respect of this Strategic Objective are:

* Job creation through housing construction;
* Skills development in respect of housing construction and project management;
* An improved quality of the product constructed and delivered.

Expected Outcomes of the above Strategic Objectives are:

* Economic impact in the area of housing construction
* Emergence of better skilled emerging contractors enabled to contract with municipalities at competitive rates.

1. RURAL SOCIAL DEVELOPMENT

The following Key Performance Areas have been identified in respect of this Strategic Objective :

* Promote integrated rural development
* Promote skills development in rural communities (REDZ)
* Community based institutional support to development
* Implementation of the Rural Economic Development Zones (REDZ) initiative.
* The Expected Outcome in respect of this Strategic Objective is:
* To eliminate rural poverty and unemployment.

Thank you.

---------------------------------------------------------------------
Home | About the Eastern Cape | Documents
 Economy | Structures | International Relations | Site Map
 Premier's Office | Speeches & Media Releases | Links
 Top of Page

---------------------------------------------------------------------

About the Eastern Cape

Premier's Office

Structures

Documents

Speeches & Media Releases

International Relations

Economy

Links


