Housing Code

Part 2

Chapter 3: Key Provisions of the Act

1. National Norms and Standards
2. Financing our Housing Programmes
3. Managing our Assets, Liabilities, Rights and Obligations
4. Housing Information
5. Delegations

ANNEXURES

This chapter considers various key provisions set out in the Housing Act. This includes the National Norms and Standards in respect of Housing Development, how our Housing Programmes are financed, how assets and liabilities were transferred from the former National Housing Board, how housing information is managed, and the delegations that apply.

3.1 National Norms and Standards

This section explains briefly, the national norms and standards. A copy of the Norms and Standards in respect of Permanent Residential Structures, is contained in Annexure A of this Chapter 3 of Part 2 of the Housing Code.

The Housing Act requires the Minister of Housing to determine national norms and standards arising out of the need for housing development.

 

Norms and standards arise out of the need to: Ensure that beneficiaries are provided with a housing product that is of optimal size and quality, within the limits of the housing subsidy.

• Address the concern that unaffordable and unsustainable levels of engineering services absorb unacceptable levels of the housing subsidy, which leave very little money for an adequate permanent residential structure.

The norms and standards define two things:

• municipal services to be subsidised by the housing subsidy. The focus here is on the types of basic internal reticulation services that can be subsidised with the portion of subsidy earmarked for internal infrastructure, rather than specific levels of basic services (see Figure 3). The National Norms and Standards therefore prescribe the minimum levels of services that are acceptable and, although maximum levels of services are not prescribed, a limit on their cost is imposed. This means that if the cost of services is higher than the limit imposed, the excess cost may not be financed from the subsidy and alternate sources of funding must be found. However, the cost of services (capital costs and running costs) must always be affordable to the consumer.
• minimum size of top structure as well as specific standards for its construction.

Figure 3 that follows provides a brief summary of the norms and standards for housing funded by State resources, with specific reference to subsidies falling in the R 16 000 category

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Figure 1. Summary of Norms and Standards in respect of Permanent Residential Structures

CATEGORY	FINANCE (R16 000 SUBSIDY)	SERVICE (MINIMUM LEVEL)	MEC EMPOWERED TO PERMIT DEVIATIONS
Municipal Services	Maximum R7 500	Land acquisition and township establishment
		Water: single metered standpipe per erf
		Sanitation: VIP per erf
		Roads: Access to erf with graded road
		Stormwater: lined open channels
		Street Lighting: Highmast security lighting (subject to conditions)
Top Structure	Residual of R8 500	Top Structure: 30m² (gross floor area)

Remember - The Norms and Standards:

• apply to all three subsidy bands
• are not mandatory in respect of dwellings and or projects developed in terms of the Rural Housing Subsidy mechanism, and projects that constitute in situ upgrading of informal settlements where township establishment has not been taken up in regard to the People’s Housing Process.

Where there are abnormal developmental costs arising from location or geophysical conditions, application may be made for a maximum variation of 15% of the subsidy amount.

Where the conditions are so adverse that the 15% variation is insufficient to address abnormal development costs, the MEC may in respect of the area concerned, approve the following maximum additional amounts of the remaining subsidy for services provided that the amount available for the top structure will be reduced by such amount:

• excessive slopes: R1 025
• sandy soil: R900
• medium dolomite: R1 950 (see Part 1, Chapter 3, Section 3.6)

The reduction of the amount for the top structure obviously implies that the minimum norm in respect of the size of the dwelling, will also reduce. The MEC: Housing may accordingly reduce the minimum size of top structures as follows:

• (where the variation relates to excessive slopes or sandy soil) and the maximum additional amount of the remaining subsidy is approved the reduction of the minimum size of top structures to 27m².
• (where the variation relates to medium dolomite) and the maximum additional amount of the remaining subsidy is approved the reduction of the minimum size of top structure to 24m².

The MEC may also approve the increase of the minimum size of the top structure where it is feasible to cap the amount in respect of services at a lower level than R7 500, or where construction costs in certain areas make it practicable.

To ensure quality the engineering norms and specifications regarding permanent residential structures as contained in Appendix 2 of the “Norms and Standards” document (Annexure A) form part of the norms and standards regarding permanent residential structures.

There are standards and guidelines besides the Norms and Standards determined by National Government which are complimentary and must be adhered to:

• all builders registered with the National Home Builders Registration Council are required to adhere to the Standards and Guidelines manual
• the National Department of Housing is producing the new ‘Red Book’ or Guidelines for Human Settlement Planning and Design
• municipalities prescribe building regulations

The Norms and Standards in respect of permanent residual structures also apply in respect of beneficiaries qualifying for subsidies of R10 000 or R5 500, given the fact that these beneficiaries are able to access external finance to enhance their subsidies.

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The National Norms and Standards are not applicable to dwellings and or projects that are developed in terms of the Rural Housing Subsidy instrument.

This is because rural housing subsidies are subsidies of last resort where it may not be possible to implement the standard subsidies such as project linked subsidies, individual subsidies and institutional subsidies. Accordingly, rural subsidies may be used for any purpose that, in the discretion of the Provincial Housing Development Board, amounts to housing purposes. Given the peculiar nature of the in situ upgrading of informal settlements where people have settled on land where township establishment and the installation of engineering services have not yet taken place, the minimum norms and standards will also not be mandatory.

In compiling the “Norms and Standards in respect of Permanent Residential Structures”, the National Department of Housing consulted a range of policies and existing norms and standards in respect of basic infrastructure provision.

3.2 Financing our Housing Programmes

This section considers how our housing programmes are financed, by reviewing the roles and responsibilities of government at its three spheres in respect of the housing budget. Specifically, the chapter considers multi-year plans, and the roles, functions and other administrative provisions of the South African Housing Fund and the Provincial Housing Development Funds.

1. Multi-Year Plan

The multi-year plan is a financial planning tool required of national and provincial government in the Housing Act. The multi- year plan is linked to the concept of a multi-year budget, which was introduced by the Ministry of Finance in December, 1997. The state budget for 1998/ 1999 reflects this concept to the extent that the budget for the year is the first part of a three year spending plan. This three year spending plan, (known as the Medium Term Expenditure Framework) is a moving three year horizon against which departments plan their future expenditure. The advantages of the Medium Term Expenditure Framework are that departments are able to plan ahead and that co-operative governance and decision-making are strengthened.

The multi-year plan provides a plan for the delivery of houses that is cognisant of housing demand and potential supply in terms of available funds for a period of three years. In this regard, it is closely linked with the housing delivery goal.

The Minister prepares a multi-year plan on the basis of multi-year plans prepared by the provincial governments. This will be done on the basis of cooperative governance.

2. The South African Housing Fund

At a national level, the South African Housing Fund established under the Housing Arrangements Act of 1993, continues to exist for the purposes of funding housing activities in terms of the Housing Act, 1997.

The Fund includes:

• all money to the credit of the Fund before the Housing Act came into effect;
• all money allocated to the Fund by Parliament; and
• contributions from any source for the purposes of housing development.

A national housing programme means any national policy framework to facilitate housing development, including but not limited to housing assistance measures contained in the existing national housing programmes, or any other measure or arrangement to:

• assist persons who cannot independently provide for their own housing needs;
• facilitate housing delivery; or
• rehabilitate and upgrade existing housing stock, including municipal services and infrastructure.

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As already indicated, the following national housing programmes have been instituted by the Minister of Housing:

• The Housing Subsidy Scheme
• The Guidelines for the Discount Benefit Scheme to promote Home Ownership
• The Hostels Redevelopment Programme: Policy for the Upgrading of Public Sector Hostels

The money in the South African Housing Fund may not be used for financing the administration of government housing departments. Any money in the South African Housing Fund, which is not required for immediate use, is invested with the Commissioner for Public Investments.

2.2 The Accounting Officer

State funds belong to all our people. In promoting transparency and accountability for public funds, accounting officers who are accountable for funds are appointed. The Director-General of Housing is the accounting officer from the time that funds are transferred from State Expenditure to the South African Housing Fund. The Director- General ceases to be the accounting officer once funds are allocated and transferred to the Provincial Housing Development Fund. Once funds are transferred to the Provincial Housing Development Fund, an officer of the provincial administration becomes the accounting officer, in terms of the provincial act that created such fund.

If a Provincial Housing Development Fund has not been established in terms of a provincial act, money is transferred from the South African Housing Fund to provincial governments in terms of Section 13 of the Housing Arrangements Act, 1993, as though the Act has not been repealed. This means that the accounting officer of the South African Housing Fund and the accounting officer in respect of the housing budget in the province, are both accountable for housing funds paid over to a province. This is obviously merely an interim measure until such time as the province established a Provincial Housing Development Fund.

When funds are transferred to an accredited municipality, the accounting officer of the Provincial Housing Development Fund remains the accounting officer for those funds. In this case, the Chief Executive Officer of the municipality is responsible for submitting financial statements and balance sheets to the provincial accounting officer.

2.3 Financial Statements

The financial year of the Fund is 1 April of any year to 31 March of the following year.

The Director-General submits an audited detailed statement and balance sheet to the Minister as soon as possible after the close of the financial year, but no later than 31 July, every year.

The Minister then submits the financial statements and balance sheets to Parliament on receipt of records from the Director-General.

2.4 Auditing of the Fund

The Auditor- General audits the books, statements of account and balance sheet of the Fund.

In carrying out the audit, the Auditor- General may order any person (including any municipality, company or other body) to make available all books, registers and documents in his or her possession or under his or her control, available.

2.5 Allocation of Money to Provincial Governments

The Minister of Housing allocates money out of the Fund for the purposes of financing the implementation in a province of any national or provincial housing programme which is consistent with national housing policy. The Minister allocates the money to the provinces on the basis of criteria determined by the Minister after consultation with the nine MEC’s for Housing. These criteria are determined on an annual basis.

The existing criteria for allocations to provinces are as follows:

• housing backlog in a province.
• number of households in the various subsidy bands.
• ratio of urban to rural areas.
• performance of a provincial government.

The first three items have a weighting of 75%, and the performance of the provincial government in respect of housing development has a weighting of 25%. The allocation per province may therefore vary from time to time, given the province’s progress in addressing its housing backlog and the demographic profile of the people who live within its boundaries.

The following diagram explains the process for the allocation of housing funds from the South African Housing Fund to provincial governments and accredited municipalities.

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3. Provincial Housing Development Funds

The Housing Act requires each province to establish a Provincial Housing Development Fund by provincial legislation. All money allocated from the South African Housing Fund to a province is to be deposited in its Provincial Housing Development Fund. In cases where the Provincial Housing Development Fund has not yet been established by provincial legislation, however, the Housing Act allows for moneys allocated from the South African Housing Fund to be managed in the manner described in Section 13 of the Housing Arrangements Act, 1993 (notwithstanding its repeal by the Housing Act). Likewise the net proceeds of any sale, letting or alienation of assets that passed to a Provincial Housing Development Board in terms of Section 14(2) of the Housing Act, 1997, must be paid into the Provincial Housing Development Fund.

Within the provincial legislation that establishes the Provincial Housing Development Fund, the following provisions must also be included:

• The condition that funds are only utilised for the implementation of national and provincial housing programmes which are consistent with national housing policy in a particular province.
• The designation of an accounting officer in respect of money in the Provincial Housing Development Fund, who is responsible for the administration thereof.
• The regulation of the accountability of the accounting officer as well as general administrative matters such as reporting by the accounting officer to the provincial legislature on all matters affecting such fund.
• The regulation of the manner in which the accounts and records of the Provincial Housing Development Fund are kept. This includes the preparation of detailed annual statements (including transactions and the balance sheet of the fund) and the submission of statements to the provincial legislature by the MEC.
• The auditing of the books and statements of account and balance sheet of the Provincial Housing Development Fund by the Auditor-General.

3.1 Interim Arrangements

Section 12 of the Housing Act provides that until such time as provincial legislation for the establishment and regulation of the Provincial Housing Development Fund is passed, provincial moneys are managed as stipulated in Section 13 of the Housing Arrangements Act, 1993, despite the repeal of the Act. Section 13 of the Housing Arrangements Act, 1993, provides the following directives:

• The Head of the Housing Department, or provincial Director-General is the accounting officer and is responsible for the administration of funds.
• The accounting officer keeps full and proper records of all money received and spent, including transactions of accredited municipalities.
• The accounting officer keeps full and proper records of assets, liabilities and financial transactions of the Provincial Housing Development Board.
• The accounting officer prepares financial statements as soon as possible after the end of the financial year in the form prescribed by the Director-General of Housing (the Accounting Officer of the South African Housing Fund). Financial statements include moneys received, expenses incurred in connection with the functions of the PHDB or a municipality, and assets and liabilities as at the end of the financial year.
• Financial statements are forwarded to the Director-General of Housing after being audited by the Auditor-General.
• The Auditor-General audits all records and financial statements.
• The Provincial Accounting Officer is responsible for collecting moneys owed to the Provincial Housing Development Fund by virtue of the performance of the functions of the PHDB.

The diagram that follows, illustrates this process.

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Figure 3. Provincial Housing Development Fund

3.2 Procedures regarding the Payment of Funds to the Provincial Housing Development Funds

The procedures for paying funds out of the South African Housing Fund to a Provincial Housing Development Fund are as follows:

1. The Director-General determines the form, intervals and periods for the payment of funds from the South African Housing Fund to the Provincial Housing Development Funds.
2. The accounting officer of the province certifies that funds requested are a true reflection of expected expenditure regarding the implementation of national housing programmes and provincial housing programmes consistent with national housing policy. Figure 6, below, provides an example of a certificate for a requisition for payments to the Provincial Housing Development Fund.
3. The accounting officer of the province then submits the requisition to the Director- General in the prescribed manner. Funds are claimed in advance of expenditure.
4. The requisition is approved and funds are paid into the Provincial Housing Development Fund.

Figure 4. EXAMPLE: Certificate of Requisition

CERTIFICATE I, _____________________________, Accounting Officer for Housing Funds in the ______________ Province certify that the information set out in the above schedule is a true reflection of the current financial situation as far as funds for the financing of national housing programmes and provincial housing programmes consistent with national housing policy in my province are concerned and that the advance of R________________ requested for the month of ___________________ is a true reflection of the expected expenditure. I also certify that expenditure against this advance will be made in accordance with the provisions as set out in the National Housing Code and will also be in accordance with general acceptable financial regulations, practices and procedures of government.

3.3 Balance of Allocations

The balance of any money allocated by the Minister to a province in respect of a financial year which was not expended remains payable to the Provincial Housing Development Fund in question. It must be paid into such fund when required for the purposes of the implementation in the relevant province of any national housing programme or any provincial housing programme which is consistent with national housing policy.

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3.3. Managing Assets, Liabilities, Rights & Obligations

This section looks at the transfer of assets, liabilities, rights and obligations of the former National Housing Board to Provincial Housing Development Boards and other authorities. In addition, the chapter considers the regulation of proceeds derived from the management of these assets, and the further devolution of assets and liabilities to municipalities.

The former National Housing Board controlled a range of assets and liabilities. Upon its dissolution, these as well as the rights and obligations of the former Board, passed to the Provincial Housing Development Boards and other authorities. Table 4, below, sets out the range of assets and liabilities as well as rights and obligations transferred from the former National Housing Board to the PHDBs and other authorities on 1 April 1998 in terms of the Housing Act, 1997.

Table 1. Transfer of Assets, Liabilities, Rights and Obligations

Asset, Liability, Right or Obligation of former NHB	Transferred to
Movable Property	Provincial Housing Development Board
Immovable Property, including undeveloped land; dwellings and/or residential stands; business premises or stands; and stands set aside for the provision of public services.	Provincial Housing Development Board
The right to recover housing loans, advances or other finance from municipalities and the Premiers	Debts of relevant municipalities or provincial premiers were extinguished. The housing assets of municipalities and Premiers which have thus became unencumbered must be managed in accordance with the prescripts of the Act. PHDBs acquire rights and obligations to ongoing schemes and projects Property acquired by the Premier is transferred to the PHDB's Loans and advances to persons are recovered by the PHDB and paid into the Provincial Housing Development Fund Loans used for the provision of a welfare facility may be written off.
Loan agreements, debentures, bills and stocks of the former National Housing Board	National government
Shares	National government
National Housing Programme contracts	Provincial Housing Development Board
National Relocation Assistance Program	Provincial Housing Development Board
Municipal infrastructure	Provincial Housing Development Board

The processes to be followed regarding the transfers of the above assets and liabilities are set out in the pages which follow.

Movable and immovable property that were transferred to PHDB’s and that have not been disposed of by a date to be determined by the Minister of Housing, may be devolved to municipalities, subject to the prescripts of the Act.

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1. Transfer & Management of Property

Property held by the former National Housing Board can be split into two categories:

• Movable property, including office furniture.
• Immovable property including undeveloped land; dwellings and/or residential stands; business premises or stands; and stands set aside for public services.

These are dealt with differently in terms of the Housing Act.

1.1 Transfer of Movable Property, and all Associated Rights, Liabilities and Obligations

Movable property of the former National Housing Board, and all associated rights, liabilities and obligations passed to the Provincial Housing Development Board of the province in which the property was mainly utilised, on 1 April 1998.

If the movable property was utilised in more than one province, an agreement is reached between the heads of the departments of each of the provinces. Where an agreement cannot be reached, agreement is determined through arbitration as stipulated in the Arbitration Act, 1965. The province that does not obtain the property can be compensated with funds out of the Provincial Housing Development Fund of the other province.

1.2 Transfer of Immovable Property and all Associated Rights, Liabilities and Obligations

Immovable property of the former National Housing Board and all associated rights, liabilities and obligations passed to the Provincial Housing Development Board for the province in which the property is situated. This is reflected on the title deed as follows:

• The head of department issues a certificate stating that the property has passed to the relevant Provincial Housing Development Board in terms of the Housing Act.
• The Registrar of Deeds makes the necessary endorsements in the registers, on the title deeds and in other documents so as to give effect to the transfer.
• The Provincial Housing Development Board does not pay transfer duty, stamp duty or registration fees in this regard.

1.3 Managing Immovable Property of the Provincial Housing Development Board

The various types of immovable property are to be managed in different ways:

• Undeveloped land is used for housing development if suitable for this purpose. Where the property is not suitable for housing development, the property must be sold at a fair market price. If the property cannot be sold at a fair market price, the property must be sold in the best interests of the State, at a price approved by the MEC. Any income generated in the process must be used for housing development, in accordance with national housing policy and a housing development project approved by the MEC.
• Dwellings and residential stands are let or sold in terms of a national housing programme, or if that is not possible, let or sold at a fair market value, or if that is not possible, in the best interests of the State at a price approved by the MEC.
• Business premises or stands are sold either at a fair market value, or if that is not possible, in the best interests of the State, at a price approved by the MEC.

Where a property has been set aside for the provision of a public service (e.g. a site for a police station), the property should be sold to the relevant department at a fair market value. If the department providing the service no longer requires the property, the property may be utilised for housing development, if appropriate. Alternatively, it must be sold at a fair market value; or if this is not possible, it must be sold in the best interests of the State at a price approved by the MEC.

• All other property (other than those contemplated above) is sold either at a fair market value, or in the best interests of the State, at a price approved by the MEC.
• Net proceeds of any sale or letting are paid into the Provincial Housing Development Fund must be utilised for housing development in accordance with national housing policy and a housing development project approved by the MEC. A housing development project means a plan to undertake housing development in terms of a national housing programme.

The general purpose is to maximally utilise the assets created under the previous dispensation for housing development, and where that is not possible or feasible, to maximally exploit such assets to generate additional funds for housing development.

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2. Rights, Liabilities and Obligations of the former National Housing Board

Contractual rights, liabilities, and obligations of the former National Housing Board in respect of projects, schemes on land which passed to the PHDB and that were underway prior to 1 April, 1998, passed to the relevant Provincial Housing Development Board.

Similarly, any claim deriving out of a contract of sale of the former National Housing Board passed to the Provincial Housing Development Board. For example, if property was sold by the former Board and there is still an outstanding debt, then the money is payable to the Provincial Housing Development Board of the relevant province and is paid into the Provincial Housing Development Fund on receipt.

In addition, the following rules apply.

2.1 Loans, Advances or Other Finance

Loans, advances or other finance, and approved ongoing projects or schemes under the following repealed legislation:

• the Housing Act, 1966 (Act 4 of 1966).
• the Development and Housing Act, 1985 (Act 103 of 1985).
• the Housing Act (House of Representatives), 1987 (Act 2 of 1987).
• the Development Act (House of Representatives), 1987 (Act 3 of 1987).
• the Housing Development Act (House of Delegates), 1987 (Act 4 of 1987).

are dealt with in the following way:

2.1.1 Debt Extinguishment

Where municipalities or the Premier of a province executed projects or schemes with loans, advances, or other finance granted by the former National Housing Board in terms of the above Acts, the outstanding debt of the municipalities and Premiers was extinguished on 1 April 1998. However, no rights, liabilities or obligations of persons who benefited from the projects or schemes so financed are affected by this provision. This would apply to situations where, for instance, a dwelling financed by the municipality or Premier with loan funding from the National Housing Board has been sold to an eligible individual and that person has not yet paid the full purchase price. In this case, the loan obligation of the municipality or Premier to the National Housing Board is extinguished, while the loan obligation of the person remains payable to the municipality or the relevant Provincial Housing Development Board as successor in title to the Premier.

By means of the debt extinguishment, the immovable property acquired by municipalities and Premiers through finance provided by the former National Housing Board has now become unencumbered. The immovable property is the same as the property of the Provincial Housing Development Boards, listed in Section 1.3 above, and must be disposed of in the same manner.

The net proceeds of the letting, selling or other alienation of such property by:

• a municipality must be paid into the separate operating account of such municipality, created in terms of section 15(4) of the Act.

Provincial Housing Development Board must be paid into the Provincial Housing Development Fund for such province, or if such fund has not been established when such net proceeds are received, be dealt with in accordance with Section 13 of the Housing Arrangements Act, 1993, despite its repeal by Section 20 of the Housing Act, 1997.

The net proceeds of any letting or sale or other alienation referred to above must be utilised for housing development in accordance with national housing policy and a housing development project approved by:

• in the case of a municipality, the MEC after consultation with the PHDB in question
• in the case of a Provincial Housing Development Board, the MEC.

2.1.2 Property Acquired by the Premier of a Province

If a property was acquired by the Premier, by means of a loan or advance or other finance, contemplated in Section 2.1.1 above, the property passed to the relevant PHDB.

The net proceeds of the letting, selling or other alienation of such property, must be paid into the Provincial Housing Development Fund for such province; or if such has not been established when such net proceeds are received, be dealt with in accordance with Section 13 of the Housing Arrangement Act, 1993, despite the repeal of that Act by Section 20 of the Housing Act, 1997.

The net proceeds referred to above must be utilised for housing development in accordance with national housing policy and a housing development approved by the MEC.

2.1.3 Ongoing Schemes and Projects

A project or scheme which was being undertaken by a municipality or the Premier of a province before 1 April 1998, using either a loan, advance or other finance approved in terms of the laws referred to above, must be completed by the municipality or the Provincial Housing Development Board of that province, as the case may be. The cost of completing such project or scheme must be financed by a grant from money paid into the relevant Provincial Housing Development Fund.

2.1.4 Recovery of Loans

The Provincial Housing Development Board recovers loans and advances to natural persons or housing utility companies. Funds from this recovered money are paid into the Provincial Housing Development Fund and utilised for housing development.

2.1.5 Welfare Loans

If, however, the funds were lent to a juristic person for purposes of the provision of a welfare facility by the former Board or a municipality, then the PHDB, or the municipality, with the approval of the MEC, and in consultation with the MEC of Welfare, may absolve the juristic person from its obligation to repay part or all of the loan, on request.

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2.2 Loan Agreements and Debentures, Bills and Stocks

Any rights, liabilities and obligations of the former National Housing Board arising out of a loan agreement or the issue of debentures, bills or stocks passed to national government.

2.3 Shares

Shares held by the former National Housing Board in terms of section 10(1) of the Housing Arrangements Act, 1993 passed to national government. However, shares in Lanok (Pty) Ltd held by the former National Housing Board, must be disposed of by the Minister, after consultation with the Executive Councils of the provinces of the Western Cape and Northern Cape.

2.4 National Housing Programme Contracts

Any rights, liabilities and obligations of the former Board arising out of a contract entered into between the Board and any person in terms of a national housing programme in the case of a national contract pass to each of the Provincial Housing Development Board. Furthermore, such rights, liabilities and obligations in the case of a contract relating to a particular province passed to the PHDB of that province.

2.5 National Relocation Assistance Programme

Any rights, liabilities and obligations of the former Board arising out of the agreement between the Mortgage Indemnity Fund (Pty) Ltd and mortgage lenders in terms of the national relocation assistance programme passed to each Provincial Housing Development Board.

2.6 Municipal Infrastructure

Municipal infrastructure of the former Board (as well as all associated rights, liabilities and obligations) passed to the Provincial Housing Development Board. In this instance, net proceeds derived by the Provincial Housing Development Board derived from such infrastructure must be utilised for housing development in accordance with national housing policy and a development project approved by the MEC.

Similarly, where a municipality has utilised a loan, advance or other finance (as contemplated in 2.1 above) to provide municipal infrastructure, the net proceeds derived by the municipality from the municipal infrastructure are to be utilised for housing development in accordance with national housing policy and a development project approved by the MEC after consultation with the Provincial Housing Development Board.

2.7 Additional Instructions

The Minister may issue additional directives regarding the management and disposal of assets, rights, liabilities and obligations of the former Housing Board where the provisions of the Act are inadequate. Consultation with MECs must take place in this regard, and the directives so issued must be consistent with the provisions of the Act.

3. Transfer of Property to Municipalities

The Housing Act requires that immovable property that has not been disposed of by the PHDB, to be transferred from Provincial Housing Development Boards to the relevant municipalities by a date to be determined by the Minister, because they are better able to manage the properties. Property (movable or immovable) is only transferred to a municipality, however, if the MEC, after consultation with the municipality determines that the municipality has the capacity to administer the property as required. The same procedures apply to the transfer of the properties to the municipality as those that apply in regard to the transfer of property from the former National Housing Board to the Provincial Housing Development Board, with changes required by the context.

3.1 Transfer of Movable Property

Movable property (and any associated rights, liabilities and obligations that passed to the Provincial Housing Development Board) will be transferred from the Provincial Housing Development Board to the municipality where the property is mainly utilised, not later than a date determined by the Minister after consultation with the MEC.

If the property is utilised in more than one municipality, the head(s) of department(s) of each province(s) reach an agreement on where the property is mainly utilised. Where there is no consensus, an agreement will be reached through arbitration and compensation must be paid to the municipality that does not obtain the property, if necessary.

3.2 Transfer of Immovable Property

Immovable property that was transferred to the Provincial Housing Development Board and that is not sold or alienated must be transferred to the municipality in whose area the property falls. The date by which property is to be transferred may not be later than a date determined by the Minister after consultation with the MEC. If the property is situated in more than one municipal area, then the MEC and the municipalities reach agreement to which municipality the property must be transferred.

3.3 The Management of Immovable Property that has been transferred from PHDB’s To Municipalities

Immovable property must be managed by municipalities in the same way in which the PHDB had to manage it. The requirements in this regard are set out in Section 3.3. The net proceeds of the sale, letting, or other alienation must be paid into the separate operating account of the municipality created in terms of Section 15(5) of the Act. The net proceeds must be utilised by the municipality for housing development in accordance with national housing policy and a housing development project approved by the MEC after consultation with the Provincial Housing Development Board.

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3.4 Separate Municipal Accounts in respect of Housing Development

A municipality that is not accredited to administer national housing programmes is only required to maintain the separate operating account referred to in Section 15(5) of the Housing Act, into which the net proceeds of the disposal of its housing assets, created under the previous dispensation, must be paid.

An accredited municipality must over and above the Section 15(5) separate operating account, also create the following separate accounts:

• an account into which funds from the Provincial Housing Development Board are paid, to enable the municipality to administer the housing subsidy scheme or part thereof
• an account into which funds from the Provincial Housing Development Board are paid to enable the municipality to undertake national housing programmes or part thereof

3.5 Registration Rights

The procedures for the registration of transfer of immovable property and/ or a registrable claim or right to the municipality is similar as that which apply in respect of the transfer of the immovable property of the former Board to the Provincial Housing Development Board. These are as follows:

The Chief Executive Officer issues a certificate to the effect that the immovable property has passed to the relevant municipality in terms of the Housing Act.

• The municipality submits a request to the Registrar of Deeds to give effect to the transfer and also submits the relevant title deeds and other documents.
• The Registrar of Deeds makes the necessary endorsements in the registers and on the title deeds and other documents to give effect to the transfer.
• The municipality does not pay transfer duty, stamp duty or registration fees.

3.6 Redundancy of Personnel

The devolution of assets to municipalities may render certain personnel in the provincial administration redundant. The matter of redundancy of personnel is addressed in accordance with the laws governing the public service.

4. Transfer of Money in Certain Funds to Municipal Operating Accounts

It may be the case that in terms of the legislation listed in Chapter 3, section 2.1 of this Part of the Code, a municipality established one or more of the following accounts:

Community Facility Account.

• Rent Reserve Fund.
• Maintenance and Renewal Fund.

The Housing Act requires that all moneys that were to the credit of these funds at 1 April 1998 must be transferred to the Section 15(5) separate operating account of the municipalities and utilised for housing development in accordance with national housing policy and a housing development project approved by the MEC after consultation with the PHDB. This process is illustrated in the diagram on the following page.

Figure 5. Transfer and Management of Assets

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3.4 Housing Information

This section describes the provisions in the Housing Act regarding a National Housing Data Bank and the Information System. Specifically, it focuses on the information requirements and outputs of the various systems that form part of the Information System. In addition, the chapter sets out the responsibilities of provincial government and municipalities in support of the Data Bank and Information System.

Information and reporting is of central importance not only to each of the spheres of government, but to all parties involved in housing development. Access to the appropriate information:

• Ensures that information is readily available for the purposes of the development, implementation and monitoring of national housing policy.
• Assists with planning for housing development.
• Serves and promotes housing development and related matters.
• Enables the National Department of Housing to effectively monitor any aspect of the housing development process.
• Provides macro-economic and other information with a view to integrating national housing policy with macro-economic and fiscal policy and the co-ordination of housing development with related activities.
• Collects, compiles and analyses categorised data in respect of housing development, including, but not limited to, data categorised according to gender, race, age and geographical location.
• Enables government to report back to our people on progress, thereby fulfilling our constitutional obligations of transparency and accountability.
• Detects fraudulent practices with housing data and funds.
• Provides information that will facilitate inter-departmental integration.

The Housing Act requires the Director-General to establish and maintain a National Housing Data Bank, and associated therewith, a National Housing Subsidy Information System. The ultimate aim is a comprehensive source of integrated information, regarding housing, urbanisation and related matters. In undertaking this task, the Director- General must access existing sources of information; co-ordinate information required for the data bank with other official sources of information; and take into account the reasonable needs of provincial governments and municipalities for housing information.

In executing the duties regarding the databank and information system imposed by the Housing Act, 1997, the Director-General may:

• Request information from provincial governments or municipalities as required.
• Provide assistance to provincial governments and municipalities to fulfil their duties where reasonably required.
• Link the databank, or the information system, or both, to any other system.
• Limit or refuse access by any person or group to all or part of the information in the data bank or information system, where access to the source data is restricted or where the information will unfairly prejudice or advantage a person.
• Determine and collect fees for the supply of, or access granted to information, in which case proceeds are made over to the South African Housing Fund.
• Take any steps reasonably necessary to carry out his or her duties or to achieve the objectives of the databank and information system.

To provide in this need, the Department embarked on establishing the following systems and databanks.

Table 2. Housing Information Systems and Data Banks

Information System / Databank	Purpose
Housing and Urbanisation Information System (HUIS)	A data warehouse with decision support facilities that will provide: a comprehensive analytical framework for monitoring the performance of housing development and urbanisation a set of practical tools for measuring the performance of housing development and urbanisation using quantitative and qualitative, policy sensitive indicators HUIS will contribute towards South Africa’s participation in international housing forums.
National Housing Subsidy Data Base (NHSDB)	To prevent double subsidisation by providing records of subsidies granted by: the previous government (such as the First Time Home Buyers Interest Subsidy, and the Discount Benefit Scheme), the Housing Subsidy Scheme other departments under the current administration (such as the land settlement grants provided by the Department of Land Affairs, and the water and sanitation subsidies provided by the Department of Water Affairs and Forestry) This still has to be developed and operationalised by the Department of Housing and the other departments concerned.
Housing Subsidy System	Operational system for the administration of the various subsidy programmes by provincial administrations.
Nomvula (Also referred to as the Perform Developer System (PFD system)	A project management system that tracks progress on subsidised housing projects throughout the country. Data is sourced nationally from each of the provinces on a daily basis, ensuring that national government can determine funds spent to date, as well as progress and problems regarding specific projects.
Integrated Development Information System (IDIS)	Information System being developed to assist local authorities with their planning and development of Land Development Objectives (LDO’s). This system will eventually provide departmental analysts, with grassroots information for research purposes via HUIS.
Geographic Information System (GIS)	The abovementioned systems will be serviced by the GIS that will facilitate the integration, manipulation, analysis and display of geographically referenced data in graphical format, to facilitate decision-making.

Each of these systems is described in detail, in this chapter. A graphical presentation of the housing information system environment, also demonstrating the interrelation between the above named systems is illustrated in the Figure 8, which follows.

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Figure 6. Housing Information System Environment

Each of these systems is described in detail in this Chapter.

1. Housing and Urbanisation Information System (HUIS)

The Housing and Urbanisation Information System (HUIS) is a data warehouse with decision support facilities. Systems feeding into the HUIS include:

• The Housing Subsidy System (an operational system to administer the different kinds of subsidies).
• The National Housing Subsidy Database (NHSDB).
• Nomvula PFD System ( a project management system).
• Other systems such as the Integrated Development Information System and systems from other departments, as indicated in Table 6, below. The department enters into formal agreements with those sources supplying data to HUIS.

The database output provides for subsidy and housing project related data, human settlement indicators, an econometric model, information on housing expertise, infrastructure programmes, the monitoring of institutions, and so on.

Table 3. Main sources of Information for the HUIS

DATA SOURCE	DATA ITEM	FREQUENCY OF ACQUISITION
Provinces	Housing Subsidy Data	Monthly
Statistics South Africa	Employment, salaries and wages summary	Quarterly
Statistics South Africa	Vpileer (Consumer Price Index)	Monthly
Statistics South Africa	Ppileer (Annual Inflation Rate on Production Price Index)	Monthly
Statistics South Africa	Arbkons1	Monthly
Statistics South Africa	Joint Building Contracts Committee: Contract Price Adjustment Provisions Work Group Indices	Monthly
Statistics South Africa	Building Construction (Bouwerk)	Monthly
Statistics South Africa	October Household Survey	Annually
Statistics South Africa	Offences/Number of Convictions	Annually
Bureau of Market Research	National Minimum Living Level	Annually
South African Reserve Bank	Money and Banking, Capital Market, National Accounts	Quarterly
NHFC	Key performance indicators	Monthly
NHBRC	Key performance indicators	Monthly
NURHCA	Key performance indicators	Quarterly
SERVCON	Key performance indicators	Quarterly
Users	Housing Expertise	Ad hoc
Statistics South Africa	Census	5 yearly

2. The National Housing Subsidy Data Base (NHSDB)

The purpose of the National Housing Subsidy Data Base is to prevent double subsidisation. Broadly, the database includes historical records of subsidies granted by the previous government (such as the First Time Home Buyers Interest Subsidies and Discount Benefits). The database also records details of subsidies granted under the Housing Subsidy Scheme. The records of subsidies provided by the Departments of Land Affairs, Water Affairs and Forestry, and so on, will also in due course be recorded on the database.

The database is programmed to do overnight batch searches of the following databases:

• The Deeds Office in respect of all provinces- this is done in order to verify that the applicant does not own fixed residential property
• The Population Register at the Department of Home Affairs- this is done in order to verify the applicant’s identity number.

Source data is captured by each of the provinces. Data is then accessed from each of the provinces by National Government.

A graphical presentation of the relation between suppliers of data to the NHSDB is illustrated in Figure 9, which follows.

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Figure 7. Supply of Data to NHSDB

3. Housing Subsidy System (HSS)

The Housing Subsidy System is an operational system by means of which the various housing subsidy programmes are administered by the provincial administrations.

Following policy decisions to enhance the existing HSS and similar needs expressed by the various spheres of government for a system that will provide reliable information for management purposes, the Department initiated the development of a new system. This new system will provide the administrative and information needs of the joint initiative between the Government, the private sector and labour, as announced during the Presidential Job Summit.

The new HSS will be implemented during 1999 and will be owned by the Department of Housing. It will be a uniform, custom built, transversal system in operation at all the provinces and accredited municipalities. The system will provide users with a facility to administer the various types of housing subsidies and housing projects.

Subsidy data captured at Provincial and accredited Local government level is replicated to the HUIS where it will be available to housing functionaries for planning and monitoring purposes.

4. Nomvula (also referred to as PFD)

Nomvula is a project management system that tracks progress on subsidised housing projects throughout the country.

At a provincial level, system administrators capture data on progress with the achievement of milestones. For example:

• Township Establishment: Have the rights to the land been secured; has the cadastral/ legal position of the land been investigated; has a town planning layout been prepared; has application been made to the local authority to establish a township; has a cadastral survey of the land been completed; have the site boundaries been defined and has a general plan been submitted to the surveyor- general and approved; have the conditions of establishment been prepared and complied with; has the township register been opened; have payments been made in respect of work undertaken?
• Sales Administration Process: Have allocation procedures been prepared; has the project been advertised; have allocation lists been prepared and approved; has all necessary legal documentation been signed; has the transfer documentation been processed?
• Land Servicing Process: Has the issue of land servicing been investigated; has preliminary design work been completed; is the construction of services complete; have services been handed over; have funds been drawn down?
• Building Operation: Have preliminary design sketches for the top structure been prepared; have detailed designs been prepared; has the project gone out to tender and has the tender been awarded; have the top structures been constructed; have payment been made?

These milestones are detailed clearly in a booklet developed for developers by the National Department of Housing and the National Business Initiative, known as “The Housing Project Programming Guide”.

At a national level, data is sourced from each of the provinces on a daily basis. This ensures that National Government is able to determine funds spent to date; that progress on projects can be monitored at a national level; and that problems and obstacles are identified at an early stage.

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5. Integrated Development Information System (IDIS)

The National Department of Housing decided to participate in the envisaged Integrated Development Information System (IDIS) being developed by the CSIR. The purpose of this system is to assist municipalities with their planning and development of Land Development Objectives (LDO’s). This system will eventually provide departmental analysts with grassroots information for research purposes via HUIS. The key objectives of this system will be to:

• Research, develop and implement an information management and decision support solution to challenges posed by the new integrated and sustainable development policies of the Government.
• Research, develop and implement the necessary Information and Communication Technology, policy and institutional mechanisms to:

• enhance joint decision-making and co-ordination between the spheres of government, thus improving the quantity and quality of service delivery;
• support the monitoring and review of service delivery;
• facilitate a multi-sectoral perspective of development and interests;
• eliminate costly duplication of information; and
• improve the accessibility and availability of information for development.

6. Help Desk

A Help Desk function is to be made available to the users of the HUIS, the HSS, the NHSDB, and the IDIS. All enquiries are to be managed and controlled at a central access point. The help desk will provide first line support on the above-mentioned systems; data quality management and improvement; preparation of management information reports; and on changes on the system.

In addition, it is envisaged that user support will include:

• The facilitation of user meetings to ensure that systems are properly used and that user needs are addressed in an organised way.
• The analyses, comparison and monitoring of management reports on information subtracted from the HUIS, the NHSDB, the IDIS and the HSS for data quality.
• The analysis, monitoring and production of error reports on provincial data from the HSS.
• The provision of feedback to users on progress of logged calls.

7. Responsibilities of Local and Provincial Government

Each system and data bank is highly dependent on information supplied by provincial and local governments. Consequently, it is the responsibility of both provincial governments and municipalities to co-operate with the national department in its request for information, in the interests of successful information systems. The Housing Act sets out this responsibility quite clearly.

The housing data banks and information systems were developed by national government, in consultation with the provinces and other departments. The aim of the systems that have been developed is to record information for purposes of development, implementation, and monitoring of national housing policy. The success of these systems therefore depends on the willingness of Provincial Governments and municipalities involved with the housing process to co-operate by using the system and by supplying it regularly with reliable data.

Reports are the means by which data and information is transferred from one sphere of government to another. Each provincial government and all municipalities must provide reports and returns to the Minister and the Director-General as and when requested, in the prescribed format.

The Directorate: Information at the National Department of Housing will, in consultation with line functionaries at the Department, the provinces and municipalities, determine procedures for the production of reports from data in the HUIS. These reports will also be available electronically to official users. Selected reports will be made available to interested parties via the Internet.

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3.5 Delegations

This section sets out the rules in respect of Delegations.

The Housing Act makes provision for the Director-General or the Head of a Provincial Housing Department to delegate powers or duties imposed on him or her by the Act to an officer or employee of the national department or provincial administration respectively. The only duty that the Director-General or Head of a Provincial Housing Department may not delegate, is the duty of accounting officer, as set out in Section 11(5) or 12(2)(b) of the Housing Act.

The officer or employee to whom the power or duty has been delegated is then responsible for carrying out that power or duty, subject to the conditions imposed by the Director-General or Head of the Provincial Housing Department.

The delegation:

• must be in writing.
• does not prevent the Director-General or Head of Department from performing the duty or exercising the power himself / herself.
• may be withdrawn at any time, in writing, by the Director General / Head of Department.

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