Benchmarking Housing. LOGO South Programme

Transcription

1 Benchmarking Housing LOGO South Programme Report, February

2 COLOPHON Authors Michelle Essink Anke Ruige Christelle Griesel Printing Minit Print Pretoria North, South Africa CMRA Centre for Municipal Research & Advice 29 Forbes Reef Rd Waterkloof Heights (c) Copyright CMRA 2012 The contents of our pages have been created with great care. However, no liability can be accepted for completeness, editorial and technical mistakes, omissions as well as for correctness of the contents.

3 Contents Graphs... 2 Tables... 2 Glossary Introduction... 5 Benchmarking... 5 Project Implementation... 6 About the report Housing in South Africa... 8 Introduction... 8 The role of the municipality in Housing... 8 The legal framework Benchmark results Municipal profile and general demographic information Data Collection and Planning Management of Rental Stock Public Participation Housing Delivery Integrated Human Settlements Informal Settlements Conclusions and Recommendations

4 Graphs Graph 1 Total Capital Budget Graph 2 Total Operational Budget Graph 3 Operational and Capital Budget per Capita Graph 4 Unemployment Rate (%) Graph 5 Percentage of Indigent Households Graph 6 Average Household Size Graph 7 Age Groups in the Population Graph 8 Expected Delivery in the next 5 years Graph 9 Sources used for Demand Data Graph 10 Data used for Planning Graph 11 Municipal Rental Stock Graph 12 Target Groups for Rental Stock Graph 13 Management of Rental Units Graph 14 Management of Future Rental Housing Stock Graph 15 Forms of Public Participation Graph 16 Target Groups for Public Participation Graph 17 Public Education on Housing Programmes Graph 18 Housing Programmes implemented Graph 19 Interventions for Informal Settlements Tables Table 1 Planning Documents for Housing Table 2 Number of subsidised ownership units delivered Table 3 Delivered units over the last 5 years... 26

5 Glossary BNG/RDP CMRA CRU DHS HDA IDP MFMA PIE Act SALGA SHI VNG International Breaking New Ground/Restructuring and Development Programme Centre for Municipal Research and Advice Community Residential Units (Programme) National Department of Human Settlements Housing Development Agency Integrated Development Planning Municipal Finance Management Act Prevention of Illegal Eviction and Unlawful Occupation of Land Act South African Local Government Association Social Housing Institution International Cooperation Agency of the Association of Netherlands Municipalities Definitions BNG Housing (Former RDP) Breaking New Ground Housing: Housing programme for the income group of people earning not more than R3500 per month. The ownership of the house and the land will be transferred fully to the beneficiary. This was formerly known as RDP Housing. Community Residential Units (CRU) Form of Rental Housing. The stock is publicly owned (often by the municipality) and made available for an income group of approximately R800 to R3500 per month. Delivery Agent Company (section 21, municipal entity, PTY, other) that is responsible for the delivery of (rental) housing stock. Housing Demand Database Provincial database into which municipalities can feed their information on the housing demand. 3

6 LOGO South Programme South Africa Twinning programme between South African and Dutch municipalities with the purpose to increase capacity in the field of rental housing through exchange of knowledge and experience based on a colleague-to-colleague approach. National Housing Code The National Housing Code 2009 sets the underlying policy principles, guidelines and norms and standards which apply to Government s various housing assistance programmes introduced since 1994 and updated. The purpose of this guide is to provide an easy to understand overview of the various housing subsidy instruments available to assist low income households to access adequate housing. The detailed description of the policy principles, guidelines, qualification criteria and norms and standards are available in the National Housing Code. Rental Housing Dwelling type which is owned and managed by a landlord/institution. Tenant pays rent to the landlord/institutions for the right to inhabit the unit. The lease agreement between landlord/institution and tenant is subject to the Rental Housing Act.

7 1. Introduction The Benchmarking Municipal Housing project is developed and implemented by the Centre for Municipal Research and Advice (CMRA) in partnership with the International Cooperation Agency of the Association of Netherlands Municipalities (VNG International) and the South African Local Government Association (SALGA) as part of the LOGO South Country Programme South Africa. The seven municipalities that participate in the Country Programme have been implementing projects in housing with their counterparts from the Netherlands. Through the benchmark project lessons learned and good practices will be compared and exchanged. Municipalities compare and exchange lessons learned and good practices in a systematic manner by administrating the questionnaire and discussing results at periodic meetings. This is followed by a conference with the aim of sharing the results with other municipalities. The overall aim of the benchmark project is to provide municipalities with a platform to assess their current performance in housing delivery and to improve this through better planning, facilitation and monitoring. The benchmark project facilitates a process of selfassessment, networking, and compare and exchange between peer municipalities in matters pertaining to provision of housing. In this manner, municipalities can tap into existing knowledge, lessons learned and good practices, and, by investigating the crucial steps and conditions, adapt this wealth of knowledge and experiences to their own local context. In 2010 a first housing benchmark cycle was implemented among the seven municipalities that are part of the LOGO South Country Programme South Africa. The benchmark of 2011 is building on the results of the previous year and going into more detail in some of the issues that were identified as problematic to the municipalities in the 2010 benchmark. In this report a comparison to the results of last year s benchmark will be made where applicable. In 2011 three municipalities were added to the benchmark group. These municipalities also have twinning relations with Dutch municipalities, but were part of one of more of the LOGO South thematic programmes. Benchmarking Benchmarking is a learning method used worldwide in businesses and governmental organisations to improve their performance. The essence of the method is the comparison of performance indicators with similar organisations and learning from the practices of the best. Therefore benchmarking is a research and learning-based improvement instrument. CMRA makes use of the CMRA benchmarking model, a benchmarking methodology for municipalities in developing countries and countries in transition. The model was developed by CMRA in cooperation with VNG-International, the mother company of CMRA. The model is a result of practical experience with benchmarking and scientific research on benchmarking. Five years of experience with the model has proven that it is a powerful instrument for capacity building of local government in developing countries and countries in transition. 5

8 CMRA benchmarking model The model consists of four stages. In the collect stage information is collected about the performance of participating local governments on a certain topic based on performance indicators. The compare stage identifies the differences between the organisations. In the learn stage municipalities learn about the practices of municipalities that perform best. In the improve stage municipalities implement the learned practices and improve their performance. Benchmarking capacitates municipalities to improve the quality of their activities as municipalities learn what practices function more effectively. The benchmark focuses on how to improve quality of activities and reduce costs for society. On top of building capacity, benchmarking enables municipalities to increase transparency and strengthen accountability as it provides municipalities with a platform to inform citizens about their achievements. In this way benchmarking contributes to reducing the distance between government and residents or between civil service and its customers. All to the benefit of both citizens and the city council. Project Implementation The key steps in the benchmark are Formation of benchmark cycles of municipalities Development of a questionnaire with housing experts, stakeholders, benchmark experts and municipalities Data collection and validation Cycle of comparison meetings where the participants meet to compare and learn Development of the final report Implementation of a project on the basis of one or more of the recommendations Distribution of a brochure with good practices About the report This report contains the final results of the benchmark based on the input that was provided by municipalities through the questionnaires. The results, the quality of the report and the success of the benchmark as a whole, fully depend on the quality of the data that is provided by the municipalities. Missing or incorrect answers distort the analysis and the results. The benchmark report has been written with the aim of highlighting differences and similarities between the municipalities, and stimulating improvements through comparing,

9 exchanging good practices and lessons learned and networking. There are three reports resulting from this project: General report: commenting on findings of all participating municipalities Municipal report: commenting on findings of an individual municipality, by making links to the practices in the other participating municipalities. Management summary: summary of the outcomes for municipal management 7

10 2. Housing in South Africa Introduction Housing is one of the biggest challenges in South Africa in the delivery of services to the public. There is a large demand for housing and there is a large part of the population that cannot afford to buy or rent housing at market prices. The government is assisting the population through different housing programmes. Many of those are focused on ownership, which is for the majority of the South Africans the preferred form of tenure. Though, with many changes in the current day society, housing preferences or needs also change. The demand for housing is becoming more diverse. Municipalities share the responsibility to provide access to decent housing with the other spheres of government. Municipalities are the sphere of government that has the closest link to the population and is for the people the first point of entry to the government. If they have problems they will go to the municipality. Municipalities are the face of government and carry a lot of responsibilities to ensure the delivery of housing to the people. The role of the municipality in Housing Although there are many discussions on what exactly should be the role of local government in housing, it is clear that there is a significant role for municipalities in housing. Local government is the sphere of government that is closest to the public and therefore in an excellent position to determine the needs at the local level. Furthermore, the municipality is responsible for many other services that are closely linked to housing, such as infrastructure and water services. According to legislation, local government has mainly a planning and facilitation role in housing. In practice it is seen that each municipality tries to find its own role in housing. Some municipalities take a lot of initiative, while others leave many matters to the provincial government. In this benchmark process some of the differences in the interpretation of the role of local government in housing came forward. The National Department of Human Settlements (DHS) has been working on the process of accreditation of municipalities. The purpose of this process is to accredit municipalities that have the necessary capacity to take over the housing functions from the provincial government. Although the process is still continuing, some municipalities have already taken up quite a number of functions and seem to be managing well. The legal framework According to the Constitution, the delivery of human settlements is a shared responsibility of national and provincial government. The Housing Act describes the role of the municipality as a facilitating and planning role. Local government needs to create the enabling environment for other stakeholders to deliver houses. Though, in many cases the provincial government has assigned municipalities with the responsibility for the delivery of houses. To provide some insight in the legal context of housing, a number of relevant pieces of legislation are discussed. One of them is the Housing Act which lays down the roles and responsibilities in the housing sector for all spheres of government. The Housing Code is

11 related to the act and outlines the national housing policy in a comprehensive way. Another important piece of legislation is the Rental Housing Act, which regulates, among others the relationship between tenants and landlords and the role of the Rental Housing Tribunals. Many municipalities are landlords because they own rental housing stock. Furthermore, the Prevention of Illegal Eviction and Unlawful Occupation of Land (PIE) Act is a very relevant piece. It regulates cases of evictions and illegal occupation. It protects the tenants against unlawful evictions and holds government responsible to supply alternative accommodation where required. The Municipal Finance Management Act (MFMA) and the Municipal Systems Act are relevant for municipalities especially in relation to the establishment and/or relationship with delivery agents for housing. Most of all, where municipalities choose to set up a municipal entity for the delivery the MFMA needs to be adhered to. 9

12 3. Benchmark results The benchmark is based on the input of ten municipalities. The analysis of the responses has been done according to the sections as they were provided in the questionnaires and mentioned in the introduction. 3.1 Municipal profile and general demographic information The ten participating municipalities are all taking part in the LOGO South Country Programme. Seven are part of the LOGO South Programme on Housing, while the remaining three municipalities have taken part in one or more of the thematic programmes. As part of the LOGO South Programme they have been implementing (rental housing) projects with their counterparts from the Netherlands. There are quite some differences between the municipalities. Three of them are Metropolitan Municipalities, while the other seven are Local Municipalities of different sizes. This has implications for the analysis and one needs to be careful interpreting the results, especially keeping in mind the demographic and economic differences between the municipalities. The participating municipalities are the following (in alphabetical order): 1. Municipality 1 2. Municipality 2 3. Municipality 3 4. Municipality 4 5. Municipality 5 6. Municipality 6 7. Municipality 7 8. Municipality 8 9. Municipality Municipality 10 Municipality 1, Municipality 5 and Municipality 8 are participating in the Housing Benchmark for the first time; the other municipalities have all participated in the Housing Benchmark of This paragraph provides a background on the municipal profiles and some demographic information of the municipalities. It will give the reader a better understanding of the municipalities and draw the context in which the rest of the analysis can be viewed. Budget To be able to draw a picture of the municipalities, they were asked to give the total municipal capital and operational budgets. Although it does not directly mean anything for housing service delivery, it does give an indication of the resources that the municipality has for running all its services and human resource capacity.

13 Graph 1 Total Capital Budget Total Municipal Capital Budget Mun5 Mun10 Mun8 Mun6 Mun7 Mun3 Mun9 Mun2 Mun4 Mun1 Ave < R 50 Million R 50 Million - R 100 Million R 100 Million - R 200 Million R 300 Million - R 600 Million R 600 Million - R 1 Billion > R 2 Billion There are major differences amongst the municipalities in the municipal capital budget ranging from R to R The average capital budget is R The municipal operational budgets also show a wide range between the municipalities, starting from R up to R The average is R Due to the large differences, it was not possible to put the exact amounts in graphs, therefore the municipalities have been assigned in categories as can be seen in Graph 1 and 2. Graph 2 Total Operational Budget Total Municial Operational Budget < R 200 Million R 200 Million - R 400 Million R 400 Million - R 800 Million R 1 Billion - 2 Billion R 4 Billion -5 Billion > R 15 Billion Graph 3 shows the budgets per capita. This gives an impression of the budget that is available per inhabitant. Although the major differences between the municipalities become smaller by viewing the budgets per capita. Still, most metropolitan municipalities score higher than the local municipalities. 11

14 Graph 3 Operational and Capital Budget per Capita Budgets per Capita R R R R R R R R R 0 Capital Budget per Capita 2011 Operational Budget per Capita 2011 Mun5 Mun10 Mun8 Mun6 Mun7 Mun Mun9 Mun2 Mun4 Mun1 Ave On average municipalities have R891 per capita for the capital costs and R5 587 per capita for the operational costs. Though most municipalities have a higher operational budget than their capital budget, in Municipality 5 and Municipality 1 the capital budget exceeds the operational budget. Compared to the results of last year most of the municipalities have a largely increased operational budget and only one municipality has a decreased operational budget. Population Demographic information is elementary to determine the demand for housing and to be able to cater for the needs of the population. The size of households, the age distribution, whether there are more young or old people, the unemployment rate and other demographic features determine the needs of the population as well as what they can afford. Based on this information, a municipality can make its plans for the delivery of housing that will be fit for their specific area. Unemployment The unemployment rate in the participating municipalities is ranging from 7.7% to 50.3% with an average of 26.6%. The differences between the municipalities are large and it is clear that some municipalities are struggling more with unemployment than others. From the data provided by the municipalities there is no clear correlation visible between the size of the municipality and the level of unemployment. Some of the rural municipalities have a very low unemployment rate, while others have very high unemployment rates. The metropolitan municipalities are all relatively close to the national average of 25.7% (second quarter of 2011, StatsSA). The data sources that have been used by the different municipalities vary considerably. Furthermore, the sources that individual municipalities used in the 2010 benchmark and the current benchmark vary as well. The data between the two years is in some of the municipalities considerably different. The unemployment rate in some of the municipalities has increased or decreased vastly. This is probably based on the difference in data source.

15 The use of different data sources does distort the comparison for the municipalities between the two benchmarks. Graph 4 Unemployment Rate (%) Unemployment (%) Mun5 Mun10 Mun8 Mun6 Mun7 Mun3 Mun9 Mun2 Mun4 Mun1 Ave Households The percentage of indigent households in a municipality, in combination with the unemployment rate can provide the municipality with valuable information regarding the demand for low cost/low income housing. The percentages of indigent households in the municipalities vary considerably, from 0% to 39%. This may to a certain extent depend on the differences in the definitions of indigent in the municipalities. Graph 5 Percentage of Indigent Households Percentage of Indigent Households Mun5 Mun10 Mun8 Mun6 Mun7 Mun3 Mun9 Mun2 Mun4 Mun1 Ave Unemployment and the percentage of indigent households are important economic indicators for the demand for housing. Another important indicator is the average household size, which can provide more information for the housing typologies that would be required. The overall average household size in this benchmark group is 3.9 persons per households 13

16 with a minimum of 3.2 and a maximum of 5. Most of the local municipalities score 4 or higher, while the three metropolitan areas score 4 or below 1. There seems to be a trend for smaller households in urban areas, which could indicate a higher demand for smaller housing units in urban areas. Graph 6 Average Household Size Average Household Size Mun5 Mun10 Mun8 Mun6 Mun7 Mun3 Mun9 Mun2 Mun4 Mun1 Ave Specific groups in the population Knowledge of the composition of the population will enable a municipality to facilitate the delivery of the kind of housing that the population needs. Many of the municipalities show a high level of youth and a lower level of elderly. This could indicate that in the (near) future there will be a rising demand for housing for young families. Graph 7 Age Groups in the Population Age Groups in Population (%) Mun5 Mun10 Mun8 Mun6 Mun7 Mun3 Mun9 Mun2 Mun4 Mun1 Ave Elderly (>65) Youth (14-35) 1 The average household size provided by Ekurhuleni was 6, though calculations proved that it actually is 3.1.

17 Some municipalities are showing a high cumulative percentage of youth and elderly, almost going up to 100%. These percentages are highly unlikely and unreliable and would need to be checked again. On average there is a percentage of almost 40% youth in the municipalities and a little bit over 10% elderly. 3.2 Data Collection and Planning One of the main tasks of municipalities in the field of housing is planning. All the municipalities in the benchmark have a housing chapter in their IDP and most of them have been updated within the last two years. Recent housing strategies as well as other planning documents for housing have also been developed in most municipalities and recently updated. This is a very good overall score. Table 1 Planning Documents for Housing Municipality Housing Chapter in the IDP Last updated Housing Strategy Last updated Other planning document for Housing Last updated Municipality 5 Yes 2010 No N/A Yes 2010 Municipality 10 Yes 2007 Yes 2008 Yes 2008 Municipality 8 Yes 2010 Yes 2011 Yes 2011 Municipality 6 Yes 2009 Yes 2007 Yes 2006 Municipality 7 Yes 2010 Yes 2010 Yes 2011 Municipality 3 Yes 2010 Yes 2008 Yes 2010 Municipality 9 Yes 2010 Yes 2009 Yes 2009 Municipality 2 Yes 2008 Yes 2009 Yes 2006 Municipality 4 Yes 2011 Yes 2011 No N/A Municipality 1 Yes 2011 Yes 2010 Yes 2010 Within the existing planning, municipalities have determined their targets for delivery in the next five years, as indicated in the graph below. The targets vary considerably with an average of units. One municipality did not indicate their targets and is seen as zero in the graph. The municipality with the highest score is Municipality 3 with a target of units. Municipality 6has a very high score as a local municipality. In a number of cases the set targets could be overrated, especially when compared to what the municipality has been able to deliver over the last few years. 15

18 Graph 8 Expected Delivery in the next 5 years Expected Delivery in 5 Years Emfuleni Mun5 City Mun10 of Tshwane Naledi Mun8 Govan Mun6 Mbeki Langeberg Mun7 Ekurhuleni Mun3 Oudtshoorn Mun9 Camdeboo Mun2 Emalahleni Mun4 Buffalo Mun1 City In the process to determine the needs for housing development in the future, municipalities have made use of different sources for demand data as can be seen in Graph 9. All municipalities except Municipality 1 have only made use of the named sources. Municipality 1 municipality made use of their housing needs register, which is indicated under Other. The most used source for demand data is the waiting list. Graph 9 Sources used for Demand Data Demand Data Sources Mun1 Buffalo City Mun4 Emalahleni Mun2 Camdeboo Mun9 Oudtshoorn Mun3 Ekurhuleni Mun7 Langeberg Mun6 Govan Mbeki Mun8 Naledi City Mun10 of Tshwane Mun5 Emfuleni StatsSA Survey Waiting List Information from ward councillors/committees Data from Provincial Government Other

19 While some municipalities make use of different sources to ensure the best possible information regarding the demand for housing, others only use one or two sources to determine the demand in their municipality. For eight of the ten municipalities the available data was sufficient to determine the demand and to draft the planning documents. Two municipalities, Municipality 1 and Municipality 5, indicated that they were missing information, such as accurate special needs information, waiting list information, information regarding informal settlement shacks and information on households that have received housing already. These municipalities had already made use of a number of sources. In the 2010 housing benchmark, three municipalities indicated to use information from the provincial government for their demand data. In the current benchmark there are five municipalities; Municipality 5 and Municipality 1 did not participate last year, the Municipality 10 and Municipality 3 already indicated last year that they were connected to the provincial database, Municipality 9 is now using the provincial demand data as opposed to last year. The kind of data that the municipalities have used in their planning documents can be seen in Graph 10. The numbers on the waiting list is the most used data for planning. Overall, municipalities use a variety of data for their planning. Municipality 7 and Municipality 6 municipalities only use one form of data. These municipalities could perhaps increase these to get a better view on the target group and its preferences, financial situation, etc. Municipality 5 mentioned besides some of the given options that they also used data from the informal settlements for their planning purposes. Graph 10 Data used for Planning Data used for Planning Buffalo City Mun1 Mun4 Emalahleni Mun2 Camdeboo Mun9 Oudtshoorn Mun3 Ekurhuleni Mun7 Langeberg Mun6 Govan Mbeki Mun8 Naledi City Mun10 of Tshwane Mun5 Emfuleni Overall Demographic Data (such as gender, race, age, etc.) Unemployment rate Income levels/affordability Dwelling type preference Numbers on Waiting List Other Two municipalities mentioned that they would like to have more information available to determine the demand for housing. Municipality 3 was missing information about inmigration into the municipality from surrounding areas. Municipality 5 needs more information on beneficiaries that have already benefited from housing schemes, on the development of rental stock and on the status of backyard dwellers. 17

20 Information regarding the number or amount of housing subsidies that have been spent in a municipality is not available in most municipalities. The two municipalities in the Western Cape have access to this kind of information. Municipality 8 also had the information available, but did not have any housing subsidies spent in the last five years. Municipality 10 also indicated to have access to the information, but could not provide the number or the amount of subsidies that had been spent. As can be seen in Table 2 the number of municipalities that had access to this information was very limited. Over the last five years there have not been any rental housing units delivered in the municipalities that had access to the information. Table 2 Number of subsidised ownership units delivered Municipality 2010/ / / / /2007 Total Municipality 5 Municipality 10 Municipality Municipality 6 Municipality Municipality 3 Municipality Municipality 2 Municipality 4 Municipality Total Management of Rental Stock Out of the ten municipalities, seven indicated to own rental housing stock. In three cases this included rental stock for municipal employees specifically.

21 Graph 11 Municipal Rental Stock Municipal Rental Stock Mun Buffalo 1 City Mun Emalahleni 4 Mun Camdeboo 2 Mun Oudtshoorn 9 Mun Ekurhuleni 3 Mun Langeberg 7 Mun Govan 6 Mbeki Mun 8 Naledi City Mun of 10 Tshwane Mun 5 Emfuleni General Rental (existing municipal stock, CRU, etc) Employee housing Other 19

22 In all the cases, one of the target groups for the rental stock was the income group below R3500 per month. The additional groups that were mentioned are the community and pensioners. Municipality 4 indicated that they would like to have rental stock developed for the income group of R8 000 R per month. This is a remarkable target group, especially for municipal stock. Graph 12 Target Groups for Rental Stock Target Groups for Rental Stock Mun1 Buffalo City Mun4 Emalahleni Mun2 Camdeboo Mun9 Oudtshoorn Mun3 Ekurhuleni Mun7 Langeberg Mun6 Govan Mbeki Mun8 Naledi City Mun10 of Tshwane Mun5 Emfuleni Income group R800 - R3500 Income group R R7500 Other income group, namely: Municipal staff Other groups The management of these rental housing units is mainly done by the municipality itself. In seven cases the municipal housing department is responsible for the management. Municipality 7 also mentioned municipal administration for the management. The most mentioned reasons for that are that it has not been a specific choice, but that it was the situation that has always been the case. In some municipalities Council had determined that the municipality needs to manage its own stock. Quite a number of municipalities are rural and do not have sufficient stock and demand for it to be viable for a separate entity or SHI to manage it. Graph 13 Management of Rental Units Management of Rental Units Mun1 Buffalo City Mun4 Emalahleni Mun2 Camdeboo Mun9 Oudtshoorn Mun3 Ekurhuleni Mun7 Langeberg Mun6 Govan Mbeki Mun8 Naledi City Mun10 of Tshwane Mun5 Emfuleni Municipal Housing Department Social Housing Institution (section 21) Municipal Entity Other

23 For four of the municipalities this is not the ideal situation. Municipality 5 indicated that the rentals need to be determined based on the MFMA, Municipality 4 mentioned that there is not sufficient capacity in the municipality for this kind of management. In the social housing benchmarks of 2010 and 2011 the rent collection rate of municipalities was compared to the rent collection rate of SHIs. This showed that for municipalities it is much harder to collect rent from their stock than for SHIs. Therefore, it is advisable for municipalities to outsource the management of their rental stock, where possible. Seven of the municipalities are planning to have rental housing stock developed in the future. Six of them are planning for CRU stock, while Municipality 7 is targeting the middle income group with stock for rental/to buy. The latter would be managed privately. Graph 14 Management of Future Rental Housing Stock Management of Future Stock Mun1 Buffalo City Mun4 Emalahleni Mun2 Camdeboo Mun9 Oudtshoorn Mun3 Ekurhuleni Mun7 Langeberg Mun6 Govan Mbeki Mun8 Naledi City Mun10 of Tshwane Mun5 Emfuleni Municipal Housing Department Municipal Entity Social Housing Institution Other Out of the ten municipalities, five have at least one delivery agent for rental housing in their area of jurisdiction. These are the three metropolitan municipalities, Municipality 6and Municipality 5 municipalities. Out of these five, three have entered into performance agreements with the delivery agent(s). Municipality 5 and Municipality 1 municipalities would like to have these agreements in place in the near future. 3.4 Public Participation Municipalities have made use of different forms of public participation, ranging from informative to cooperative public participation with an increasing level of public involvement. Municipality 5 added the IDP as a form of public participation, which could be categorised under consultative. Four municipalities go as far as to give the public a certain degree of decision making powers in the process and could be a good example for the ones which limit the public participation to information and consultation. The most used method for the involvement of the public is the organisation of public meetings. This will mainly fall under informative public participation. 21

24 Graph 15 Forms of Public Participation Mun1 Buffalo City Mun4 Emalahleni Camdeboo Mun2 Oudtshoorn Mun9 Ekurhuleni Mun3 Langeberg Mun7 Govan Mbeki Naledi Mun6 City of Tshwane Mun8 Emfuleni Forms of Public Participation Informative (from municipality to public) Consultative (requesting input from public) Cooperative (giving public decision making powers together with municipality) Other The municipalities target different groups for input during the decision making processes. In Graph 16 an overview is given of the different groups. The provincial government is one of these groups in almost all municipalities. The neighbourhood of the project is also a very important target group for the municipalities in this benchmark. Graph 16 Target Groups for Public Participation Public Participation Target Groups Other Civic organisations (NGOs, CBOs, etc.) District Municipality National Government Provincial Government Business environment (e.g. possibly Possible future tenants Overall public in the municipality Neighbourhood of the project Emfuleni Mun 5 City Mun of Tshwane 10 Naledi Mun 8 Govan Mun Mbeki 6 Langeberg Mun 7 Ekurhuleni Mun 3 Oudtshoorn Mun 9 Camdeboo Mun 2 Emalahleni Mun 4 Buffalo Mun 1 City Seven municipalities involve the future beneficiaries to a certain extent in the design of the housing units. The extent differs per municipality; in some municipalities the future beneficiaries get to discuss the finishes, lay-out and other details of the houses within the financial possibilities, in other municipalities the input of the beneficiaries is more limited. All municipalities are positive about the public participation processes they have conducted and consider it to be beneficial for the end result of the projects. All municipalities emphasize the need to keep the public involved in the projects.

25 Only Municipality 8 and Municipality 7 had the impression that the public was not satisfied with the public participation process. Both indicated that they would need to inform the public better on the different steps that are taken. Councillors would need to be informed better to ensure that they can pass the information to the public. Four municipalities indicated that the projects were delayed due to the public participation process. They mentioned a number of issues that would need to be improved to streamline the process; information has not always been filtered down to the public and decisions by representative groups were not always accepted by the public. Although municipalities were in general satisfied with the public participation processes, there was a need for improvement of the involvement and participation of the public, as well as more transparency from the municipality and better communication. This will most likely mean that more attention needs to be paid to the quality and the impact of the public participation activities. Alternative methods for public participation may be required to improve these issues. The public participation is in the municipalities in this benchmark a combined effort of the department that is responsible for housing, the office of the Speaker and/or the communication department. Councillors have a clear role in the communication to the public. They need to inform the public on the project that is planned and they lead the meetings with the public. Although the Councillors have an important role in public participation and are crucial in the information provision to the public, in five municipalities the Councillors are not sufficiently knowledgeable on the different housing programmes. This will impact on the quality of the information that the public receives and it will influence the public opinion in the public participation process. Half of the municipalities have a communication strategy that includes planning for public participation in housing. Of the other five, four municipalities indicate that they are working on a strategy, or would like to develop one as soon as possible. Only one municipality does not need a strategy. A part of the public participation process is informing the public to ensure that they can make informed input and/or decisions. Overall, the municipalities consider this their task and ensure that the public is informed about the different housing programmes. In Graph 17 an overview is given of the different housing programmes on which the municipalities inform the public in their areas of jurisdiction. The provision of this information is done through meetings with the communities. 23

26 Graph 17 Public Education on Housing Programmes Public Education on Housing Programmes Mun1 Buffalo City Mun4 Emalahleni Mun2 CRU Camdeboo Mun9 Oudtshoorn ephp Mun3 Ekurhuleni RDP Mun7 Langeberg Informal Settlements Upgrading Mun6 Govan Mbeki Social/Rental Housing Mun8 Naledi Other City Mun10 of Tshwane Mun5 Emfuleni 3.5 Housing Delivery Municipalities have been delivering different housing programmes within the last five years. In Graph 18, an overview is given of the programmes per municipality. All municipalities have had at least one form of subsidised housing implemented in their area in the last five years. RDP housing and the upgrading of informal settlements are the most occurring programmes in this benchmark. Graph 18 Housing Programmes implemented Housing Programmes Other Rectification Programme Pre & Post Consolidation subsidies Individual Subsidy Project linked subsidies Gap Housing Upgrading Informal Settlements EEDBS Institutional Subsidy (Rental) Social Housing CRU ephp RDP/BNG Farm Worker's Housing Rural Housing Emfuleni Mun5 City Mun10 of Tshwane Naledi Mun8 Govan Mun6 Mbeki Langeberg Mun7 Ekurhuleni Mun3 Oudtshoorn Mun9 Camdeboo Mun2 Emalahleni Mun4 Buffalo Mun1 City

27 The municipalities also indicated the number of units that have been delivered in the different programmes, these numbers vary a lot per municipality. In Table 3 an overview is given of the data that the municipalities have on the delivered housing units per programme. It is possible that more units have been delivered in the municipalities by other agents. Municipalities do not always have access to all the necessary information from the Provincial and National governments. Municipality 8 and Municipality 9 municipalities did not have any delivery. The main focus in the delivery of these municipalities is on housing subsidies for ownership. RDP, the upgrading of informal settlements, project linked subsidies and the rectification programme are the programmes under which most units are delivered. Municipality 3 and the Municipality 10 are scoring the highest, which is logical considering their size. The local municipalities have a lower delivery rate, though Municipality 5 is scoring quite high for a local municipality. 25

28 Table 3 Delivered units over the last 5 years Municipality Rural Housing RDP/B NG ephp CRU Social Housin g EEDB S Upgrading Informal Settlement s Project linked subsidi es Individual Subsidy Consolida tion subsidies Rectificat ion Program me Pre & Post 1994 Municipality Municipality Municipality Municipality Municipality Municipality Municipality 9 0 Municipality Municipality Municipality Total Total 26

29 3.6 Integrated Human Settlements The goal of the National Department of Human Settlements is to deliver not only houses, but to create sustainable human settlements. These are areas with housing that include social and economic facilities. Municipalities need to take this into account when they do their planning for housing delivery. In this benchmark group, only the Municipality 10 so far has had an inclusionary housing project delivered. This was a combined effort of the national, provincial and local government with private sector involvement. It was one of the nationally coordinated housing projects that have been delivered over the last number of years. Four of the ten municipalities (Municipality 10, Municipality 6, Municipality 7 and Municipality 9) consider themselves successful in the creation of sustainable human settlements. This is mainly done through the identification and allocation of well-located land for housing projects. The four municipalities that are already working on this kind of planning can function as examples for the others. 3.7 Informal Settlements Informal settlements are a major challenge for many municipalities in the country. Both metropolitan and local municipalities are familiar with the phenomenon and the challenges that it brings about. Also in the group of municipalities in the benchmark these challenges are common. Only Municipality 2 and Municipality 4 do not have any informal settlements. These are local municipalities in more rural areas. The other eight municipalities identified a number of challenges regarding the informal settlements. In these cases the lack of funding to find solutions for the problem and to find land for alternative accommodation is mentioned as some of the main challenges. The constant influx of new people in the settlements is contributing to this problem. Municipality 1 municipality also mentioned that the people in the informal settlements are not always well informed about the processes regarding the application and allocation of houses. Many are registered on the waiting list, but get frustrated because of the long waiting period. In dealing with informal settlements it is very important that municipalities provide correct information to the people in the areas and that the municipality, both Councillors and officials, speaks in one voice. Although the municipalities have limited resources, most of them try to address the problem as much as possible within their means. In Graph 19 an overview is given of the interventions of municipalities in the informal settlements. Formalising the informal settlements and the provision of services are the most used methods to improve the situation of the people in the settlements. In only four municipalities the informal settlements are eradicated. Municipality 2 Municipality indicated not to have any informal settlements and therefore does not have to make use of any of the interventions. 27

30 Graph 19 Interventions for Informal Settlements Informal Settlements Mun1 Buffalo City Mun4 Emalahleni Mun2 Camdeboo Mun9 Oudtshoorn Mun3 Ekurhuleni Mun7 Langeberg Mun6 Govan Mbeki Mun8 Naledi City Mun10 of Tshwane Mun5 Emfuleni Formalising Providing services such as water, sanitation and electricity Eradication Other For the longer term, sustainable measures need to be taken. In many of the cases the municipalities are trying to acquire additional land, either through negotiations with private landowners, the Housing Development Agency (HDA), or the provincial government. Higher density housing is mentioned as one of the solutions to this problem. With a lack of suitable land and a high number of people in need of housing, there is a need to consider a higher density, especially in the urban areas.

31 4. General Conclusions Introduction The benchmark in housing has been conducted among the 7 municipalities that are taking part in the LOGO South Country Programme South Africa and the 3 municipalities that have been participating in one or more of the thematic programmes. The benchmark is focused on capacity building in rental housing. The purpose of the benchmark is to compare the service delivery of the municipalities among each other, but most of all to give the municipalities an opportunity to take an inward look into their own performance and to learn from the good practices of other municipalities. This benchmark is a follow up of the housing benchmark that was conducted in 2010 and focuses on some of the issues that were identified as problematic in the previous benchmark. Through the benchmark, municipalities are provided with insight in the current status of housing in their areas of jurisdiction. With these insights and the recommendations that they receive, municipalities can improve their performance. Furthermore, other stakeholders in the sector can also learn from these lessons. The benchmark process in itself was a learning experience for the participating municipalities. It allowed them to take an inward look into their operations and performance and realise what their roles and responsibilities are. The questionnaire triggered them to think about these issues and made them aware of the gaps in their data and the performance. The current benchmark results have been compared to the results of last year, where possible. This has shown the changes in the performance of the municipalities. Conclusions Municipal Profile and General Demographic Information In the benchmark of 2010 it turned out that the demographic data that is available to municipalities is often of a bad quality. Some of the data is old, some of it is incorrect or contradictory compared to other sources. This year again the benchmark shows that this is a matter of concern. Some of the demographic data was out of proportion compared to last year s data. One of the problems was the unemployment rates which in some cases dropped enormously compared to last year. Another was the percentages of age groups which are very different this year, which is impossible from a demographic point of view. These differences can in some cases be explained by the use of different sources, which are giving contradictory information. Municipalities need to be careful with the collection of this kind of data and the way they use it for their planning purposes. It will affect the estimation of needs for municipal services and especially the need for housing. Data Collection and Planning All municipalities have their basic planning documents in place, the Housing Chapter is present in all IDPs and most municipalities also have a Housing Strategy and/or other planning documents for Housing. Most documents are recently updated, though in some of the cases the Housing Chapter needs to be updated. 29

32 The delivery targets that the municipalities have set for the next five years vary extremely. In some cases the targets are very low, while in other cases the targets are overrated compared to the delivery in previous years. Municipalities need to focus on setting realistic targets that they will be able to reach. To make it easier for municipalities to plan, they need to know how many subsidies will be allocated to their municipality by the provincial government. This issue was already highlighted in the 2010 benchmark, but is still a problem for municipalities. SALGA is lobbying for the Gazetting of these budgets. Although municipalities seem to be quite satisfied with the available demand data, there is still some need for details that will enable municipalities to make more tailor-made plans for their areas that will fit the needs of the local population better. Management of Rental Stock Almost all of the municipalities have municipal rental stock and in all those cases it is managed by the municipal housing department. This may not be the ideal situation considering the capacity of municipalities to collect rent successfully. Where municipalities have plans to develop rental stock in the future, the preferred management agent is often an external one. There is a trend visible in municipalities to move away from management of their own stock. Municipalities should try to find alternative ways for management of stock and to assess the possibilities for cooperation with existing delivery agents, to develop and manage rental housing stock. Public Participation In general the participating municipalities are satisfied with the implementation of public participation activities, though there are a number of areas for improvement. Some of these areas are the communication to the public, the active participation of the public and the transparency from the municipality to the public. It would be advisable for municipalities to look at new methods to conduct public participation which can yield better results and to look at ways to better incorporate the feedback of the public into the planning of the municipality. If other, maybe more creative, methods are used, the results of public participation could be much more valuable for the municipality and the satisfaction of the public could increase. Housing Delivery The delivery of housing programmes is for a number of municipalities a stumbling block. Even though planning may be in place, the actual delivery stays behind. Some municipalities have been able to deliver to a large extent, while others have not had any delivery over the last five years. Municipalities will have their own specific challenges and problems in the delivery, though there will be many common challenges. These can be identified and possible solutions can be shared to tackle the problems based on the good practices of some of the municipalities. The delivery of housing was mainly focused on ownership programmes and within that group on RDP/BNG housing and the upgrading of informal settlements. Integrated Human Settlements The number of municipalities that consider themselves successful in the delivery of sustainable human settlements is very limited. Only four out of the ten think they succeeded in it. Considering that the delivery of sustainable human settlements is the most important national directive, there is a need to increase the number of municipalities that have

33 incorporated this concept in their housing planning and delivery. This will definitely be a point of attention for municipalities in the future. It is recommended that municipalities look at the local opportunities to mix different kinds of housing in the same area and/or project and to look at the possibilities for the inclusion of social and economic facilities. The housing departments in the municipalities will need to link with their Local Economic Development (LED) colleagues and their colleagues from the social department to align their policies and planning. Informal Settlements The informal settlements remain one of the biggest problems for municipalities. The problems in those areas are interlinked and difficult to tackle. There are no easy solutions for these settlements and there are currently no sustainable solutions. The actions that municipalities implement to deal with the problems in informal settlements are mostly small, or short time solutions such as the delivery of water and sanitation or the identification of beneficiaries. In general, municipalities do not have a sustainable, definite solution to deal with the complex problems of informal settlements. 31

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