http://www.businessday.co.za/Articles/Content.aspx?id=75622

Eradication of shacks not possible by 2014, say officials
SIBONGAKONKE SHOBA
Published: 2009/07/14 07:03:41 AM

THE Gauteng housing department has admitted that its goal of eradicating shacks by 2014 is becoming impossible to reach.

Department head Manching Monana yesterday said that for this goal to be achieved the department would have to build 200000 houses a year. She said the department provided about 64000 houses last year — exceeding its target of 58000 — and this year planned to deliver 28000 units, but this may be cut to 12000 due to budget constraints.

Department chief operations officer Mongezi Mnyani said the department needed about R4bn extra (on top of its R3,6bn budget) to provide the 200000 houses a year that were required. “We do have the capacity as all big construction companies are back at housing. They could deliver more than 350000 units a year.”

Mnyani said the department had approached the national department for an extra R6bn this year. He said the Breaking New Ground housing project, which will include double- storey buildings as well as RDP houses, was more expensive to build.

In 2004, the department registered all informal settlements: 405 were “captured” and 395 were identified for eradication by 2014. This year, the department planned to eradicate 122 of these informal settlements. According to department officials, this is not possible because the department is underfunded.

The department appeared before the Gauteng standing committee on public accounts (Scopa) yesterday to answer to the auditor-general’s findings on its financial statements for the 2007-08 financial year.

Officials told Scopa the department had enough capacity to deliver the needed houses but was under- funded. The department was explaining why it had overspent by R68,5m on its programme of building houses.

In the 2007-08 financial year, the department built 64056 houses, exceeding its target of 58552. The department had a budget of R2,6bn and received additional funding of R350m that was taken away, unspent, from the Eastern Cape government.

The auditor-general said the over- expenditure was unauthorised. The department said it had notified the Gauteng treasury and the national Department of Housing of the overexpenditure before it occurred.

Monana said the department had had to reduce its targets to match the budget. “We have the capacity to deliver more than we receive money for,” she told the committee.

Meanwhile, local government and housing MEC Kgaogelo Lekgoro defended the payment of large performance bonuses to senior managers at the Gauteng Partnership Fund last year, saying these payments were in line with the government’s strategy to retain scarce skills.

shobas@bdfm.co.za