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Social Housing Foundation

Social Housing Foundation. “Building Communities, Building Social Housing”. Social Housing Bill. Presentation to Parliament 11 th September 2007. Contents. 1. History 2. SHF’s Response 3. ISHP + Turnaround 4. Functions in the Bill 5. Phasing-In. 1. History.

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Social Housing Foundation

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  1. Social Housing Foundation “Building Communities, Building Social Housing” Social Housing Bill Presentation to Parliament 11th September 2007

  2. Contents 1. History 2. SHF’s Response 3. ISHP + Turnaround 4. Functions in the Bill 5. Phasing-In

  3. 1. History • SHF is a Section 21 company in existence since 1997 and listed as Schedule 3A public entity in PFMA • Provided capacitation, research and policy development expertise to the sector. • Took as its point of departure, the Institutional Subsidy regime as espoused in the Housing Act, and Chapter 6 of the Housing Code. • Established international relationships with sector leaders to research international trends and to develop a world-class best practice model for SA.

  4. 1. History • Institutional subsidies were disbursed in the absence of a well constituted policy framework – leading to inconsistent and non-sustainable application. • The institutional subsidy instrument was incongruent with construction practices, causing frustration in financial modelling and project packaging. • Private sector funders (banks etc) were reluctant to extend credit facilities to the institutions due to this being unchartered territory and also due to doubts as to organisational strength and competence (non-profit sector, corporate governance etc)

  5. 1. History • Provinces were planning and budgeting for institutional subsidies, but, because the approval process is reactive (they wait for an SHI to submit projects), under-expenditure and under-delivery of units was realised. • Government was also concerned that its significant investment was left largely in the hands of external entities, who were un-regulated and did not necessarily marry themselves to the mandate of ensuring that low income earners were also accommodated. • Projects submitted by SHI’s did not always conform with municipal IDP processes.

  6. 2. SHF’s Response • SHF was given the mandate to manage the EU-sponsored Special Programme for Social Housing (SPSH) and a Programme Management Unit (PMU) was created. • Focus was given to the capacitation of institutions to be able to bolster delivery. • Tools were developed to facilitate technical SHI operations as well as good governance. • Technical support was provided for ready-to-go projects. • Support was also provided to the 3 spheres of government

  7. 2. SHF’s Response • Research was commissioned that covered the following areas of concern:- • A Regulatory framework for SHI operations • A financial model that kept pace with construction sector and the property management sector (operations and maintenance) • A strategy to attract private sector funding • A modus operandi that allowed proactive interaction by municipalities (IDP process inclusion, etc) • Different grants that could be accessed – the Restructuring Capital grant which favoured development in Restructuring Zones coupled with a bias for low income earners as the target market.

  8. 2. SHF’s Response • NDoH, partnered by SHF, harnessed together a team of specialists drawn from international expertise as well as domestic industry leaders to form a “think-tank”, or laboratory of sorts to address the shortcomings of our policies and to customise an international solution to the South African scenario. • The result of this passionate labour is the Bill before you. • Elements of the Bill formed part of the Minister’s ground-breaking “Breaking New Ground” document in 2004 and was also the basis for the Social Housing Policy approved by Minmec in 2005.

  9. 2. SHF’s Response • The Bill seeks to address, inter alia, the following:- • The formation of a regulatory and compliance body – the Social Housing Regulatory Authority • 5 types of new grants, over and above the institutional subsidy (now referred to as the “Top-Up” portion). The most significant is the Restructuring Capital Grant which provides subsidies in line with inflation, CPIX, Construction Index. • Provisional Restructuring Zones and Restructuring Zones • An Interim Process • Processes and cycles • Roles and Responsibilities

  10. 3. ISHP + Turnaround • Whilst SH Bill undergoing enactment process and SHRA still to be formed, NDoH mandated SHF to run with the Interim Social Housing Programme. • Budgets: • 2006/07 : R107m • 2007/08 : R180m • 2008/09 : R250m

  11. 3. ISHP + Turnaround • Turnaround Strategy addresses SH projects in distress – future role of SHRA

  12. 4. Functions Outlined in the Bill • Bill envisages the following functionality:- • Accreditation of Institutions • Registration of Institutions • Funding/Disbursement • Regulation • Compliance/Enforcement • Capacitation • Research • Support (SHI’s, govt, others) • International linkages and networks • Marketing and Communication • Referee and player implications

  13. 5. Phasing In • Phase I 18 months allows for complete development (regulations) hand-holding fine-tuning and tweaking sector communication – not a knee-jerk switch-over

  14. 5. Phasing In Clear understanding of roles Well performing sector Separate legal entities but interdependent • Phase II Policy Strategy Funding Programmes Research Capacity Building Registration & Accreditation Compliance & Legal Interventions & Turnaround

  15. 5. Phasing In • Considerations • Policy • Strategy (New Rental Strategy) • Legal • Programme (SH, CRU, Tenants)

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