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Parliamentary Portfolio Committee 02/09/2011

Parliamentary Portfolio Committee 02/09/2011. Structure of Presentation. Social Housing Act and SHRA Accreditation Report Draft Regulations Process. Social Housing Act & SHRA. Context. Social Housing Act & SHRA.

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Parliamentary Portfolio Committee 02/09/2011

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  1. Parliamentary Portfolio Committee 02/09/2011

  2. Structure of Presentation • Social Housing Act and SHRA • Accreditation Report • Draft Regulations • Process Parliamentary Portfolio Committee

  3. Social Housing Act & SHRA Parliamentary Portfolio Committee

  4. Context Parliamentary Portfolio Committee

  5. Parliamentary Portfolio Committee

  6. Parliamentary Portfolio Committee

  7. Social Housing Act & SHRA • Social Housing Act 16 of 2008, promulgated in December 2008 came into operation on 1st September 2009. Introduced 3 new instruments:- Legislative & regulatory Instruments Social Housing Act = framework legislation Social Housing Regulatory Authority (SHRA) Defined sector roles & players Financial instruments Restructuring capital grants for social housing Capacity building grants Tax incentives Risk mitigation measures • Capacity building instruments • Focus on capacity to run viable projects • 1. Capacity to develop and implement projects • 2. Effective interventions • 3. Support to gear up SHI’s Parliamentary Portfolio Committee

  8. SHRA • The mandate of the Social Housing Regulatory Authority (SHRA) is derived from the Social Housing Act 16 of 2008 CHAPTER 3 SOCIAL HOUSING REGULATORY AUTHORITY Establishment of Social Housing Regulatory Authority 7. (1) There is hereby established a juristic person to be known as the Social Housing Regulatory Authority. • (2) The Public Finance Management Act applies to the Social Housing Regulatory Authority. • (3) The Social Housing Regulatory Authority is accountable to the Minister and Parliament. • The Act further sets out the composition of SHRA in Section 8 and the functions of SHRA in Section 11 Parliamentary Portfolio Committee

  9. SHRA Parliamentary Portfolio Committee

  10. SHRA • SHRA “reason for being”…. Restructuring • Social, Economic and Spatial Re-structuring Parliamentary Portfolio Committee

  11. SHRA • SHRA Business Model Accredited Service Providers Parliamentary Portfolio Committee

  12. SHRA Functional Structure Sub-Committee Council Sub-Committee Parliamentary Portfolio Committee

  13. SHRA • SHRA High-level Process Parliamentary Portfolio Committee

  14. SHRA Progress • Investment : 2342 units approved (target of 1705) and 2nd call for proposals still to come estimate further 1500 units. Huge interest from private sector. • Capacitation grants recommended. Engaging service providers for proposals/quotations. • Accreditation : 2011/12 cycle complete. Preparing for 2012/13 cycle. See report later. • Draft Regulations ready for presentation to Parliament and for gazetting (noting Parliament’s comments) • Monitoring and Evaluation on accredited SHI’s started Parliamentary Portfolio Committee

  15. AG Dashboard Parliamentary Portfolio Committee

  16. Accreditation Parliamentary Portfolio Committee

  17. SOCIAL HOUSING ACT • All institutions having undertaken housing developments with the benefit of an institutional subsidy and • who carries on the business of providing rental or co-operative housing options for low to medium income household on an affordable basis. Parliamentary Portfolio Committee

  18. CATEGORIES OF INSTITUTIONS • Social Housing Institutions • Municipal Owned Social Housing Institutions • Co- Operatives Parliamentary Portfolio Committee

  19. ACCREDITATION PROCESS APPLICATION ASSESSMENT ACCREDITATION COMPLIANCE MONITORING Parliamentary Portfolio Committee

  20. ACCREDITATION PROGRESS REPORT • Accredited SHI’s • Declined SHI’s • Non Applicants • List from the Department Parliamentary Portfolio Committee

  21. 1. ACCREDITED SHI’s

  22. 1. ACCREDITED SHI’s Cont…

  23. 2. DECLINED 10 Applications were declined, list may have to be revisited Parliamentary Portfolio Committee

  24. INTERNAL REVIEW (PAJA) Section 11(a) Application for Internal Review received Council has 90 days within which to re-affirm or substitute decision Decision Substituted Decision Affirmed SHI has 180 days to institute judicial review of the decision Application Dismissed SHI makes successful application Commence with Court Process to recover Stock Accreditation Restored Management reinstated Compliance Monitoring Parliamentary Portfolio Committee

  25. 3. NON ACCREDITED INSTITUTIONS 12 Institutions identified as non accredited were: Parliamentary Portfolio Committee

  26. 4. LIST FROM THE DEPARTMENT A list of 378 projects received from DoHS. SHRA is in the process of obtaining and collating information received from the Provinces to identify institutions administering those projects. Parliamentary Portfolio Committee

  27. WORK PLAN TO ACCREDIT THE NON ACCREDITED SHI’s No Application Received • Intervention: • Forensic Audit • Suspension of Member • Transfer of Housing Stock Notice of Non Compliance i.t.o Section 13(9) (20 Days) Application for Accreditation received Provisional Accreditation • Conditions not met: • Withdrawal of Prov. Accr • Institutional Intervention Fund • Intervention • Forensic Audit • Suspension of Chair & Management • Transfer of Housing Stock Assessments & Conditions (90 days) Conditions met Full Accreditation Certificate Issued Compliance Monitoring Parliamentary Portfolio Committee

  28. INTERVENTION BY SHRA & FORECLOSURE PROCESSES Maladministration / Non - Compliance Trigger SHRA prepares a report Institutional Intervention Programme SHI resist proposed Remedial Action Notice to Intervene and propose Remedial Action SHI takes proposed Remedial Action Forensic Investigation No improvement following remedial action Remedial Action Yield Results Public Accountant / Auditor Appointed SHI Regularised Consultation with Debt Funders Internal Review 60 Days before we proceed Buy out Process Apply to Court for suspension of SHI’s Management & Appointment of Administrator SHI Regularised Positive Report Forensic Report Parliamentary Portfolio Committee

  29. Draft Regulations Parliamentary Portfolio Committee

  30. INTRODUCTION • Section 19 of the Social Housing Act (“the Act”) determines that the Minister, by notice in the Gazette and after consultation with Parliament: • Must make regulations prescribing: • Any matter required to be prescribed by regulation under the Act; • A code of conduct, the investment criteria and the qualifying criteria for social housing institutions; • May make regulation: • in respect of the required provisions of the agreements the SHRA, other delivery agents, provincial authorities and the National Housing Finance Corporation. • Any other ancillary or administrative matter that is necessary to prescribe for the proper implementation or administration of the Act • The regulations may provide for offences in cases of contravention thereof. Parliamentary Portfolio Committee

  31. Hierarchy of Legislation Parliamentary Portfolio Committee

  32. Hierarchy of Legislation Parliamentary Portfolio Committee

  33. BACKGROUND THE DRAFT REGULATIONS • The draft regulations development began in 2010 and were published for public comment on 10 September 2010 under Government Gazette No 33518 • Interested parties were invited to comment no later than 30 September 2010 and comments were received and checked for relevance. • The ultimate goal of the draft regulations is to complement the Social Housing Act in ensuring an effective and proactive regulatory authority for social housing institutions and other delivery agents and to promote growth, stability, good governance and confidence in the Social housing Sector. Parliamentary Portfolio Committee

  34. APPLICATION OF THE REGULATIONS • In terms of the draft regulations, a social housing institution should be not for profit. It should also be able to demonstrate good governance, financial sustainability and effective service delivery. • The main objective of the social housing institution should be the provision of rental or co-operative housing for low to medium income households. Parliamentary Portfolio Committee

  35. Structure of Regulations Parliamentary Portfolio Committee

  36. THE DRAFT REGULATIONS PROVIDES FOR 1. Applications for accreditation of social housing institutions ( Regulation 2); • Qualifying criteria for accreditation (Regulation 3); 3. Provisional accreditation of social housing institutions ( Regulation 4); 4. A register of social housing institutions (Regulation 5); 5. Reporting requirement ( Regulation 6) Parliamentary Portfolio Committee

  37. THE DRAFT REGULATIONS PROVIDES FOR CONT… 6. Withdrawal of accreditation ( Regulation 7); 7. Compliance monitoring ( Regulation 9); • Intervention on cases of non compliance and maladministration (Regulation 10); • Internal review ( Regulations 11); • Transfer of social housing stock ( Regulation 12); 11. Disposal of publicly funded social housing stock ( Regulation 13); Parliamentary Portfolio Committee

  38. THE DRAFT REGULATIONS PROVIDES FOR CONT… • Approvals ( Regulation 15 & 16) • Code of Conduct ( Regulation 17); • Investment Criteria ( Regulation 21); • The powers of the SHRA in respect of entry, enquiry document seizure and inspection ( Regulation 32); • Agreements with other delivery agents, national and provincial government and the NHFC ( Regulation 33 & 34); 17. Offences and penalties (Regulation 36) Parliamentary Portfolio Committee

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