1 / 25

DEPARTMENT OF HUMAN SETTLEMENTS: PORTFOLIO COMMITTEE MEETING 2011-2012 STRATEGIC BUSINESS PLAN

DEPARTMENT OF HUMAN SETTLEMENTS: PORTFOLIO COMMITTEE MEETING 2011-2012 STRATEGIC BUSINESS PLAN WEDNESDAY, 16 MARCH 2011. THE MANDATE.

odele
Download Presentation

DEPARTMENT OF HUMAN SETTLEMENTS: PORTFOLIO COMMITTEE MEETING 2011-2012 STRATEGIC BUSINESS PLAN

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. DEPARTMENT OF HUMAN SETTLEMENTS: PORTFOLIO COMMITTEE MEETING2011-2012 STRATEGIC BUSINESS PLAN WEDNESDAY, 16 MARCH 2011

  2. THE MANDATE NURCHA ensures the availability of bridging finance to small, medium and established contractors building low and moderate income housing and related community facilities and infrastructure 2

  3. UPDATE ON ENVIRONMENT • Weak international environment • Funding • DOHS – R100m (2011) + R200m • Cadiz R75 • Public Investment Corporation R100m • Increased pressure from construction industry on poor payment from government • Provincial and local authorities struggling with project procurement • Operations rejecting more than 70% of projects • Cost of NURCHA products and services is perceived to be expensive • National Treasury and DOHS engaged in non payment of loans • Completed research on fee based opportunities • Role in MIG & USDG (R6b) 33

  4. THE 2011 – 2012 BUSINESS PLAN • CORE STRATEGY IS THREE-FOLD: • Deal with collections as a dedicated effort with resources and targets • Adapting, modifying and tuning the existing business to the changing environment • Augmenting current revenue stream with fee based opportunities within the context of current mandate 44

  5. UNPACKING THE KEY OBJECTIVES (1) • PRIORITY ONE: To collect all outstanding debt to the fullest extent possible. • Healthy Book (What are we doing different?) • Improved policies and procedures for new projects • Better Irrevocable legal recourse • Move to quality loans as opposed to volumes • Delinquent book • Dedicated resources project manager and credit analyst • Additional legal capacity both at Tusk and NURCHA • Use DOHS and NT to put pressure on public employers • Setting Targets • Provisions raised to R86m • Collectable R41m • 2010/11 – R9.7m • 2011/12 – R42m • 2012/13 – R33m 55

  6. UNPACKING THE KEY OBJECTIVES (2) • PRIORITY TWO: Refocusing the Subsidy housing programme • Few larger contractors to deliver on scale (Dezzo- 10 000 units, Stedon- 4000 units) • Base of 4 projects per month with a potential to deliver 18 000 units/ sites – upgrades of services • Reduced internal capacity to manage this business • Reshape subsidy programme to interface with informal settlement upgrading programme • Traditional contractor financing • Programme implementation for small Municipalities 66

  7. SUBSIDY HOUSING IMPACT 77

  8. UNPACKING THE KEY OBJECTIVES (3) • PRIORITY THREE: Increase volume and lending into Affordable Housing market • Focus on established developers with track record and strong pipeline of projects (Cosmopolitan, MDV, JFS etc established pipeline) • Set up programme for small scale developers (4 Projects for possible PIC funding) • Government guarantee may assist market • Link Banks to specific projects • Increase approvals form 12 to 19 projects will result in peak cash flow on book of R285m and production of 2850 homes/sites • Need to increase internal capacity, improve systems and risk management 88

  9. AFFORDABLE HOUSING LOANS SIGNED 99

  10. UNPACKING THE KEY OBJECTIVES (4) • PRIORITY FOUR: Maintain volumes of loans in infrastructure programme. • Attract more private sector employers (MTN, Mining companies, large construction companies) • Public works, Human Settlements, Local Government – select employers and contractors with track record • Leverage of MIG and USDG projects • Enforce additional credit guidelines • The different sectors can support at least 6 projects per month – “Pressure to deliver” 1010

  11. INFRASTRUCTURE LOANS SIGNED 1111

  12. UNPACKING THE KEY OBJECTIVES (5) • PRIORITY FIVE: Secure fee based income to augment current revenue stream. • Assist National Department of Human Settlements with implementation of Contractor Development Programme (270 contractors-R35m to finance support-DOHS) • Finalize and implement deferred payment facility with DBSA (size of facility is linked to project) • Finalize and implement Khula fund and risk management arrangement (R30m fund) • Potential revenue – net R2.3m – 2011/12 • Chase other opportunities identified and structure fee based deal (DOHS Programme Implementation) • Use current staff – only appoint when deal flow and revenues are guaranteed 1212

  13. INTERNAL IMPLICATIONS • Rationalized subsidy unit • Dedicated resources redeployed to assist with collections • Additional capacity for affordable housing (initially will use existing capacity) • New business will be handled using current skills and transferred to operations • Existing vacancies (except IT specialist) to be frozen • If adverse trading conditions persist NURCHA and TUSK will reduce head count by 30% • Consult government on possible retrenchments • Role in MIG and USDG to be clarified and agreed during 2011 financial year 1313

  14. Combined programmes will create 10348 jobs 14

  15. EMPOWERMENT 1515

  16. STATEMENT OF COMPREHENSIVE INCOME 2011/12 1616

  17. STATEMENT OF FINANCIAL POSITION 2011/12 1717

  18. EXPENDITURE COMPARISON 1818

  19. BUDGET NOTES AND ASSUMPTIONS 2013 - 2015 1919

  20. BUDGET STATEMENT OF FINANCIAL POSITION 2013-2015 2020

  21. BUDGET STATEMENT OF COMPREHENSIVE INCOME: 2013 - 2015 2121

  22. Gauteng Brentwood Park (Benoni) KwaZulu-Natal Bulk Water installation (Edendale) 22

  23. 23

  24. AFFORDABLE HOUSING MARKET – MAHUBE VALLEY GAUTENG 24

  25. THANK YOU

More Related