City seeks urgent intervention of National Treasury in R180m Housing Funding dispute with Province
10 January 2019
Today the MMC of Housing, Councillor Meshack van Wyk and I conducted an oversight visit to the Riverside Housing Project near Diepsloot. The completion of 1 485 RDP houses at this project will be stalled due to the Gauteng Provincial Government’s irrational decision to reduce of the City’s Human Settlements Development Grant (HSDG) funding by R180 million.
After exhausting efforts to resolve this dispute with the Department of Human Settlements and the Provincial Government, the City Manager will today be writing to the Director-General of National Treasury, in terms of section 44 of the Municipal Finance Management Act, to seek their urgent intervention in this dispute. The City Manager will be seeking a meeting with the Director-General of National Treasury within the week.
By exercising its powers, it is hoped that National Treasury will be able to promptly intervene in this dispute and assist the City in receiving funding which will result in the construction thousands of housing units for our most needy residents.
However, should these efforts fail the City will consider all other legal avenues to protect the interests of the most vulnerable in our society, including approaching the courts as a last resort.
The Riverside Housing Project visited today is just one of the numerous housing developments across Johannesburg which will now come to a grinding halt as a result of the Gauteng Provincial Government’s abuse of power in unlawfully cutting the City’s funding by R180m.
What is evident from this oversight visit today is that foundational work has already been completed and developers were ready to come on sight to continue the construction of the houses. This clearly shows the lies being peddled by the MEC of Human Settlements, Uhuru Moiloa, when he alleges that our money was reduced as a result of contractors not been appointed or paid.
The decision to reduce Johannesburg’s HSDG funding comes on the back of the City spending 98% of its Housing Capital Budget last year, and having contractors on the ground busy with construction. The decision is clearly irrational and informed by political considerations rather than the interests of our residents who are suffering as a result of the 300 000 housing unit backlog inherited by the multi-party government in Johannesburg.
The sad truth of the matter is that MEC Moiloa and the Gauteng Provincial Government is placing politics before the interests of service delivery to our residents, especially the poor. In a year in which South Africa is holding its national and provincial elections, it appears that the ANC lead, Gauteng Provincial Government, will do everything in its power to prevent the City from fulfilling its mandate to its residents. Probably with the intention of swooping in as the saviour of these developments at a later stage.
I will not allow this to happen on my watch.
The City of Johannesburg has exhausted efforts to engage MEC Moiloa, Premier Makhura, Minister Mfeketo and President Ramaphosa on this decision to reduce its HSDG funding. These efforts have been ignored outright and I am yet to receive a response to any of my letters.
At the start of this financial year, the City was informed that that our HSDG funding would be in the region of R248 Million on the basis of the City’s Department of Housing’s business plans, which were adopted by Council and ultimately the Province.
Late last year, without warning or reasons being provided, a provincial gazette indicated that the City’s HSDG funding from Provincial Government would only amount to R68 million – a reduction of R180m.
The following housing developments, to name a few, will not proceed as a result of Provincial Government’s petty and shameful decision (previous budget allocation in brackets):
- Elias Motsoaledi housing for Military Veterans (R2 288 661);
- Elias Motsoaledi’s RDP housing (R13 439 705);
- Fleurhof RDP housing development (R33 703 913);
- South Hills housing project (R67 053 913); and
- Riverside View development (R63 643 600).
This follows a pattern of Provincial Government intentionally reducing the City’s HSDG funding post the 2016 local government elections in which the ANC lost control of the City’s purse.
Prior to the 2016 elections the City was allocated R411 million for housing projects, however soon after entering office this was reduced by R66 million. The following year, the Province reduced the City’s HSDG funding from R411 million to R145 million. What the Province fails to realise is that these irrational decisions hurt our poorest residents the most.
In another act of total bad faith, on 18 December 2018, MEC Moiloa hosted a handover ceremony of housing units at the City of Johannesburg’s integrated housing development in Fleurhof.
Bizarrely, despite the development being spearheaded by the City, the handover ceremony occurred without consultation with the City. In fact, the City’s leadership had no knowledge of this event until it appeared in the media. According to reports, some 60 units were handed over for allocation. These 60 units formed part of an earmarked 200 units for military veterans.
Since entering office, I have also been committed to creating a credible and accessible housing list for our residents. The City has invested much time and resources into this project. I have on numerous occasions requested MEC Moiloa to assist the City with consolidating our housing lists to ensure that we work off of one credible system which cannot be abused. This would help our residents to know exactly where they are on the housing waiting list. This online database will also bring an end to fraud, corruption and queue jumping in the housing allocation process. These efforts have also been ignored.
It is time for MEC Moiloa and the Gauteng Provincial Government to put their personal political interests aside and act in the best interests of our residents.
Issued by Tony Taverna Turisan, Director: Legal Services, Office of the Executive Mayor, City of Johannesburg, 10 January 2019