1. Annual Report 2014/15 Portfolio Committee on Human Settlements 14 October 2015

2. Table of Contents 2 1.The SHRA’s Programmes 2.Medium Term Expenditure Framework 3.Planned Targets and Achievements 4.Medium Term Strategic Framework 2014 – 2019 5.Additional Performance 6.External Auditor’s Report 7.Irregular Expenditure 8.Statement of Financial Position 9.Statement of Financial Performance 10.Statement of Changes in Net Assets 11.Cash Flow Statement 12.Recalled Grant Funds (SHIP Projects) 13.Programme Costs 14.Challenges 15.Provincial MTSF Targets

3. PERFORMANCE Social Housing Regulatory Authority’s Annual Report 2014/15

4. 1.The SHRA’s programmes 4 REGULATORY Accreditation Compliance Monitoring Enforcement INSTITUTIONAL INVESTMENT (from the Institutional Capacity Building budget) Approval, administration and disbursement of the Institutional Investment grant Research, best practice Stakeholder Engagement INVESTMENT MANAGEMENT Approval, Administration and disbursement of the Restructuring Capital Grant (“RCG”) ADMINISTRATION Council Office of the CEO Corporate Services

5. 2.Medium Term Expenditure Framework 5 * Reduced from R827 543 million with virement of R230 000 million to NHFC Budget Actual ExpenditureBudget Financial year2014/15 2015/162016/172017/18 Operational Budget 33 48034 41834 56036 39238 212 Capital budget 597 543*43 971932 3071 036 4091 110 514 Institutional Investment Capital Budget n/a 41 93640 18338 489

6. 3.Planned Targets and Achievements 6 Programme Performance indicator Audited/ Actual performance 2014 Planned Performance 2015 Qtr.1 Qtr. 2 Qtr. 3 Qtr.4 Annual Total Variance TargetActualTargetActualTargetActualTargetActual 1 Number of SH units approved 2 2795 668 28681432 2 80039965398 The variance was - 270 which equates to 5%. There was only one performance indicator for 2014/15 due to operational budget constraints.

7. 7 3.Planned Targets and Achievements

8. 4.Medium Term Strategic Framework 2014 - 2019 The SHRA’s MTSF target for this five year period is the delivery of 27,000 social housing units. The Department has split this target evenly over the five year period as follows: 8 FY2014/152015/162016/172017/182018/19TOTAL Target delivery of social housing units 5,400 27,000 Actual delivery of social housing units 2,053

9. 5.Additional Performance Regulatory Programme 61 social housing institutions (SHI) were accredited – 8 fully accredited – 41 conditionally accredited – 12 pre-accredited 20,447 units under regulation 40% units are managed by fully accredited SHIs Institutional Investment Programme Grants awarded: – 4 project acquisition and feasibility grants – 4 pre-accreditation grants – 13 general capacity building grants 9

10. ANNUAL FINANCIAL STATEMENTS Social Housing Regulatory Authority’s Annual Report 2014/15 10

11. 6.External Auditor’s Report Audit opinionUnqualified Emphasis of matterGoing Concern (not qualified) - the Minister’s pronouncement about the SHRA being placed under Administration may cast doubt on the entity’s ability to operate as a going concern. Compliance with laws and regulations Reportable irregularities emanating from lack of a Corporate Services Manager which is a statutory position in terms of the Social Housing Act Section 8 (1) (c) Expenditure management - the entity did not take effective steps to prevent irregular expenditure Performance InformationNo material findings on usefulness and reliability of the reported performance information. 11

12. 7.Irregular expenditure 12 In terms of the Social Housing Act, No. 16 of 2008, the Council must consist of between seven and twelve non-executive members. During March 2014 to February 2015 and March 2015, the Council only comprised of six and five members respectively. Decisions taken by the Council during this period have been rendered invalid and the new Council will need to remedy these. There was no fruitless and wasteful expenditure during the period under review.

13. 8.Statement of financial position 13

14. 9.Statement of financial performance 14

15. 10.Statement of changes in net assets 15

16. 11.Cash flow statement 16

17. 12.Recalled Grant Funds (SHIP Projects) 17

18. 13.Programme Costs 18

19. 14.Challenges 19 ChallengesMitigation Measures Planned targets were based on approval vis-à-vis delivery of social housing units As from 2015/16, planned targets are based on delivery of social housing units Coordination with Provincial Authorities Provinces have been given social housing delivery targets that correspond to the SHRA’s Credible pipelineProvincial Steering Committees to assume responsibility in development of credible pipeline Construction cashflow planningImproved pipeline planning and enhanced coordination between Province and Municipality will improve cashflow predictions Debt funding for SHIsNHFC’s social housing targets for loan approvals must align to the SHRA’s

20. 15.Provincial MTSF targets In order to ensure the delivery of units, the Provinces have been provided with correlating targets as follows: 20 Province2015/162016/172017/18 Target: delivery of social housing units E Cape392 Free State387 Gauteng1981 KZN617 Limpopo210 Mpumalanga309 N Cape570 NW113 W Cape822 TOTAL5,401

21. THANK YOU 21