SELECT COMMITTEE ON PUBLIC SERVICE: REPORT ON QUALITY SANITATION TO HOUSEHOLDS PROGRESS REPORT ON THE RURAL HOUSEHOLD INFRASTRUCTURE PROGRAMME (RHIP) 28 AUGUST 2012 By MR T ZULU DIRECTOR GENERAL

PRESENTATION OUTLINE Background RHIP Overview RHIP Objectives Roles and Responsibilities Progress per Province – 2010/11 Challenges – 2010/11 Progress per Province – 2011/12 Financial Performance – 2011/12 Job Creation – 2011/12 Challenges – 2011/12 Way Forward – 2012/13 & 2013/14

Draft and Confidential Background In May 2009 State President announced the transfer of sanitation function from DWA to NDHS Programme was formally transferred on 1 Nov 2009 Staff transferred were component dealing with basic sanitation - high level of sanitation remained with DWA Draft and Confidential

RHIP OVERVIEW The Rural Household Infrastructure Programme is a special four year programme to provide basic sanitation to rural communities. The budget allocation at R1.2 billion over four year period as a schedule 7 Grant . NDHS appoints Implementation Agents & enters into SLAs with Water Services Authorities. The budget split over 4 year lifespan: 2010/11: R100 million; 2011/12: R231,5 million; 2012/13: R479,5 million and 2013/14: R389 million.

RHIP OBJECTIVES To support municipalities to address rural basic sanitation backlogs. To improve the quality of life in rural communities. To contribute to the rural development priority of government. To contribute to job creation and Local Economic Development. To contribute towards meeting the sanitation MDG targets of South Africa. To accelerate delivery of sanitation to meet the 2014 target.

Roles and Responsibilities of Implementing RHIP Grant being gazetted as a Schedule 7 Grant: Even though funds are gazetted against municipalities, it is transferred to the National Department for management /implementation in particular municipalities National Department is responsible for identifying mechanisms for implementation - Implementing Agents which could be NGOs, CBOs, Public Entities or Managing Contractors. National Department needs to agree with municipalities on the scope of the work to be done. This is for the purpose of aligning the RHIP projects to municipal IDPs. This necessitates identification of specific areas of operation up to ward level. National Department needs to agree with municipalities on issues of operation and maintenance of infrastructure

Roles and Responsibilities of Implementing RHIP (cont…) Municipalities are to ensure that RHIP projects appear in their IDPs. All parties attend site meetings to monitor progress and identify means of interventions should there be obstacles during implementation.

Demographic Profile (National Perspective)   Population estimate % of total population households Eastern Cape 6 829 958 13,50 1 623 448 Free State 2 759 644 5,46 888 536 Gauteng 11 328 203 22,39 2 658 402 KwaZulu-Natal 10 819 130 21,39 1 754 348 Limpopo 5 554 657 10,98 1 358 087 Mpumalanga 3 657 181 7,23 1 060 026 Northern Cape 1 096 731 2,17 962 663 North West 3 253 390 6,43 230 878 Western Cape 5 287 863 10,45 1 711 439 Total 50 586 757 100,00 12 247 827 The current population of 50.5 million (2011) can be split into more than 68 000 settlements, of which: ~21.2 million people (or 42% of the population) live in large metropolitan areas ~9.1 million people (or 18% of the population) live in medium-sized cities and towns ~4.5 million people (or 9% of the population) live in small towns in rural areas ~15.5 million people (or 31% of population) live in small rural villages and scattered settlements 2018/11/20

SANITATION STAUTS QUO: Households National Sanitation Backlog Profile from the Period 1994 to 2011. (Source: Water Services National Information System (WS/NIS April 2011). Table 1. Province Households with no access to basic Sanitation - April 1994 Households with no access to basic Sanitation - Oct 2001 Households with no access to basic Sanitation - April 2011 Households Served 2009/2010 Eastern Cape 1,001,327 899,487 288,346 49,371 Free State 399,780 348,433 236,647 9,104 Gauteng 621,394 522,836 406,054 33,667 KwaZulu-Natal 939,542 1,063,336 348,629 92,149 Limpopo 800,352 840,257 464,257 37,151 Mpumalanga 421,757 434,306 296,169 13,420 North West 368,290 411,760 236,577 17,845 Northern Cape 143,068 85,530 47,909 2,958 Western Cape 388,745 153,239 80,743 4,707 National 5,084,255 4,759,184 2,405,331 260,372

PROGRESS PER PROVINCE - 2010/11 Allocation: 2010/2011 (R’000) Number of Benefiting Municipalities Target Number of VIP Toilets VIP Toilets completed at 31 March 2012 % Completion Eastern Cape R18,000 5 2,559 100% Free State R3,000 1 300 Limpopo R27,000 9 3,600 3,376 94% KwaZulu-Natal 7 3,674 Mpumalanga R4,000 515 Northern Cape 400 North West R6,000 2 828 National Prog. Management R12,000 Grand Total R100,000 26 11,876 11,652 98%

CHALLENGES - 2010/11 Programme started in Oct 2010 (procurement delays). Some WSAs did not fully grasp the nature of Schedule 7 Grant and delayed signing SLAs with NDHS as they wanted to implement the programme themselves. Excessive rainfall was experienced during December 2010 and January 2011 which caused delays. Implementing Agents struggled to source building material and have it delivered on site. Some contractors struggled with difficult ground conditions i.e. hard rock and high water table.

PROGRESS PER PROVINCE - 2011/12 Allocation: 2011/2012 (R’000) Number of Benefiting Municipalities Number of VIP Toilets targeted VIP Toilets completed as at 31 May 2012 % Completion Eastern Cape R65,000 13 7,462 7,185 96% Free State R10,000 3 1,297 1,198 92% Limpopo R48,000 12 5,864 4,081 70% KwaZulu-Natal R68,000 15 7,967 7,137 90% Mpumalanga R8,000 2 1,038 1,023 99% Northern Cape 1 507 486 North West R28,000 7 3,551 2,979 84% Grand Total R231,500 53 27,686 24,089 87%

FINANCIAL PERFORMANCE - 2011/12 (WITH ROLL-OVERS) Province 2011/12 Allocation & 2010/11 Rollover Expenditure at 31 March 2012 Work in Progress KwaZulu-Natal R80,487,091 R63,207,997 R17, 279,094 Eastern Cape R65,000,000 R55,868,072 R9,131,928 Limpopo R54,552,091 R26,688,032 R27,864,059 North West R30,063,533 R22,711,497 R7,352,036 Free State R12,924,676 R8,548,344 R4,376,332 Mpumalanga R10,086,447 R7,943,553 R2,142,894 Northern Cape R4,394,162 R2,298,425 R2,095,737 Grand Total R257,508,000 R187,265,920 R70,242,080

2010/11 Roll-overs PROVINCE AMOUNT LP R9 m FS R3 m MP R2 m KZN R12m TOTAL R26 m

RHIP 2012/13 Expected Delivery Province Allocation: 2012/2013 (R’000) Number of Benefiting Municipalities Estimated Target Number of VIP Toilets Eastern Cape 136 500 15 15,165 Free State 18 000 2 2,000 Limpopo 88 000 12 9,775 KwaZulu-Natal 147 000 17 16,328 Mpumalanga 24 000 2,666 Northern Cape 9 000 1 1,000 North West 57 000 7 6,332 Grand Total 479 500 56 53266

No of Benefiting Municipalities Estimated Target No. of VIP Toilets TEMP. JOB CREATION - 2011/12 Province No of Benefiting Municipalities Estimated Target No. of VIP Toilets Jobs Created as at 31 May 2012 Eastern Cape 13 7,462 1,372 Free State 3 1,297 181 KwaZulu-Natal 15 7,967 1,254 Limpopo 12 5,864 867 Mpumalanga 2 1,038 324 Northern Cape 1 507 70 North West 7 3,551 658 Grand Total 53 27,686 4,726

CHALLENGES - 2011/12 The 2 appointed Implementing Agents (Mvula Trust and IDT) could not implement such a programme at scale and achieve the outcomes set. The existing SLAs between the NDHS and the Programme Management Support Team (Maxima Global/TranSpace) on one hand and Mvula Trust and IDT on the other were not consistent with each other. The process of handling claims of the Implementing Agents needed to be restructured to assist them with improved cash-flow management.

CHALLENGES - 2011/12 cont… The recovery plans submitted in Sept 2011 by the 2 Implementing Agents were too optimistic. The IAs ability to procure building materials from suppliers in large quantities posed a serious challenge to the outcomes of the programme. The scope of work approved for the IDT was at high risk of not being completed by end of the 2011/12 financial year. In December 2011 NDHS re-allocated 7,098 units from IDT and negotiated with Mvula Trust to complete these units by the end of the 2011/12 financial year.

Operations and Maintenance Challenges 2012 Division of Revenue Act: Basic Service component of the Equitable Share, breaks down the allocation between water, sanitation and refuse removal. These funds are for operation and maintenance which include emptying of full pits and septic tanks. Draft and Confidential

WAY FORWARD - 2012/13 & 2013/14 NDHS has reduced the previous allocations to IDT and Mvula Trust to approximately 60% of the 2012/13 budget (in line with NDHS Portfolio Committee recommendations). NDHS is currently in process of allocating approx 40% balance of the 2012/13 budget to tender for additional Implementing Agents to be added to the programme. The SLA of the Programme Management Support PSP is to be aligned to the performance of the IAs. In 2012/13 both machinery & manual labour will be used in difficult ground conditions where needed.

Draft and Confidential Thank you Draft and Confidential