The Department of Housing hereby publishes the draft Housing Amendment Bill, 2006 for public information, discussion and comment.
_-__-------Words underlined with a solid line indicate insertions in existing enactments.
To amend the Housing Act, 1997, so as to insert new definitions; to enable the Minister to prescribe a policy framework for the accreditation of municipalities and the assignment of powers and functions; to substitute the existing provisions pertaining to the accreditation of municipalities; to substitute the provisions dealing with the restriction on the sale of state subsidised housing; to provide for the disestablishment of the South African Housing Fund; to make further provision for the allocation of money to provinces; to substitute certain expressions; to make further provision for accountability; to vest certain powers and duties in the MEC; and to provide formatters connected therewith.
and to provide for matters connected therewith.
or 3(5), granted in terms of the Discount Benefit Scheme.
bank account" means the Drimatv bank account as contemplated in section 1 by the deletion of the definition of "provincial housing development fund".
The Criteria and Procedures governing the Allocation of the Bulk and Connector Infrastructure Grant until it is phased out on a date determined by the Minister in consultation with the Minister for Provincial Affairs and Constitutional Development.
The National Urban Reconstruction and Housing Agency.
A panel shall consist of not more than [six] eiqhteen fit and proper persons who have knowledge] qualifications or experience in the field of housing development.
(e) subiect to the provisions of the Promotion of Access to Information Act, 2000 (Act No.
and administer the assets contemplated in section 14.
obtain accreditation in accordance with the Drovisions of section 10.
to administer national housing programmes in terms of which a housing development project is being planned and executed, such municipality may not act as developer, unless such project has been approved by the MEC [relevant provincial housing development board].
by the deletion in subsection (2) of paragraph (b).
Substitution of section 10 of Act 107 of 1997 The following section is hereby substituted for section 10 of the principal Act: 10.
Any municipality may apply in writing to the MEC in the form determined by the MEC to be accredited under subsection (2) for the purposes of assigning powers and functions as contemplated in subsection (3).
complies with the all the requirements for accreditation as prescribed by the Policy Framework contemplated in subsection (6), the MEC must approve the application for accreditation of the municipality.
Notwithstanding any provision in any law, the MEC may, as contemplated in section 126 of the Constitution, by agreement assign any power or function that is to be exercised or performed by him or her in terms of this Act, to a municipality accredited in accordance with the provisions of subsection (2).
The assignment of any such power or function takes effect upon proclamation by the Premier.
of the Constitution, prescribe a Policy Framework for the accreditation of municipalities and the assignment of powers and functions to accredited municipalities.
multi-year strategic housing development planning requirements for accredited municipalities; and rules and procedures for managing non-performance by accredited municipalities.
comply with the prescribed reporting duties; and comply with any duties and obligations prescribed by the Policy Framework.
monitor the performance of accredited municipalities; and where a municipality fails to perform adequately, take the necessary steps to ensure proper and adequate performance.
Any dispute arising between an MEC and a municipality concerning an application for accreditation must be referred to the Minister, whose decision shall be final and bindinq.
Restriction on sale of state-subsidised housing.
such person or his or her successors in title or creditors in law shall not sell or otherwise alienate [his or her] that dwelling or site within a period of [eight] five years from the date on which the property was [acquired by that] reRistered in the name of such person unless the dwelling or site has first been offered to the relevant provincial housing department.
provincial housing department to which the dwelling or site has been offered as contemplated in subsection (I)shall endorse in its records that the person wishes to vacate his or her property and relocate to another property and is entitled to remain on a waiting list of beneficiaries requiring subsidised housing.
[Nopurchase price or other remuneration shall be paid to the person vacating the property but such person will be eligible for obtaining another state-subsidised house, should he or she qualify therefor.
Valuers Profession Act, 2000 (Act No. 47 of 2000).
the purchase price shall be financed bv bank account either conditionally or unconditionallv, in respect of any dwellina or site to which the provisions of that subsection apply.
and that an exemption has been aranted under subsection (5), either unconditionally or subiect to the conditions set out in the certificate.
The Minister may, bv notice in the Gazette, make rules on the qrantina of exemption in terms of subsection 161 as well as the amount that must be paid or creditor concerned for the grantinq of such exemption.
in terms of law or a mortqaae bond, as the case may be, on the wounds that the person or mortqaqor has failed to meet his or her obliqations in terms of such law or mortqaae bond.
Section 1OB of the principal Act is hereby repealed.
of the Housing Arrangements Act, 1993 (Act No 155 of 1993), is hereby disestablished.
were advanced out of the former Fund shall be deemed to have been advanced out of the National Revenue Fund.
Any reference to the former Fund in any document, in relation to the financing of any national housing programme or any provincial housing programme, must be construed as a reference to the National Revenue Fund.
Allocation of money in Fund to provincial governments.
[Fund] for the purposes of financing the implementation in a province of any national housing programme and any provincial housing programme, which is consistent with national housing policy and section 3(2)(b).
criteria for the allocation of money in terms of paragraph (a) must, subject to paragraph (c), be determined by the Minister after consultation with every MEC.
the manner in which the accounts and records of such fund are to be kept, the preparation of detailed annual statements showing the results of the transactions and the balance sheet of the fund and their submission to the provincial legislature by the MEC; and the auditing of the books and statements of account and balance sheet of such fund by the Auditor-General.
No. 155 of 1993, despite its repeal by section 20.
or an officer of the provincial administration aesignated for that purpose by that accounting officer, in which he or she has certified that the money is required to meet expenditure that is reasonably expected to be incurred within the period for which the requisition has been submitted.
Such requisition must be submitted in the form, at the intervals and in respect of the periods the Director-General determines.
To achieve an equitable result such agreement or arbitration may provide for the payment of compensation out of the primary bank account [provincial housing development fund] of one province to the credit of the primarv bank account [provincial housing development fund] of another province.
(i) be paid into the primarv bank account of [provincial housing development fund for] the province in question [or, if such fund has not been established when such net proceeds are received, be dealt with in accordance with section 13 of the Housing Arrangements Act, 1993 (Act No.
(ii) The cost of completing such project or scheme must be financed by a grant from money paid into the primarv bank account of the province [relevant provincial housing development fund] as contemplated in section 12(2).
the premier of a province, must be paid into the primary bank account of [provincial housing development fund for] such province [or, if such fund has not been established when such net proceeds are received, be dealt with in accordance with section 13 of the Housing Arrangements Act, 1993, despite its repeal by section 201.
"(ii) The cost of completing such project or scheme must be financed by a grant from money paid into the primary bank account of the province [relevant provincial housing development fund] as contemplated in section 12(2)."
"(ii) Any money recovered by the Provincial Government by virtue of the right that so passes to that Provincial Government, must be paid into its primary bank account [provincial housing development fund] and must be utilised for housing development in accordance with the national housing policy and a housing development project approved by the MEC."
~11The Dowers, duties, riahts and obliqations of a Provincial Government in relation to immovable property belonqina to such Provincial Government in terms of the provisions of this section, shall vest in the MEC.
to a Provincial Government and an r>rimal y bank account of a province [a provincial housing development fund] must be construed as a reference to the relevant municipality and the municipality's operating account as contemplated in subsection (5), respectively.
In this section "provincial housing development fund" means a provincial housing development fund contemplated in section 12(2).
after the commencement date would have become payable to or for the credit of any provincial housing development fund shall become payable to the accredited bank account of the province concerned: and were advanced out of any provincial housing development fund shall be deemed to have been advanced out of the accredited bank account of the province concerned.
Any reference to a provincial housing development fund in any document, in relation to the financing of any national housing programme or any provincial housing programme, must be construed as a reference to the accredited bank account ofthe province concerned.
This Act is called the Housing Amendment Act, 2006.
1.3 thirdly the Bill addresses the contentious issue of the restriction of the sale of state-subsidised housing, as contained in sections IOA and 1 OB of the Act.
2.1 The amendment of the existing funding regime.
The Act currently makes provision for a South African Housing Fund at national level, and Provincial Housing Development Funds at provincial level. All monies allocated to housing are paid into these funds, and all expenditure incurred is met from these funds. The funds were created mainly as a ring fencing mechanism to ensure that money appropriated for housing is used only for that purpose.
As far as the provincial housing development funds are concerned, the current payment of moneys into these funds is contradictory to the provisions of both the PFMA and DORA.
Provision is made for a savings section that will make provision for transitional arrangements.
2.2 The accreditation of municipalities and the assignment of powers and functions.
Section 10 of the Housing Act, 1997 allows for the accreditation of municipalities so as to enable 'them to administer national housing programmes instituted in terms of the Act.
Creation of Sustainable Human Settlements (a Cabinet approved policy directive), the existing provisions of section 10 have become inadequate, especially with regard to aspects such as the constitutionally based assignment of powers and functions, the role of intergovernmental relations, and capacity and funding requirements.
To address this issue the department followed a two-pronged approach. A policy framework and guidelines for the accreditation of municipalities was firstly developed, with the policy framework including, amongst other things, the requirements for accreditation. This was then followed by the preparation of the amendments to section 10, in accordance with the approved framework, whilst also incorporating provisions pertaining to the assignment of powers and functions as provided for in the Constitution.
of the Constitution have been used as a basis.
allows for the assignment, by agreement and subject to any conditions, the administration of, inter alia, matters listed in part A of Schedule 4 of the Constitution, which includes housing.
The amended section 10 will therefore firstly allow for two essentially separate (yet intricately interweaved) processes, which firstly allows for the accreditation of a municipality on the basis of the requirements of the Policy Framework, and secondly enables an MEC to, by agreement, assign any of his or her powers or functions (as per the Housing Act) to the accredited municipality. Lastly, the draft clause also lists a number of matters which may be prescribed in the Policy Framework.
2.3 The sale of state=subsidised housing.
and 106 in the Housing Act. The general design was to restrict the sale of these houses by creating a pre-emptive right in favor of the state which entailed that such houses may not be sold within a period of 8 years from the date of acquisition unless it had first been offered to the relevant provincial housing department.
This was an attempt to firstly curb the escalating sale of subsidised houses by beneficiaries, mostly for substantially less than the original subsidy amount, and secondly to protect these houses from being sold in execution for ridiculous amounts, so as to settle claims by creditors which in most instances amounts to much less than the subsidy investment made by government.
proved murky at best.
In terms of section IOA, the offer to the provincial housing department is in fact interpreted as a notice of vacation, with the property then being deemed to be owned by the province, with the 'seller' reverting back to the waiting list of persons requiring subsidised housing. This clearly does not constitute a pre-emptive right in the legal sense, but is more a matter of disposition without compensation. No consideration is thus given to aspects such as the appreciation of value etc, and the procedures pertaining to the transfer of ownership in the Deeds Office is virtually non-existent, if compared to that provided for in section 1OB.
With regard to section 1 OB, the position is virtually transversal from that contained in 1 OA. Firstly, the most glaring lacuna is the fact that the pre-emptive right is not linked to the 8 year period provided for in IOA, and is hence almost open-ended.
However, on the other hand section 1OB makes provision for both a fair process in the exercise of the pre-emptive right, and a properly stipulated process of ownership transfer in the Deeds Office.
by including the successors in title of the beneficiary and also certain creditors, it is clear that these sections should not be divorced, but should instead be merged, as is proposed by the amendments to section 1OA and the repeal of 1 OB.
In the revised clause IOA, the pre-emptive period is reduced from 8 to 5 years, as per approved national housing policy, whilst a fair process is put in place for dealing with the acceptance, or not, of the offer to sell as made by the beneficiary. Lastly, provision is made for the formal transfer of ownership via the Office of the Chief Registrar of Deeds.
2.4 Miscellaneous amendments.
and 7(4)(g)(ii), dealing with the cessation of membership of the Minister's and an MEC's advisory panels, respectively, is amended to delete the provision pertaining to the Agricultural Credit Act, 1966, by virtue of the mentioned Act having been repealed by the Agricultural Debt Management Act, 45 of 2001.
3.1 With regard to aspects such as the funding regime and the accreditation of municipalities, task teams consisting of provinces, Salga, Metro's and other stakeholders were used to workshop the issues involved.
3.2 In relation to the restriction of the sale of state-subsidised housing, the department worked closely with the Office of the Chief State Law Adviser to find an appropriate solution.
3.3 The Bill is to be published for comment in the Gazeffe pursuant to Cabinet approval in that regard.
3.4 The Bill also served before the FOSAD Social Sector Cluster Committee which approved its submission to Cabinet for approval and publication in the Gazeffe for public comment.
Bill to be dealt with in terms of the procedure as provided for in section 76 of the Constitution.