Informed by its mandate to efficiently manage over R30-billion a year and deliver 1.5-million housing opportunities by 2019, the Department of Human Settlements (DHS) says it plans to review its often-criticised tender application and award system.

“We will be reviewing the tender system, [which is] one of our biggest headaches in the human settlements environment. The review will focus on prequalifying contractors based on skills and capacity rather than price,” Human Settlements Minister Lindiwe Sisulu remarked during her budget vote speech, in Parliament, on Thursday.

She further reiterated the department’s intention to “revitalise” its relationship with the private sector while incentivising and mobilising private sector investment.

“We have revitalised the support of our important stakeholders, such as the Banking Association of South Africa, as well as every stakeholder that is concerned about the plight of the poor and is part of our delivery chain.

“We have had a lot of goodwill from people who want to partner with us, ranging from mining companies, banking institutions and businesses, to nongovernmental organisations and private individuals,” she said.

Sisulu’s comments followed commitments made by construction majors at the signing of the Social Contract for the Development of Sustainable Human Settlements, in December, during which companies pledged to assist in the realisation of government’s housing development strategy.

She told Parliament that the DHS had since received over 150 project applications from public and private sector players interested in participating in the roll-out of the national “megacatalytic” projects underpinning government’s 1.5-million housing target.

As part of this strategy, the department aimed to conclude the establishment of the Thembalethu and Southern Corridor N2 Gateway Phase 2 projects, in the Western Cape; the Bendor 100 and Lephalale Altoostyd integrated developments, in Limpopo; the Lerato Park and Upington 7612 projects, in the Northern Cape; Cosmo City and Fleurhof, in Gauteng; and extensions to the Cornubia settlement, in KwaZulu-Natal, over the next four years.

“To support provinces to fast-track the implementation of megaprojects, the Housing Development Agency has been requested to restructure itself to become a fully fledged developer that would be able to subcontract on a rotational basis that is fair and transparent, thus removing a source of grievance from especially our municipalities,” she added.

As previously announced, 60% of the labour used in the development of the projects would be sourced from the DHS’s Youth Brigade – an ambitious programme that sought to create organised teams of youth who would be trained in the construction and engineering sectors, driving the upskilling of the country’s unemployed youth while advancing the DHS’s housing delivery target.

Further outlining on departmental deliverables, Sisulu noted that the department planned to build 5 854 houses for military veterans across the country by the end of the medium-term expenditure framework (MTEF) period.

The DHS was, meanwhile, also focusing on the roll-out of housing in 22 mining towns in six provinces, as tasked by President Jacob Zuma.

“[In] the last financial year, more than 4 000 units were delivered, mainly in Mpumalanga and the North West, which are the main pressure points.

“In the Marikana area, there are two human settlement projects being completed that will deliver over 500 units, built on land donated by [miner] Lonmin. [Fellow mining house] Anglo American has also embarked on a project to provide more than 10 000 housing units,” she outlined.

Of the R6.3-billion committed by government to housing delivery over the MTEF period, R2.1-billion had been provided by the DHS, while mining companies had contributed R3.5-billion, she revealed.

Sisulu added that government was investigating the establishment of a National Human Settlements Corporation through the consolidation of financial institutions the National Housing Finance Corporation, the National Urban Reconstruction and Housing Agency and the Rural Housing Loan Fund.

She further expressed concern over the housing subsidy quantum, which had increased from R77 868 a house in 2009 to R160 573 in 2014.

“This phenomenal leap is unsustainable and [we] have decided to curb the quantum of the subsidy at its current level, notwithstanding inflationary pressures we currently face in our sector. We take this as a challenge to find more efficient ways to finance our housing commitment for our people,” she noted.

The DHS was, meanwhile, also in the process of establishing a credible National Human Settlements database linked to the population register that would assist the department to identify legitimate people on the waiting list for houses.