Regulator put under administration for ‘creative’ use of R400m without consent

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THE SOCIAL Housing Regulatory Authority (SHRA), which was established in 2011 to control the terms and conditions of social housing, has been placed under administration by the Human Settlements Department after using funds allocated to it “creatively” and outside its mandate without approval.

Lindiwe Sisulu, the Minister of Human Settlements, said about R400 million was spent in one year by the SHRA in this manner.

Sisulu said this was the major entity in the social housing sphere that she highlighted in her budget vote speech and which she had ordered to be audited in terms of its output because of concerns about the management of its finances.

She said that almost before the SHRA was familiar with the terrain and its responsibility, it had some money allocated to it that was used “very creatively”.

In terms of the law, the SHRA’s mandate was to regulate the terms and conditions of the provision of social housing, determine how much money went into a subsidy for social housing, ascertain the social housing responsibility of the government, and handle disputes.

But Sisulu said that the authority had for some reason conflated its responsibility with investment, using the resources that it had and other resources that had been directed to it.

Sisulu did not know how the SHRA managed to have these resources directed to it and would have preferred them to have remained within the department and the SHRA only be given operational resources.

She said that the SHRA was supposed to follow a particular process if it wanted to invest in social housing or give incentives for social housing.

However, that process was never put in place or followed, she said. “There was a lot of abuse of state resources, which has resulted in us putting that entity under administration and we are investigating how we came to be in a situation where resources were diverted without any protocols.

“Quite a lot of resources ended up in the hands of individuals who would probably have nothing to show for it.” – Roy Cokayne

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