Infrastructure

My Department spent the entire Human Settlements Development Grant (HSDG) and Informal Settlements Upgrading Partnership Grant (ISUPG) available. However, it should be noted that at the end of February 2025 both the HSDG and ISUPG were incorrectly reduced by R200 million and R100 million, respectively. While the implementation of some phases of large projects could be delayed, accrued payments for March 2025 were paid in the 2025/26 financial year which will have an impact on funding available to initiate new projects.  The Western Cape Province was initially allocated R1.605 billion under the HSDG and R382,315 million under the ISUPG for the 2024/25 financial year. However, following a national reduction to the provincial human settlements budget, both grant allocations were reduced by R300 million cumulatively.

My Department’s Human Settlements programme still managed to meet targets despite the unilateral reduction in national conditional grant allocations, comprising a R200 million cut to the Human Settlements Development Grant (HSDG) and a R100 million cut to the Informal Settlements Upgrading Partnership Grant (ISUPG). My Department provided 4 779 housing opportunities against the HSDG Business Plan target of 4 845 and serviced 3 181 sites against the HSDG Business Plan target of 2 801, despite the R200 million reduction in allocation with a total spend of R1.405 billion from the HSDG. My Department serviced 1 672 sites against the ISUPG Business Plan target of 1 527, with a total budget spend of R282.315 million from the ISUPG.

ADDITIONAL INFORMATION IF REQUIRED:

In terms of the delivery of housing opportunities, context matters. Between 2014 and 2019, the Western Cape received around R2.3 billion a year for human settlements. Since 2019, our allocation has declined every year-down to R1.688 billion in 2024/25. Yet despite this and including my Department’s Q1 25/26 data we still delivered 57 458 opportunities to date which includes the Building New Ground programme, First Home Finance, sites, services, and individual subsidies, in a fiscal environment where we have lost close to R2 billion cumulatively compared to if the 2019 baseline had been sustained. In real terms, after inflation, today’s budget is 30- 35% smaller than it was in 2019. Fewer rands, more efficient delivery. The 2014/15 – 2018/19 allocations were relatively stable, averaging around R2.2 – R2.4 billion per year. From 2019/20 onward a steady decline set in as illustrated in the table below:

That means the Province has lost close to R2 billion cumulatively compared to if the 2019 baseline had been sustained. In real terms (after inflation), today’s budget is 30–35% smaller than it was in 2019. My Department continues to deliver despite cuts. During 2014/15–2018/19 when stable budget allocations were received, cumulatively 97 405 housing opportunities were delivered averaging 19 500 housing opportunities per year. During the period 2019/20–2023/2 despite shrinking budgets, and the devastating effects of the global Covid-19 pandemic, My Department provided 53 614 housing opportunities averaging 10 700 housing opportunities per year. When calculating opportunities delivered per R1 billion, the Province actually became more efficient by stretching fewer rands further.