Statement of Responsibility and Confirmation of Accuracy for the Annual Report
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STATEMENT OF RESPONSIBILITY AND CONFIRMATION OF ACCURACY FOR THE ANNUAL REPORT To the best of my knowledge and belief, I confirm internal control that has been designed to provide the following: reasonable assurance as to the integrity and reliability of the performance information, the All information and amounts disclosed in the annual human resources information and the annual report are consistent with the annual financial financial statements. statements audited by the Auditor General. The external auditors have been engaged to The annual report is complete, accurate and is free express an independent opinion on the annual from any omissions. financial statements. The annual report has been prepared in accordance In our opinion, the annual report fairly reflects with the guidelines on annual reporting as issued by the operations, the performance information, the National Treasury. human resources information and the financial The Annual Financial Statements (Part B) have been affairs of the entity for the financial year ended 31 prepared in accordance with the South African March 2015. Generally Recognised Accounting Practice (GRAP) Yours faithfully standards applicable to the Public Entity and the Public Finance Management Act of South Africa, 1999. (Act No. 1 of 1999) (PFMA). The accounting authority is responsible for the preparation of the annual financial statements and for the judgements made in this information. BONI MUVEVI The accounting authority is responsible for CHIEF EXECUTIVE OFFICER establishing and implementing a system of 28 JULY 2015 GAUTENG PARTNERSHIP FUND | ANNUAL REPORT 2014/15 CONTENTS 06 REPORT OF THE CHAIRPERSON 08 REPORT OF THE CEO 10 OPERATIONS REPORT 30 CORPORATE GOVERNANCE 76 ANNUAL FINANCIAL STATEMENTS 38 MARKETING AND COMMUNICATIONS REPORT 79 GENERAL INFORMATION 40 HUMAN RESOURCES REPORT 80 REPORT OF THE TRUSTEES 48 PERFORMANCE REVIEW 82 STATEMENT OF FINANCIAL POSITION 72 REPORT OF THE AUDIT AND RISK COMMITTEE 83 STATEMENT OF FINANCIAL PERFORMANCE 74 REPORT OF THE AUDITOR-GENERAL 84 STATEMENT OF CHANGES IN NET ASSETS 85 STATEMENT OF CASH FLOWS 86 STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS 87 ACCOUNTING POLICIES 100 NOTES TO THE FINANCIAL STATEMENTS The following supplementary information does not form part of the annual financial statements and is unaudited: 148 DETAILED STATEMENT OF FINANCIAL PERFORMANCE Project: HLANGANANI GARDENS 3 GAUTENG PARTNERSHIP FUND | ANNUAL REPORT 2014/15 REPORT OF THE AUDIT AND RISK COMMITTEE BOARD OF TRUSTEES OUR PHILOSOPHY VISION P MPHAHLELE B MUVEVI Z FIHLANI L KHANGALA The partner of choice in affordable housing delivery in Gauteng CHAIRPERSON CHIEF EXECUTIVE OFFICER MISSION As a public sector affordable housing delivery vehicle, we: • Mobilise new and innovative funding streams for projects, • Leverage private and public sector finance to ensure better bankability of projects, • Facilitate collaboration between public and private sector partners, • Promote accountability, monitoring and efficiency in the M LESHABANE L MAKIBINYANE D MAPHATIANE S MBANJWA implementation of projects, thereby enabling coordinated effort by both the public and private sector in sustainable, integrated human settlements delivery. GAUTENG PARTNERSHIP FUND | ANNUAL REPORT 2014/15 REPORT OF THEREPORT AUDIT ANDOF THE RISK CHAIRPERSON COMMITTEE REPORT OF THE CHAIRPERSON DEAR VALUED STAKEHOLDERS, Gauteng is the economic engine of the South The role of GPF has been to facilitate or mobilise about 100 companies. Our approved funding for In 2019, we will be exploring ways for GPF to African economy. It is home to more than 12 funding for affordable housing. We will support the the EEPF to date amounts to approximately R400 become institutionally and funding sustainable. million people and a destiny of choice for many Gauteng Human Settlements to facilitate private million, spread between 40 development projects, In the past year we have forged new strategic job seekers across the country and continent. It is sector participation and mobilise appropriate which, once completed, will provide approximately relationships with the Ekurhuleni Metropolitan by far the most urbanised province in South Africa funding for social housing and integrated projects. 1 775 rental units. During the year under review, Municipality to partner on social housing projects. (97% urbanised). Given these challenges, in the we also saw completion of 4 EEPF projects in The GPF, as an organisation, has matured. Recently We are also finalising senior debt funding current global economic environment, we need to Pretoria, Kempton Park, Johannesburg CBD and it went through a smooth leadership transition to a agreements with Futuregrowth Asset Management collectively devise and implement programmes that Bronkhorstspruit. new CEO, Mr Boni Muvevi, (appointed on the 1st and the Public Investment Corporation (PIC) to respond to their specific needs. of March 2014), following the resignation of the In 2014 the following Trustees were re-appointed: the value of R600 million. This has been a major The Gauteng Partnership Fund (GPF) mandate previous CEO (Mr Kutoane Kutoane). Overall, the Lefadi Makibinyane, Dineo Maphatiane, Zola challenge and risk for GPF as there are not many seeks to provide housing finance and solutions for GPF has continued to deliver on its mandate and Fihlani and myself. We look forward to working senior debt funding institutions actively lending in households that earn income between R3500 to remain in line with the organisation strategic plan. more closely with the current Gauteng Human the affordable housing market. R18000 per month (adjusted 2015). This income The organisation is governed by sound governance Settlements Department under the leadership of To all our Stakeholders, thank you for your support band remains one of the greatest social challenges systems and structures, as evidenced by clean the Honourable MEC Jacob Mamabolo. We fully - I am pleased to present our Annual Report for for provision of housing in South Africa. In Gauteng audits obtained from the Auditor General (‘AG”) support the new vision of Human Settlements, the year ended 31st March 2015. To the Board, it is particularly severe, because of the higher rate since inception. We are proud that once again namely housing delivery through mega projects. Executive management and Staff, thank you for of urbanization which contributes to work and the GPF obtained a clean audit for the year under The pressure on the Government Treasury is your hard work and commitment to GPF. economic opportunities. review. As the Board Chairperson, I give credit to tremendous given the slow economic growth and management and fellow Board members. In 2014 the government strategy or response to the high level of social infrastructure backlog. PAKIE MPHAHLELE growing housing backlog and informal settlements Over the past 5 years, through our flagship As the Board, we have mandated the CEO to CHAIRMAN has shifted to the mega projects that deliver Entrepreneur Empowerment Property Fund (EEPF), seek alternative funding streams for grant and on average 10 000 houses with the integrated we have provided financial support to 40 black- concessionary funding. infrastructure i.e. clinics, retail etc. owned companies and non-financial support to 6 7 GAUTENG PARTNERSHIP FUND | ANNUAL REPORT 2014/15 CHIEF EXECUTIVE OFFICER’S REPORT HOUSING WATER ECONOMIC CHIEF & SANITATION EXECUTIVE LAND ELECTRICITY HUMAN SETTLEMENT the medium to long term. In 2014, our efforts have PRODUCT OFFICER’S SOCIAL GOVERNANCE resulted in securing funding commitment of R600 million from two established financial institutions REPORT as co-funding partners in affordable housing rental ENVIRONMENT TRANSPORT projects. HOUSING In 2014, the general global slowdown in economic across all funding products and we apply robust TYPOLOGY growth has had an effect on the South African up-front risk mitigation approaches to every The Human Settlements treasury allocation has economy resulting in significant job losses. In the investment. Our loan book bad debt ratio is 0.20% been under pressure for years, especially in 2014. affordable residential rental sector this has had compared to our target of 5%. Supply Chain In 2015 we will focus our efforts on finding ways Fig A: Human Settlement Product (Mega projects) an impact on tenants’ ability to pay for rental management processes are in place. During the to become institutional and fully sustainable in the future. This will be a huge task given our accommodation. According to a TPN report, “2014 year under review there were no unsolicited bid government institutions in shaping the sustainable social objective and public sector compliance ended on a positive note for landlords and rental proposals. Approval was obtained for the rollover human settlements sector. In addition to Tshwane requirements. agents, with 86% of residential tenants recorded as of funds. There are no events after the reporting Metro we have signed partnership agreements being in good standing” [The South African Rental date. We will continue to focus on GPF operational 2014 was a crucial period for Gauteng Province and with the Ekurhuleni Metropolitan Municipality Market, Rental Payment Monitor, Quarter 4 of efficiency to ensure we meet our clients’ turnaround GPF as new political Leadership was appointed, and the Mogale City Local Municipality, and 2014:TPN Registered Credit Bureau]. expectations and future business sustainability namely Honorable: Premier David Makhura