Department of Infrastructure Development Annual Report 2021-2022

ANNUAL REPORT 2021 | 2022

Overview of the financial results of the Department

Departmental receipts

2020/2021

2021/2022

(Over)/ Under Collection

(Over)/ Under Collection

Actual Amount Collected

Actual Amount Collected

Estimate

Departmental receipts

Estimate

R’000

R’000

R’000

R’000

R’000

R’000

Sale of goods and services other than capital assets Sale of scrap, waste and other goods Interest, dividends and rent on land

13 138

12 374

764

29 260

13 936

15 324

-

-

-

-

2 017

(2 017)

-

503

(503)

-

35

(35)

Sale of capital assets

-

-

-

-

-

-

Financial transactions in assets and liabilities

730

3 028

(2 298)

770

905

(135)

Total

13 868

15 905

(2 037)

30 030

16 893

13 137

The revenue target for the year 2021/22 was R30,0 million. To date, the Department has collected R16,8 million of its annual target. This implies a collection of 54% on the overall projected revenue. Revenue from sale of goods and services consist of rental dwellings, parking collection, and other revenue. R12,5 million of the R13,9 related to rental dwellings, R597 thousand to parking and the balance to of R789 thousand to other revenue. The Department has 176 residential and 84 commercial tenants. Commercial property collected R8,4 million for the year, whereas residential properties collected R1,1 million. Overall commercial properties have potential to reach the annual target since the Department achieved 62% collection compared to 9.5% of residential properties. During the year under review, the Department had plans to sell scrap furniture. This process has yielded positive result with a total collection of R2,0 million. Financial transaction is assets and liabilities related to revenue collected from previous year debts that were raised by the Department. The Department managed over-collected R905 thousand, from the R770 thousand that was estimated for the same period The Department has not met its target largely due to tenants’ inability to afford rentals. During the year, the Department sold five properties of which revenue will be received in the following financial year. Although the Department managed to sell some properties, illegal occupation remains one of the key challenges that the Department faces to ensure that the process of sale is completed on time. Lack of investment in upgrading the property has also contributed to the tenants’ failure to meet their monthly obligation. COVID-19 has imposed serious challenges on many tenants – which also resulted in the Department not being able to achieve the set target. A detailed exercise of profiling the tenants to determine affordability is currently underway and this will include physical verification to confirm the tenancy per the records. In the year 2021/22, the Department sent 210 letters of demand to all tenants who failed to pay monthly rentals of which some tenants responded by paying R1,7 million. Instead of blacklisting non-paying tenants, Legal Services advised that letters of demand should continually be sent to tenants until a handover process is initiated. Once they are handed over to State Attorney, the Department will effect eviction. Refurbishment of nature reserves, commercial and residential properties remain one of the key objectives for the Department since it will enhance the market value of the Departmental properties, which will in turn assist the Department to realise its targeted revenue through optimal usage of properties.

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DEPARTMENT OF INFRASTRUCTURE DEVELOPMENT