1. To give effect to the framework of PSCBC Resolution 2 of 2004, the Minister of Public Service and Administration has approved a directive on housing which must be read in conjunction with such resolution as was set out in Circular 0070/2004.
2. The existing housing allowance scheme has been extended to allow full-time employees appointed on a permanent or fixed contract basis and who have a rental agreement or own a paid-off dwelling, to share in the state’s non-pensionable housing benefits from 1 January 2005.
3. HOUSING ALLOWANCE FOR HOMEOWNERS
3.1 The home in respect of which the employee, as owner, applies for the housing allowance, must be registered in the employee’s name or in the names of both the employee and her/his spouse. For this purpose, the following documentation confirming ownership will be acknowledged:
3.1.1 Title deed – Document submitted to the Deeds Office by a conveyancer and which confirms the registration of transfer of the property in the name of the buyer
3.1.2 Permission to occupy land certificate – Permission from the traditional authority/state to construct a home on the stand granted. Arrangements differ from province to province.
3.1.3 Instalment Sale Agreement – Deferred ownership agreement through which the buyer takes ownership with the payment of the final instalment
3.2 An employee who, as a new homeowner on or since 29 September 2004, wishes to be considered for the maximum housing allowance benefit, must have a bond/home loan with
3.2.1 a registered financial institution/bank ,
3.2.2 a national housing finance corporation , or
3.2.3 a company that grants home loans.
3.3 An employee who wishes to access the housing allowance scheme must submit the prescribed documentation as proof with his/her application for a housing allowance. Failure to do so or the submission of incomplete/invalid documentation may result in the delay or refusal of the application.
3.4 The maximum value of the housing allowance is based on a maximum bond of R 70 000.00, and is revised quarterly by the Minister of Public Service and Administration based on the average interest rate levied by the five biggest financial institutions at the beginning of each quarter.
4. HOUSING ALLOWANCE FOR RENTAL
4.1 An employee who is applying for the housing allowance as a tenant must have a valid written rental agreement in his/her name for the housing he/she occupies. For this purpose, the following rental agreements are recognised:
4.1.1 Occupational rent as part of a purchase of a home
4.1.2 Renting from a private landlord
4.1.3 Renting from municipalities
4.1.4 Renting from family/friends
4.1.5 Compulsory occupation of State housing in terms of PSCBC Resolution. 3 of 1999
4.1.6 Voluntary occupation of other housing as provided for in departmental policy of PSCBC Resolution. 3 of 1999.
4.2 No rental agreement entered into between an employee and his/her spouse, one or both of whom is/are the only registered titleholder(s) of the housing concerned or part of the housing that they occupy, will be recognised for the purposes of the housing allowance scheme.
4.3 No verbal/informal rental agreement will be recognised under the housing allowance scheme. The WCED has an abridged sample rental/lease agreement which will be available to employees on request. This agreement can be adapted according to the needs of the respective parties. Please note that the WCED will not accept any liability for any damages whatsoever that arise from the composition of this contract.
4.4 A housing allowance of R 100.00 per month is payable with effect from 1 January 2005 to employees who rent housing.
5. OCCUPANCY REQUIREMENTS
5.1 The home in respect of which an employee is receiving a benefit in terms of the new housing allowance scheme must be occupied by the employee and/or his/her immediate family, except in instances where he/she or the immediate family cannot occupy the home temporarily for reasons beyond their control.
5.2 The home in respect of which an employee received a homeowner’s allowance in terms of the previous system must be occupied by the employee and/or his/her immediate family, which includes dependants who for the most part rely on the employee for their maintenance.
5.3 The occupancy requirements may only be waived in the case of an employee who
5.3.1 has been transferred abroad for official duties.
5.3.2 is performing sessional duties.
5.3.3 is compelled to occupy State housing and cannot occupy her/his own home.
6. PAID-UP OR NO BOND/HOME LOAN HOUSES
6.1 Homeowners who, prior to 29 September 2004, owned a home that was fully paid-up or on which there is no bond/home loan, qualify for a housing allowance of R 100.00 per month with effect from 1 January 2005.
6.2 When an employee’s bond/home loan is paid-up on the home he/she and/or his/her immediate family is/are occupying, the WCED will continue to pay the housing allowance for as long as the other qualifying requirements are met.
7. GENERAL
7.1 All the relevant application forms for the different housing benefits are available on the WCED website. The employee concerned must complete the applicable forms and return it then to the WCED Head Office, with the necessary proof.
7.2 The state guarantee scheme, as prescribed in paragraph 3 of Circular 0174/00, remains unchanged. Employees who have had the same property for at least five years, bought with a state guarantee, should apply in writing to their financial institutions for the release of the guarantee to avoid any implications when leaving the service of the WCED.
7.3 All employees who were in receipt of a homeowner’s allowance before 29 September 2004 must take note that their allowance has been converted to a housing allowance.
7.4 Employees must note that they will receive the housing allowance only from the month in which he/she submitted her/his application accompanied by all the supporting documentation. A concession has been granted for this provision to be waived until 30 June 2006.
8. Kindly bring the contents of this circular to the notice of all those concerned.


SIGNED: J.H. HURTER
HEAD: EDUCATION
DATE: 2006:03:27