Sectoral Performance Audit
The government’s housing program was aimed at expanding shelter security to every Filipino family through the grant of security of land tenure and provision of socialized housing to landless and homeless urban poor families and low-cost/economic housing units for low-salaried employees.
In line with this objective, the government adopted five essential strategies in solving the problem. These consist of making the housing market more efficient, creating a sustainable housing finance system, accelerating assistance and provision of security of tenure for informal sector, making housing loans available and affordable to low salaried members of the formal sector and strengthening the shelter delivery system, and accelerating the localization of housing and development efforts.
For CYs 2001 to 2004, the government estimated that the total housing needs would be 3.624 million units composed of total backlog of 2.073 million and new household requirements of 1.551 million. The great need for housing is most felt in the country’s thickly populated regions of the National Capital Region (1.06 million units), Southern Tagalog (0.6 million units) and Central Luzon (0.3 million units).
Against a total housing need of 3.624 million units for the four year period, the housing sector is targeting to accomplish 1.2 million units. This translates to an annual target of 300,000 shelter security units in the form of a lot, a house or a house and lot package broken down as follows:
While the implementation of the government’s housing program is continuous, it seems that such efforts were not sufficient to ensure accessibility of the socialized housing programs to the poor and low-income families, especially those located in the urban areas. This condition was acknowledged by our planners as manifested in the Medium -Term Development Plan for CY 2001-2004. It was disclosed therein that the bottom 40 per cent of both urban and rural households were forced to resort to informal housing or settlements in congested areas under poor living conditions due to poverty.
The audit was conducted to assess the effective implementation of the housing program in addressing the needs of the homeless taking into consideration the following:
AUDIT SCOPE AND METHODOLOGY
The audit covered the review of the implementation of the housing program by the following agencies using CYs 2003 to 2004 data:
The performance of selected key shelter agencies were assessed using the following audit criteria:
To meet the audit objective, the team performed the following procedures, among others:
The audit was conducted from July 7, 2004 to February 8, 2005 in compliance with COA MS/TS Office Order No. 2004-023 dated June 10, 2004.
The government’s housing program could not be considered effectively implemented due to its inability to meet the targeted 1.2 housing needs, weak coordination among housing agencies and inadequate policies for land banking and for disposition/distribution of available units.
Of the total estimated housing needs of 3.6 million units, 1.2 million were targeted to be accomplished during CYs 2001-2004. Out of the total target, only 892,216 units were reportedly accomplished as of September 2004 due to weak coordination among the housing agencies. This reported accomplishment may even be considered bloated as HUDCC failed to establish performance indicators to accurately measure overall performance as evidenced by double or triple reporting of a single accomplishment. On the other hand, HDMF’s indicators vary from year to year and report to report resulting in inaccurate data and hindering comparative analysis of performance.
Not all completed units were distributed/awarded or disposed of. An accumulated total of 66,694 units remained undisposed or undistributed by the implementing agencies as of September 2004 due to inadequate policies for disposition of available units.
In the case of HDMF, out of the total acquired assets of 26,818 units, 19,179 remained on hand. These were part of the reported accomplishment of 226,605 units for CYs 2001-2004 representing 25.40% of the overall sector’s accomplishment. Of the 19,179 undisposed units, documentary requirements of 8,571 units are still being completed while disposition papers of 855 units are already in process. The disposition of acquired assets were adversely affected by HDMF’s strict policies on disposition of acquired properties.
The collection performance of HDMF could not also be considered satisfactory. Only about 61% of the outstanding accounts are updated with the rest on arrears from six months to over 3 years adversely affecting its investment portfolio and ability to provide housing assistance to other qualified members.
As the housing program is one of the priority concern of the government, the team recommended measures under Part V of the report to improve the performance of the housing sector.
MANAGEMENT’S REACTION TO AUDIT OBSERVATIONS
The results of the audit were forwarded to the President and CEO of HDMF on May 26, 2005 for comments. In general, HDMF supports some findings and recommendations of the team and submitted justifications on some other issues raised in the report. Their comments were incorporated in the report together with the team’s rejoinder.