National Housing Authority Housing Programs

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National Housing Authority Housing Programs (PAO-2023-04)

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Date added: November 21, 2023

What COA Found

The NHA did not achieve its vision of providing housing needs to 50% of homeless low-income families (based on the 2011 census) by end of 2019. It completed only 455,444 housing units or 81% of the target leaving 104,435 or 19% of the intended beneficiaries without housing units. NHA is also not on track to attain its target by end of 2025 of addressing 23% of the housing needs of homeless, marginalized, and low-income families. The issues encountered in the implementation of housing projects which affected the start and completion of housing units were due to internal and external issues, such as weak forward planning and targeting, several revisions of plans/estimates, inclement weather, site condition, and issues with the developer, LGUs and other agency, among others.

On the other hand, out of the 279,428 target units for 2015 to 2022, only 164,593 units, or 58.90%, amounting to ₱39.40 billion, were sold and disposed of. NHA could not achieve its sales and disposition target due to internal and external issues that affected its purpose of immediate provision of housing units. It will also result in the eventual deterioration of the housing units if not immediately sold or disposed of.

The NHA has a low collection efficiency rate (CER) on Residential Accounts. NHA's target CERs from 2015 to 2022 ranged from 35% to 56%; however, its actual CERs only went from 20% to 50%. Only in 2015 and 2022 did NHA achieve the target CERs. In addition, some NHA Housing Programs were given partial cost recoverability or full grants, which does not align with Section 4 (e) of RA No. 7835, where NHA implements cost-recoverable socialized housing projects.

A review of critical processes and policies of NHA found that there were established policies and procedures in administering the programs; however, certain mechanisms need to be revisited because some are deficient and result in ineffective implementation of its programs and operations.

For instance, in selecting beneficiaries, NHA has been lenient in evaluating applicants against eligibility criteria and submission of documentary requirements. Some applicants failed to meet eligibility criteria, and some submitted incomplete documents and/or application forms with incomplete data yet were still awarded housing units. For AFP/PNP Housing/GEHP, the income level in determining the beneficiaries' eligibility was not defined and considered. This resulted in awarding housing units to high-salaried government employees and even OFWs. This defeats the program's purpose of providing housing units to low-salaried members.

Regarding the conditionalities of awarding home lots, NHA has no monitoring and does not strictly impose the sanctions embodied in NHA MC Nos. 2374 and 2506, resulting in beneficiaries' continued occupancy of the housing units without fear of being sanctioned for violating the policies and procedures of NHA.

Regarding the construction of housing units, the percentage of timely implementation of the projects was low. Several reasons for the approved work suspensions and contract time extension could be addressed as early as the project's planning stage. Of the 286 completed projects, 29, or 10.14%, were completed on time based on the original contract duration. While 173 projects with 69,737 units, or 60.49%, have several contract time extensions, work suspension orders, and corresponding work resumption orders.

With the opportunities for improvement identified in this audit, NHA needs to hasten strategies to improve its achievement of performance targets in line with the goals and objectives of housing programs.

 

Why COA did this study

NHA’s charter will expire in July 2025, and several House and Senate Bills were filed seeking its renewal for another 50 years. The Committee on Housing and Urban Development requested COA to conduct an agency-based audit of the NHA Housing Program spanning from 2015 to 2022. Within this period, ₱65.43 billion has been budgeted for housing programs. Likewise, 341,407 units were completed, and 204,726 units were sold/distributed to the beneficiaries. However, concerns in various media outlets about delayed production, uncompleted projects, slow turn-over of housing units to beneficiaries, low collection efficiency, and use of substandard construction materials affected the NHA’s efficiency and effectiveness in achieving the goals and objectives of its housing programs.

Given this, we audited the NHA’s housing programs to determine the extent to which (a) the NHA achieved its vision of providing housing needs to 50% of homeless low-income families (based on the 2011 census) by 2019 and 23% (428,121 units) by 2025; and (b) the NHA administered the programs following the established policies, regulations, rules, and procedures.

We reviewed the program documents and accomplishment reports from 2015 to 2022; administered surveys on selected beneficiaries; performed technical inspections on selected housing projects, interviewed key management officials, community associations, contractors, and local government units’ (LGUs) officials involved in the implementation of the housing programs; performed walkthrough of target setting (production, program costing, sales, and disposition, collection, and beneficiaries), selection of beneficiaries, information dissemination, collection, and monitoring and evaluation (production, sales and disposition, and collection) processes and procedures; and assessed the extent of stakeholders’ coordination in the implementation of the program.

 

What COA recommends

COA recommends that the NHA revisit and evaluate its action plan to determine if it effectively addresses the issues and challenges in housing production, create a work plan and ensure its implementation, ensure proper coordination and communication within NHA, compliance with readiness criteria on prioritizing the projects and adopt the past performance in the target setting, establish a standardized template for addressing production issues and recommendations, and ensure that the ROs provide in-depth analysis and recommendations to address production issues adequately.

Also, COA recommends that NHA address identified issues/deficiencies/problems encountered in the implementation of the housing programs and its operations, such as (1) ensuring and requiring submission of all documentary requirements for every project and evaluating applicant’s eligibility based on established criteria; (2) re-strategize to improve collection efficiency; (3) package the housing project with complete essential services and facilities; and (4) put in place a comprehensive planning and systematic monitoring to address new and existing implementation gaps adequately.