Description
Within this brief information regarding city of joburg property company (soc) ltd jpc.
CITY OF JOBURG PROPERTY COMPANY SOC LTD
BUSINESS PLAN 2012/2013
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339999
City of Joburg Property Company (SOC) LTD
“JPC”
CITY OF JOBURG PROPERTY COMPANY SOC LTD
BUSINESS PLAN 2012/2013
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Sign Off:
Managing Director Name: ……………………..…………………………………………….
Signature of MD:……………………………………………………………………………….
Signature of ED: ………..…………………………………………………………………….
Signature of MMC: ……………………………………………………………………………
Date: ………..…………………………………………………………………………………..
Receipt & Review:
Signature of Finance Officer: ……………………………………………………………
Signature of CSU Representative: ……………………………………………………..
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TABLE OF CONTENTS
1. INTRODUCTION 4
2. EXECUTIVE SUMMARY 7
3. STRATEGIC ANALYSIS 11
4. STRATEGIC FOCUS AREAS 13
5. FINANCIAL IMPACT 18
6. HUMAN CAPITAL 25
7. RISK ASSESSMENT 32
8. APPENDIX 42
Glossary 44
ANNEXURE 1: 2012/13 SCORECARD
ANNEXURE 2: SDBIP
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1. INTRODUCTION
Joburg Property Company is the Municipal Entity created to develop and manage Council-
owned properties for the purpose of maximising both social and commercial opportunities for
the Council in the short and longer term. The overall nature of business is the Management of
the CoJ property portfolio. JPC therefore has a dual mandate to generate significant financial
returns for the City by maximising the economic potential of the property portfolio, as well as
contributing towards the City’s social upliftment goals.
The current Service Delivery Agreement requires JPC to provide, amongst others, the following
services:
? Property strategic planning and property advice
? Financial, accounting and secretarial services for the property portfolio – JPC currently
provides financial and accounting services and only part of secretarial services
? Property register maintenance
? Council property portfolio information
? Property maintenance –currently at a small scale
? Letting (including outdoor advertising)
? Servitudes, encroachments and access rights
? Disposal and acquisition of properties
? Development of properties
? Ad hoc property management services and/or development services and/or other services
JPC has positioned itself as the managing agent of the property assets of the Council,
responsible for maximising the social, economic and financial value of the CoJ’s total property
portfolio and enhancing the efficiency of its use as “The People’s Property Company”.
1.1. VISION AND MISSION
1.1.1. Vision
To provide property management, property development, property asset management services,
land strategy, acquisition and stewardship in order to maximise the social, economic and
financial benefit to the CoJ and support the CoJ’s delivery objectives on a cost competitive
basis.
1.1.2. Mission
JPC is the manager of the property assets of the City of Johannesburg, responsible for
maximising the social, economic and financial value of the CoJ’s total property Portfolio and
enhancing the efficiency of its use. JPC will provide asset management, property management,
property development services and land strategy, acquisition and stewardship to the CoJ, as
well as interact with the general public in respect of this Portfolio. JPC will support the
achievement of the CoJ’s strategic priorities, including economic and social development and
the service delivery objectives of the CoJ.
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1.1.3 Core values
Values have become an ethical foundation for all organizations and are therefore fundamental
to the JPC’s success. Such values are not just important but crucial to the overall ascendancy
of JPC. The following values were identified and adopted by JPC:
? Professionalism,
? Accountability,
? Responsibility,
? Customer Service and
? Trust
1.2. MANAGEMENT AND ORGANISATIONAL STRUCTURE
The current approved organisational structure is divided into the following three (3) core
business units and six (6) main support units with 154 positions (both filled and vacant posts). It
should however be noted that the current approved structure does not cater for the Facilities
Management function that will be incorporated into JPC following the Institutional review:
Current Core Business units
? Property Asset Management - This entails the strategic management of the City’s property
portfolio which includes fixed asset register management, physical verification of city fixed
assets, property sector and economic research, strategic plan and property advise,
compilation of asset management plans, portfolio sector and economic returns and council
property information. The main goal is to ensure maximisation of portfolio returns in line with
JPC’s social and economic mandate and to unlock potential economic and social base of
developed and underdeveloped areas of the City whilst increasing sustainable revenue
streams and asset value of CoJ‘s property.
? Property management -This function involves obtaining and maintaining value from the
property portfolio by effectively administering & leasing, acquiring and selling and lastly
ensuring maintenance of the property and management of servitudes and encroachments
and facilities management.
? Property Development -Property development aims to increase value of the COJ’s land
portfolio and generate long term recurring income for COJ, by facilitating development of
Council owned land by third party private sector developers. Development facilitation
includes project packaging, project preparation, development contracting & actual
development facilitation in line with the City’s Growth and Development Strategy.
Support Units
? Human Resources
? Corporate Services (previously Stakeholder Management)
? Finance
? Office of the COO – this is a new unit headed by a Chief Operations Officer consisting of
Project Management Office, Transformation, Legal Services and Land Regularisation)
? Risk Management
? Company Secretariat
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The following is the current approved high level organisational structure of J PC:
MANAGING DIRECTOR
ASSET
MANAGEMENT
PROPERTY
MANAGEMENT
HUMAN
RESOURCES
FINANCE
CORPORATE
SERVICES
PROPERTY
DEVELOPMENT
Executive
Secretary
Strategic/Executive
Support
Company Secretary
OPERATIONS
OFFICE
Risk Manager
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2. EXECUTIVE SUMMARY
To fulfil its mandate JPC sees as a core part of its business to support and encourage
investment and growth, but also to address socio-economic disparities and legacies of
discrimination and inequality.
Financial and Budgetary Environment
The proposed and allocated budget for 2012/13 is as follows:
REQUESTED ALLOCATED
CAPEX
‘000
OPEX
‘000
CAPEX
‘000
OPEX
‘000
JPC R2,350 R74,610 NIL R74,610
CoJ Portfolio R84,650 R49,100 R18,000 R44,175
Impact of under allocation
The impact of under allocation results in the following:
? Facilities management will not be effectively implemented resulting in dilapidated Council-
owned property;
? Progress in Site development and site preparation will decline resulting in lack of realisation
of the value of land;
? Job creation will be negatively impacted and
? Negative impact on infrastructure development and thus reducing the value of the City’s rate
base.
Some of JPC’s projects are unfunded and they are usually rolled over. The magnitude and the
size of the projects means that the timeframe to completion is between 3 and 5 years before a
completed development can realise a value. Over the years, JPC has attracted more than R8.5
billion worth of investments but in order to realise the economic value of these investments it is
critical to proceed with and finalise them, as they impact on job creation, infrastructure
development and improved rates base.
Company contribution to Master Programmes and IDP Sub-programmes
JPC forms part of the City’s Economic growth cluster and the company endeavours to
contribute, through its mandate, towards the economy that is inclusive, liveable and prosperous
for all; linked to this outcome are the following outputs: Job intensive economic growth;
Expanded and refined support to small businesses, and greater facilitation of the potential
offered by entrepreneurs and the informal economy; Increased competitiveness of the local
economy – enabling and attracting investment; A smart City of Johannesburg, which is able to
deliver quality services to citizens in an efficient and reliable manner.
The following sub-programmes are linked to above-mentioned outputs:
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Table 1: IDP Sub-Programme and Performance Targets for 2012/13
2012/16 IDP Sub- programme Projects 2012/13 Performance Target
1. Facilitation of the creation of
jobs in property portfolio
projects on Council owned land
– 1085 jobs to be created
OUTCOME: Reduction in
unemployment & an increase in
economic growth
Site Preparation; Fixed Assets physical
verification; Facilities Management
1085 jobs
2. Enterprise & Property skills
development to emerging
industries
OUTCOME: Economy that is
inclusive of all
Property incubator project Launch the incubator
programme – 5 companies
incubated
Property skills project Launch the property skills
programme
3. Promote Joburg as a sort
after property investment
destination
OUTCOME : Growth in the
economy
African property summit project Complete the event plan
(including funding, venue,
service provider, etc.)
4. Branding strategic property
projects & City’s strategic land
parcels
OUTCOME : Attracting investors
& thus improving on economy
Key strategic projects, properties & land
parcels
Brand 15 land parcels;
Brand 8 strategic buildings;
Brand 2 construction sites
5. Council-owned property
management and maintenance
OUTCOME: Job creation &
completeness of CoJ Fixed Assets
Asset management and maintenance Complete the verification of
CoJ’s properties
Conduct highest and best use
analysis on CoJ properties
6. Sustainable property
economy through expediting the
transfer of properties
OUTCOME: Economic growth that
includes all & redressing the
inequalities of the past
SOWETO Land regularisation project Transfer 150 properties;
Appoint a service provider and
Commence with the audit of
vacant non-residential
properties
7. Revenue maximisation
utilising City’s property portfolio
OUTCOME : Economic growth &
effective service delivery
(upgrading of infrastructure)
Land sales R50 million received for land
sales
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8. Leveraging of private sector
investment in property portfolio
projects –
NOTE: Leveraging is equivalent
to investment attracted and this
is recognised when construction
starts
OUTCOME: Economic growth
Third party investment R220 million investment
NOTE: The following deliverables, prioritised, are dependent on budget:
1. Sub-programme 5 – Physical verification of Council owned land is 100% dependent on
budget – no verification will be conducted. Non-allocation of budget will result in CoJ
receiving a qualified audit report due to incompleteness of fixed assets;
2. Sub-programme 8 – Potential investment through underlined projects will not
materialised due to CoJ budget cuts
3. Sub-programme 3 – Positive contribution to the City of Johannesburg’s economic
growth target through hosting the African property Summit;
4. Sub-programme 1 – Activities /developments that will result in the creation of jobs
5. Sub-programme 6 – Land Regularisation programme and
6. Sub-programme 2 – Transformation of the property industry through skilling of the
emerging industries
Inter-governmental initiatives and collaboration with other sectors:
Collaboration with other Municipal Owned Entities (MOEs), City Departments, provincial
departments, national departments and the private sector is critical to delivering quality
services. JPC identifies and engages private sector partners for the implementation of capital
projects, which contribute to the economic growth of the City, as per the Economic
Development Sector plans. Our engagement with private sector has in the past attracted
investments of more than R8, 5 billion; however the company is looking at attracting more
investments in future.
Regulatory issues:
The JPC is governed primarily by the Municipal Systems Act (as amended) and Municipal
Finance Management Act No 56 of 2003 (MFMA) and its various regulations. The JPC has
further adopted the Supply Chain Management Policy for Land (SCMPL) in compliance with
Section 111 of the MFMA which provides a framework for the alienation and granting of rights to
use, control or manage of municipal capital assets. The JPC was bound by the Companies Act,
1973. This Act has been replaced by the new Companies Act 2008, which came into operation
in 2011 and the company shall ensure compliance thereto.
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Dependency Matrix:
To deliver its mandate, JPC works hand in hand with the following Departments/MOEs:
Department/MOE Dependency - assisting JPC in the managing and developing of Council-
owned properties by
Property Development and value
creation
1. department of Planning and Urban
Management
2. Transportation Department /
Johannesburg Roads Agency
(JRA)/ City Power/Joburg Water
3. Environment Department
Rezoning and subdivision of property; Timeous approval of building plans;
Timeous approval of outdoor advertising in terms of by laws; Timeous
establishment of townships; Implementation of the Land Strategy and
Completion of Geographical Information System (GIS) and Land
Information System (LIS)
Avail bulk services; Timeous connection of bulk infrastructure to property
developments
Timeous assessments of environmental management plans and impact
assessments
Land Requirements
1. All CoJ departments and MOEs
Ensuring compliance of Sec 14(2) of the MFMA by obtaining comments
from departments and MOEs prior to leasing or alienating properties;
Support land and property requirements from departments and MOEs to
ensure successful completion of asset management plans; Ensuring that
strategic land parcels are alienated or leased in line with the Supply Chain
Management policy for land and acquisition is done in terms of the Land
Strategy and Spatial Development Frameworks; Ensuring specialised
asset, like parks, will be ring fenced for MOEs to perform facilities
management;
To ensure JPC is provided with all land requirements to enable the ring
fencing of land parcels intended for service del, social purposed, service
del purposes, environmental needs
Management of the property portfolio
and revenue generation
1. Revenue Department
2. Group Finance Department
o Issuing timeously release of clearance certificates for properties
which have been alienated.
o Ensure availability of funds for the maintenance of the asset
register in line with good governance
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3. STRATEGIC ANALYSIS
PEST analysis
The property environment, within which JPC operates, is affected by the macro-environment
factors, such as political (and legal) forces, economic forces, socio-cultural forces and
technological forces, as follows:
Political (incl Legal) factors Economic factors
Regulations
? Introduction of the Municipal Asset Transfer
Regulations, 2008 which regulates the
transfer and permanent disposal of non-
exempted capital assets by municipalities
and municipal entities in order to facilitate
the enforcement and administration of
section 14 (2) of the Municipal Finance
Management Act 56 of 2003, which is to
attain a council resolution before the
alienation of any council owned properties.
These regulations hinder the process of the
City in the alienation of land because of
time delays caused by compliance
? Environmental regulations and protection -
National Environmental Management Act,
1998
? The introduction of the National Credit Act
and the global economic meltdown
significantly impacting on the growth and
demand for residential, commercial and
industrial properties
? Formalities in respect of Leases Act, 1969
? The property portfolio is adversely affected by
downturns in the global market
? Fluctuating interest rates also have an impact on
the property market
? Economic growth and investor confidence affects
the property market
Socio-cultural factors Technological factors
The skewed disposal income in different
regions will adversely impact the property
transactions in areas where the levels are low.
Innovative construction methods should be
investigated to ensure cost reduction
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SWOT analysis
The company is currently in the process of implementing the turnaround strategy which will
improve operational efficiencies and revenue streams. Highlighted below are the SWOT
elements that would have an impact on the effective implementation of the turnaround strategy.
Internal Strengths Weakness
? Good and reliable top management;
? Extensive Experience in property
management, development, asset
management and facilities;
? Solid understanding of legislation and
ability/commitment to work within in;
? Ability to use the strength of property
to leverage investment;
? Island of excellent in property
management;
? JPC is the sole agent of the CoJ with
a mandate to manage Council owned
properties on behalf of the City in
terms of the 25 year SDA with the
City.
? Missing skills (middle
management and lower
levels) within the
organisation;
? Inadequate funding to
deliver on mandate;
? Cumbersome internal land
transfer processes;
? Inability to maintain the
property portfolio due to
JPC’s limited mandate
regarding security and
facility management
services;
? Overlaps with City
Departments/MOEs and
unclear mandate;
? Dependency on City
departments /MOEs
resulting in delays in
implementation of property
strategies.
External Opportunities Threats
? Maximisation of revenue through the
outdoor advertising portfolio and creation
of a property fund;
? Increase the value of the property
portfolio by purchasing strategic land for
land banking;
? International investment: investigating
alternative sources of revenue which can
be generated from the property asset;
? Optimise revenue from effective highest
and best use analysis and effective
monitoring and evaluation of leases (post
lease audit).
? Vandalism to property
portfolio;
? Land invasions & illegal
occupation of land parcels;
? Fraudulent land sales;
? Encroachment on JPC’s
mandate by other MOEs;
? Cumbersome CoJ’s land
approval processes for land
transactions.
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4. STRATEGIC FOCUS AREA
4.1. IDP Sub-Programme Implementation Plan
Table 2: IDP Sub-Programme Annual Implementation Plan 2012/13
N
o
.
2012/16 IDP
sub-
programme
Projects Key Project
Performance
Indicators
Baseline 5-year Target 2012/13
Target
Cumulative performance targets
(Tangible, measurable targets that fulfil requirements of being SMART)
Q1 Q2 Q3 Q4
1 Facilitation of the
creation of jobs
in property
portfolio projects
on Council
owned land –
NOTE: Job –
person employed
for any length of
time per project
Site
Preparation;
Fixed Assets
physical
verification;
Facilities
Management
Create jobs utilising
the CoJ property
portfolio
None 3100 jobs
150 jobs created
520 jobs created
840 jobs created
1085 jobs created
1085 jobs in year
2012/13
2 Enterprise &
Property skills
development to
emerging
industries
Property
incubator
project
Develop and Launch
the incubator
programme for
emerging industries
None 100% rolling out
– 20 companies
incubated
Launching of the
incubator
programme by
end June 2013 –
5 companies.
Continue
conducting
workshops
Finalise Strategy
Document
Obtain Board Approval
& Launch the
programme – 5
companies incubated
Property skills
project
Launch & roll out the
property skills
programme for
emerging industries
None 100% rolling out
of the property
skills
programme
Launching &
rolling out of the
property skills
programme by
end June 2013.
Launch the property
skills programme
Roll out the property skills
programme
Ongoing roll out Ongoing roll out
3 Promote
Joburg as a
African
property
Complete the event
plan (including funding,
venue, service
None Hold a
successful
African Property
Approved
Property summit
Appoint service
provider, establish
event’s planning
Draft event-plan, Finalise event plan,
Source funding, secure
Get approval for event
plan, Marketing and
communications plan;
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N
o
.
2012/16 IDP
sub-
programme
Projects Key Project
Performance
Indicators
Baseline 5-year Target 2012/13
Target
Cumulative performance targets
(Tangible, measurable targets that fulfil requirements of being SMART)
Q1 Q2 Q3 Q4
sort after
property
investment
destination
summit project provider, etc) summit plans committee, venue, set-up dedicated
website, marketing
campaign, publication,
promotions
4. Branding
strategic
property
projects &
City’s strategic
land parcels
Key strategic
projects,
properties &
land parcels
Brand land parcels;
strategic buildings and
construction sites
None Brand 60 land
parcels;
Brand 30
strategic
buildings;
Brand 5
construction
sites
15 land parcels
8 strategic
buildings
2 construction
sites
3 land parcels
2 strategic buildings
1 construction site
8 land parcels
4 strategic buildings
1 construction site
13 land parcels
6 strategic buildings
15 land parcels
8 strategic buildings
5. Council-owned
property
management
and
maintenance
Asset
management
and
maintenance
Verify Council-owned
property and maintain
the fixed asset register
1%
verification of
council
owned
property
Verify 100%
Council owned
property
100%
completeness of
the verification of
Council owned
property
Verify 10% of
properties
Verify 60% of properties Verify 90% of properties Verify 100% of
properties
Conduct highest and
best use analysis on
CoJ properties
Ongoing Ongoing highest
and best use
analysis
Conduct highest
and best use
analysis on 300
CoJ properties
50 properties 100 properties 250 properties 300 properties
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N
o
.
2012/16 IDP
sub-
programme
Projects Key Project
Performance
Indicators
Baseline 5-year Target 2012/13
Target
Cumulative performance targets
(Tangible, measurable targets that fulfil requirements of being SMART)
Q1 Q2 Q3 Q4
6. Sustainable
property
economy
through
expediting the
transfer of
properties
SOWETO
Land
regularisation
project
Transfer properties in
the Greater Soweto
Area, the Greater
Orange Farm Area,
Ivory Park and
surroundings as well
as Alexandra.
631 actual
transfers
and/or
allocations of
properties
2000 properties
to be transferred
Transfer 150
properties to
beneficiaries
Transfer 25
properties to
beneficiaries
Transfer 75 properties to
beneficiaries
Transfer 100 properties
to beneficiaries
Transfer 150
properties to
beneficiaries
Conduct Audit of
vacant non-residential
stands /properties -
None 100%
completion of
the audit of
vacant non-
residential
properties
30% completion
of the audit
Appointment of
service provider
10% completion of the
audit
20% completion of the
audit
30% completion of the
audit
7. Revenue
maximisation
utilising City’s
property
portfolio
Land sales and
land
acquisitions
and completion
of
developments
Rand value of land
sales, acquisitions &
completion of
developments
New Indicator R200 million R50 million of
land sales,
acquisitions &
completion of
developments
10 million received R20 million received 45 million received R50 million received
8.
Leveraging of
private sector
investment in
property
portfolio
projects -
investment is
realised on
construction
Public
Waterfront
project
Third party
investment on COJ
property
R215 million R6.4 billion
investment
R220 million
investment
R25 million R95 million R165 million R220 million
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4.2 Day-to-day Operations
Table 2: Operational Plan- day-to-day KEY activities
Operational Plan: Day-to-day Operations
IDP Sub-
Programme that
an Operation is
likely to
Contribute
Towards
Key
Operations
Key
Performance
Indicators
2012/13 Target Baseline Estimated
budget R’000
Cumulative Quarterly Performance Targets
Q1 Q2 Q3 Q4
Fixed asset register
management
Data cleansing,
Alignment of asset
register to LIS
100% Migration to LIS
None R1, 000 20% migration 40% migration 70% migration 100% migration
Strategic planning and
property advise –
Portfolio performance
& planning
Monitor and evaluate
finance performance of
the improved properties
and mitigate risk of
negative cash flow
Annual Financial
analysis reports
(Income statements of
improved CoJ
properties)
None R1.500 Assess JPC Portfolio
strategy into regions
focusing on renewal
/property development
plan and letting plan.
Assess the portfolio
according the regions
/property types.
Draft a new letting and
renewal list /sales and
disposal list.
Assess the process
and procedure manual
and template used for
renewal and letting
application.
Assess the debtors’
collection and arrears
age analysis.
Assess the legal status
of tenants handed over
Implement a portfolio
strategy according to
regions and set
budgets and targets
for property
management and
development
Create a vacancy
schedule.
Implement and
advertise a vacancy
schedule
Request Marketing
Department to
advertise the
properties through TO
LET /FOR SALE
BOARDS.
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Create a vacancy
schedule
Site identification,
project identification &
Preparation of
Properties for
Development
Land preparation Preparation of 5
properties
R10, 000 Appointment of
professional teams
and submission of
application
Circulations of
development
applications
Finalisation of
comments
Approval of
applications
Awarding of
Development
Agreements for
properties
Give awards Award development
contracts to the value
of R500 00M
R5, 000 Obtain Section 14(2)
approvals for release
of properties
Prepare RFP
documents and
Advertise
Bid evaluation and
EAC awards
Signature of
Contracts
Facilitation and
monitoring of
development
Achieve investment of
R500 M in construction
value and create 1500
jobs
R5, 000 Resolution of
development obstacles
and monitoring of
development in terms
of signed contracts
Resolution of
development obstacles
and monitoring of
development in terms
of signed contracts
Resolution of
development obstacles
and monitoring of
development in terms
of signed contracts
Resolution of
development
obstacles and
monitoring of
development in terms
of signed contracts
Leasing, acquisitions
and sales transactions
Update Property Lease
register and monitor
leases; land sales
R2, 000 Identify and package
properties for lease,
sale and
developments
Identify and package
properties for lease,
sale and
developments
Identify and package
properties for lease,
sale and
developments
Identify and package
properties for lease,
sale and
developments
Maintenance
management
Facilities management
for the City property
Facilities management
plan for the CoJ
owned properties
R3, 000 Maintenance and
cleaning of corporate
buildings, other
regional offices, public
conveniences
Maintenance and
cleaning of corporate
buildings, other
regional offices, public
conveniences
Maintenance and
cleaning of corporate
buildings, other
regional offices, public
conveniences
Maintenance and
cleaning of corporate
buildings, other
regional offices,
public conveniences
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5. FINANCIAL IMPACT
5.1 Key Operations by general Cost Category
Operational Expenditure
Table 4: Operational Expenditure
Key Operations Financial Impact – ZAR ‘000
S & W R & M CS GE Other Total
Salaries and wages
54,227
17,230
3,153 74,610
Etc.
Totals 54,227
17,230
3,153 74,610
The above indicates the anticipated expenditure of R 74.610 million for the year ended 30 June 2013. Salaries make up 69% of the total
expenditure budget and remaining refers to general expenses which contain fixed costs such as rental, subscriptions, and lease agreements
that JPC had entered into.
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Key Operations by general Cost Category
2008/09 2009/10 2010/11 Current year 2011/12 Medium Term Revenue and Expenditure Budget
Audited Audited Audited
Original
Budget
Adjusted
Budget
Full Year
Forecast
Budget Year Variance Estimates Estimates Estimates
Outcome Outcome Outcome 2012/13 % 2013/14 2014/15 2015/16
R 000 R 000 R 000 R 000 R 000 R 000 R 000 R 000 R 000 R 000
REVENUE
Interest earned - external investments 24 8 143 8 10 10 10 0.0% 11 12 12
Interest earned - outstanding debtors 1 441 2 086 6 259 4 255 4 255 -100.0%
Licences and permits 0.0%
Agency services 40 687 18 664 29 445 50 387 38 589 38 589 32 119 -16.8% 30 123 31 985 33 881
Operating grants & subsidies 0.0%
Other Revenue 14 713 68 699 23 672 39 635 35 167 35 167 37 415 -6.4% 36 991 37 166 37 346
Gain on Disposal of PPE
0.0%
DIRECT OPERATING REVENUE 56 865 89 457 59 519 90 030 78 021 78 021 69 544 -16.6% 67 125 69 163 71 239
Internal Transfers
Interest Income (Sweeping Account) 0.0% 31 32 34
Operating Grants & Subsidies from (COJ) 10 516 537 3 509 5 066 0.0% 18 054 20 958 24 020
Total Internal Transfers 10 516 537 3 509 5 066 0.0% 18 085 20 990 24 054
TOTAL OPERATING REVENUE 67 381 89 994 59 519 93 539 78 021 78 021 74 610 3.2% 85 210 90 153 95 293
CITY OF JOBURG PROPERTY COMPANY SOC LTD
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EXPENDITURE
Employee related costs 31 778 37 653 42 342 59 153 51 498 51 498 54 227 5.3% 57 371 60 700 64 160
Depreciation & asset impairment 1 247 1 191 1 082 1 500 3 222 3 872 1 584 -38.0% 2 107 2 229 2 356
Interest Paid : External Borrowings 382 314 265 391 650 650 413 -100.0%
General expenses 16 469 16 157 23 023 25 332 17 230 16 580 17 758 0.0% 17 575 18 594 19 654
Loss on disposal of PPE 385 350 103 0.0%
DIRECT OPERATING EXPENDITURE 50 261 55 665 66 815 86 376 72 600 72 600 73 983 1.2% 77 053 81 523 86 170
Internal Transfers
Interest Expense (Sweeping Account) 137 0.0%
Internal Charges (ME's / Core) 603 624 1 095 1 095 1 095 627 5.6% 1 223 1 294 1 368
TOTAL OPERATING EXPENDITURE 50 864 56 426 66 815 87 471 73 695 73 695 74 610 1.2% 78 276 82 817 87 538
OPERATING DEFICIT/ (SURPLUS) (16 517) (33 568) 7 296 (6 068) (4 326) (4 326)
37.0% (6 934) (7 336) (7 755)
OPERATING DEFICIT/ (SURPLUS) (16 517) (33 568) 7 296 (6 068) (4 326) (4 326)
37.0% (6 934) (7 336) (7 755)
Less Tax 4 310 11 484 (1 839) 1 760 18 18 -100.0%
OPERATING DEFICIT/ (SURPLUS) - after tax (12 207) (22 084) 5 457 (4 308) (4 308) (4 308)
37.6% (6 934) (7 336) (7 755)
The CAPEX allocated to JPC and Portfolio is as follows:
REQUESTED ALLOCATED
CAPEX
‘000
CAPEX
‘000
JPC R2,350 NIL
CoJ Portfolio R84,650 R18,000
CITY OF JOBURG PROPERTY COMPANY SOC LTD
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The list below reflects the core projects and is not necessarily in order of priority.
Table 5: Key Sub programme costing
GDS output / Other IDP Programme /
Activity
Project Baseline 5 Year Target Target for -
2012/13
2012/13
R 000
Job intensive
economic growth
1 Leveraging and
Facilitating of the
creation of jobs in
property portfolio
projects on Council
owned land
Site Preparation;
Fixed Assets physical
verification; Facilities
Management
800 3100 jobs 1085 jobs
45,889
Expanded and refined
support to small
businesses, and
greater facilitation of
the potential offered
by entrepreneurs and
the informal economy
2. Enterprise &
Property skills
development to
emerging industries
Property incubator
project - Develop and
Roll-out a Property
Incubator
None 100% rolling out of
the incubator
programme. Total
cost of project R6
million
Launch the incubator
programme
1,954
Property skills project
- Develop and Roll-
out a Property Skills
programme for
emerging industries
None 100% rolling out of
the property skills
programme. Total
cost of project R16.5
million
Launch the property
skills programme
3,426
Increased
competitiveness of the
local economy –
enabling and
3 Promote Joburg
as a sought after
property investment
destination
African property
summit project - Hold
a property summit.
None Hold a successful
African property
summit. Total cost of
project R25 million
Complete the event
plan (including
funding, venue,
service provider, etc)
3,372
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attracting investment
4 Branding
strategic property
projects & City's
strategic land
parcels
Key strategic projects,
properties & land
parcels - Brand land
parcels, strategic
buildings and
construction sites.
Brand 60 land
parcels;
Brand 30 strategic
buildings;
Brand 5 construction
sites.
None Brand 60 land
parcels; Brand 30
strategic buildings;
and Brand 5
construction sites.
Total cost of project
R8 million
Brand 15 land
parcels; Brand 8
strategic buildings;
and Brand 2
construction sites
2,685
5 Council-owned
property
management and
maintenance
Asset management
and maintenance -
100% verification of
Council-owned
property and
maintenance of the
fixed asset register
1% verification of
council owned
property
Verify Council owned
property. Total cost
of project R20 million
Complete the
verification of CoJ's
properties
3,426
Asset management
and maintenance -
Conduct highest and
best use analysis on
CoJ properties
Ongoing Ongoing highest and
best use analysis.
Total cost of project
R4 million
Conduct highest and
best use analysis on
CoJ properties
1,072
6 Sustainable
property economy
through expediting
the transfer of
properties
SOWETO Land
regularisation project
- Transfer properties
in the Greater Soweto
Area, the Greater
Orange Farm Area,
Ivory Park and
surroundings as well
631 actual transfers
and/or allocations of
properties
2000 properties to be
transferred in 5
years. Total cost of
project R42 million
150 transfers. 3,426
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as Alexandra
Audit of vacant non
residential stands
properties
None 100% completion of
the audit of vacant
non-residential
properties. Total cost
of Project R20
million. This
expenditure relates
to portfolio and will
be on tender thus no
cost to JPC
30% completion of
the audit
2,558
A smart City of
Johannesburg, that is
able to deliver quality
services to citizens in
an efficient and
reliable manner
7 Revenue
maximisation
utilising City's
property portfolio
Land sales and land
acquisitions and
completion of
developments -
Implement the income
generating initiatives
to boost the City’s
property portfolio
None R200 million Total
cost of project R50
million
R50 million of land
sales, acquisitions &
completion of
developments
6,802
8 Leveraging of
private sector
investment in
property portfolio
projects - investment
is realised only on
construction
Third party
investment on COJ
property
R215 million
investment on CoJ
property
R1. 2 billion
investments.
R220 million
investment
TOTAL R74,610
CITY OF JOBURG PROPERTY COMPANY SOC LTD
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5.2 Capital Expenditure
Table 6: Operational Capital
EXPENDITURE APPROVED BUDGET
2010/11
R’000
BUDGET 2011/12
R’000
ESTIMATE BUDGET
2012/13
R’000
ESTIMATE BUDGET
2013/14
R’000
Computers 1 600 1 250 1 250 2000
Furniture 200 500 500 500
Equipment and leasehold 200 600 600 1000
TOTAL 2 000 2 350 2 350 3500
5.3 Service Delivery Budget Implementation Programme
Not applicable to JPC
5.4 Revenue/Tariff Analysis
Not applicable to JPC
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6. HUMAN CAPITAL
6.1 Staff Establishment
The company currently conducts its business with a staff complement of 128 employees
inclusive of 14 short-term contractors. Additional temporary workers are intermittently employed
through labour brokers to address staff shortages in certain departments.
JPC as an organisation has grown significantly over the past decade and it has therefore
become necessary to realign itself to the strategic intent of the organisation. Failure to do so
results in an organisation being unable to achieve its strategic goals and inefficiencies result.
The approved new structure makes provision for an increase in Human Capital to occupy 154
identified inclusive of critical and strategic positions. This allows for the recruitment, selection
and placement of 40 additional personal to strengthen the core business and operate optimally.
In support of the Turnaround Strategy, it makes provision for additional positions at mid-
management level, compared with historically a predominantly administrative heavy structure.
JPC’s core business departments are Asset Management with a staff compliment of 16
positions; which focuses on Asset Management Planning, Portfolio Strategy Analysis and Asset
Register Management. The second and largest core business department is Property
Management with a staff compliment of approximately 42 positions: which focuses on Client
Services, Regional Management, Municipal Management, Outdoor Advertising and Transaction
Management. The third core department is Property Development: with a staff compliment of 17
positions focusing on Revenue Generation, through Project Development and Management.
The support departments with a staff compliment of approximately 79 positions consist of the
following units namely Finance, Corporate Services, Human Resources, Office of the Managing
Director and the Chief Operating Officer.
In addressing the operational needs in terms of the Turnaround strategy, the following Human
Capital interventions will be undertaken:
1. Filling of critical positions through internal recruitment. This is in line with the JPC
recruitment and selection policy.
2. Filling of critical positions through external recruitment (buy strategy). External recruitment
will only be initiated in instances where suitably qualified candidates could not be identified
from within.
3. To strengthen JPC’s strategic goals and inefficiencies and in building strategy, the
secondment of employees to more critical roles (lateral interim moves) and the appointing of
employees to act temporarily, would be options for consideration. . In addition, much
emphasis will be placed on training initiatives and the granting of bursaries to uplift the skills
gap. The training programme would furthermore focus on the development of succession
candidates occupying critical leadership roles. This will enable JPC to grow its own skills
pool over time.
The table below illustrates the current and future Human Capital requirements to strengthen
JPC’s operational and strategic demands.
CITY OF JOBURG PROPERTY COMPANY SOC LTD
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Table 7: Staff Estimates
Department
Actual Head
Count
Approved
Structure
Predicted
Variance
1 Office of the MD 3 8 5
2 Asset Management 8 16 8
3 Property Management 31 42 11
4 Property Development 17 17 0
5
COO: Special Projects &
Risk 10 20 10
6 Human Resources 5 8 3
7 Finance 18 22 4
8 Corporate Services 22 21 -1
Total 114 154 40
6.2 Human Capital Expenditure
The following costs are attached to the human capital requirements in fulfilment of the JPC
operations.
Table 8: Staff Expenditure
TOTAL STAFF EXPENDITURE
SALARIES AND
WAGES
Financial
Year
2010/11
Financial
Year
2011/12
Financial Year
2012/13
Projected
Percentage
Growth/Decrease
42 342 000 59 153 000 54 227 000 9%
The decrease from 2011/12 to 2012/13 will not affect the operational implementation of the
proposed structure.
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Table 9: Expenditure on Contracted Services
CONTRACTED SERVICES (Consultancy Services)
SERVICES
RENDERED
Previous
Financial
Year
2010/11
‘000
Current
Financial
Year 2011/12
‘000
Next Financial
Year 2012/13
‘000
Projected
Percentage
Growth/Decrease
TOTALS
7 435
8 951
8 699
2.8% increase
Table 10: Staff Expenditure vs. Operational Expenditure
RATIO OF STAFF TO OPERATING EXPENDITURE
Previous
Financial
Year
2010/11
‘000
Current
Financial
Year
2011/12
‘000
Next Financial
Year
2012/13
‘000
Projected
Percentage
Growth/Decreas
e
STAFF
EXPENDITURE 42 342 59 153 54 227 -8.3 %
TOTAL OPERATING
EXPENDITURE 56 246 66 815 74 610 12%
RATIO 75.0% 88.5% 61.9%
6.3 Employment Equity
JPC as an employer fully subscribes to the purposes and intent of the Employment Equity Act
no. 55, 1998. Reports are submitted annually to Department of Labour.
Table 11: Employment Equity
Categories
Male Female
Total
A C I W A C I W
Managing Director 0 0 0 0 0 1 0 0 1
Senior Managers 6 0 1 3 1 1 1 0 13
Middle Managers 7 0 1 2 5 0 1 0 16
Junior Managers 11 0 1 4 13 2 1 3 35
Semi-Skilled Staff 10 0 0 0 28 5 1 5 49
TOTAL 34 0 3 9 47 9 4 8 114
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JPC is committed to the principles of equity, anti-discrimination and diversity as enshrined in the
Constitution of the Republic of South Africa and the Employment Equity Act (EEA) No 55 of
1998. Gender mainstreaming, youth programmes, succession planning and retention have
become some of the key drivers in managing the manpower strategies at JPC. More so,
employment equity strategies have become a course for action to promote equality amongst
employees and help towards the development of future competent leaders in the Property
Industry.
Designated group status may be used as a tie-breaker in recruitment process, to ensure that
where two suitably qualified job candidates are available, we may prefer to appoint the
employee from a designated group, if that group is under-represented in that position or
occupation.
A revised EE policy was introduced in the past financial year where the following broad targets
were established:
o Current target base = 65/35%
o Planned target base = 80 /20%
o Gender target base = 50 /50%
During the 2012/2013 financial year implementation of the following planned interventions will
be implemented and managed by JPC’s Employment Equity and Training and Development
Committee;
? JPC will continue to strive to create an open, fair and democratic workplace based on
human dignity, freedom and equality;
? Adhere to the principles of equity, non-discrimination and diversity as enshrined in the
Constitution of the Country and the EEA;
? JPC will continue to create a workplace that reflects the diversity of South African society,
and contribute to maximising the human resource potential of all people;
? JPC will manage employment equity to promote equity in the workplace;
? Employment equity measures will be designed to ensure that suitably qualified people from
designated groups have equal opportunities in employment and advancement;
? The Committee with its own Constitution will promote JPC’s employment equity targets to
dissolve inequalities in designated groups and afford equal opportunities and advancement
in employment:
o The recognition that the disparities inherited from the apartheid past created
inequalities for the majority of the population and that these disparities require
constant monitoring and redress
o JPC core principles are drawn from the Constitution, social legislation and
shared values of the organisation’s stakeholders and staff
? JPC believes that the essence of non-discrimination lies in the creation of fair opportunities
for all in the society, and in particular those who are or have been discriminated against on
the basis of race, gender, sexual orientation or other arbitrary or unjustifiable grounds;
? JPC will implement this policy using an inclusive approach that addresses both numerical
targets and non-numerical processes; i.e. affirmative action measures;
? Overall targets set for the JPC will inform departmental targets;
? Employment equity constitutes a major change initiative and will be managed as such;
? The policy will endeavour to facilitate the involvement of all stakeholders, and their roles will
be clearly outlined;
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? Effective processes and structures will be put in place to monitor and evaluate the success
of the employment equity programmes in a transparent and participative manner. The
numerical targets and non-numerical objectives are to form part of Management’s
Performance Contracts;
? Preference in future appointments for groups that are under-represented in the different
occupational levels/categories will form part of a key feature in the implementation of the
JPC’s EE Policy;
? In accordance with Section 15(4) of the EEA, nothing in this policy requires JPC to take any
decision concerning an employment policy or practice that would establish an absolute
barrier to the prospective or continued employment or advancement of people who are not
from designated groups.
Gender Mainstreaming Programme
The City of Johannesburg’s (hereafter CoJ or City) Gender Mainstreaming Programme (GMP)
began in earnest in May 2008 and since them much progress has been achieved. The progress
made bodes well for the roll-out process which is planned in the three year lifespan of the
project. The GMP broadly aims to ensure that gender becomes mainstreamed into the process,
systems, policies and organisational culture of the City of Johannesburg, across Core
Departments and Municipal Owned Entities.
This programme will consolidate the many gender initiatives undertaken within the City, which
have mostly lacked institutionalisation and have been poorly popularised. These initiatives have
remained fragmented along department /institutional lines and, consequently, the monitoring of
these programmes and the assessment of their impact has also remained fragmented. Through
the GMP these initiatives will be examined against the objectives and key deliverables of the
Programme.
A key strength of the GMP is that is focus lays both in internal and external communities of the
City. As a result of this two-pronged focus, the Programme has two main departmental drivers,
namely the Departments of Corporate and Shared Services.
The main objectives of the Gender Mainstreaming Programme are:
? To finalise the gender policy of the City of Johannesburg.
? To work with all departments and units of the City in developing gender action plans.
? To build capacity for the implementation of these plans through on-the-job training.
? To monitor and evaluate implementation of the Gender Policy.
? Present the Draft Gender Policy to the Executive Management Team
? Gender Policy be finalised and adopted by the Council
? Gender indicators be included in the current IDP planning process, and
? Structures and roles and responsibilities around gender mainstreaming need further
interrogation.
? Hold capacity building workshops for the Gender Focal Points
CITY OF JOBURG PROPERTY COMPANY SOC LTD
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6.4 Staff turnover / movement during previous financial year 2011/12
Table 12: Staff Turnover
Staff
Movements
African Coloured Indian White
Totals
Male Female Male Female Male Female Male Female
Recruitment 1 3 0 0 0 0 0 0 4
Promotion 0 0 0 0 0 0 0 0 0
Resignation 4 1 0 0 0 0 0 0 5
Early Retirement 0 0 0 0 0 0 0 0 0
Retirement 0 0 0 0 0 0 0 0 0
Retrenchment 0 0 0 0 0 0 0 0 0
Medical Boarding 0 0 0 0 0 0 0 0 0
Dismissal 0 0 0 0 0 0 0 0 0
Death 0 0 0 0 0 0 0 0 0
Contract Expiring 0 0 0 0 0 0 0 0 0
Grand Total 5 4 0 0 0 0 0 0 9
6.5 Employee wellness programmes
JPC’s employee Wellness Committee previously comprised of dedicated employees who
performed duties voluntarily towards the goal of managing the social wellness side of JPC’s
manpower. The voluntary employee wellness team changes participation on an annual basis, in
order to provide opportunities to other staff members who have a passion towards such social
courses.
A significant milestone has been achieved during the 2011/12 financial year in that the company
managed to establish an official OHASA committee. The structure is still at its infant stages and
interventions based on capacitation of the forum members are currently being undertaken.
JPC in the interim still continues to seek the assistance of the CoJ’s OHASA department, in
particular where there is need for the services of a medical doctor or a professional counsellor
to assist employees in the workplace. In addition, JPC participates in all peer education
workshops and currently has two skilled peer coordinators who are able assist to staff in
managing their HIV and Aids status. The company actively participated and will continue to
support World Aids Day on the 1
st
of December and other important awareness campaigns
such as World breast cancer day and World tuberculosis day.
The move of the JPC to new office premises enabled the HR department to deliver amongst
other employee wellness imperatives a three day wellness campaign was a subproject derived
from the Strategic Plan of the Human Resources Department: Employee Relations.
The primary focus of the Health and Wellness campaign was to educate and raise awareness
amongst JPC employees with regard to their Health and Wellbeing and secondly to understand
JPC’s Health and Wellness profile with the aim of informing business planning.
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The proposed theme for the event was “Your Health, JPC’ s Future”. Attention was paid to
several pillars of Health and Wellness including financial matters by The National Credit
Regulator, physical aspect by Virgin Active, Diabetes SA WITS Health Consortium, COJ
Primary Health, Pink Drive, The Pacific Institute, JPC Contracted Medical Scheme Providers,
Motivational Talk by Criselda Kananda (HIV Activist and Metro fm talk show Presenter, and
Annique Health and Beauty and various social aspects.
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7. RISK ASSESSMENT
The table below reflects the strategic risks of the company. It should however be noted that the company is in the process of reviewing its
strategic risks
STRATEGIC OBJECTIVES
1. Support economic development utilising the property portfolio.
2. Support community development and social initiatives utilising the property portfolio.
3. Utilise the CoJ property portfolio as a vehicle for transformation.
4. Ensure efficient, economic, and effective service delivery to J PC's clients, customers and stakeholders.
5. Ensure a professionally managed and sustainable company.
R
i
s
k
N
o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
SR1 Human
resourc
e/capital
All Poor
organizational
performance
Mismatch or
shortage of skills.
4 4 16 Approved and
implemented HR
policies. Approved
turnaround strategy.
Redesign of HR
structure.
Draft HR strategy in
place and developed job
descriptions. WSP
0.75 12 To perform
scientifically skills
audit
1
Senior
Manager:
HR
30-
Mar-12
The results from the
skills audit fed to VIP
system for monitoring
Senior
Manager :
30-
Jun-12
1
It entails approval of HR strategy by Board. Partially implementation for 2011/2012 as it will be spread over two years.
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R
i
s
k
N
o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
and maintaining of the
skills base database
HR
Implementation of the
new structure
Senior
Manager :
HR
30 –
Jun-12
To ensure compliance
and enforce
performance
management
2
Senior
Manager:
HR
30-
Jun-12
Coaching and training
of staff
All EM’s 30-
Jun-
12
SR2
Financia
l
All
Failure to
meet revenue
and delivery
targets
Inadequate
financial resources
( Insufficient
CAPEX and OPEX
budget)
5 5 25
Applied for additional
funding from internal and
external sources.
Constantly request for a
revised budget half-
yearly. Accurate
budgeting is done
0.75
18.75
Implement revenue
model as per
turnaround strategy.
To present to the City
on JPC's mandate and
funding. To draft a
report to the City for
JPC to retain a certain
MD&
Chairperso
n Board
30-
Jun-12
2
Will be linked to PIMS, performance management cycle will be tool for monitoring. It entails IPMS policy refined and rolled out to the entire organization, introduction of moderation process for
organizational excellence and recognition strategy developed)
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R
i
s
k
N
o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
supported by evidence
percentage from
income collected.
Sourcing external
funding.
Cumbersome CoJ's
land approval
processes for land
transactions
and inadequate
planning.
Policies and procedures
are in place .Delegations
of authority. Supply
Chain Management
Policies are in place
Project manager to
ensure that the
property is on the LIS
before the tender is
out, create an
account.
EM :
Finance
EM:
Property
developme
nt
30-
Dec-11
To review the policies
and procedures with
City department
All EM’s 30-
Jun-12
Non conducive
investment
environment(
Package investment
deals with incentives
i.e. highlight
investment and
demand
3
EM :
property
manageme
nt, property
developme
nt , asset
manageme
30-
Jun-12
3
Need to explore with other departments what are they doing and what DED is doing.
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R
i
s
k
N
o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
nt
Plan an African
Property Summit and
market JPC
4
EM:
stakeholder
manageme
nt
30-
Jun-12
SR3
Process
es
4
Vandalism
and inability to
maintain
facilities
Overlaps of
mandate with other
municipal entities
regarding facility
management
4
3
12
Service Delivery
Agreement( SDA)
0.90
10.8
Completion of
mandate with City
MD&
Chairperso
n Board
30-
Jun-12
Lack of lease
contract
enforcement and
monitoring
Ad-hoc site inspection of
facilities. Lease
agreements with
tenants.
Streamline and fast
track awarding of
lease management
agreements so that
maintenance burden is
passed onto the
lessee
EM:
Property
manageme
nt
30-
Jun-12
4
Appoint event management service provider, establish event committee and draft event plan, source sponsors and market and communicate the event
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R
i
s
k
N
o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
Tenant vacating
without notifying
lease unit ,lack of
site inspection and
contract
management
Ad-hoc inspections by
stakeholder
management unit and
leasing officials and
enforcing of contracts
Develop a plan for
formalising site
inspections(prioritising
).Inspection of leased
properties
5
EM:
Property
manageme
nt
30-
Jun-12
Inadequate funding
for security and
maintenance
Budget, onsite security
and security placed on
hot spot.
Request for additional
funding for
maintenance and
security
MD/Chairpe
rson of
Board
30-
Mar-12
Inadequate
facilities
management and
lack of
maintenance plan
Repairs on an ad-hoc
basis. Maintenance
clause on leases term
To develop a
maintenance plan.
Exchange programs
on facilities
management to
selected officials
EM : Asset
manageme
nt
30 -
Jun-
12
5
Regionalisation of the portfolio and appointment of four regional officers to do inspection and also managing contracts(i.e. Implementation of turnaround strategy)
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R
i
s
k
N
o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
SR4 Informat
ion
manage
ment
4
Incomplete
asset register
Lack of physical
verification
4 5 20 Physical verification of
Region E( Greater Ivory
Park, Region G( Orange
farm and Greater
Alexander)
0.75
15
To extend physical
verification to other
regions e.g. Region A,
etc
EM : Asset
Manageme
nt
30-
Jun-12
SR5 Financia
l
2,3,4,
5
Loss of
revenue
on leases,
outdoor
advertising
/cellular mast
Lack of income
statements per
property to assess
performance to
ascertain
performance of the
portfolio.
4
3
12
Holistic evaluations
performed ,consolidated
financial reporting
management reports
transaction on report
show all transactions
0.90
10.8
Customization of
NICOR to produce
income statements
EM :
Finance,
Asset,
Property
manageme
nt
&Property
developme
nt
28 -
Feb-
12
Processes not
integrated between
all core
departments i.e.
asset management,
finance, legal, and
property
management (
Value chain)
Manual system - spread
sheet
Access to NICOR by
all core departments
and to integrate
NICOR to PIMS
system
EM: Asset
manageme
nt
30 -
Jun 12
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R
i
s
k
N
o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
Pending litigation(
outdoor
advertising)
Report submit to
Mayoral
Reviewing of the
by-laws as they are
restrictive factor to
the revenue stream
of JPC
Unclear mandate
from City regarding
outdoor advertising
SR6 Regulat
ory
5 Possible
litigation /legal
action
Delays in property
transfers and
finalisation of
contracts
4 3 12 Informal tracking system 0.75 9 Formalisation of
tracking system
COO 30-
Jun-12
Non-compliance
with relevant
legislation
Compliance checklists.
Quarterly litigation
reports. Approved
delegations of authority.
Evaluation of controls by
Implementation of
compliance register
and monitoring
thereof. Quarterly
reporting on
Company
secretary
30-
Jun-12
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R
i
s
k
N
o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
internal auditors.
Frameworks and
strategies are in place
compliance to relevant
stakeholders.
6
Educate and raise
awareness to all
stakeholders about
processes
(compliance)
COO &
Company
secretary
30-
Apr-12
SR7 Integrity All Fraud and
corruption
Fraudulent sales.
Illegal occupation
of land parcels.
4 4 16 JPC, City Fraud hotline,
caveats, fraud policy,
scrutinise of illegal
transaction. Continuous
risk assessments
0.75 12 Develop and
implement fraud
prevention plan.
Create awareness on
fraud prevention plan
COO/Risk
manager
30-
Jun-12
Inadequate
business processes
that are aligned to
the City's
Policies and procedures
are in place e.g. SCM.
Evaluations by internal
Audit Committee.
To develop business
processes for all the
different departments
and align to City
processes
All EM's
and
support
units
30-
Mar-12
6
Implementation of compliance software
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R
i
s
k
N
o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
SR8 Process
es
All Loss of
valuable
information as
result of IT
failure
Lack of efficient &
effective data and
document
management
system
4 3 12 PIMS system and
training conducted
0.75 9 Roll-out and
continuous training on
PIMS system
EM: Asset
manageme
nt
30 -
Jan-12
Implementation of
PIMS system and
reporting monthly to
EXCO
7
All EM's
and
support
units
28-
Feb-12
Lack of business
continuity and IT
disaster recovery
plans
IT disaster recovery
plans
The BRP and BCP
plans are being
drafted for submission
to Board.
Quarterly reporting to
relevant stakeholders
EM: SMU 30-
Jun-12
SR9 Financia
l
All Illegal
occupation of
land
parcels/land
invasion
Poor marketing of
company’s
properties and
services offered by
JPC
4 3 12 Road shows are
conducted, broadcasting
through radio station.
Property sale are
displayed on billboards.
Draft marketing strategy.
0.75 9 Continuous road
shows. Finalisation of
marketing strategy.
Implementing and
continuous monitoring
of the marketing
strategy.
EM :
Property
Manageme
nt
30-
Dec-11
7
Training will happen November and December 2011.
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Risk aligned to the following Master Programmes:
? Enabling Resilience, Inclusion & Sustainability
? Enabling Growth & Job Creation
? Empowering Citizen & partnership
? Going green
? Institutional Renewal
RISK LINK TO MASTER PROGRAMME
Poor organizational performance
ALL
Failure to meet revenue and delivery targets
ALL
Vandalism and inability to maintain facilities
ALL
Incomplete asset register ALL
Loss of revenue on leases, outdoor advertising /cellular mast
ALL
Possible litigation /legal action ALL
Fraud and corruption ALL
Loss of valuable information as result of IT failure ALL
Illegal occupation of land parcels/land invasion ALL
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8. APPENDIX
2008/09 2009/10 2010/11 Current year 2011/12 Medium Term Revenue and Expenditure Budget
Audited Audited Audited
Original
Budget
Adjusted
Budget
Full Year
Forecast
Budget Year Variance Estimates Estimates Estimates
Outcome Outcome Outcome 2012/13 % 2013/14 2014/15 2015/16
R 000 R 000 R 000 R 000 R 000 R 000 R 000 R 000 R 000 R 000
REVENUE
Interest earned - external investments 24 8 143 8 10 10 10 0.0% 11 12 12
Interest earned - outstanding debtors 1 441 2 086 6 259 4 255 4 255 -100.0%
Licences and permits 0.0%
Agency services 40 687 18 664 29 445 50 387 38 589 38 589 32 119 -16.8% 30 123 31 985 33 881
Operating grants & subsidies 0.0%
Other Revenue 14 713 68 699 23 672 39 635 35 167 35 167 32 922 -6.4% 36 991 37 166 37 346
Gain on Disposal of PPE
0.0%
DIRECT OPERATING REVENUE 56 865 89 457 59 519 90 030 78 021 78 021 65 051 -16.6% 67 125 69 163 71 239
Internal Transfers
Interest Income (Sweeping Account) 0.0% 31 32 34
Operating Grants & Subsidies from (COJ) 10 516 537 3 509 15 487 0.0% 18 054 20 958 24 020
Total Internal Transfers 10 516 537 3 509 15 487 0.0% 18 085 20 990 24 054
TOTAL OPERATING REVENUE 67 381 89 994 59 519 93 539 78 021 78 021 80 538 3.2% 85 210 90 153 95 293
EXPENDITURE
Employee related costs 31 778 37 653 42 342 59 153 51 498 51 498 54 227 5.3% 57 371 60 700 64 160
Depreciation & asset impairment 1 247 1 191 1 082 1 500 3 222 3 872 1 997 -38.0% 2 107 2 229 2 356
Interest Paid : External Borrowings 382 314 265 391 650 650 -100.0%
General expenses 16 469 16 157 23 023 25 332 17 230 16 580 17 230 0.0% 17 575 18 594 19 654
Loss on disposal of PPE 385 350 103 0.0%
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DIRECT OPERATING EXPENDITURE 50 261 55 665 66 815 86 376 72 600 72 600 73 454 1.2% 77 053 81 523 86 170
Internal Transfers
Interest Expense (Sweeping Account) 137 0.0%
Internal Charges (ME's / Core) 603 624 1 095 1 095 1 095 1 156 5.6% 1 223 1 294 1 368
TOTAL OPERATING EXPENDITURE 50 864 56 426 66 815 87 471 73 695 73 695 74 610 1.2% 78 276 82 817 87 538
OPERATING DEFICIT/ (SURPLUS) (16 517) (33 568) 7 296 (6 068) (4 326) (4 326) (5 928) 37.0% (6 934) (7 336) (7 755)
OPERATING DEFICIT/ (SURPLUS) (16 517) (33 568) 7 296 (6 068) (4 326) (4 326) (5 928) 37.0% (6 934) (7 336) (7 755)
Less Tax 4 310 11 484 (1 839) 1 760 18 18 -100.0%
OPERATING DEFICIT/ (SURPLUS) - after tax (12 207) (22 084) 5 457 (4 308) (4 308) (4 308) (5 928) 37.6% (6 934) (7 336) (7 755)
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GLOSSARY OF TERMS
TERM DETAIL
CoJ City of Johannesburg
JPC Joburg Property Company
MOE Municipal Owned Entity
WSP Workplace Skills Plan
ATR Annual Training Report
OPEX Operational Expenditure
CAPEX Capital Expenditure
MFMA Municipal Finance Management Act
GDS Growth & Development Strategy
doc_984750832.pdf
Within this brief information regarding city of joburg property company (soc) ltd jpc.
CITY OF JOBURG PROPERTY COMPANY SOC LTD
BUSINESS PLAN 2012/2013
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1
339999
City of Joburg Property Company (SOC) LTD
“JPC”
CITY OF JOBURG PROPERTY COMPANY SOC LTD
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Sign Off:
Managing Director Name: ……………………..…………………………………………….
Signature of MD:……………………………………………………………………………….
Signature of ED: ………..…………………………………………………………………….
Signature of MMC: ……………………………………………………………………………
Date: ………..…………………………………………………………………………………..
Receipt & Review:
Signature of Finance Officer: ……………………………………………………………
Signature of CSU Representative: ……………………………………………………..
CITY OF JOBURG PROPERTY COMPANY SOC LTD
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TABLE OF CONTENTS
1. INTRODUCTION 4
2. EXECUTIVE SUMMARY 7
3. STRATEGIC ANALYSIS 11
4. STRATEGIC FOCUS AREAS 13
5. FINANCIAL IMPACT 18
6. HUMAN CAPITAL 25
7. RISK ASSESSMENT 32
8. APPENDIX 42
Glossary 44
ANNEXURE 1: 2012/13 SCORECARD
ANNEXURE 2: SDBIP
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1. INTRODUCTION
Joburg Property Company is the Municipal Entity created to develop and manage Council-
owned properties for the purpose of maximising both social and commercial opportunities for
the Council in the short and longer term. The overall nature of business is the Management of
the CoJ property portfolio. JPC therefore has a dual mandate to generate significant financial
returns for the City by maximising the economic potential of the property portfolio, as well as
contributing towards the City’s social upliftment goals.
The current Service Delivery Agreement requires JPC to provide, amongst others, the following
services:
? Property strategic planning and property advice
? Financial, accounting and secretarial services for the property portfolio – JPC currently
provides financial and accounting services and only part of secretarial services
? Property register maintenance
? Council property portfolio information
? Property maintenance –currently at a small scale
? Letting (including outdoor advertising)
? Servitudes, encroachments and access rights
? Disposal and acquisition of properties
? Development of properties
? Ad hoc property management services and/or development services and/or other services
JPC has positioned itself as the managing agent of the property assets of the Council,
responsible for maximising the social, economic and financial value of the CoJ’s total property
portfolio and enhancing the efficiency of its use as “The People’s Property Company”.
1.1. VISION AND MISSION
1.1.1. Vision
To provide property management, property development, property asset management services,
land strategy, acquisition and stewardship in order to maximise the social, economic and
financial benefit to the CoJ and support the CoJ’s delivery objectives on a cost competitive
basis.
1.1.2. Mission
JPC is the manager of the property assets of the City of Johannesburg, responsible for
maximising the social, economic and financial value of the CoJ’s total property Portfolio and
enhancing the efficiency of its use. JPC will provide asset management, property management,
property development services and land strategy, acquisition and stewardship to the CoJ, as
well as interact with the general public in respect of this Portfolio. JPC will support the
achievement of the CoJ’s strategic priorities, including economic and social development and
the service delivery objectives of the CoJ.
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1.1.3 Core values
Values have become an ethical foundation for all organizations and are therefore fundamental
to the JPC’s success. Such values are not just important but crucial to the overall ascendancy
of JPC. The following values were identified and adopted by JPC:
? Professionalism,
? Accountability,
? Responsibility,
? Customer Service and
? Trust
1.2. MANAGEMENT AND ORGANISATIONAL STRUCTURE
The current approved organisational structure is divided into the following three (3) core
business units and six (6) main support units with 154 positions (both filled and vacant posts). It
should however be noted that the current approved structure does not cater for the Facilities
Management function that will be incorporated into JPC following the Institutional review:
Current Core Business units
? Property Asset Management - This entails the strategic management of the City’s property
portfolio which includes fixed asset register management, physical verification of city fixed
assets, property sector and economic research, strategic plan and property advise,
compilation of asset management plans, portfolio sector and economic returns and council
property information. The main goal is to ensure maximisation of portfolio returns in line with
JPC’s social and economic mandate and to unlock potential economic and social base of
developed and underdeveloped areas of the City whilst increasing sustainable revenue
streams and asset value of CoJ‘s property.
? Property management -This function involves obtaining and maintaining value from the
property portfolio by effectively administering & leasing, acquiring and selling and lastly
ensuring maintenance of the property and management of servitudes and encroachments
and facilities management.
? Property Development -Property development aims to increase value of the COJ’s land
portfolio and generate long term recurring income for COJ, by facilitating development of
Council owned land by third party private sector developers. Development facilitation
includes project packaging, project preparation, development contracting & actual
development facilitation in line with the City’s Growth and Development Strategy.
Support Units
? Human Resources
? Corporate Services (previously Stakeholder Management)
? Finance
? Office of the COO – this is a new unit headed by a Chief Operations Officer consisting of
Project Management Office, Transformation, Legal Services and Land Regularisation)
? Risk Management
? Company Secretariat
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The following is the current approved high level organisational structure of J PC:
MANAGING DIRECTOR
ASSET
MANAGEMENT
PROPERTY
MANAGEMENT
HUMAN
RESOURCES
FINANCE
CORPORATE
SERVICES
PROPERTY
DEVELOPMENT
Executive
Secretary
Strategic/Executive
Support
Company Secretary
OPERATIONS
OFFICE
Risk Manager
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2. EXECUTIVE SUMMARY
To fulfil its mandate JPC sees as a core part of its business to support and encourage
investment and growth, but also to address socio-economic disparities and legacies of
discrimination and inequality.
Financial and Budgetary Environment
The proposed and allocated budget for 2012/13 is as follows:
REQUESTED ALLOCATED
CAPEX
‘000
OPEX
‘000
CAPEX
‘000
OPEX
‘000
JPC R2,350 R74,610 NIL R74,610
CoJ Portfolio R84,650 R49,100 R18,000 R44,175
Impact of under allocation
The impact of under allocation results in the following:
? Facilities management will not be effectively implemented resulting in dilapidated Council-
owned property;
? Progress in Site development and site preparation will decline resulting in lack of realisation
of the value of land;
? Job creation will be negatively impacted and
? Negative impact on infrastructure development and thus reducing the value of the City’s rate
base.
Some of JPC’s projects are unfunded and they are usually rolled over. The magnitude and the
size of the projects means that the timeframe to completion is between 3 and 5 years before a
completed development can realise a value. Over the years, JPC has attracted more than R8.5
billion worth of investments but in order to realise the economic value of these investments it is
critical to proceed with and finalise them, as they impact on job creation, infrastructure
development and improved rates base.
Company contribution to Master Programmes and IDP Sub-programmes
JPC forms part of the City’s Economic growth cluster and the company endeavours to
contribute, through its mandate, towards the economy that is inclusive, liveable and prosperous
for all; linked to this outcome are the following outputs: Job intensive economic growth;
Expanded and refined support to small businesses, and greater facilitation of the potential
offered by entrepreneurs and the informal economy; Increased competitiveness of the local
economy – enabling and attracting investment; A smart City of Johannesburg, which is able to
deliver quality services to citizens in an efficient and reliable manner.
The following sub-programmes are linked to above-mentioned outputs:
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Table 1: IDP Sub-Programme and Performance Targets for 2012/13
2012/16 IDP Sub- programme Projects 2012/13 Performance Target
1. Facilitation of the creation of
jobs in property portfolio
projects on Council owned land
– 1085 jobs to be created
OUTCOME: Reduction in
unemployment & an increase in
economic growth
Site Preparation; Fixed Assets physical
verification; Facilities Management
1085 jobs
2. Enterprise & Property skills
development to emerging
industries
OUTCOME: Economy that is
inclusive of all
Property incubator project Launch the incubator
programme – 5 companies
incubated
Property skills project Launch the property skills
programme
3. Promote Joburg as a sort
after property investment
destination
OUTCOME : Growth in the
economy
African property summit project Complete the event plan
(including funding, venue,
service provider, etc.)
4. Branding strategic property
projects & City’s strategic land
parcels
OUTCOME : Attracting investors
& thus improving on economy
Key strategic projects, properties & land
parcels
Brand 15 land parcels;
Brand 8 strategic buildings;
Brand 2 construction sites
5. Council-owned property
management and maintenance
OUTCOME: Job creation &
completeness of CoJ Fixed Assets
Asset management and maintenance Complete the verification of
CoJ’s properties
Conduct highest and best use
analysis on CoJ properties
6. Sustainable property
economy through expediting the
transfer of properties
OUTCOME: Economic growth that
includes all & redressing the
inequalities of the past
SOWETO Land regularisation project Transfer 150 properties;
Appoint a service provider and
Commence with the audit of
vacant non-residential
properties
7. Revenue maximisation
utilising City’s property portfolio
OUTCOME : Economic growth &
effective service delivery
(upgrading of infrastructure)
Land sales R50 million received for land
sales
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8. Leveraging of private sector
investment in property portfolio
projects –
NOTE: Leveraging is equivalent
to investment attracted and this
is recognised when construction
starts
OUTCOME: Economic growth
Third party investment R220 million investment
NOTE: The following deliverables, prioritised, are dependent on budget:
1. Sub-programme 5 – Physical verification of Council owned land is 100% dependent on
budget – no verification will be conducted. Non-allocation of budget will result in CoJ
receiving a qualified audit report due to incompleteness of fixed assets;
2. Sub-programme 8 – Potential investment through underlined projects will not
materialised due to CoJ budget cuts
3. Sub-programme 3 – Positive contribution to the City of Johannesburg’s economic
growth target through hosting the African property Summit;
4. Sub-programme 1 – Activities /developments that will result in the creation of jobs
5. Sub-programme 6 – Land Regularisation programme and
6. Sub-programme 2 – Transformation of the property industry through skilling of the
emerging industries
Inter-governmental initiatives and collaboration with other sectors:
Collaboration with other Municipal Owned Entities (MOEs), City Departments, provincial
departments, national departments and the private sector is critical to delivering quality
services. JPC identifies and engages private sector partners for the implementation of capital
projects, which contribute to the economic growth of the City, as per the Economic
Development Sector plans. Our engagement with private sector has in the past attracted
investments of more than R8, 5 billion; however the company is looking at attracting more
investments in future.
Regulatory issues:
The JPC is governed primarily by the Municipal Systems Act (as amended) and Municipal
Finance Management Act No 56 of 2003 (MFMA) and its various regulations. The JPC has
further adopted the Supply Chain Management Policy for Land (SCMPL) in compliance with
Section 111 of the MFMA which provides a framework for the alienation and granting of rights to
use, control or manage of municipal capital assets. The JPC was bound by the Companies Act,
1973. This Act has been replaced by the new Companies Act 2008, which came into operation
in 2011 and the company shall ensure compliance thereto.
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BUSINESS PLAN 2012/2013
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10
Dependency Matrix:
To deliver its mandate, JPC works hand in hand with the following Departments/MOEs:
Department/MOE Dependency - assisting JPC in the managing and developing of Council-
owned properties by
Property Development and value
creation
1. department of Planning and Urban
Management
2. Transportation Department /
Johannesburg Roads Agency
(JRA)/ City Power/Joburg Water
3. Environment Department
Rezoning and subdivision of property; Timeous approval of building plans;
Timeous approval of outdoor advertising in terms of by laws; Timeous
establishment of townships; Implementation of the Land Strategy and
Completion of Geographical Information System (GIS) and Land
Information System (LIS)
Avail bulk services; Timeous connection of bulk infrastructure to property
developments
Timeous assessments of environmental management plans and impact
assessments
Land Requirements
1. All CoJ departments and MOEs
Ensuring compliance of Sec 14(2) of the MFMA by obtaining comments
from departments and MOEs prior to leasing or alienating properties;
Support land and property requirements from departments and MOEs to
ensure successful completion of asset management plans; Ensuring that
strategic land parcels are alienated or leased in line with the Supply Chain
Management policy for land and acquisition is done in terms of the Land
Strategy and Spatial Development Frameworks; Ensuring specialised
asset, like parks, will be ring fenced for MOEs to perform facilities
management;
To ensure JPC is provided with all land requirements to enable the ring
fencing of land parcels intended for service del, social purposed, service
del purposes, environmental needs
Management of the property portfolio
and revenue generation
1. Revenue Department
2. Group Finance Department
o Issuing timeously release of clearance certificates for properties
which have been alienated.
o Ensure availability of funds for the maintenance of the asset
register in line with good governance
CITY OF JOBURG PROPERTY COMPANY SOC LTD
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3. STRATEGIC ANALYSIS
PEST analysis
The property environment, within which JPC operates, is affected by the macro-environment
factors, such as political (and legal) forces, economic forces, socio-cultural forces and
technological forces, as follows:
Political (incl Legal) factors Economic factors
Regulations
? Introduction of the Municipal Asset Transfer
Regulations, 2008 which regulates the
transfer and permanent disposal of non-
exempted capital assets by municipalities
and municipal entities in order to facilitate
the enforcement and administration of
section 14 (2) of the Municipal Finance
Management Act 56 of 2003, which is to
attain a council resolution before the
alienation of any council owned properties.
These regulations hinder the process of the
City in the alienation of land because of
time delays caused by compliance
? Environmental regulations and protection -
National Environmental Management Act,
1998
? The introduction of the National Credit Act
and the global economic meltdown
significantly impacting on the growth and
demand for residential, commercial and
industrial properties
? Formalities in respect of Leases Act, 1969
? The property portfolio is adversely affected by
downturns in the global market
? Fluctuating interest rates also have an impact on
the property market
? Economic growth and investor confidence affects
the property market
Socio-cultural factors Technological factors
The skewed disposal income in different
regions will adversely impact the property
transactions in areas where the levels are low.
Innovative construction methods should be
investigated to ensure cost reduction
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SWOT analysis
The company is currently in the process of implementing the turnaround strategy which will
improve operational efficiencies and revenue streams. Highlighted below are the SWOT
elements that would have an impact on the effective implementation of the turnaround strategy.
Internal Strengths Weakness
? Good and reliable top management;
? Extensive Experience in property
management, development, asset
management and facilities;
? Solid understanding of legislation and
ability/commitment to work within in;
? Ability to use the strength of property
to leverage investment;
? Island of excellent in property
management;
? JPC is the sole agent of the CoJ with
a mandate to manage Council owned
properties on behalf of the City in
terms of the 25 year SDA with the
City.
? Missing skills (middle
management and lower
levels) within the
organisation;
? Inadequate funding to
deliver on mandate;
? Cumbersome internal land
transfer processes;
? Inability to maintain the
property portfolio due to
JPC’s limited mandate
regarding security and
facility management
services;
? Overlaps with City
Departments/MOEs and
unclear mandate;
? Dependency on City
departments /MOEs
resulting in delays in
implementation of property
strategies.
External Opportunities Threats
? Maximisation of revenue through the
outdoor advertising portfolio and creation
of a property fund;
? Increase the value of the property
portfolio by purchasing strategic land for
land banking;
? International investment: investigating
alternative sources of revenue which can
be generated from the property asset;
? Optimise revenue from effective highest
and best use analysis and effective
monitoring and evaluation of leases (post
lease audit).
? Vandalism to property
portfolio;
? Land invasions & illegal
occupation of land parcels;
? Fraudulent land sales;
? Encroachment on JPC’s
mandate by other MOEs;
? Cumbersome CoJ’s land
approval processes for land
transactions.
CITY OF JOBURG PROPERTY COMPANY SOC LTD
2012 – 2013 BUSINESS PLAN
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4. STRATEGIC FOCUS AREA
4.1. IDP Sub-Programme Implementation Plan
Table 2: IDP Sub-Programme Annual Implementation Plan 2012/13
N
o
.
2012/16 IDP
sub-
programme
Projects Key Project
Performance
Indicators
Baseline 5-year Target 2012/13
Target
Cumulative performance targets
(Tangible, measurable targets that fulfil requirements of being SMART)
Q1 Q2 Q3 Q4
1 Facilitation of the
creation of jobs
in property
portfolio projects
on Council
owned land –
NOTE: Job –
person employed
for any length of
time per project
Site
Preparation;
Fixed Assets
physical
verification;
Facilities
Management
Create jobs utilising
the CoJ property
portfolio
None 3100 jobs
150 jobs created
520 jobs created
840 jobs created
1085 jobs created
1085 jobs in year
2012/13
2 Enterprise &
Property skills
development to
emerging
industries
Property
incubator
project
Develop and Launch
the incubator
programme for
emerging industries
None 100% rolling out
– 20 companies
incubated
Launching of the
incubator
programme by
end June 2013 –
5 companies.
Continue
conducting
workshops
Finalise Strategy
Document
Obtain Board Approval
& Launch the
programme – 5
companies incubated
Property skills
project
Launch & roll out the
property skills
programme for
emerging industries
None 100% rolling out
of the property
skills
programme
Launching &
rolling out of the
property skills
programme by
end June 2013.
Launch the property
skills programme
Roll out the property skills
programme
Ongoing roll out Ongoing roll out
3 Promote
Joburg as a
African
property
Complete the event
plan (including funding,
venue, service
None Hold a
successful
African Property
Approved
Property summit
Appoint service
provider, establish
event’s planning
Draft event-plan, Finalise event plan,
Source funding, secure
Get approval for event
plan, Marketing and
communications plan;
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N
o
.
2012/16 IDP
sub-
programme
Projects Key Project
Performance
Indicators
Baseline 5-year Target 2012/13
Target
Cumulative performance targets
(Tangible, measurable targets that fulfil requirements of being SMART)
Q1 Q2 Q3 Q4
sort after
property
investment
destination
summit project provider, etc) summit plans committee, venue, set-up dedicated
website, marketing
campaign, publication,
promotions
4. Branding
strategic
property
projects &
City’s strategic
land parcels
Key strategic
projects,
properties &
land parcels
Brand land parcels;
strategic buildings and
construction sites
None Brand 60 land
parcels;
Brand 30
strategic
buildings;
Brand 5
construction
sites
15 land parcels
8 strategic
buildings
2 construction
sites
3 land parcels
2 strategic buildings
1 construction site
8 land parcels
4 strategic buildings
1 construction site
13 land parcels
6 strategic buildings
15 land parcels
8 strategic buildings
5. Council-owned
property
management
and
maintenance
Asset
management
and
maintenance
Verify Council-owned
property and maintain
the fixed asset register
1%
verification of
council
owned
property
Verify 100%
Council owned
property
100%
completeness of
the verification of
Council owned
property
Verify 10% of
properties
Verify 60% of properties Verify 90% of properties Verify 100% of
properties
Conduct highest and
best use analysis on
CoJ properties
Ongoing Ongoing highest
and best use
analysis
Conduct highest
and best use
analysis on 300
CoJ properties
50 properties 100 properties 250 properties 300 properties
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N
o
.
2012/16 IDP
sub-
programme
Projects Key Project
Performance
Indicators
Baseline 5-year Target 2012/13
Target
Cumulative performance targets
(Tangible, measurable targets that fulfil requirements of being SMART)
Q1 Q2 Q3 Q4
6. Sustainable
property
economy
through
expediting the
transfer of
properties
SOWETO
Land
regularisation
project
Transfer properties in
the Greater Soweto
Area, the Greater
Orange Farm Area,
Ivory Park and
surroundings as well
as Alexandra.
631 actual
transfers
and/or
allocations of
properties
2000 properties
to be transferred
Transfer 150
properties to
beneficiaries
Transfer 25
properties to
beneficiaries
Transfer 75 properties to
beneficiaries
Transfer 100 properties
to beneficiaries
Transfer 150
properties to
beneficiaries
Conduct Audit of
vacant non-residential
stands /properties -
None 100%
completion of
the audit of
vacant non-
residential
properties
30% completion
of the audit
Appointment of
service provider
10% completion of the
audit
20% completion of the
audit
30% completion of the
audit
7. Revenue
maximisation
utilising City’s
property
portfolio
Land sales and
land
acquisitions
and completion
of
developments
Rand value of land
sales, acquisitions &
completion of
developments
New Indicator R200 million R50 million of
land sales,
acquisitions &
completion of
developments
10 million received R20 million received 45 million received R50 million received
8.
Leveraging of
private sector
investment in
property
portfolio
projects -
investment is
realised on
construction
Public
Waterfront
project
Third party
investment on COJ
property
R215 million R6.4 billion
investment
R220 million
investment
R25 million R95 million R165 million R220 million
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4.2 Day-to-day Operations
Table 2: Operational Plan- day-to-day KEY activities
Operational Plan: Day-to-day Operations
IDP Sub-
Programme that
an Operation is
likely to
Contribute
Towards
Key
Operations
Key
Performance
Indicators
2012/13 Target Baseline Estimated
budget R’000
Cumulative Quarterly Performance Targets
Q1 Q2 Q3 Q4
Fixed asset register
management
Data cleansing,
Alignment of asset
register to LIS
100% Migration to LIS
None R1, 000 20% migration 40% migration 70% migration 100% migration
Strategic planning and
property advise –
Portfolio performance
& planning
Monitor and evaluate
finance performance of
the improved properties
and mitigate risk of
negative cash flow
Annual Financial
analysis reports
(Income statements of
improved CoJ
properties)
None R1.500 Assess JPC Portfolio
strategy into regions
focusing on renewal
/property development
plan and letting plan.
Assess the portfolio
according the regions
/property types.
Draft a new letting and
renewal list /sales and
disposal list.
Assess the process
and procedure manual
and template used for
renewal and letting
application.
Assess the debtors’
collection and arrears
age analysis.
Assess the legal status
of tenants handed over
Implement a portfolio
strategy according to
regions and set
budgets and targets
for property
management and
development
Create a vacancy
schedule.
Implement and
advertise a vacancy
schedule
Request Marketing
Department to
advertise the
properties through TO
LET /FOR SALE
BOARDS.
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Create a vacancy
schedule
Site identification,
project identification &
Preparation of
Properties for
Development
Land preparation Preparation of 5
properties
R10, 000 Appointment of
professional teams
and submission of
application
Circulations of
development
applications
Finalisation of
comments
Approval of
applications
Awarding of
Development
Agreements for
properties
Give awards Award development
contracts to the value
of R500 00M
R5, 000 Obtain Section 14(2)
approvals for release
of properties
Prepare RFP
documents and
Advertise
Bid evaluation and
EAC awards
Signature of
Contracts
Facilitation and
monitoring of
development
Achieve investment of
R500 M in construction
value and create 1500
jobs
R5, 000 Resolution of
development obstacles
and monitoring of
development in terms
of signed contracts
Resolution of
development obstacles
and monitoring of
development in terms
of signed contracts
Resolution of
development obstacles
and monitoring of
development in terms
of signed contracts
Resolution of
development
obstacles and
monitoring of
development in terms
of signed contracts
Leasing, acquisitions
and sales transactions
Update Property Lease
register and monitor
leases; land sales
R2, 000 Identify and package
properties for lease,
sale and
developments
Identify and package
properties for lease,
sale and
developments
Identify and package
properties for lease,
sale and
developments
Identify and package
properties for lease,
sale and
developments
Maintenance
management
Facilities management
for the City property
Facilities management
plan for the CoJ
owned properties
R3, 000 Maintenance and
cleaning of corporate
buildings, other
regional offices, public
conveniences
Maintenance and
cleaning of corporate
buildings, other
regional offices, public
conveniences
Maintenance and
cleaning of corporate
buildings, other
regional offices, public
conveniences
Maintenance and
cleaning of corporate
buildings, other
regional offices,
public conveniences
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5. FINANCIAL IMPACT
5.1 Key Operations by general Cost Category
Operational Expenditure
Table 4: Operational Expenditure
Key Operations Financial Impact – ZAR ‘000
S & W R & M CS GE Other Total
Salaries and wages
54,227
17,230
3,153 74,610
Etc.
Totals 54,227
17,230
3,153 74,610
The above indicates the anticipated expenditure of R 74.610 million for the year ended 30 June 2013. Salaries make up 69% of the total
expenditure budget and remaining refers to general expenses which contain fixed costs such as rental, subscriptions, and lease agreements
that JPC had entered into.
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Key Operations by general Cost Category
2008/09 2009/10 2010/11 Current year 2011/12 Medium Term Revenue and Expenditure Budget
Audited Audited Audited
Original
Budget
Adjusted
Budget
Full Year
Forecast
Budget Year Variance Estimates Estimates Estimates
Outcome Outcome Outcome 2012/13 % 2013/14 2014/15 2015/16
R 000 R 000 R 000 R 000 R 000 R 000 R 000 R 000 R 000 R 000
REVENUE
Interest earned - external investments 24 8 143 8 10 10 10 0.0% 11 12 12
Interest earned - outstanding debtors 1 441 2 086 6 259 4 255 4 255 -100.0%
Licences and permits 0.0%
Agency services 40 687 18 664 29 445 50 387 38 589 38 589 32 119 -16.8% 30 123 31 985 33 881
Operating grants & subsidies 0.0%
Other Revenue 14 713 68 699 23 672 39 635 35 167 35 167 37 415 -6.4% 36 991 37 166 37 346
Gain on Disposal of PPE
0.0%
DIRECT OPERATING REVENUE 56 865 89 457 59 519 90 030 78 021 78 021 69 544 -16.6% 67 125 69 163 71 239
Internal Transfers
Interest Income (Sweeping Account) 0.0% 31 32 34
Operating Grants & Subsidies from (COJ) 10 516 537 3 509 5 066 0.0% 18 054 20 958 24 020
Total Internal Transfers 10 516 537 3 509 5 066 0.0% 18 085 20 990 24 054
TOTAL OPERATING REVENUE 67 381 89 994 59 519 93 539 78 021 78 021 74 610 3.2% 85 210 90 153 95 293
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EXPENDITURE
Employee related costs 31 778 37 653 42 342 59 153 51 498 51 498 54 227 5.3% 57 371 60 700 64 160
Depreciation & asset impairment 1 247 1 191 1 082 1 500 3 222 3 872 1 584 -38.0% 2 107 2 229 2 356
Interest Paid : External Borrowings 382 314 265 391 650 650 413 -100.0%
General expenses 16 469 16 157 23 023 25 332 17 230 16 580 17 758 0.0% 17 575 18 594 19 654
Loss on disposal of PPE 385 350 103 0.0%
DIRECT OPERATING EXPENDITURE 50 261 55 665 66 815 86 376 72 600 72 600 73 983 1.2% 77 053 81 523 86 170
Internal Transfers
Interest Expense (Sweeping Account) 137 0.0%
Internal Charges (ME's / Core) 603 624 1 095 1 095 1 095 627 5.6% 1 223 1 294 1 368
TOTAL OPERATING EXPENDITURE 50 864 56 426 66 815 87 471 73 695 73 695 74 610 1.2% 78 276 82 817 87 538
OPERATING DEFICIT/ (SURPLUS) (16 517) (33 568) 7 296 (6 068) (4 326) (4 326)
37.0% (6 934) (7 336) (7 755)
OPERATING DEFICIT/ (SURPLUS) (16 517) (33 568) 7 296 (6 068) (4 326) (4 326)
37.0% (6 934) (7 336) (7 755)
Less Tax 4 310 11 484 (1 839) 1 760 18 18 -100.0%
OPERATING DEFICIT/ (SURPLUS) - after tax (12 207) (22 084) 5 457 (4 308) (4 308) (4 308)
37.6% (6 934) (7 336) (7 755)
The CAPEX allocated to JPC and Portfolio is as follows:
REQUESTED ALLOCATED
CAPEX
‘000
CAPEX
‘000
JPC R2,350 NIL
CoJ Portfolio R84,650 R18,000
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The list below reflects the core projects and is not necessarily in order of priority.
Table 5: Key Sub programme costing
GDS output / Other IDP Programme /
Activity
Project Baseline 5 Year Target Target for -
2012/13
2012/13
R 000
Job intensive
economic growth
1 Leveraging and
Facilitating of the
creation of jobs in
property portfolio
projects on Council
owned land
Site Preparation;
Fixed Assets physical
verification; Facilities
Management
800 3100 jobs 1085 jobs
45,889
Expanded and refined
support to small
businesses, and
greater facilitation of
the potential offered
by entrepreneurs and
the informal economy
2. Enterprise &
Property skills
development to
emerging industries
Property incubator
project - Develop and
Roll-out a Property
Incubator
None 100% rolling out of
the incubator
programme. Total
cost of project R6
million
Launch the incubator
programme
1,954
Property skills project
- Develop and Roll-
out a Property Skills
programme for
emerging industries
None 100% rolling out of
the property skills
programme. Total
cost of project R16.5
million
Launch the property
skills programme
3,426
Increased
competitiveness of the
local economy –
enabling and
3 Promote Joburg
as a sought after
property investment
destination
African property
summit project - Hold
a property summit.
None Hold a successful
African property
summit. Total cost of
project R25 million
Complete the event
plan (including
funding, venue,
service provider, etc)
3,372
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attracting investment
4 Branding
strategic property
projects & City's
strategic land
parcels
Key strategic projects,
properties & land
parcels - Brand land
parcels, strategic
buildings and
construction sites.
Brand 60 land
parcels;
Brand 30 strategic
buildings;
Brand 5 construction
sites.
None Brand 60 land
parcels; Brand 30
strategic buildings;
and Brand 5
construction sites.
Total cost of project
R8 million
Brand 15 land
parcels; Brand 8
strategic buildings;
and Brand 2
construction sites
2,685
5 Council-owned
property
management and
maintenance
Asset management
and maintenance -
100% verification of
Council-owned
property and
maintenance of the
fixed asset register
1% verification of
council owned
property
Verify Council owned
property. Total cost
of project R20 million
Complete the
verification of CoJ's
properties
3,426
Asset management
and maintenance -
Conduct highest and
best use analysis on
CoJ properties
Ongoing Ongoing highest and
best use analysis.
Total cost of project
R4 million
Conduct highest and
best use analysis on
CoJ properties
1,072
6 Sustainable
property economy
through expediting
the transfer of
properties
SOWETO Land
regularisation project
- Transfer properties
in the Greater Soweto
Area, the Greater
Orange Farm Area,
Ivory Park and
surroundings as well
631 actual transfers
and/or allocations of
properties
2000 properties to be
transferred in 5
years. Total cost of
project R42 million
150 transfers. 3,426
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as Alexandra
Audit of vacant non
residential stands
properties
None 100% completion of
the audit of vacant
non-residential
properties. Total cost
of Project R20
million. This
expenditure relates
to portfolio and will
be on tender thus no
cost to JPC
30% completion of
the audit
2,558
A smart City of
Johannesburg, that is
able to deliver quality
services to citizens in
an efficient and
reliable manner
7 Revenue
maximisation
utilising City's
property portfolio
Land sales and land
acquisitions and
completion of
developments -
Implement the income
generating initiatives
to boost the City’s
property portfolio
None R200 million Total
cost of project R50
million
R50 million of land
sales, acquisitions &
completion of
developments
6,802
8 Leveraging of
private sector
investment in
property portfolio
projects - investment
is realised only on
construction
Third party
investment on COJ
property
R215 million
investment on CoJ
property
R1. 2 billion
investments.
R220 million
investment
TOTAL R74,610
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5.2 Capital Expenditure
Table 6: Operational Capital
EXPENDITURE APPROVED BUDGET
2010/11
R’000
BUDGET 2011/12
R’000
ESTIMATE BUDGET
2012/13
R’000
ESTIMATE BUDGET
2013/14
R’000
Computers 1 600 1 250 1 250 2000
Furniture 200 500 500 500
Equipment and leasehold 200 600 600 1000
TOTAL 2 000 2 350 2 350 3500
5.3 Service Delivery Budget Implementation Programme
Not applicable to JPC
5.4 Revenue/Tariff Analysis
Not applicable to JPC
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6. HUMAN CAPITAL
6.1 Staff Establishment
The company currently conducts its business with a staff complement of 128 employees
inclusive of 14 short-term contractors. Additional temporary workers are intermittently employed
through labour brokers to address staff shortages in certain departments.
JPC as an organisation has grown significantly over the past decade and it has therefore
become necessary to realign itself to the strategic intent of the organisation. Failure to do so
results in an organisation being unable to achieve its strategic goals and inefficiencies result.
The approved new structure makes provision for an increase in Human Capital to occupy 154
identified inclusive of critical and strategic positions. This allows for the recruitment, selection
and placement of 40 additional personal to strengthen the core business and operate optimally.
In support of the Turnaround Strategy, it makes provision for additional positions at mid-
management level, compared with historically a predominantly administrative heavy structure.
JPC’s core business departments are Asset Management with a staff compliment of 16
positions; which focuses on Asset Management Planning, Portfolio Strategy Analysis and Asset
Register Management. The second and largest core business department is Property
Management with a staff compliment of approximately 42 positions: which focuses on Client
Services, Regional Management, Municipal Management, Outdoor Advertising and Transaction
Management. The third core department is Property Development: with a staff compliment of 17
positions focusing on Revenue Generation, through Project Development and Management.
The support departments with a staff compliment of approximately 79 positions consist of the
following units namely Finance, Corporate Services, Human Resources, Office of the Managing
Director and the Chief Operating Officer.
In addressing the operational needs in terms of the Turnaround strategy, the following Human
Capital interventions will be undertaken:
1. Filling of critical positions through internal recruitment. This is in line with the JPC
recruitment and selection policy.
2. Filling of critical positions through external recruitment (buy strategy). External recruitment
will only be initiated in instances where suitably qualified candidates could not be identified
from within.
3. To strengthen JPC’s strategic goals and inefficiencies and in building strategy, the
secondment of employees to more critical roles (lateral interim moves) and the appointing of
employees to act temporarily, would be options for consideration. . In addition, much
emphasis will be placed on training initiatives and the granting of bursaries to uplift the skills
gap. The training programme would furthermore focus on the development of succession
candidates occupying critical leadership roles. This will enable JPC to grow its own skills
pool over time.
The table below illustrates the current and future Human Capital requirements to strengthen
JPC’s operational and strategic demands.
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Table 7: Staff Estimates
Department
Actual Head
Count
Approved
Structure
Predicted
Variance
1 Office of the MD 3 8 5
2 Asset Management 8 16 8
3 Property Management 31 42 11
4 Property Development 17 17 0
5
COO: Special Projects &
Risk 10 20 10
6 Human Resources 5 8 3
7 Finance 18 22 4
8 Corporate Services 22 21 -1
Total 114 154 40
6.2 Human Capital Expenditure
The following costs are attached to the human capital requirements in fulfilment of the JPC
operations.
Table 8: Staff Expenditure
TOTAL STAFF EXPENDITURE
SALARIES AND
WAGES
Financial
Year
2010/11
Financial
Year
2011/12
Financial Year
2012/13
Projected
Percentage
Growth/Decrease
42 342 000 59 153 000 54 227 000 9%
The decrease from 2011/12 to 2012/13 will not affect the operational implementation of the
proposed structure.
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Table 9: Expenditure on Contracted Services
CONTRACTED SERVICES (Consultancy Services)
SERVICES
RENDERED
Previous
Financial
Year
2010/11
‘000
Current
Financial
Year 2011/12
‘000
Next Financial
Year 2012/13
‘000
Projected
Percentage
Growth/Decrease
TOTALS
7 435
8 951
8 699
2.8% increase
Table 10: Staff Expenditure vs. Operational Expenditure
RATIO OF STAFF TO OPERATING EXPENDITURE
Previous
Financial
Year
2010/11
‘000
Current
Financial
Year
2011/12
‘000
Next Financial
Year
2012/13
‘000
Projected
Percentage
Growth/Decreas
e
STAFF
EXPENDITURE 42 342 59 153 54 227 -8.3 %
TOTAL OPERATING
EXPENDITURE 56 246 66 815 74 610 12%
RATIO 75.0% 88.5% 61.9%
6.3 Employment Equity
JPC as an employer fully subscribes to the purposes and intent of the Employment Equity Act
no. 55, 1998. Reports are submitted annually to Department of Labour.
Table 11: Employment Equity
Categories
Male Female
Total
A C I W A C I W
Managing Director 0 0 0 0 0 1 0 0 1
Senior Managers 6 0 1 3 1 1 1 0 13
Middle Managers 7 0 1 2 5 0 1 0 16
Junior Managers 11 0 1 4 13 2 1 3 35
Semi-Skilled Staff 10 0 0 0 28 5 1 5 49
TOTAL 34 0 3 9 47 9 4 8 114
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JPC is committed to the principles of equity, anti-discrimination and diversity as enshrined in the
Constitution of the Republic of South Africa and the Employment Equity Act (EEA) No 55 of
1998. Gender mainstreaming, youth programmes, succession planning and retention have
become some of the key drivers in managing the manpower strategies at JPC. More so,
employment equity strategies have become a course for action to promote equality amongst
employees and help towards the development of future competent leaders in the Property
Industry.
Designated group status may be used as a tie-breaker in recruitment process, to ensure that
where two suitably qualified job candidates are available, we may prefer to appoint the
employee from a designated group, if that group is under-represented in that position or
occupation.
A revised EE policy was introduced in the past financial year where the following broad targets
were established:
o Current target base = 65/35%
o Planned target base = 80 /20%
o Gender target base = 50 /50%
During the 2012/2013 financial year implementation of the following planned interventions will
be implemented and managed by JPC’s Employment Equity and Training and Development
Committee;
? JPC will continue to strive to create an open, fair and democratic workplace based on
human dignity, freedom and equality;
? Adhere to the principles of equity, non-discrimination and diversity as enshrined in the
Constitution of the Country and the EEA;
? JPC will continue to create a workplace that reflects the diversity of South African society,
and contribute to maximising the human resource potential of all people;
? JPC will manage employment equity to promote equity in the workplace;
? Employment equity measures will be designed to ensure that suitably qualified people from
designated groups have equal opportunities in employment and advancement;
? The Committee with its own Constitution will promote JPC’s employment equity targets to
dissolve inequalities in designated groups and afford equal opportunities and advancement
in employment:
o The recognition that the disparities inherited from the apartheid past created
inequalities for the majority of the population and that these disparities require
constant monitoring and redress
o JPC core principles are drawn from the Constitution, social legislation and
shared values of the organisation’s stakeholders and staff
? JPC believes that the essence of non-discrimination lies in the creation of fair opportunities
for all in the society, and in particular those who are or have been discriminated against on
the basis of race, gender, sexual orientation or other arbitrary or unjustifiable grounds;
? JPC will implement this policy using an inclusive approach that addresses both numerical
targets and non-numerical processes; i.e. affirmative action measures;
? Overall targets set for the JPC will inform departmental targets;
? Employment equity constitutes a major change initiative and will be managed as such;
? The policy will endeavour to facilitate the involvement of all stakeholders, and their roles will
be clearly outlined;
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? Effective processes and structures will be put in place to monitor and evaluate the success
of the employment equity programmes in a transparent and participative manner. The
numerical targets and non-numerical objectives are to form part of Management’s
Performance Contracts;
? Preference in future appointments for groups that are under-represented in the different
occupational levels/categories will form part of a key feature in the implementation of the
JPC’s EE Policy;
? In accordance with Section 15(4) of the EEA, nothing in this policy requires JPC to take any
decision concerning an employment policy or practice that would establish an absolute
barrier to the prospective or continued employment or advancement of people who are not
from designated groups.
Gender Mainstreaming Programme
The City of Johannesburg’s (hereafter CoJ or City) Gender Mainstreaming Programme (GMP)
began in earnest in May 2008 and since them much progress has been achieved. The progress
made bodes well for the roll-out process which is planned in the three year lifespan of the
project. The GMP broadly aims to ensure that gender becomes mainstreamed into the process,
systems, policies and organisational culture of the City of Johannesburg, across Core
Departments and Municipal Owned Entities.
This programme will consolidate the many gender initiatives undertaken within the City, which
have mostly lacked institutionalisation and have been poorly popularised. These initiatives have
remained fragmented along department /institutional lines and, consequently, the monitoring of
these programmes and the assessment of their impact has also remained fragmented. Through
the GMP these initiatives will be examined against the objectives and key deliverables of the
Programme.
A key strength of the GMP is that is focus lays both in internal and external communities of the
City. As a result of this two-pronged focus, the Programme has two main departmental drivers,
namely the Departments of Corporate and Shared Services.
The main objectives of the Gender Mainstreaming Programme are:
? To finalise the gender policy of the City of Johannesburg.
? To work with all departments and units of the City in developing gender action plans.
? To build capacity for the implementation of these plans through on-the-job training.
? To monitor and evaluate implementation of the Gender Policy.
? Present the Draft Gender Policy to the Executive Management Team
? Gender Policy be finalised and adopted by the Council
? Gender indicators be included in the current IDP planning process, and
? Structures and roles and responsibilities around gender mainstreaming need further
interrogation.
? Hold capacity building workshops for the Gender Focal Points
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6.4 Staff turnover / movement during previous financial year 2011/12
Table 12: Staff Turnover
Staff
Movements
African Coloured Indian White
Totals
Male Female Male Female Male Female Male Female
Recruitment 1 3 0 0 0 0 0 0 4
Promotion 0 0 0 0 0 0 0 0 0
Resignation 4 1 0 0 0 0 0 0 5
Early Retirement 0 0 0 0 0 0 0 0 0
Retirement 0 0 0 0 0 0 0 0 0
Retrenchment 0 0 0 0 0 0 0 0 0
Medical Boarding 0 0 0 0 0 0 0 0 0
Dismissal 0 0 0 0 0 0 0 0 0
Death 0 0 0 0 0 0 0 0 0
Contract Expiring 0 0 0 0 0 0 0 0 0
Grand Total 5 4 0 0 0 0 0 0 9
6.5 Employee wellness programmes
JPC’s employee Wellness Committee previously comprised of dedicated employees who
performed duties voluntarily towards the goal of managing the social wellness side of JPC’s
manpower. The voluntary employee wellness team changes participation on an annual basis, in
order to provide opportunities to other staff members who have a passion towards such social
courses.
A significant milestone has been achieved during the 2011/12 financial year in that the company
managed to establish an official OHASA committee. The structure is still at its infant stages and
interventions based on capacitation of the forum members are currently being undertaken.
JPC in the interim still continues to seek the assistance of the CoJ’s OHASA department, in
particular where there is need for the services of a medical doctor or a professional counsellor
to assist employees in the workplace. In addition, JPC participates in all peer education
workshops and currently has two skilled peer coordinators who are able assist to staff in
managing their HIV and Aids status. The company actively participated and will continue to
support World Aids Day on the 1
st
of December and other important awareness campaigns
such as World breast cancer day and World tuberculosis day.
The move of the JPC to new office premises enabled the HR department to deliver amongst
other employee wellness imperatives a three day wellness campaign was a subproject derived
from the Strategic Plan of the Human Resources Department: Employee Relations.
The primary focus of the Health and Wellness campaign was to educate and raise awareness
amongst JPC employees with regard to their Health and Wellbeing and secondly to understand
JPC’s Health and Wellness profile with the aim of informing business planning.
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The proposed theme for the event was “Your Health, JPC’ s Future”. Attention was paid to
several pillars of Health and Wellness including financial matters by The National Credit
Regulator, physical aspect by Virgin Active, Diabetes SA WITS Health Consortium, COJ
Primary Health, Pink Drive, The Pacific Institute, JPC Contracted Medical Scheme Providers,
Motivational Talk by Criselda Kananda (HIV Activist and Metro fm talk show Presenter, and
Annique Health and Beauty and various social aspects.
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7. RISK ASSESSMENT
The table below reflects the strategic risks of the company. It should however be noted that the company is in the process of reviewing its
strategic risks
STRATEGIC OBJECTIVES
1. Support economic development utilising the property portfolio.
2. Support community development and social initiatives utilising the property portfolio.
3. Utilise the CoJ property portfolio as a vehicle for transformation.
4. Ensure efficient, economic, and effective service delivery to J PC's clients, customers and stakeholders.
5. Ensure a professionally managed and sustainable company.
R
i
s
k
N
o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
SR1 Human
resourc
e/capital
All Poor
organizational
performance
Mismatch or
shortage of skills.
4 4 16 Approved and
implemented HR
policies. Approved
turnaround strategy.
Redesign of HR
structure.
Draft HR strategy in
place and developed job
descriptions. WSP
0.75 12 To perform
scientifically skills
audit
1
Senior
Manager:
HR
30-
Mar-12
The results from the
skills audit fed to VIP
system for monitoring
Senior
Manager :
30-
Jun-12
1
It entails approval of HR strategy by Board. Partially implementation for 2011/2012 as it will be spread over two years.
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R
i
s
k
N
o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
and maintaining of the
skills base database
HR
Implementation of the
new structure
Senior
Manager :
HR
30 –
Jun-12
To ensure compliance
and enforce
performance
management
2
Senior
Manager:
HR
30-
Jun-12
Coaching and training
of staff
All EM’s 30-
Jun-
12
SR2
Financia
l
All
Failure to
meet revenue
and delivery
targets
Inadequate
financial resources
( Insufficient
CAPEX and OPEX
budget)
5 5 25
Applied for additional
funding from internal and
external sources.
Constantly request for a
revised budget half-
yearly. Accurate
budgeting is done
0.75
18.75
Implement revenue
model as per
turnaround strategy.
To present to the City
on JPC's mandate and
funding. To draft a
report to the City for
JPC to retain a certain
MD&
Chairperso
n Board
30-
Jun-12
2
Will be linked to PIMS, performance management cycle will be tool for monitoring. It entails IPMS policy refined and rolled out to the entire organization, introduction of moderation process for
organizational excellence and recognition strategy developed)
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R
i
s
k
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o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
supported by evidence
percentage from
income collected.
Sourcing external
funding.
Cumbersome CoJ's
land approval
processes for land
transactions
and inadequate
planning.
Policies and procedures
are in place .Delegations
of authority. Supply
Chain Management
Policies are in place
Project manager to
ensure that the
property is on the LIS
before the tender is
out, create an
account.
EM :
Finance
EM:
Property
developme
nt
30-
Dec-11
To review the policies
and procedures with
City department
All EM’s 30-
Jun-12
Non conducive
investment
environment(
Package investment
deals with incentives
i.e. highlight
investment and
demand
3
EM :
property
manageme
nt, property
developme
nt , asset
manageme
30-
Jun-12
3
Need to explore with other departments what are they doing and what DED is doing.
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R
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s
k
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o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
nt
Plan an African
Property Summit and
market JPC
4
EM:
stakeholder
manageme
nt
30-
Jun-12
SR3
Process
es
4
Vandalism
and inability to
maintain
facilities
Overlaps of
mandate with other
municipal entities
regarding facility
management
4
3
12
Service Delivery
Agreement( SDA)
0.90
10.8
Completion of
mandate with City
MD&
Chairperso
n Board
30-
Jun-12
Lack of lease
contract
enforcement and
monitoring
Ad-hoc site inspection of
facilities. Lease
agreements with
tenants.
Streamline and fast
track awarding of
lease management
agreements so that
maintenance burden is
passed onto the
lessee
EM:
Property
manageme
nt
30-
Jun-12
4
Appoint event management service provider, establish event committee and draft event plan, source sponsors and market and communicate the event
CITY OF JOBURG PROPERTY COMPANY SOC LTD
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R
i
s
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o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
Tenant vacating
without notifying
lease unit ,lack of
site inspection and
contract
management
Ad-hoc inspections by
stakeholder
management unit and
leasing officials and
enforcing of contracts
Develop a plan for
formalising site
inspections(prioritising
).Inspection of leased
properties
5
EM:
Property
manageme
nt
30-
Jun-12
Inadequate funding
for security and
maintenance
Budget, onsite security
and security placed on
hot spot.
Request for additional
funding for
maintenance and
security
MD/Chairpe
rson of
Board
30-
Mar-12
Inadequate
facilities
management and
lack of
maintenance plan
Repairs on an ad-hoc
basis. Maintenance
clause on leases term
To develop a
maintenance plan.
Exchange programs
on facilities
management to
selected officials
EM : Asset
manageme
nt
30 -
Jun-
12
5
Regionalisation of the portfolio and appointment of four regional officers to do inspection and also managing contracts(i.e. Implementation of turnaround strategy)
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R
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s
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o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
SR4 Informat
ion
manage
ment
4
Incomplete
asset register
Lack of physical
verification
4 5 20 Physical verification of
Region E( Greater Ivory
Park, Region G( Orange
farm and Greater
Alexander)
0.75
15
To extend physical
verification to other
regions e.g. Region A,
etc
EM : Asset
Manageme
nt
30-
Jun-12
SR5 Financia
l
2,3,4,
5
Loss of
revenue
on leases,
outdoor
advertising
/cellular mast
Lack of income
statements per
property to assess
performance to
ascertain
performance of the
portfolio.
4
3
12
Holistic evaluations
performed ,consolidated
financial reporting
management reports
transaction on report
show all transactions
0.90
10.8
Customization of
NICOR to produce
income statements
EM :
Finance,
Asset,
Property
manageme
nt
&Property
developme
nt
28 -
Feb-
12
Processes not
integrated between
all core
departments i.e.
asset management,
finance, legal, and
property
management (
Value chain)
Manual system - spread
sheet
Access to NICOR by
all core departments
and to integrate
NICOR to PIMS
system
EM: Asset
manageme
nt
30 -
Jun 12
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R
i
s
k
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o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
Pending litigation(
outdoor
advertising)
Report submit to
Mayoral
Reviewing of the
by-laws as they are
restrictive factor to
the revenue stream
of JPC
Unclear mandate
from City regarding
outdoor advertising
SR6 Regulat
ory
5 Possible
litigation /legal
action
Delays in property
transfers and
finalisation of
contracts
4 3 12 Informal tracking system 0.75 9 Formalisation of
tracking system
COO 30-
Jun-12
Non-compliance
with relevant
legislation
Compliance checklists.
Quarterly litigation
reports. Approved
delegations of authority.
Evaluation of controls by
Implementation of
compliance register
and monitoring
thereof. Quarterly
reporting on
Company
secretary
30-
Jun-12
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R
i
s
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o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
internal auditors.
Frameworks and
strategies are in place
compliance to relevant
stakeholders.
6
Educate and raise
awareness to all
stakeholders about
processes
(compliance)
COO &
Company
secretary
30-
Apr-12
SR7 Integrity All Fraud and
corruption
Fraudulent sales.
Illegal occupation
of land parcels.
4 4 16 JPC, City Fraud hotline,
caveats, fraud policy,
scrutinise of illegal
transaction. Continuous
risk assessments
0.75 12 Develop and
implement fraud
prevention plan.
Create awareness on
fraud prevention plan
COO/Risk
manager
30-
Jun-12
Inadequate
business processes
that are aligned to
the City's
Policies and procedures
are in place e.g. SCM.
Evaluations by internal
Audit Committee.
To develop business
processes for all the
different departments
and align to City
processes
All EM's
and
support
units
30-
Mar-12
6
Implementation of compliance software
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s
k
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o
Risk
Categor
y
L
i
n
k
t
o
o
b
j
e
c
t
i
v
e
Risk
description Root cause
I
m
p
a
c
t
L
i
k
e
l
i
h
o
o
d
I
n
h
e
r
e
n
t
r
i
s
k
Current controls
C
o
n
t
r
o
l
e
f
f
e
c
t
i
v
e
n
e
s
s
R
e
s
i
d
u
a
l
r
i
s
k
Action Plans
Action
Owner
Action
Plan
date (
end
date)
SR8 Process
es
All Loss of
valuable
information as
result of IT
failure
Lack of efficient &
effective data and
document
management
system
4 3 12 PIMS system and
training conducted
0.75 9 Roll-out and
continuous training on
PIMS system
EM: Asset
manageme
nt
30 -
Jan-12
Implementation of
PIMS system and
reporting monthly to
EXCO
7
All EM's
and
support
units
28-
Feb-12
Lack of business
continuity and IT
disaster recovery
plans
IT disaster recovery
plans
The BRP and BCP
plans are being
drafted for submission
to Board.
Quarterly reporting to
relevant stakeholders
EM: SMU 30-
Jun-12
SR9 Financia
l
All Illegal
occupation of
land
parcels/land
invasion
Poor marketing of
company’s
properties and
services offered by
JPC
4 3 12 Road shows are
conducted, broadcasting
through radio station.
Property sale are
displayed on billboards.
Draft marketing strategy.
0.75 9 Continuous road
shows. Finalisation of
marketing strategy.
Implementing and
continuous monitoring
of the marketing
strategy.
EM :
Property
Manageme
nt
30-
Dec-11
7
Training will happen November and December 2011.
CITY OF JOBURG PROPERTY COMPANY SOC LTD
2012 – 2013 BUSINESS PLAN
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41
Risk aligned to the following Master Programmes:
? Enabling Resilience, Inclusion & Sustainability
? Enabling Growth & Job Creation
? Empowering Citizen & partnership
? Going green
? Institutional Renewal
RISK LINK TO MASTER PROGRAMME
Poor organizational performance
ALL
Failure to meet revenue and delivery targets
ALL
Vandalism and inability to maintain facilities
ALL
Incomplete asset register ALL
Loss of revenue on leases, outdoor advertising /cellular mast
ALL
Possible litigation /legal action ALL
Fraud and corruption ALL
Loss of valuable information as result of IT failure ALL
Illegal occupation of land parcels/land invasion ALL
CITY OF JOBURG PROPERTY COMPANY SOC LTD
2012 – 2013 BUSINESS PLAN
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42
8. APPENDIX
2008/09 2009/10 2010/11 Current year 2011/12 Medium Term Revenue and Expenditure Budget
Audited Audited Audited
Original
Budget
Adjusted
Budget
Full Year
Forecast
Budget Year Variance Estimates Estimates Estimates
Outcome Outcome Outcome 2012/13 % 2013/14 2014/15 2015/16
R 000 R 000 R 000 R 000 R 000 R 000 R 000 R 000 R 000 R 000
REVENUE
Interest earned - external investments 24 8 143 8 10 10 10 0.0% 11 12 12
Interest earned - outstanding debtors 1 441 2 086 6 259 4 255 4 255 -100.0%
Licences and permits 0.0%
Agency services 40 687 18 664 29 445 50 387 38 589 38 589 32 119 -16.8% 30 123 31 985 33 881
Operating grants & subsidies 0.0%
Other Revenue 14 713 68 699 23 672 39 635 35 167 35 167 32 922 -6.4% 36 991 37 166 37 346
Gain on Disposal of PPE
0.0%
DIRECT OPERATING REVENUE 56 865 89 457 59 519 90 030 78 021 78 021 65 051 -16.6% 67 125 69 163 71 239
Internal Transfers
Interest Income (Sweeping Account) 0.0% 31 32 34
Operating Grants & Subsidies from (COJ) 10 516 537 3 509 15 487 0.0% 18 054 20 958 24 020
Total Internal Transfers 10 516 537 3 509 15 487 0.0% 18 085 20 990 24 054
TOTAL OPERATING REVENUE 67 381 89 994 59 519 93 539 78 021 78 021 80 538 3.2% 85 210 90 153 95 293
EXPENDITURE
Employee related costs 31 778 37 653 42 342 59 153 51 498 51 498 54 227 5.3% 57 371 60 700 64 160
Depreciation & asset impairment 1 247 1 191 1 082 1 500 3 222 3 872 1 997 -38.0% 2 107 2 229 2 356
Interest Paid : External Borrowings 382 314 265 391 650 650 -100.0%
General expenses 16 469 16 157 23 023 25 332 17 230 16 580 17 230 0.0% 17 575 18 594 19 654
Loss on disposal of PPE 385 350 103 0.0%
CITY OF JOBURG PROPERTY COMPANY SOC LTD
2012 – 2013 BUSINESS PLAN
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43
DIRECT OPERATING EXPENDITURE 50 261 55 665 66 815 86 376 72 600 72 600 73 454 1.2% 77 053 81 523 86 170
Internal Transfers
Interest Expense (Sweeping Account) 137 0.0%
Internal Charges (ME's / Core) 603 624 1 095 1 095 1 095 1 156 5.6% 1 223 1 294 1 368
TOTAL OPERATING EXPENDITURE 50 864 56 426 66 815 87 471 73 695 73 695 74 610 1.2% 78 276 82 817 87 538
OPERATING DEFICIT/ (SURPLUS) (16 517) (33 568) 7 296 (6 068) (4 326) (4 326) (5 928) 37.0% (6 934) (7 336) (7 755)
OPERATING DEFICIT/ (SURPLUS) (16 517) (33 568) 7 296 (6 068) (4 326) (4 326) (5 928) 37.0% (6 934) (7 336) (7 755)
Less Tax 4 310 11 484 (1 839) 1 760 18 18 -100.0%
OPERATING DEFICIT/ (SURPLUS) - after tax (12 207) (22 084) 5 457 (4 308) (4 308) (4 308) (5 928) 37.6% (6 934) (7 336) (7 755)
CITY OF JOBURG PROPERTY COMPANY SOC LTD
2012 – 2013 BUSINESS PLAN
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44
GLOSSARY OF TERMS
TERM DETAIL
CoJ City of Johannesburg
JPC Joburg Property Company
MOE Municipal Owned Entity
WSP Workplace Skills Plan
ATR Annual Training Report
OPEX Operational Expenditure
CAPEX Capital Expenditure
MFMA Municipal Finance Management Act
GDS Growth & Development Strategy
doc_984750832.pdf