President Ramaphosa concludes inaugural PICC under 7th administration

President Cyril Ramaphosa says the seventh administration has prioritised its commitment to scale up investment in infrastructure, as government seeks to boost the economy, create jobs, improve access to basic services, and the quality of life for citizens. 

President Ramaphosa said this at the conclusion of the inaugural Presidential Infrastructure Commission Council (PICC) under the seventh administration. 

The council convened to discuss, amongst others, a plan on dealing with crime and extortion at construction sites, the level of implementation of priority infrastructure projects and programmes, as well as strategic initiatives that are being developed to accelerate the pace and quality of infrastructure investments in the country.

“This administration has prioritised scaling up investment in infrastructure, as we seek to grow the economy, create more jobs, improve access to basic services, and improve the quality of life of our citizens. 

“Continuing the work of the sixth administration, we are working to involve the private sector in achieving our infrastructure development goals. It is encouraging that after a period of declining infrastructure spend, public sector capital expenditure is on the rise for the second straight year. 

“According to Statistics South Africa, last year, public sector institutions had a combined capital expenditure of R233 billion. This is an 11% increase on the previous year,” President Ramaphosa said. 

The council is constituted by the President, Deputy President, Ministers designated by the President, Premiers of provinces, Executive Mayors of metropolitan councils and the chairperson of the South African Local Government Association. 

Per the Infrastructure Development Act, the Council is tasked with, inter alia:

• Coordinating the development, maintenance, implementation and monitoring of the national infrastructure plan; 
• Coordinating the determination of priorities for infrastructure development;
• Ensuring that infrastructure development in respect of any strategic integrated project is given priority in planning, approval and implementation;
• Ensuring co-operation between organs of state affected by projects undertaken, and
• Promoting investment and identifying and develop strategies to cause the removal of impediments to investment.

Implementation of Strategic Integrated Projects

The council noted that there are 19 completed Strategic Integrated Projects (SIPs) valued at R26 billion.

Of these projects, six are in transport, three in water and sanitation, one in energy, four in human settlements and five in student accommodation. 

Currently, 82 projects, valued at R437 billion, are in construction.

In addition to providing technical assistance and resources to help project sponsors prepare comprehensive business cases, ensuring they are economically viable and socially beneficial, Infrastructure South Africa (ISA) has played a pivotal role in supporting project sponsors to expedite approvals, authorisations, licences, permissions and exemptions with the relevant authorities. 

Over 654 requests for regulatory unblocking were lodged with ISA between 2020 and 2024. To date, 497 approvals have been granted and 157 are currently in progress.

The total project value of SIP projects gazetted between 2020 and 2024 has grown to R3 trillion, with the key drivers being the Eskom Programme (SIP 8, 9 and 10), the Embedded Generation National Programme and the Green Hydrogen National Programme (SIP 20E).

Aiding municipalities

The council agreed that there is a need to enhance the Municipal Infrastructure Service Delivery Model using ISA’s methodology, which emphasises project preparation using the Five-Case Model, which is planning and prioritisation, development of business cases, mobilisation of funds from private and public sectors, implementation of innovative solutions and effective monitoring.

This model will be piloted in four local municipalities and leverage external resources and technical capacity stemming from local and international partners. 

The following four municipalities will benefit from the “Adopt a Municipality” pilot initiative: Govan Mbeki Local Municipality in Mpumalanga, Kagisano-Molopo Local Municiapity in the North West, Umngeni Municipality in KwaZulu-Natal and Metsemaholo Local Municipality in the Free State.

This initiative, spearheaded by ISA, will address critical service delivery challenges, including persistent incomplete projects and infrastructure issues. ISA aims to drive urgent improvements over the next 24 months, with some projects being completed during this timeframe. ISA will hold further consultations on the next cohort of municipalities to be added to the initiative.

Crime and Extortion on Construction Sites

The council has lauded the contribution of the construction industry to job growth in the second and third quarters. 

According to the Quarterly Labour Force Survey released by Statistics South Africa earlier this month, the construction sector added 176 000 jobs, playing a pivotal role in reducing the national unemployment rate by 1.4% in the third quarter.

The council said the construction industry is vital for socio-economic development, employment and infrastructure improvement.

“Crime and extortion on construction sites must be condemned in the strongest possible terms,” the council said, while welcoming efforts by the police in addressing criminal and extortion cases.

The council further noted that there is an indication of increasing trends in criminal activities on construction sites, despite government’s efforts to embed social facilitation and involve law enforcement. Effective mitigation will require coordinated efforts from all stakeholders.

The council has made the following recommendations on the matter:

• Law enforcement must be allocated more resources to deal with criminal activity and violence on construction sites.
• Policy reforms in the construction sector must be prioritised.
• Industry must adopt best practices in social facilitation and invest in security measures.
• Infrastructure project leads must enhance community engagement and encourage communities to actively participate in project planning.

Programme of Action for the PICC Council in the 7th administration 

The PICC Council has identified eight pathways to driving infrastructure investment and growth in the next five years. 

These pathways will underpin the infrastructure investment plan of the 7th administration.

The eight pathways include:

Pathway 1: Institutional Coordination

Affirming Infrastructure South Africa as a single point of entry for priority infrastructure projects.

Pathway 2: Centralised Planning and Prioritisation

Establish a gateway mechanism for projects and programme that are deemed strategic/catalytic.

Pathway 3: Budget Reforms

Accelerate the implementation of broader reforms to enable infrastructure investment.

Pathway 4: Address Regulatory Bottlenecks

Streamline regulatory and approval processes to fast-track implementation of infrastructure projects.

Pathway 5: Municipal Bulk Infrastructure

Address funding and financing of municipal bulk infrastructure.

Pathway 6: Unlocking other sources of funding

Increase and diversify sources of funding for both project preparation and infrastructure funding & financing.

Pathway 7: Economic Regulation in Construction

Strengthen regulatory framework governing construction industry.

Pathway 8: Cancellation of Tenders, Social Unrest, Damage to Infrastructure and Crime

Improving governance of infrastructure projects and ensure close collaboration with law enforcement agencies. – SAnews.gov.za

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