Tuesday 23 July 2024
Construction, Infrastructure Development, Land Reform – The Role of Public Works & Infrastructure and its entities contributing to Economic Transformation
Construction and Infrastructure development are the key drivers for implementing the Economic Reconstruction and Recovery Plan. Therefore, the Department of Public Works and Infrastructure and its entities have a critical role to play in ensuring the implementation of the Economic Reconstruction and Recovery Plan to ensure inclusive economic growth and job creation. This is also largely as a result of the fact that construction of the built environment and infrastructure development are the core competence of the Department of Public Works and Infrastructure. The Economic Reconstruction and Recovery Plan seeks to reverse the historic injustice of the apartheid past through ensuring inclusive economic growth and development as well as job creation. It also seeks to reverse the historical legacy of poverty, inequality, unemployment and historic economic exclusion for the majority of South Africans.
The Budget Policy Vote of the Department of Public Works and Infrastructure comes at a critical moment as the Department has made important progress to reverse the effects of state capture and corruption and also made important progress to implement the transformation polices of the ANC Government in the 6th Parliament. Critical areas need to be highlighted in order for the Government of National Unity to build on the successes which have been laid and to ensure that the policy and programmes of the Government of National Unity are delivered and are within budget. The Department is a policy department and it has entities which are implementing agents. In the past the entities of the department were plagued by a number of issues and currently the entities have stable boards which ensure good corporate governance and financial controls. In the last financial year the AG’s Report reflects that the Department and most of its entities receiving unqualified reports. One entity received a qualified report which was the Property and Trading Management Entity and this was also an improvement on the previous years. We are expecting that the same type of financial performance will continue to prevail with further improvements.
In order to achieve the policy objectives of the Government the department has five Programmes relating to Government immovable property, construction and the built environment. Other programmes of the Department include administration, intergovernmental coordination, Extended Public Works Programme, Property and Construction Industry Policy and Research and the Prestige programme. There has been a decline in the budget of the Department which means that it will need to achieve more with less financial resources. There is no room for fruitless and wasteful expenditure or irregular expenditure as there is a need for qualitative and impactful spending.
The creation of Infrastructure South Africa in the Department means that the Department has an important role to ensure the delivery of infrastructure projects with the Presidency and National Treasury. Over the medium term Infrastructure South Africa will be allocated some R585 million to ensure the development of pre-feasibility and feasibility studies geared towards the implementation of infrastructure projects. However, Infrastructure projects in the form of Wellisizwe Bridge building Project has already commenced. The Welisizwe Rural Bridges Programme, SIP 25, is geared towards providing rural communities with access to social services, educational facilities, jobs and markets. Without these bridges in the rainy season it is impossible for example to access schools and health facilities. This bridge building programme commenced in the past financial year with the construction of 28 bridges through the department reprioritising its budget. These bridges were built in flood affected areas like KZN to ensure that flood affected communities could have access to social services and buy food. This programme was implemented with the assistance of the Defence Force and Department of Transport. In Phase 2
ISA plans to construct a total of 96 rural bridges, with 18 bridges per province being built in Eastern Cape, KwaZulu-Natal, Mpumalanga and Limpopo, and 12 bridges per province in the Free State and North West. R3.8 billion is allocated for the programme over the medium term. This is part of directing investments into the rural areas to ensure infrastructure development that benefits the community in ensuring the success of land reform and the development of the agricultural sector as it also enables access to markets.
The development of the Oceans Economy is a key priority of the Economic Reconstruction and Recovery Plan as this will economically benefit coastal communities and ensure the development of small and medium fishing and cooperatives as the Department of Environmental Affairs has already been issuing fishing licences to these communities. These small harbours are also tourist attractions with the hospitality industry also benefitting. The refurbishing and development of small harbours has already occurred with the 13 harbours in the Western Cape and the Government invested some R500 million in the project. The refurbishment of the small harbours in the Western Cape created 925 jobs and empowered local SMME’s to the value of over R116 Million. The Department must continue with the development of the Small Harbours programme. In the last financial year the department commenced with a pre-feasibility study to develop small harbours in Port St. Johns and Port Alfred. These projects will enable the development of the oceans economy for the local community and enable inclusive economic development and job creation in historically disadvantaged areas. These harbours also have the ability to ensure the development of agro-processing zones in the sea food sector and this must be part of the integrated approach adopted to the development of small harbours.
The Department through its entity the PMTE is responsible for the immovable assets of Government. It must enhance the value of property for Government. This entity has improved during the course of the 6th Parliament and much more improvement in the functioning of the entity is required to improve the value of the property and its income potential. Its audit outcome in the past financial year has also improved and further improvement is required for it to achieve an unqualified audit in this financial year. However, there are a number of perineal problems which afflict the entity such as the lack of maintenance of Government property and ensuring that it is paid rentals by Government departments and entities. The process with National Treasury to ensure that Departments pay the rentals and the quantum paid is in accordance with lease agreements in order to reduce the overdraft of the PMTE. The completion of the immovable asset register remains a critical issue requiring the attention of the executive and the Department. A solution must be found to shorten the period and in which this task is projected to be completed. The cost of leasing property from the private sector must be reduced. The weak control environment cited by the AG for leasing property needs to be fixed in this financial year as corruption has no place in our environment and comes at a high cost to the fiscus. In such cases the law must take its cause.
The IDT has historically played a critical developmental role in the ensuring infrastructure development in communities. The IDT has over a number of years had difficulties which has been resolved in the 6th Parliament and repositioned to engage in development projects as it has historically done. It is imperative that the Department ensure the financial stability and viability of the IDT through ensuring that it is able to engage in infrastructure development projects.
The Construction Entities under the Department have a critical role to play in the construction industry and the regulation of the industry. The industry must function on the best international practice. It is imperative that the construction industry is able to absorb young graduates in the sector as interns to ensure that they are able to do their training to qualify in their professions and gain work experience.
Land Reform is critical for reversing apartheid spatial planning and for agrarian reform and the role of the Department is critical in this regard as the process has already commenced in terms of making state land available for spatial development and for the development of small and medium scale black farming. An integrated approach needs to develop between Department of Human settlements and Department of Land Reform with Public Works to ensure that housing development and agricultural development occurs. Much land has already been distributed and this needs to become productive in terms of development. The Department is intending to release more land to ensure development in the current financial year. Development progress is critical as land empowers people in communities economically and improves their lives. The Expropriation Bill which was passed by both houses is an important tool for expropriating land in the public interests to ensure transformation and must be used once signed into law. This legislation assists the labour tenants on farms who were historically dispossessed to acquire land
The Extended Public Works Programme has provided critical jobs to families which would not ordinarily have an income. It has also been a source of skilling people employed. This programme removes people from extreme poverty and benefits communities. The programme functions in the three spheres of Government, namely, national, provincial and local. During the 6th Parliament the Department was able to achieve its target of creating some 5 million jobs. The department will continue the programme under the Government of National Unity, which aims to create work opportunities using labour-intensive methods creating work opportunities in working class and poor areas. An estimated R6.1 billion is allocated over the medium term for transfers and subsidies. The programme also has a skilling component for the training of artisans in different fields which enable the skilled artisans to be self-employed or employed in the private sector. This part programme must be intensified as in the past financial a number of artisans qualified as motor mechanics and auto electricians and through the Nedlac process were taken in as interns at Isuzu Motors. Thereafter the interns were absorbed into the workforce at Isuzu. We need to see much more of this. Artisans need to be put into contact with the Department of Small Business to enable the development of the small and medium enterprise sector.
There is much work to be done and much to be achieved to ensure the transformation of the communities and create inclusive economic development. Job creation is critical to create a better life for all and improve the quality of life for people. The Select Committee will oversight and await the reports of the Department and its entities to monitor progress in the sector. We expect to see delivery and more delivery based on qualitative and impactful spending under current fiscal conditions.
The ANC supports this Budget Policy Vote of the Department of Public Works and Infrastructure.