adminMany projects have been in the pipeline for years and may not be as ready for implementation as government claims – Industry Insight
The government’s announcement about the first 50 out of 276 strategic infrastructure projects (SIPs) worth R360 billion has been criticised for lacking critical details and any meaningful background to encourage private sector support.
Construction market intelligence firm Industry Insight said in its latest Construction Industry Monitor that many of these projects have also been in the pipeline for years and may not be as “bankable” and ready for implementation as government claims.
“We will have to wait and see, but we remain skeptical for the time being,” said Industry Insight CEO Elsie Snyman.
Industry Insight added that all projects will be assessed in terms of how they will advance the National Development Plan (NDP) despite the fact that none of the infrastructural targets outlined in the NDP has been achieved “and in fact had regressed over the last decade”.
Minister of Public Works and Infrastructure Chairperson of the Presidential Infrastructure Coordinating Commission Council (PICC) secretariat Patricia De Lille gazetted the projects on July 24 2020 as the next step in the implementation of South Africa’s infrastructure investment plan.
This followed the Sustainable Infrastructure Development Symposium (SIDSSA) held on Jun 23 2020.
The gazetted projects include:
– R106 billion for water and sanitation projects, including phase 2A of the Mokolo Crocodile water augmentation project in Limpopo.
– Three energy projects valued at R58 billion, including the development, installation and operation of 2 000 megawatts of new generation capacity from Independent Power Producers (IPP’s)
– R47 billion for 15 transport projects.
– R138 billion for human settlement projects, including Mooikloof Mega Residential City Project, one of four projects listed from the private sector.
– R4 billion for projects in the digital sector
– R7 billion for two projects in the agriculture and agro-processing sector.
Fragmentation in delivery
Industry Insight said three important issues raised at the SIDSSA were the need for a credible, bankable infrastructure project pipeline, a focused infrastructure plan and to address fragmentation in delivery.
It highlighted the government was reconfigured in May last year to include Infrastructure as part of the Department of Public Works.
“This is an attempt to deal with the fragmentation in infrastructure delivery. The 50 identified projects are already in the system of several local and provincial departments of government and municipalities, and are apparently ready for implementation.
“These projects form part of the larger infrastructure drive estimated at R2.3 trillion over the next decade, and have been fast tracked.
“Government, as stated many times over the past few decades, cannot do this alone, and continues to be reliant on private sector support and collaboration. Government is now seeking financial support from development finance institutions, multilateral institutions, and the highly controversial private pension funds,” it said.
Bongani Ndlovu