Speech notes: Vicky Knoetze MPL – Provincial Expenditure on Infrastructure Delivery Plans

COMMITTEEs MUST TAKE A PROACTIVE APPROACH TO THE CHALLENGE OF INFRASTRUCTURE DELIVERY IN THE PROVINCE

  • DRPW as the infrastructure nerve centre of the province suffers from a culture of non-compliance and a lack of capacity
  • Infrastructure Development will boost economic growth and alleviate poverty.
  • Stability within the DRPW must be achieved to stimulate infrastructure delivery success.

Honourable Speaker, honourable premier, honourable members, officials of the Department and guests.

Mr Stephen Hayes, the president of the Corporate Council of Africa said that:

“Infrastructure is probably the single most important need for Africa to develop.”

The development of infrastructure is essential for the creation of a prosperous and flourishing economic climate.

The success and the enhancement of sustainable development rely on an efficient infrastructure programme within any given country especially in developing countries such as South Africa. It is therefore important honourable speaker that, infrastructure in South Africa is regarded as an investment into economic growth.

According to other leading economists:

If South Africa’s economy is to move to a high-growth path, which is sufficiently high to bring down unemployment in any significant way, sustained investment in its economic infrastructure will be essential to achieving that outcome.

Given the wealth of demands on the public purse and the temptation to neglect infrastructural investment when times are tough, and the difficulty of taking long- term decisions in the presence of enormous uncertainty, this is easier said than done. But it cannot be avoided.

Honourable Speaker, in response to this, government adopted a National Infrastructure Plan in 2012. With this plan, the government is aiming to transform the country’s economic landscape while simultaneously creating significant numbers of new jobs, and strengthening the delivery of basic services.

The Provincial Treasury added a 5th programme called Infrastructure Development. This is all done in an effort to take that proactive stance on infrastructure development that will be a catalyst to economic growth.

Speedy and cost-effective delivery of infrastructure will enable the private sector to expand capacity, employ more people and produce more goods and services, therefore creating a larger taxpayer base, which will help to reduce the fiscal deficit and allow for more room to deliver on key social services. Both theoretical and empirical evidence thus point to the existence of a robust positive relationship between infrastructure and economic growth.

The challenge in South Africa is implementation and delivery on the ground and the huge amounts of the budget that are wasted each year through corruption and chronic implementation. Weaknesses in planning and capacity continue to delay implementation of some projects.

Honourable Speaker, the South African Reserve Bank estimated that with our current economic infrastructure, the economy’s potential for growth is almost certainly capped at around 3.5%, which is undoubtedly insufficient if we are to adequately address unemployment, inequality or widespread poverty. We need to move closer to a figure of at least 8%economic growth if we want to sufficiently grow the economy in line with other developing countries.

It is of the utmost importance that proposed infrastructure spending is subject to careful assessment based on a number of issues. These include:

  • cost-benefit analysis;
  • efficient spending of available funds;
  • effective implementation of projects from beginning to end;
  • finding sustainable solutions to funding shortfalls;
  • public consultation and debate;
  • building partnerships between the private and public sectors;
  • co-ordination between all participants and other stakeholders,
  • clear planning and
  • strong leadership.

Honourable Speaker, we must also keep in mind that sustainable infrastructure design is not just about incorporating new infrastructure into society – it is about the rehabilitation, reuse and optimisation of existing infrastructure.

In the long term we need to gradually move into a position where we are focussing the bulk of our attention and spending NOT on fixing what is broken but on creating new infrastructure and maintaining established infrastructure.

Honourable Speaker, this report comes in response to persistent expenditure by departments towards infrastructure development, it was therefore necessary to verify on the ground value for money vis – a – vis recorded expenditure.

One of our roles in carrying out oversight is to develop indicators to determine whether the department is using the tax payer’s money in the most efficient and effective way possible and in doing so is achieving its objectives in terms of service delivery.

In this instance, there were mainly 4 departments being monitored, The Department of Health, Education, Human Settlements as well as Roads and Public Works.

The key department mentioned here is of course the Department of Roads and Public Works as this Department was mandated to be the infrastructure nerve centre of the Eastern Cape and its function is to provide and manage the provincial roads network and the building infrastructure as well as to drive the implementation of the EPWP.

Honourable Speaker, each member sitting in this house has the best interests of the province at heart, it is therefore of grave concern that this is the one department that was not represented at either one of the meetings that was held in our efforts to take a proactive approach to infrastructure delivery. All other departments were represented but the DRPW was never there to account.

The result is this: when a department is not there to account, fingers will pointed at the department and the department won’t be able to defend itself and the department won’t be able to account therefore hampering all our efforts to take this important proactive approach to infrastructure delivery in the province.

For instance, the Department of Education cited that it is difficult to expedite infrastructure delivery due to the incapacity of the Department of Roads and Public Works.

It was also stated that the DRPW incapable of delivering on the Infrastructure Delivery Master Plan, that the Department has no plan to deal with poor performing contractors, that the Department will not be able to deal with incapacity issues before finalising its organisational structure and that the Department embarks on projects without proper feasibility studies.

It was just last year that the Auditor General stated that the Department suffers from a culture of non-compliance and that there is an over-reliance on consultants by the DRPW.

Honourable speaker, the DRPW is supposed to be the infrastructure nerve centre of the Eastern Cape, we must urgently start to acknowledge the importance of infrastructure in economic growth and the alleviation of poverty. This department must prioritise infrastructure delivery and be available to account. It must start working with other departments otherwise all our combined efforts towards infrastructure delivery will be fatally hampered.

If we can stabalise this Department it will have a knock-on effect on other Departments as well. If we can shift this Department into a position where it can clearly and fully fulfil its mandate to operate as an infrastructure nerve centre we will be able to increase economic growth and reduce poverty. If this Department can address the backlog on roads infrastructure, the Eastern Cape will have taken a massive step to becoming more prosperous.

Honourable Speaker, I urge this house to be reminded of the recent Constitutional Court judgement where is highlights the power of parliaments to keep the executive to account. We must do just that, keep the executive to account.

Basic infrastructure is therefore not a luxury that can be implemented once a country is established, but a necessity for supporting and creating a sustainable economic environment for continuous economic growth.

Thank you.

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