sanews - 22 days ago

Infrastructure drive firmly on the roll Efforts to step infrastructure development are accelerating in South Africa - to support economic growth and drive improved service delivery. This is according to National Treasury’s Medium Term Budget Policy Statement (MTBPS) released on Wednesday. In the maiden budget speech of the Government of National Unity (GNU) earlier this year, Finance Minister Enoch Godongwana announced a R1 trillion allocation for infrastructure investment over the medium term. “Infrastructure investment has strong direct and indirect effects on growth, boosting demand for inputs and workers in the short term and expanding the economy’s capacity to produce over the longer term. “Reforms are under way to mobilise private-sector finance and technical expertise at scale. In parallel, there are initiatives to strengthen government’s ability to deliver infrastructure more efficiently and improve spending outcomes. “These actions will address the persistent underspending of infrastructure budgets and enhance value for money,” National Treasury said. Reforms to create a conducive environment for public-private partnerships (PPP) by “improving the PPP framework, strengthening institutional arrangements and enhancing monitoring and reporting”. Amendments to Treasury Regulation 16 – which addresses PPPs – took effect in June. “In October 2025, guidelines relating to unsolicited bids and fiscal commitments and contingent liabilities were published and took effect. These provide a clear, structured pathway for the private sector to submit innovative project ideas, including provisions for recoverable development fees. “They also provide a framework to identify, manage and report on fiscal commitments and contingent liabilities in anticipation of the expansion of the PPP market. Updates to the PPP manual and the development of sector-specific toolkits in priority sectors will be completed in 2026,” Treasury added. Amendments to municipal PPP regulations are underway and are expected to be completed by February 2026, following COGTA concurrence. Tabling the MTBPS in Parliament on Wednesday, the Minister gave more details on the reconfiguration of the Budget Facility for Infrastructure (BFI) which will now run four bid windows per year instead of one. “Since the reconfiguration, the BFI has received 28 submissions. Nine projects were accepted for detailed analysis. “Funding to the tune of R4.1 billion is also allocated for disaster relief to fix schools, pipelines, clinics and substations damaged between last year and this year by flooding in KwaZulu Natal, Mpumalanga, and the Eastern Cape,” he said. A new infrastructure bond is expected to be launched to raise some R15 billion aimed at funding these BFI projects. “The bond forms part of our efforts to introduce dedicated financing instruments that can mobilise cheaper financing to support our infrastructure agenda. “Government will also contribute to R2 billion to capitalise the Credit Guarantee Vehicle. Initially, the vehicle will support electricity transmission expansion, directly contributing to our efforts at energy security while also driving decarbonisation. “This heralds a new era in PPPs, where private investment in high-voltage transmission lines is enabled. This is real progress in our move away from merely fixing the power utility to securing power to the grid from a range of sources,” Godongwana added. The Infrastructure Finance and Implementation Support Agency is expected to be operational by March 2026 to “infrastructure finance functions to systematically crowd-in private capital and promote the use of alternative delivery mechanisms”. – SAnews.gov.za NeoB Wed, 11/12/2025 - 13:42 248 views

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