Gauteng Infrastructure Budget Cut By 15%

It is a generally accepted principle that in constrained economic times, large scale implementation of infrastructure is one way of stimulating the economy.

It is therefore noteworthy that the Gauteng budget for infrastructure development in the next financial year (2017/18) is much lower than what will be spent in the current year financial year ending March 2016.

Gauteng Treasury argues that there are too many infrastructure projects that get implemented before the planning process is complete, leading to projects not being delivered on time or within budget.

Treasury has therefore reduced the budget in accordance with the number of “shovel ready” projects that are currently ready for implementation.

For those projects not currently ready for implementation, Treasury have created a ring-fenced financial reserve that can be accessed during the course of the financial year, once the planning is complete.

The problem with the creation of a financial reserve available for access once projects are implementation ready, is that one has financial resources sitting idle and not being used productively or efficiently.

In order to build skills, it is the private sector that is well placed to share their expertise and to upskill young people through public-private-partnerships (PPP) that will see the fast-tracking of infrastructure projects in the province and jobs created rather than shed.

The problem that government faces is that the private sector is loath to invest in an environment where:

  • private property rights are threatened;
  • corruption is seen to be rewarded;
  • inefficiency is rife in terms of the successful completion of projects within time, budget and quality considerations; and
  • service providers are not paid within agreed time frames.

It is therefore up to the Gauteng government to mitigate a number of these negative dynamics and build a positive relationship with the private sector. Failure to do so will result in further job losses and a further slowing of the economy.

The DA will continue to encourage government to invest their resources in productive sectors of the economy in order to promote growth, jobs and skills development for young people.

 

 

 

Media enquiries:

Alan Fuchs MPL

DA Gauteng Shadow MEC for Infrastructure Development  

060 558 8313

 

Yaseen Carelse

Social Cluster Manager

076 721 8613

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