Presentation on theme: "Background Challenges Poverty, inequality and unemplyment"— Presentation transcript:
0 PRESIDENTIAL INFRASTRUCTURE COORDINATING COMMISSION Gauteng Infrastructure Indaba High level plans and challenges regarding infrastructure delivery in South AfricaFriday, 14 February 2014Change Classification
1 Background Challenges Poverty, inequality and unemplyment The New Growth Path sets a goal of 5 million new jobs by 2020; identifies structural problems in the economy to be overcome and points to opportunities in specific sectors and markets (“jobs drivers”)The 1st jobs driver is infrastructure: laying the basis for higher growth, inclusivity and job creationHowever, the pace of infrastructure development and spending on infrastructure is projected to fall from 9,1% of GDP currently to 8,1% of GDP (2013)Blockages include weak implementation capacity in parts of the state (with unspent monies) and poor project development planningProjects are not always strategic, integrated or aligned with national prioritiesPoor co-ordination slows projects and limits their impactResponse by GovernmentEstablish a structure in to address the challenges through coordination, integration andaccelerated implementation: the Presidential Infrastructure Coordinating Commission (PICC)Adopted a single common National Infrastructure Plan in that will be monitored and centrally drivenIdentify who is responsible and hold them to accountDevelop a twenty-year planning framework beyond one administration to avoid stop-start patterns1
2 Moving from poor performance to integrated, multi-programme delivery Improved programme co-ordination in state supported by project management and engineering skillsAlign the National, Provincial and Local structuresLong term support for long term projects, especially regional projectsPredictable process for implementing projects including streamlined regulatory approvalsStrong policy direction for incentivisation of supplier development, localisation and private sector participationPlan and build projects that promotes low life cycle costsStandardised designs and deliveryFull life cycle costs recovered through user tariff and a committed funding strategyStrengthening project controls and monitoring in government departments and state owned enterprisesStandardised and simple automated reporting to track project progress and performanceEarly warning to address bottlenecksPoor planning at institutional levelSlow approval of projectsLate start to projectsPoor quality of executionHigh costs and monopoly pricingPoor industry reaction timePoor project controls (schedule, cost, quality, safety, health and environment)Tender abuses and corruptionUnrealistic accelerationUnplanned and costly rework of designs or constructionNo political alignment with no championPermitting (e.g. EIA) rework or delaysLead time delaysSlow or non-payment of contractorsImprove by
3 PICC Terms of reference PICC’s mandate is to ensure systematic selection, planning and monitoring of large projects and its Terms Of Reference include the objectives outlined belowIdentify 5 year prioritiesInfrastructure is critical to:Promote balanced economic developmentUnlock economic opportunitiesPromote mineral extraction and beneficiationAddress socio-economic needsPromote job creationHelp integrate human settlements and economic developmentDevelop 20 year project pipelineDevelopment Objectives: skills, localisation, empowerment, research & developmentExpand maintenance: new and existing infrastructureImprove infrastructure links: rural areas and poorest provincesInfrastructure BookAddress capacity constraints and improve coordination and integrationAn Infrastructure Book has been compiled, which contains more than 645 infrastructure projects across the countryAn Infrastructure Plan with 18 Strategic Integrated Projects (SIPs) has been developed and adopted by Cabinet and the PICCScale up investment in infrastructureAddress impact of pricesSupport African development and integration
4 Governance StructurePICC Council comprises Cabinet Ministers, Premiers and Executive Mayors and consider the performance dashboards for every SIP, Report into Cabinet, Recommend policy changes to CabinetPICC Manco comprises a number of Ministers to unblock challenges; monitor the development plan; ensure coordinated regulatory approvals and enablersPICC Secretariat is supported by Ministers, Deputy Ministers and oversee day-to-day work of technical teamPICC Technical Task Team comprises skills and competence drawn from public agencies and governmentIntergovernmental Forum Chair and SIP Coordinators - support the PICC through implementing SIPsImplementation Agencies are responsible for project implementation within budget, on time & within the required levels of quality
5 Population (2010) Access to utilities Analysis of population distribution & density, combined with limited access to basic services and transport resulting in the movement of people to economic hubs in the countryPopulation (2010) Access to utilitiesPopulation (2010)Combined Area with limited access to servicesEconomic centersHigh population densityConstrained transport & services7
6 Fragmentation compromises urban efficiency necessary for effective utility provision and sustained economic growthEconomic centersHigh population DensityConstrained transport & services9
7 Addressing spatial imbalances through targeted infrastructure investment Heavy HaulHeavy HaulNeeds analysisindicates the bulk infrastructure requirements – electricity, water,transport, town planning, ports, etc.ElectricityPipelineIndustrial HaulElectricityPipelineHeavy Haul ……..Heavy HaulPipelineElectricityPopulationMiningLimited Utility ServicesGeneration (wind, solar)Water
8 Primary Mineral Reserves SIP 1: Unlocking the Northern Mineral Belt with Waterberg as the CatalystUnlocking SA’s northern mineral belt in one of the poorest provinces (Limpopo) through key infrastructure provision in the Waterberg and Steelpoort districts, initiating new energy and industrial development, shifting coal from road to rail in Mpumalanga and increasing rail capacity to Richards Bay whilst supporting regional integrationProposalInvestment in rail, water pipelines, energy generation and transmission infrastructure will catalyse unlocking of rich mineral resources in Limpopo resulting in up to direct jobs across the areas covered. Urban development in the Waterberg will be the first major post apartheid new urban centre and will be a “green” development project.Mining includes coal , platinum and other minerals for local use and export, hence the rail capacity is being extended to Mpumalanga power stations and for export principally via Richards Bay and in future Maputo (via Swaziland link).The additional rail capacity will shift coal from road to rail in Mpumalanga with positive environmental and social benefits. Supportive logistics corridors will help to strengthen Mpumalanga’s economic development.Primary Mineral ReservesProject locationPlatinum tons8
9 SIP 1: Unlocking the Northern Mineral Belt with Waterberg as the Catalyst ComponentsRail and road:Waterberg km rail (increase capacity to 112Mtpa)Mpumalanga - 140km rail (increase capacity to 32Mtpa)Swazi link – 163km (increase capacity from 16Mtpa to 33Mtpa)Export link – upgrade Ermelo to Richards BayRolling stock :14000 wagons, 1000 locomotivesRoad: national, provincial and municipal roadsMoloto corridor centered around deeper economic linkages with GautengWater:Mokolo Phase km water pipeline providing potentially 150Mm3 per annumOlifants River Water Resource Development - De Hoop Dam (80Mm3 per annum) and distribution system (260km pipeline)Electricity:Medupi Coal Fire Power StationNew Coal fired power station (Coal 3) 4800MW, and transmission linesUrban development, including human settlement, energy, roads, etc.:Housing, community centers, public transport, green urban development and roadsPort:Richards Bay capacity from 14.2Mtpa to 23.7MtpaIndustrial Development:barrels/day Coal-to-liquid plant (Mafutha)Coal Mines : 3 mines 5-10 Mtpa per mine9
10 Geographic SIPsSIP 2: Durban-Free State-Gauteng Logistics and Industrial CorridorStrengthen the logistics and transport corridor between SA’s main industrial hubsImprove access to Durban’s export and import facilitiesIntegrate Free State Industrial Strategy activities into the corridorNew port in DurbanAerotropolis around OR Tambo International AirportSIP 3:South-Eastern node and corridor developmentNew dam at Mzimvubu with irrigation systemsN2-Wildcoast Highway which improves access into KZN and national supply chainsStrengthen economic development in Port Elizabeth through a manganese rail capacity from Northern CapeA manganese sinter (Northern Cape) and smelter (Eastern Cape)Possible Mthombo refinery (Coega) and transshipment hub at Ngqura and port and rail upgrades to improve industrial capacity and performance of the automotive sector.
11 Geographic SIPsSIP 4:Unlocking the economic opportunities in the North-West ProvinceThe acceleration of investments in roads, rail, bulk water, water treatment and transmission infrastructureEnabling reliable supply and basic service deliveryFacilitate development on mining, agricultural activities and tourism opportunitiesOpen up beneficiation opportunities in the NW ProvinceIntegrated rail and port expansionBack-of-port industrial capacity (including and IDZ)Strengthening maritime support capacity for oil and gas along African West CoastExpansion of iron ore mining production and beneficiationSIP 5:Saldanha-Northern-Cape development corridor
12 Energy SIPsSIP 8:Green Energy in support of the South African economySupport sustainable green energy initiatives on a national scale through a diverse range of clean energy options as envisaged in the Integrated Resource Plan (IPR2010) and to support bio-fuel production facilities.SIP 9:Electricity Generation to support socio-economic developmentAccelerate the construction of new electricity generation capacity in accordance with the IRP2010 to meet the needs of the economy and address historical imbalances. Monitor implementation of major projects such as new power stations: Medupi, Kusile and Ingula.SIP 10:Electricity Transmission and Distribution for allExpand the transmission and distribution network to address historical imbalances, provide access to electricity for all and support economic development.Align the 10-year transmission plan, the services backlog,the national broadband roll-out and the freight rail linedevelopment to leverage off regulatory approvals, supplychain and project development capacity.
13 Spatial SIPs SIP 6: Integrated Municipal Infrastructure Project SIP 7: Develop national capacity to assist the 23 least resourced Districts (18.9 million people) to address all the maintenance backlogs and upgrades required in water, electricity and sanitation bulk infrastructure. The road maintenance programme will enhance the service delivery capacity thereby impacting positively on the population.Coordinate planning and implementation of publictransport, human settlement, economic and socialinfrastructure and location decisions into sustainable urban settlements connected by densified transport corridors. This will focus on the 12 largest urban centres of the country, including all the metros in South Africa. Significant work is underway on urban transport integration.SIP 7:Integrated Urban Space and Public Transport ProgrammeSIP 11:Agri-Logistics and Rural InfrastructureImprove investment in agricultural and rural infrastructure that supports expansion of production and employment, small-scale farming and rural development, including facilities for storage (silos, fresh-produce facilities, packing houses); transport links to main networks (rural roads, branch train-line, ports), fencing of farms, irrigation schemes to poor areas, improved R&D on rural issues (including expansion of agricultural colleges), processing facilities (abattoirs, dairy infrastructure), aquaculture incubation schemes and rural tourism infrastructure.
14 Social Infrastructure SIPs Revitalisation of Public Hospitals and other Health FacilitiesBuild and refurbish hospitals, other public health facilities and revamp 122 nursing colleges. Extensive capital expenditure to prepare the public health care system to meet the further requirements of the National Health Insurance (NHI) system. The SIP contains major builds for 6 hospitals.SIP 13:National School Build ProgrammeA national school build programme driven by uniformity in planning, procurement, contract management & provision of basic services. Replace inappropriate school structures and address basic service backlog & provision of basic services under the Accelerated School Infrastructure Delivery Initiative (ASIDI). In addition address national backlogs in classrooms, libraries, computer labs and admin buildings. Improving the learning environment will go a long way in improving outcomes especially in the rural schools as well as reduce overcrowding.SIP 14:Higher Education InfrastructureInfrastructure development for higher education focusing on lecture rooms, student accommodation, libraries and laboratories as well as ICT connectivity. Development of university towns with combination of facilities from residence, retail and recreation & transport. Potential to ensure shared infrastructure such as libraries by universities, FETs & other educational institutions. Two new universities will be built – in Northern Cape and Mpumalanga.
15 Knowledge SIPs SIP 15: Expanding access to Communication Technology Local Municipal NetworkInfraco national networkDistricts connected into provincial backboneInfraco capacity on WACs.Provide for broadband coverage to all households by 2020by establishing core Points of Presence (POP’s) in districtmunicipalities, extend new Infraco fibre networks acrossprovinces linking districts, establish POP’s and fibreconnectivity at local level, and further penetrate the networkinto deep rural areas.While the private sector will invest in ICT infrastructure forurban and corporate networks, government will co-investfor township and rural access as well as for e-government,school and health connectivity.The school rollout focus initially on the 125 Dinaledii (science and math focussed) schools and 1525 district schools. Part of digital access to all South Africans includes TV migration nationally from analogue to digital broadcasting.SIP 16:SKA & MeerkatSKA is a global mega science project, building an advanced radio-telescope facility linked to research infrastructure and high speed ICT capacity & provides an opportunity for Africa and South Africa to contribute towards global advance science projects.
16 Regional SIPsPopulation: 1 bnArable landWater resourcesOil, gas and mineral resourcesGrowing economiesBulk water resources: Lesotho HighlandsElectricity Transmission: Mozambique (Cesul)Hydro Power: DRC (Grand Inga), Zambia Lesotho and Mozambique (Mphanda Nkuwa)Transport: Regional interconnectorsSIP 17:Regional Integration for African cooperation and developmentParticipate in mutually beneficial infrastructure projects to unlock long-term socio-economic benefits by partnering with fast growing African economies with projected growth ranging between 3% and 10%. The projects involving transport, water and energy also provide competitively-priced, diversified, short and medium to long-term options for the South African economy where for example, electricity transmission in Mozambique (Cesul) could assist in providing cheap, clean power in the short term whilst Grand Inga in the DRC is long term. All these projects complement the Free Trade Area (FTA) to create a market of 600 million people in South, Central and East Africa.
17 Water and Sanitation SIP Developing a sustainable water supply-chain: “Source-to-tap-to-sourceA 10-year plan to address the estimated backlog of adequate water to 1.4 million households and 2.1 million households to basic sanitation. The project will involve the provision of sustainable supply of water to meet social needs and support economic growth. Projects will provide for new infrastructure, rehabilitation and upgrading of existing infrastructure, as well as improve management of water infrastructure.National project covering all nine provinces
18 Database from a select number of entities SkillsDatabase from a select number of entities7,173 artisans (3,468 Eskom, 1,900 Denel, 117 DWA, 200 Nelson Mandela, 551 City of Jo’burg, 472 City of Cape Town, 337 from Water Boards)6,132 technicians (4,074 Eskom, 1,731 SAA, 235 DWA, 36 Tshwane, 56 Ekurhuleni)1,359, project planners & managers (1,109, Eskom, 12 Nelson Mandela, 83 DBSA, 77, City of Jo’burg, 64, City of Cape Town, 14, Water Boards.)713 Financial managers (642 City of Jo’burg, 54 City of Cape Town,16 Water Boards)182 Procurement Specialists (15 DBSA, 119 City of Jo’burg, 45 Water Boards)131 technologists (16 DWA, 89 Tshwane, 8 Ekurhuleni, 18 Water boards)OtherprofessionalsProjection of skills required for a 800MW coal-fired power stationSupervisionPaintersMillwrightsElectriciansSheetmetal WorkersTruck driversPipe fittersInsulatorsCement FinishersBoiler MakersStructural SteelWorkersUnskilled LabourersEquipment OperatorsCarpenters1818
19 Land - the challenge experienced in gaining access to land EIA, appeals and expropriation can take up to 6,5 years
20 Industrial Development Platinum tonsMiningWith access to water, electricity and transport logistics the SIPs will unlock mining development in Limpopo and the North West Province.Inputs: BitumenLocal capacity to be increased with investment in port handling facilities required to import bitumen to meet unplanned shortagesInputs: SteelMost of the SOCs require steel fabrication as an input into their long term capital expansion programmes which is being leveraged to assess the possibility of local steel milling and fabrication
21 Delivery Compact and Development Impact Plans Compacts aligned to delivery1 Infrastructure PlanPICCPresidencyDirectivesDelivery Agreement / Outcomes Compact18 SIPsSIP CoordinatorMOUs< 200 projects / componentsImplementing Agent & CompactsShareholderShareholder Compacts
22 What Next NDP alignment Infrastructure Development Bill Skills DevelopmentMaintenanceIBT’s ( Innovative Building Technologies)LocalisationState capacityFundingAuthorisationsYouth EmploymentRegulatory environmentCollaboration across 3 spheresForward Planning
23 Empowering a Nation, triggering development The Infrastructure Plan is a bold effort to transform the economy, laying the basis for growth and jobsThe Plan is an opportunity to mobilise the nation behind a common vision and requires partnerships with business and labourAimed at promoting:Re-industrialisation through manufacturing of inputs, components and machinerySkills development aimed at critical categoriesGreening the economyEmpowerment23