Finance Minister Announces Reforms To Speed Up Infrastructure Projects And Boost Job Creation

Minister of Finance Enoch Godongwana on Wednesday announced reforms designed to encourage more private sector investment in infrastructure.

During the 2024 Medium Term Budget Policy Statement in Parliament presentation, the minister explained that these infrastructure reforms will improve planning, evaluation, contracting, financing, and monitoring, SA News reported.

The expected result will include faster delivery of infrastructure, which will help boost economic growth, increase in access to basic services, and creation of more jobs. He further said that one of the strategies for promoting a stronger and more inclusive economy was to support infrastructure that fosters growth.

"Pillar three is about effective infrastructure investment, to boost economic activity and enable higher growth over the medium term. In this regard, we are implementing reforms that will create conditions to attract greater private sector participation," Godongwana said.

The reforms include several key points:

• Attracting substantial private sector funding and expertise to enhance the limited resources and skills of the public sector
• Changing the Public-Private Partnership regulations to make it easier to start these projects
• The updated Treasury Regulation 16 will be released by the end of November and will take effect in 2025/26. The Municipal PPP Regulations 309 will be completed by June 2025

The minister went on to explain that the government was creating a dedicated team to plan, prepare and design programs that will produce a reliable list of projects ready for market investment.

The Department of Water and Sanitation's Water Partnerships Office has two key programs focused on reducing non-revenue water and recycling wastewater that will need private investment.

In the same way, the Department of Transport, Transnet, and the Passenger Rail Agency of South Africa were finalizing a list of important projects that will be made available to the market in 2025/26.

The resolution of the Gauteng Freeway Improvement Project opened up a project pipeline worth R85 billion for the non-toll network over the next three years. The minister mentioned that the government was working on improving the capital budgeting process.

The Budget Facility for Infrastructure was being changed into a centralized hub for all large infrastructure projects that need financial support to move forward. Starting in 2025, this facility will have a continuous evaluation process instead of a yearly review. In January 2025, the National Treasury will release a circular to guide how to submit proposals.

Finally, the government was making a strong effort to increase the number of funding sources to diversify public infrastructure financing using new methods and tools, as per the minister.