KZN Business Sense - 2016 SONA : Infrastructure Investment Siyanda Ralane Consultant at KPMG
KZN Business Sense - 2016 SONA : Infrastructure Investment Siyanda Ralane Consultant at KPMG



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KZN Business Sense - 2016 SONA : Infrastructure Investment Siyanda Ralane Consultant at KPMG

2016-02-18

Though South Africa is facing its worst drought since 1982, it was surprising that the topic of infrastructure investment, with particular focus on water was not highlighted. Instead, the tone of Thursday night’s SONA speech was structured to quell the turmoil around the South African economy’s position, aimed to inspire investor confidence that it indeed is part of the executive cabinet agenda.

The President briefly touched on water infrastructure being a critical focus, without expanding on the approach to be taken, instead highlighting short-term relief projects currently in-flight, like Operation Hydrate.

The water infrastructure projects mentioned were:
  • The first phase of the Mokolo and Crocodile Water Augmentation project in Lephalale area in Limpopo is fully operational. It will provide 30 million cubic meters of water per annum.
  • The raising of the Clan William Dam wall in the Western Cape entails raising the existing dam level by 13 metres to provide additional water supply.
  • There is a need for a strategic investment plan as a long term solution, in KZN alone, R352,6 million initially and an additional R96,6m has been set aside to mitigate against the impact of the drought.
As part of the 2015/16 budget speech, R12,4bn had been set aside for Water Infrastructure Development. The Department of Water and Sanitation had highlighted 229 funded bulk water supply and wastewater infrastructure projects in various stages of the project delivery lifecycle, aimed at increasing and securing the provision of water, and eradicating service delivery backlogs. Between 2011/12 and 2014/15, the expenditure increased from R 8.5 billion to R13.2 billion. This increase was mainly due to additional funding allocated for the development of bulk water infrastructure and the introduction of interim water supply services in 2013/14. It would be interesting to know where these projects are currently tracking on both the project lifecycle and budget.

In the upcoming budget speech, there will hopefully be more emphasis made on water infrastructure development. The government media statement on the water scarcity and drought on 13 Nov 2015 highlighted four dams at critical levels;Hazelmere, Goedetrouw, Hluhluwe and Klipfontein Dam. It will be critical to get a view on planned expenditure on infrastructure and the selected performance indicators.




KZN Business Sense - 2016 SONA : Infrastructure Investment Siyanda Ralane Consultant at KPMG

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