According to construction giant Murray & Roberts, government has not issued a single tender for the much punted R4 trillion infrastructure build planned by the Presidential Infrastructure Coordinating Commission (PICC).
This casts serious doubt over the efficacy of the Commission, which was established in September 2011 under the leadership of President Jacob Zuma, to improve the coordination and planning around key infrastructure projects and enhance project execution.
Major infrastructure investment has been the silver bullet for South Africa’s economic woes propagated in every major economic policy update from senior government leaders.
In his State of the Nation Address in February this year, President Zuma invited the “the nation to join government in a massive infrastructure development drive”.
Zuma also claimed in this speech nearly nine months ago that the Strategic Infrastructure Projects identified by the PICC “have been clustered, sequenced and prioritised into a pipeline of strategic integrated projects”.
The infrastructure build was also the major focus of the Finance Minister Pravin Gordhan’s Budget Speech in February, where he announced that R845 billion will be attributed to the programme over the next three years.
In April this year, we saw the release of the “infrastructure plan” from the PICC which identified 17 priority projects, and outlined implementation steps for 2012. Implementation steps for this year included plans for intergovernmental forums for every project and “delivery performance compacts to be signed by public entities to specify who will do what, by when, with what resources”.
And it is precisely with regard to the question around “by when” and “with what resources” that the Murray & Roberts claim raises serious concern.
Has this project stalled because government has not been able to locate the necessary funds to implement it?
With high and growing government debt levels, we know that Treasury has limited scope to fund the infrastructure plan.
State Owned Enterprises (SOEs) are seriously constrained in terms of their capacity to deliver, and their financial position has been put under pressure by recent credit downgrades.
With both President Zuma and Minister Gordhan continuing to punt the infrastructure build as the vehicle through which government will stimulate economic growth, create jobs and address service and infrastructure backlogs, it is imperative that we develop a clear understanding around (a) how these projects will be funded (b) the level of private sector involvement, and (c) the progress with the roll-out of the PICC proposals.
As the custodian of the public purse, Minister Gordhan must brief the Portfolio Committee on Finance on the progress of this critical programme.