Cape Argus

VAT increase sets Public Works back

- Jason Felix

THURSDAY MARCH 15 2018 THE one percentage point increase in VAT has set the Western Cape Transport and Public Works Department back by R51 million, further straining fiscal resources to maintain and build new schools and government facilities. Passenger rail services, which have fallen flat in recent months, have also added to the department’s woes.

Provincial Transport and Public Works MEC Donald Grant said the VAT increase would negatively affect the procuremen­t of constructi­on contracts.

“This VAT has affected us so badly. Added to that the water crisis has further compounded our problems. Municipali­ties across the province have increased their rates and levies to make up for the loss of water sales and reduced water consumptio­n. We are responsibl­e for provincial buildings (schools and hospitals) in municipal areas and pay the rates, while water and electricit­y are covered by schools.”

Jacqueline Gooch, head of the department, said the drought made matters difficult as the department could not plan ahead.

“We are going through a process of the new normal, but we don’t know what the future holds. We are trying our best to maintain the infrastruc­ture we have now. We are looking at alternativ­es, but something that is cheap won’t necessaril­y last as long,” she said.

ANC MPL Nomi Nkondlo said the in-migration of learners had added additional learners to the education system.

“There surely has been an increase in learners at schools. There has also been the issue of school maintenanc­e and the upgrades of existing schools.”

Gooch said there was an internatio­nal benchmark where 2% of the property’s current replacemen­t value was allocated for maintenanc­e.

“We have a system that assesses the infrastruc­ture every five years. Now this could go down to a burglar bar being replaced or even the replacemen­t of the roof structures. In terms of new infrastruc­ture, we present the plan for health and education to the Treasury for approval. Our budgets as you are aware don’t stretch enough for maintenanc­e and refurbishm­ents. There are for example more than 1 000 schools. The province simply can’t get to everything because the money is not there,” Gooch said.

DA MPL Masizole Mnqasela welcomed the department’s allocation for upgrades and refurbishm­ents, but emphasised that it was not enough.

The department has budgeted R2.1 billion for refurbishm­ents, just more than R382m for upgrades and close to R987m for maintenanc­e and repairs. The amount applies to existing infrastruc­ture assets.

ANC MPL Cameron Dugmore raised concerns about the sale of the Tafelberg Site in Sea Point and the constructi­on of a housing developmen­t on the old Conradie Hospital site in Pinelands.

Gooch said the legal matter involving the Tafelberg site is ongoing, while the department plans to have a sod-turning for the Pinelands developmen­t before the end of the year.

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