Huge spend on infrastructure

THE GOVERNMENT plans to spend R947.2 billion in public sector infrastructure over the three-year medium-term expenditure framework period.

The Budget review released by the National Treasury yesterday allocated R63.4bn to fund public housing and bulk infrastructure for low-income housing subsidy programmes.

It added that although these assets were transferred to homeowners and not retained on the public sector balance sheet, the expenditure was an important public contribution to the built environment.

The government allocated metropolitan municipalities R35.9bn for bulk infrastructure, land and basic services, with a focus on upgrading informal settlements.

The government also allocated R3.2bn for social housing through the consolidated capital grant.

The review said the Human Settlements Department planned to start 25 catalytic development projects over the next three years, which were integrated mixed-use, mixed-income human settlement developments.

“The department will facilitate the delivery of 368 530 fully subsidised units, disburse 66 554 finance-linked individual housing subsidies and upgrade 623 635 houses in informal settlements by 2019,” it said.

It said state-owned companies would spend a projected R432.8bn over the next three years, while provinces were expected to spend R198.2bn on infrastructure and municipalities R179.6bn during the period.

The review said energy expenditure was expected to total R234.5bn over the next three years, with Eskom accounting for R203.8bn.

It said water and sanitation would get R125.3bn over the medium term to develop and rehabilitate infrastructure, including dams, canals, water treatment works, reservoirs and pipelines to connect households.

The review also allocated R18.4bn to regional bulk infrastructure grant and R12.5bn to the water services infrastructure grant in terms of the Water Infrastructure Development Programme.

It expanded the water services infrastructure grant to include the eradication of 25 383 bucket sanitation systems in informal settlements and to provide 170 water and sanitation infrastructure projects in the country’s 27 most impoverished district municipalities.

The Water Trading Entity will receive R5.7bn over the medium term, including R2.6bn for the implementation of a long-term solution to acid mine drainage.

Government- and stateowned companies plan to spend R327.7bn on transport and logistics, with Transnet’s capital expenditure expected to total R118.4bn over the next three years.

This will include R9.9bn in 2017/18 for the acquisition of electric and diesel locomotives for Transnet Freight Rail, R4.25bn on phase one and two of the manganese rail project, R2bn on the first phase of the new multi-product pipeline, R6.1bn on capital infrastructure, locomotives and wagon maintenance, and R84 million on the acquisition of tugs.

A total of R35.6bn will be invested in health infrastructure in all spheres of government in the next three years, while consolidated education expenditure will total R50.1bn, with provincial education departments using R37.6bn from the education infrastructure grant to build new schools and other facilities such as libraries, laboratories and administration blocks.

An amount of R3bn has been allocated over the medium term to the Department of Higher Education and Training to continue construction at the University of Mpumalanga and Sol Plaatje University in the Northern Cape. THE NATIONAL Treasury has remained silent on the budget for the nuclear build programme despite Eskom calling for interested parties to submit request for information.

Director-general in the Treasury Lungisa Fuzile yesterday said it was still early to talk about nuclear energy.

Fuzile said no funding had been allocated for the nuclear build programme, adding that the fiscus was not required to make funds available.

This is besides the R200 million allocated last year for the preparatory work for nuclear, he said.

Last December, Eskom issued a request for information to interested parties.

This sparked a response of 22 companies bidding for the R1 trillion nuclear tender.

In his Budget speech in the National Assembly yesterday, Finance Minister Pravin Gordhan said nothing about nuclear.

Even the Budget Review of the National Treasury did not say anything on the programme.

In his reply during the debate on the State of the Nation address, President Jacob Zuma insisted that South Africa would cover nuclear on a scale and pace that was affordable to the country.

Protesters outside Parliament yesterday also called for the government to scrap the nuclear deal.

Russian nuclear agency Rosatom has denied that it had already bagged the nuclear contract with South Africa.

Rosatom vice-president for southern Africa Viktor Polikarpov said it would bid like any other country including China, France, Korea and the US.

Last week Energy Minister Tina Joemat-Pettersson said 22 companies had submitted requests for information to Eskom.

She said this would be taken to the cabinet for discussion.

Eskom said it had not yet issued a request for proposals on nuclear.

However, the request for information would be able to determine who was able to do what.

The Energy Department also told Parliament last year that the first nuclear power plant would not come in 2022 as earlier projected.

This deadline has been shifted by 10 years to 2032 because of the work that has to be undertaken including the preparatory work.

Zuma insisted in the State of the Nation address nuclear was part of the energy mix programme for the government.

Opposition parties have raised concerns that this would be an expensive programme that would bankrupt the government.

However, a final decision would be made after all processes have been undertaken.