Running a tight ship
The Limpopo government is balancing growth and social needs in its R59-billion budget
fund industrialisation to help grow the economy. But Tooley is optimistic. “We have to be more efficient and focus more on serving the population” he says.
In spite of the budget constraints they still manage to direct about R5 billion in spending to infrastructure. “If managed well, this can go far and have the desired impact” says Tooley. Almost half of which, or R 2 billion, goes to Human Settlements; Agriculture and Rural Development and the Department of Economic Development , Environment and Tourism abut R1 billion each while sports and recreation, which Tooley believes has a critical role in a diverse province like Limpopo, receives R400-million.
Government infrastructure spending is complemented at municipal level by spending the Municipal Infrastructure Grant and spending by State Owned Enterprises such as Transnet and Eskom as well as the private sector at national level. Limpopo is host to one of the largest rail projects in the R200 billion Waterberg Rail projects that carries coal from the region through Mpumalanga to Richards Bay in order to reach global markets.
Tooley says the province is steadily is improving its own fundraising capabilities, increasing revenue from R500 million in 2010 to R1 billion in the last financial year. Revenue bonus for a number of years now.
Tooley notes that solving Limpopo’s economic challenges requires more than just financial resources but also leadership. Tooley notes that for example in land restitutions, many of the farms that were returned to rightful owners have collapsed. Tooley says the primary cause of this is a move from a single or handful of owners to multiple owners in a community. New owners require technical and financial assistance.
The province also has the challenge of developing its mineral beneficiation and agro processing capacity while mitigating the effects of climate change in agriculture. Tooley says the best way to create new jobs is through greenfield, or brand new projects, in mining and agriculture, but to achieve that, South Africa needs to transform its banking sector to be more inclined to fund new ventures. That would ease pressure on government finances.