The Portfolio Committee heard from eight entities on the first day of the public hearings on the Infrastructure Development Bill, now tagged by the Joint Tagging Mechanism as a section 76 bill. Common concerns were expressed by several of the entities, with the majority commenting on lack of full consultation by the Department of Economic Development with those entities (specifically with local and provincial government) prior to the tabling of the Bill in Parliament. Although the Department of Economic Development confirmed that the Bill had been published for public comment, some entities said that even though they had commented, there had been no response to their submissions to the Department, nor to requests for the opportunity to discuss technical issues, and maintained that there were a number of issues that needed to be clarified before they could make any meaningful suggestions on how the detailed wording of the Bill could be improved. Only the Industrial Development Corporation and South African National Roads Agency were not concerned with lack of consultation. Other concerns expressed in several submissions related to the lack of clarity in the definitions, whether the Bill would apply to private projects, and, if it did, the risk that preferential treatment might be given to state owned rather than private sector projects. Concerns also highlighted the apparent inconsistencies in listing a number of matters in Schedule 1 that were within the day-to day competencies of local government, or were dealt with in other pieces of legislation. Linked to this were comments that the Bill appeared to be inconsistent with other pieces of legislation requiring approvals, most notably the Water Act, National Environmental Management Act and Minerals and Petroleum Resources Development Amendment Act.
The South African Local Government Association, Business Unity SA and the Provincial Government of the Western Cape questioned whether this Bill was indeed necessary. They pointed out that other existing legislation seemed to cover the same issues as this Bill, and they and the Centre for Environmental Rights noted that recent changes to legislation and policy had resulted in improved turnaround times on application processes in particular. However, the Committee Members, and some of the other bodies, noted, on the contrary, that current infrastructure projects were beset with delays, under-spending, inefficient use of resources and other problems. Some submissions suggested that the Bill itself could not address these problems, and suggested that adding another layer of requirements would lead to greater inefficiencies, whilst a contrary view was that the Bill was intended to be a special intervention, and that rather than adding other layers it was attempting to coordinate the existing mechanisms to greater efficiency. Another concern linked to other legislation was whether this Bill impinged on provincial and local competencies, and the fact that there was nothing in the Bill dealing with what would happen in the case of any inconsistency in time frames, processes and functions. Clauses 15 and 17 were criticised as being apparently contradictory with each other and several submissions highlighted the difficulty of requiring simultaneous approvals. South African Roads Agency Limited made a strong plea that this Bill should not be allowed to prevent or hinder certain of its functions. Other criticisms were that not enough was said about issues of sustainable development, youth and skills development, and localisation. All presenters were agreed on the correlation between infrastructure development and economic growth.
CommuniTgrow believed that the Bill had several very useful elements, and outlined very briefly its model for sustainable and integrated development. It made some suggestions on the need for tax incentives to boost private spending for the public good. Other pointers were made to the need to address sanctions for non-compliance, and more clarity on dispute resolution mechanisms and roles and functions, particularly at Steering Committee level. Industrial Development Corporation suggested also some changes to the way in which budgets were to be handled, and the duties of the implementing agencies.
Members repeatedly stressed that these public hearings must be seen as part of the consultative process and asked presenters to be quite precise in their critique and suggest alternatives to wording or concepts. They asked for further comment on the necessity for the Bill, asked whether the entities would agree that infrastructure development needed to be expedited, called for further comment on issues raised around constitutionality, stressed that if the state did not function speedily, the private sector was also at risk, and pointed out that the Bill did not actually prevent public/private collaboration on projects. Some Members suggested that the Bill had not been clearly understood, and that it was essentially intended as a special intervention to improve all phases of infrastructure development. They did not agree with the suggestions that the Bill duplicated the IDP processes, pointing out that it was applicable across all three spheres and stressed that a requirement for coordination of decisions did not imply any diminution of the right to take decisions. The experiences of 2010 had demonstrated that South Africa had the ability to expedite matters, and the country should not be reverting to the relaxed manner of the past. Questions about apparent conflict with existing government commitments on environmental rights, revised wording and constitutional issues were to be responded to in writing, due to shortage of time.
Chairperson’s opening remarks
The Chairperson noted that the mandate of Parliament was to act as the voice of the people in fulfilling the Constitutional function and overseeing actions. Public participation was central to the Constitutional imperative cast upon this Committee. After the Bill was presented to the Committee last year, the Committee decided to have public hearings in order to assist with the finalisation of the Bill, and to expand the number of inputs to ensure that Parliament passed a law that was of high quality and effective. All substantive issues arising from these hearings would be considered.
The Chairperson noted that the Bill had now been tagged, by the Joint Tagging Mechanism, as a section 76 bill.
South African Local Government Association (SALGA) submission
Mr Sibulele Dyodo, Roads and Transport Specialist, SALGA and Marx Mupariwa Development Planning Specialist, presented the submission from SALGA. At the outset, Mr Dyodo explained the mandate and composition of SALGA, stressing that it essentially was the voice of local government but its own submission should not be regarded as superceding any others expressed from individual municipalities.
He indicated that there had not been meaningful consultation with local government and that was seen as a major impediment, so SALGA requested the opportunity to have structure consultative engagement with the Department of Economic Development (EDD).
SALGA believed that tighter and better definitions were needed, for projects of significant economic and social importance, projects of a public purpose or were in the public interest, and more clarity on Schedule 1. In addition, he suggested that it would have been useful to have a Preamble to contextualise the Bill. Finally, there was no indication of how conflicts with other legislation were to be resolved.
He outlined the perceived problems with the sub-clauses of clause 4, which appeared to intrude into the role of municipalities and purported to supercede municipal Integrated Development Planning (IDP) processes. The powers of the members of the Steering Committee contemplated by the Bill were not stated. The value of the Steering Committee was also questionable as it had no statutory competency to address potential bottlenecks. Clause 15 was seen as confusing and duplicated other processes. It appeared to sanction the use of state resources to facilitate private development. It was suggested that the Steering Committee functions should be limited to supporting the relevant organ of State and facilitate the participation of sector departments and other spheres to implement Strategic Infrastructure Projects (SIPs).
In regard to clause 8 he suggested that the provisions were too prescriptive and appeared to override long term municipal planning of IDPs. The SIPS would be designated by way of notice in the Gazette with no reference as to how the projects were to be identified and prioritised.
The framework did not seem to take into account, nor correlate with the many and varied processes that were already required for infrastructure projects. The time periods were listed in Schedule 2 but were expressed in strong language and may not be reasonable or bear relation to other requirements of existing legislation regulating land development and environmental impact assessments (EIAs).
Whilst SALGA acknowledged the noble intentions of the Bill, Mr Dyodo reiterated that the lack of meaningful consultation with local government continued to be problematic. If there was indeed a need for new legislation, as opposed to providing meaningful support to local government within the existing legislative framework, SALGA requested that such local government be meaningfully consulted.
Mr X Mabasa (ANC) pointed out that this process of public hearings was part of the necessary consultative process to assist the Committee in finalising a good piece of legislation. He asked SALGA to expand on the impression that it did not regard this Bill as critical or necessary. He pointed out that in the past, both the private and public sector had been quite slow in executing decisions – it had been said that South Africa had excellent laws but its action plans were not so good.
Mr S Motau (DA) referred to the comment made at the end. The presentation had been rather cryptic; it made reference to intrusions into local government functions, but he would have liked to see more specifics on how, for example, the legislation was seen as intruding. Full consultation was part of the process, but he understood the point that perhaps other steps should have been undertaken before the Bill was drafted. He asked for more clarity on the references to clauses 4 and 12.
Mr F Beukman (ANC) asked what process of consultation had been followed in other legislation affecting local government.
He commented that other presentations raised constitutional points and he questioned whether SALGA believed that this Bill was constitutionally sound.
Mr Z Ntuli (ANC) questioned whether SALGA was happy with service delivery, Secondly he asked the presenters to expand on their comment about lack of consultation, questioning that surely, through other structures, SALGA and its officials were not part of the consultation process.
The Chairperson said that she was aware that this presentation was an attempt to summarise the full written submission but agreed with her colleagues that some of the issues needed further explanation; in particular the point that perhaps legislation was not needed, which seemed to be in conflict with the statements elsewhere that aspects of the Bill that could be accepted.
Mr Marx Mupariwa, Development Planning Specialist, SALGA, responded that if Parliament was of the view that the Bill was required, then SALGA needed the opportunity to engage in meaningful consultation. SALGA had not been consulted at drafting stage, although many of the issues could have been resolved had this happened. There was, for instance, doubt whether other public projects, and private projects were included – the Schedule and definitions clauses seemed to be inconsistent.
The Chairperson interjected and asked him to clarify still further, and state what SALGA felt was lacking in the document.
Mr Mupariwa said SALGA had doubts still as to exactly what works were referred to in the Bill. In regard to the comment on the intrusion into the powers of local government, he said that original powers were given to municipalities, whether there were public or private projects. A process to encourage implementation of projects was commendable, but SALGA thought the Bill was not aligning with the IDP process. If there was a need for legislation to accelerate development, then he urged that it must give full recognition to local government powers, specifically local planning processes.
He agreed that the public hearings could be seen as part of the consultation process but reiterated that SALGA would have liked to have been consulted prior to the Bill being tabled in Parliament, because its concerns could have been raised at that time. SALGA was concerned with the time frames set out in the Schedules; municipalities were compelled to comply with other laws and the Bill gave no guidance as to what should happen in the event of conflict with other legislation. Municipalities were unsure which legislation would take precedence.
The Chairperson said that, for the purposes of clarity, she wanted comment from the Director General as to the consultation process followed.
Ms Jenny Schreiner, Director General, Department of Economic Development, said that there was a consultation process, from the end of 2012. The EDD had published the Bill for public comment and there were other consultation processes which had involved other stakeholders.
The Chairperson thanked the presenters and noted that the comments would be raised with the Department.
Mr Beukman pointed out that a number of questions had not been responded to as yet.
The Chairperson confirmed that written answers could be submitted.
A SALGA representative said it was difficult to comment on the constitutionality aspects. SALGA understood Mr Ntuli's comments about bottlenecks in the process, but it would be difficult to have any implementation outside of the current municipal processes, and that was the main concern.
Business Unity South Africa submission
Mr Kgatlaki Ngoasheng, Policy Specialist, Business Unity South Africa (BUSA) said that some of the concerns of other member organisations would be covered also in the BUSA submission. He briefly outlined what BUSA was, pointing out that it was regarded as the “official voice” of business, being a confederation of business organisations, including the Chamber of Commerce and Industry. It aimed to ensure that business played a constructive role in the legislative and other processes. It welcomed any intervention that expedited infrastructure development. The institutionalisation of coordinating structures was a positive step to achieving the objectives of the Bill. However, BUSA felt that the Bill alone could not address all coordination challenges.
BUSA also had some other concerns. The first was lack of clarity on the treatment of private sector projects. It was worried about possible diversion of scarce resources for approval processes to focus on public projects. It was also worried about the risk of undermining existing approval processes. There was not sufficient provision for public consultation. BUSA shared concerns of SALGA in this regard. He noted the comments of the EDD about the opportunity to comment, but said that BUSA had made a submission on the Bill as first published, and later requested several meetings to clarify several technical issues, but had not been given the opportunity to discuss them with the EDD.
The Chairperson interjected at this point and said that it was important that presenters substantiate their comments. She said that although BUSA had mentioned that the Bill presented the risk of undermining of other processes, it had not specified how this would happen. She also urged presenters to make specific recommendations.
Mr Ngoasheng continued that the Bill seemed to assume that there would be one application for approval process, but large projects would be subject to various processes. Various approvals might be required from different departments. There was lack of clarity on the national infrastructure plan and a risk of duplicating requirements. BUSA was worried also that there was a risk of preferential treatment being given to state owned projects over private sector ones, for instance in the telecommunications or energy space.
Dr Laurraine Lotter, Advisor, BUSA, said that the key concern was the lack of clarity on whether private sector projects would be covered. BUSA had provided an opinion from Adv Jeremy Gauntlett, who agreed that the Bill was not clear on the treatment of private projects, and that suggested that this could be unconstitutional. He had submitted a proposal with which BUSA did not necessarily agree. BUSA suggested rather that the definitions and Schedules needed to be addressed as they caused significant confusion, as most of those projects listed in the schedule could be private sector projects. She suggested that all references to the Schedule be excluded from the definitions, and the Schedule be more clearly set out.
The Chairperson asked her to clarify the point, saying that these matters involved public responsibility.
Dr Lotter responded that they were also areas in which the private sector could be involved. No matter whether investment was public or private, the state had a responsibility to see that the project was carried out properly – with the proper environmental management and so on. However, the difference with the ownership lay in approval processes. Citing the example of healthcare, she said that although it was the responsibility of the State to provide hospitals, the private sector also did so. It was desirable to have certainty on whether a private hospital was also subject to this Bill. BUSA agreed with the need to expedite implementation of projects, but cautioned that if the legislation was not clear, and required interpretation, this would delay the matter. BUSA wanted to ensure that the Bill was clear. It would cover public projects, but it might be useful to express synergies with the private projects. Half of the SIP projects listed referred to private sector projects within the scope of the whole projects, and BUSA felt that there was potential for good cooperative working relationships.
BUSA also shared concerns of SALGA in regard to approvals but had a slightly different problem. The different approvals were problematic and it appreciated that the Bill attempted to address them. However, it was not sure that improvements to the backlogs would result from the measures set out. Schedule 2 set out specific actions that project owners must take, and the State must give specified approvals in the specified time. However, the implementation plans were additional to other laws already in place and so, for instance, a project manager would have to comply with water, mining and environmental legislation, in addition to the requirements of the Bill. If the State wanted to exercise additional controls over public projects, it could, but BUSA pleaded that these additional requirements should not be imposed on private projects.
The time frames in the NEMA and Schedule 2 were not the same and that was a serious contradiction. The other difficulty with approvals was that the Bill referred specifically to NEMA but not to any other legislation by name, although it referred to “all approvals” and “all authorisations”
Clauses 15 and 17 suggested different approaches to applications. Clause 15 suggested that all approvals must be submitted concurrently whereas clause 17 was not so specific and was preferred by BUSA.
Mr Mabasa noted that it was not easy, in South Africa, to differentiate between provision of infrastructure by the government and by the private sector, since government took the view that it should facilitate an environment in which the private sector could thrive. It was not desirable to have strict delineations. The intention of the Bill was that everything that happened, especially where the public sector was concerned, should be expedited. If the state did not function speedily, the private sector could also suffer.
Mr S Mohai (ANC) asked BUSA to give its views on the challenges of how to deliver more substantial results, more quickly. He believed that the Bill did address issues of coordination and planning, and how to mobilise the technical ability of the State to deliver on the infrastructure projects.
Mr A van der Westhuizen (DA) asked what would happen if an application was incomplete and additional information was required. There did not seem to be provision for this, and he asked if this was of concern to BUSA.
Mr N Gcwabasa, (ANC, member of Portfolio Committee on Trade and Industry) asked for more clarity on the fear that budget may be diverted. In regard to the consultation, he reminded the participants that there had been opportunities to comment, and he urged that these hearings be regarded as part of the consultation process and be used to inform the Committee. In regard to the issue of preferential treatment, he said that it must be acknowledged that the State Owned Entities (SOEs) were implementing on behalf of government. This Bill did not, in his view, prohibit investment by the private sector. Finally, he requested if there was anything in the Bill which would prevent the public/private collaboration on projects, such as the building of a mall, which would require government to provide access. He regarded the Bill as allowing for collaboration, not conflict.
Ms D Chili (ANC) suggested that perhaps alternative wording should be suggested for the clauses that were of concern to the presenters.
Ms M Mohorosi (ANC) also stressed that these public hearings must be regarded as part of the consultation process. She also agreed with her colleagues that it was not sufficient merely to criticise approval processes, or wording, but to suggest alternatives that would help to improve the Bill. She also asked for BUSA's view on whether the Bill was necessary.
Mr Ntuli said that the core intention of the Bill was to fast-track infrastructure development in the country. He was hoping that commentators would tell the Committee how that could be done. He asked if BUSA would agreed that there were bottlenecks hindering delivery in government, which the Bill was trying to unlock, or whether it believed that the Bill would hinder this even further.
The Chairperson read out the objects of the Bill, to clarify its intention. There seemed to be challenges in understanding the Bill. It sought to provide for facilitation and coordination of public infrastructure development, which was of significant importance. It sought to ensure that infrastructure development was given priority, and to improve the management through all planning and implementation phases. This suggested that it was a special and out of the ordinary intervention. She felt that there was more resistance than attempts to reconcile or make practical suggestions for approval.
The Chairperson requested responses in writing, with suggestions.
Dr Lotter expressed the appreciation of BUSA for the openness of the Committee to receiving suggestions and committed to providing detailed answers with recommendations. BUSA welcomed the fast-tracking of infrastructure development. BUSA agreed that there were bottlenecks in infrastructure but did not think that the Bill would solve all these problems. It would like to see the areas of confusion clarified.
The Chairperson said that the Committee felt that the Bill could indeed be the solution; and at this stage was not looking to withdraw the Bill, but rather to have it improved. The Committee was of the view that the Bill was in fact necessary.
Western Cape Provincial Government submission
Mr Paul Hardcastle, Director: Policy Planning Commission, Western Cape Provincial Government, wanted to raise four points in support of his lengthy written submission (which was not made available at the meeting).
Mr Hardcastle said that the key component of any planning process was that there must be some level of strategic assessment to inform the designation of the land use. There must be consultation and coordination of all SIPs. The purpose of the IDP was to integrate all purposes of government and identify areas where positive streaming was required. He was concerned that there was no clarity on how SIPs would be identified, and through what process, or through what level or consultation . The intention of the Bill seemed to be to facilitate and coordinate. In the existing framework he believed, however, that SALGA and other local authorities could in fact fulfil what were stated as the objects of the Bill.
The Provincial Government’s first recommendation was that rather than its current focus, the Bill should instead be directed towards improving existing frameworks rather than attempting to usurp what was already in place. Matters listed in Schedule 1 were already the subject of day-to-day planning at local authority level. The local authorities could not wait to see what came out of strategic planning exercises. Therefore how the SIPs related to the normal procedures around strategic planning were important, but this was not addressed in the Bill.
Secondly, he explained that normally a strategic process would merely provide context, but not in any way attempt to pre-empt the outcome of applications. There was a difference between the scale of information provided at different levels. Projects could already be prioritised via the current regulatory processes, especially through the new legislation, which was drawn after extensive consultation processes.
He acknowledged that there was some inefficiency in project implementation, but also wanted to stress that there had been some significant progress through the latest amendments to the National Environmental Management Act (NEMA), Minerals and Petroleum Resources Development Act (MPRDA) and Spatial Planning and Land Use Management (SPLUM) legislation. All of those acknowledged that the “one size fits all” processes would not work, since not all scales of applications, nor the different socio-economic contexts, could be fitted into the same regulatory requirements. This Bill, however, particularly in clause 8, seemed to suggest that a certain outcome would result, even before all the information was available, and he suggested that this was a case of putting the cart before the horse and attempting to ensure that the SIP subsumed other requirements. He suggested again that the Bill should be aimed at streamlining and integrating existing processes, rather than putting additional processes into place.
The Provincial Government, like SALGA and BUSA, was concerned about the lack of clarity on how the SIP process would fit in with existing processes. He noted the plea by Members of the Committee that presenters make concrete recommendations but felt that without having some more information on what the drafters had in mind, it was very difficult to suggest changes in the wording, and some fundamental concepts would need to be clarified.
Mr Hardcastle suggested that sustainability considerations should be part of any major policy in South Africa, not least the National Development Plan (NDP), yet they were not sufficiently addressed in the Bill. This was a serious omission that should be addressed, when dealing with the functions of the Bill and Steering Committee.
He questioned what would constitute a SIP. The definition of “infrastructure”, read with clause 7 and Schedule 1, was too wide, and did not allow for clear understanding of what a SIP actually was, so it remained vague and open-ended. He noted that every one of the elements listed in Schedule 1 was the daily business of a local authority and so there was no clear distinction as to what would be used to determine what a SIP was. Again, he said it was difficult to recommend other wording without knowing what the intention was, and fundamental discussion on these points too was needed with the EDD.
Mr Hardcastle shared the concerns of BUSA and SALGA in regard to the apparent conflict in time frames, and what legislation might take precedence. More discussion was also needed on this point.
He reiterated that the Bill should rather be focused on strengthening existing frameworks and their coordination. He pointed out that the reason for missing of targets was not so much due to inadequacy of the legislation as to human error.
Finally, he noted that the Provincial Government had commented on the Bill but had received no answer from the EDD, and he felt that no real consultation with provincial or local authorities had taken place on this fundamental legislation. The comments that the Provincial Government had raised merely touched on the surface; and in the absence of any indication whether the EDD agreed, or why it might disagree, it was difficult to take the points further.
Mr Motau said that in the written submission, the tagging issue was raised. The Bill had recently been tagged as a section 76 Bill, and he asked whether that affected the comment made, and what processes were now needed.
Mr Beukman referred to page 3 of the submission, on the tagging issues, and asked if there was likely to be any attack on the constitutionality of the Bill.
Mr Motau asked what key elements were needed to “fix” the Bill.
Ms Chili noted that the presenters had said that no recommendations could be made now on the changes.
Mr Hardcastle said that there was too much vagueness in the Bill to allow for any concrete recommendations to be made.
Ms Chili then asked what he would suggest should be done.
Mr N Kwankwa (UDM) asked if there were specific recommendations, and how the Committee could improve on the institutional and legislative framework to ensure that the issues were covered.
Mr Mohai noted that institutions monitoring projects had previously highlighted under-spending as a major problem. He submitted that the Bill provided the necessary impetus for appropriate structures with the necessary authority, plus support by way of technical capacity, to respond to those challenges. Economic growth and development remained key to all other issues. He questioned, therefore, how the Provincial Government could not support the Bill, and found this contradictory.
Mr Beukman said that infrastructure was desperately needed for job creation, but it was necessary to be honest about the current processes in the provinces. The current development infrastructure was not sustainable and he suggested that this Bill created the necessary framework.
Ms Mohorosi said that Mr Hardcastle had suggested that the Bill was duplicating the IDPs, but she could not agree, because these were specific to a particular municipality, whilst the Bill spread across three spheres of government. She could also not agree with the suggestion that this was disempowering provinces and municipalities. The Bill merely required that there be coordination of decisions, and it was not taking away the right to make decisions.
Mr Ntuli questioned whether the Western Cape Government saw the need for national government intervention, and if so, how it was suggested that this should be done.
Mr Mabasa noted that the Chairperson had read out some of the objectives of the Bill, and those indicated that the Bill sought to improve and hasten the processes, particularly the speed of delivery. That, to his mind, was the central objective, and this was very important. Sustainability would be addressed, as provision of infrastructure did not imply that maintenance would not also be attended to.
The Chairperson asked for a brief summary from Mr Hardcastle, followed up with full written responses. She asked whether the presenters agreed that the Constitution allowed for three spheres, to be distinct, yet inter-related. There were several submissions made suggesting that the Bill was interfering with existing powers and encroaching upon them although she herself did not interpret the Bill in this way. The clause dealing with designation of SIPs clarified what must happen in the case of conflict and acknowledged the need for conflict resolution mechanisms. She felt that perhaps the context and objects of the Bill were not clearly understood. She agreed that there should be streamlining of current regulations and legislation, but she also emphasised that this Bill provided an intervention by the State, for support of the State, a point that did not appear to have been understood by many of those making submissions. She understood his point that it was difficult to come up with recommendations, but urged also that the Provincial Government should embrace the need for change.
Mr Hardcastle said that “business as usual” was not possible and there was a need to significantly improve service delivery. However, there was a need to acknowledge the improvements that had already been made to various planning and implementation processes, at local and provincial level. The relevant institutions could not really embrace the Bill fully before engaging in full debate on what more could be done to strengthen human agency and institutions, and pleaded for the opportunity for that fundamental discussion, before simply adding yet another layer of processes without first identifying and addressing the current problems. Briefly, he responded that his institution believed that the tagging of Bill was now corrected, but that meant that provinces and local government must then be properly consulted.
The Chairperson asked that the written responses should attempt to include some more positive recommendations.
South African Roads Agency Limited (SANRAL) submission
Mr Thabiso Malahlela, Project Manager: Stakeholder Management and Research, SANRAL, said that he would raise practical concerns that SANRAL had identified in implementation of projects. He acknowledged that there were some deficiencies in the current legislation and said that although this Bill was essentially a good piece of legislation, there was a need to fine-tune and improve it still further.
The first issue had been raised by other submissions, namely was the potential inconsistencies with other pieces of legislation. Time and cost implications were indeed of concern. The Bill would address some of those. The NEMA, Water Act, MPRDA and other legislation indeed needed to be coordinated and there was possible misalignments that would need to be addressed.
The Bill was not definitive on time frames, sanctions and skills capacity. Skilled practitioners were needed to operationalise the Bill and approving authority processes. There was nothing on appeals, processes and timeline and practical challenges from lobby groups and so forth. The Bill did not deal with the possibility of “asylum on critical non SIP projects” – which would include emergency works, for instance arising from floods, which could impede upon access and mobility and SANRAL would like to see how those would be handled.
The Bill was not definitive on dispute resolution between parties in the Steering Committee, and suggested that the Steering Committee Chairperson should be able to state where the Committee was headed and make more specific recommendations.
SANRAL felt that the Bill compromised SANRAL's legislative rights to grant access to and egress from national roads, and wanted to engage with the drafters on that point. He made the point strongly that the SANRAL Act should not be compromised by the Bill. Further clarity was also needed on how expropriation right might impact on SANRAL’s ability and rights to carry out its projects.
Clause 4(g)(h) needed to be more explicitly stated. SANRAL felt that there should be an onus placed on the project manager to ensure asset maintenance. Supporting infrastructure for anchor projects to the SANRAL – such as water projects – would also need more consideration.
SANRAL felt that clause 15 was too vague, given SANRAL’s experience in the past on the approval processes, and he suggested that a very strong framework was needed to guide the process. Furthermore, he made the point that it was not always possible or practical to have simultaneous submissions, as, for instance, EIAs and water licencing processes could not always run simultaneously, as one set of information might result from another process; this was a matter on which SANRAL had experienced difficulty in the past. It was also necessary to take into consideration the mining and water licence processes. There was the potential also for conflict between this Bill and SPLUM, and that would need to be addressed.
SANRAL suggested that the Bill should include sanctions for non-adherence to timelines. .
Mr Mohai wanted to stress again that an appropriate structure was needed to enable the appropriate authority to intervene to address the current problems and backlogs, recognising that SIPs were needed as a catalyst to economic growth. He acknowledged that any ambiguities would have to be addressed. He asked if SANRAL supported the Bill. He believed that the Bill was in fact attempting to address problems of litigation, collusion and corruption, which also increased cost and slowed projects. Integration of all stakeholders would go far in addressing the known problems in infrastructure development. He believed that other projects would also be able to be elevated through this Bill.
Mr Ntuli had been expecting to hear from SANRAL that this Bill would assist that body. He said that the intention was not that this Bill should override other legislation, but instead, to ensure that matters were expedited. He suggested that sanctions should not be included in the Bill itself, although they could probably be dealt with in the regulations. He believed that too complex a Bill could actually hinder what the Bill was intended to do.
The Chairperson reiterated that the Bill was intended to introduce changes in the way that matters were being done. She was interested in what was said about the time spent on EIAs and other impact assessments. The Bill would allow for opportunities to negotiate, as with the current processes, but was also trying to ensure that matters were handled more efficiently than in the past. The experiences of 2010 had demonstrated that South Africa had the ability to expedite matters, and the country should not be reverting to the relaxed manner of the past.
Mr Malahlela said that SANRAL broadly supported the aims and intentions of the Bill, as it obviously would like to see infrastructure delivery being fast-tracked. However, it was trying to ensure that scenario planning was not impacted upon by negative forces. He heard the point about sanctions not being included in the Bill but stressed that if time lines were not met by the approving authority, sanctions were definitely needed, to ensure that project managers maintained a professional, disciplined and accountable stance. This Bill certainly had the potential, with the necessary improvements, to assist SANRAL and Transnet and other entities.
Ms Mpati Makoa, Specialist: Environmental Management, SANRAL, spoke to environmental concerns. She noted that it could be possible to submit simultaneous applications if these were properly planned, despite the fact that different levels of detail were required for different assessments. The EIA process was better defined than others. She hoped that other authorities would be part of the process and if so, then it was possible to plan ahead to allow for simultaneous applications.
The Chairperson said that SANRAL's comments would assist in the implementation process, and highlighted issues that needed to be clarified.
Industrial Development Corporation (IDC) submission
Mr Kugan Thaver, Manager, Industrial Development Corporation, noted that the IDC welcomed the Bill and its intention, and felt that the Bill and SIPs would contribute well to the country's development. Essentially, the Bill looked at key projects or SIPs and highlighted their importance to all three levels of government, and provided a way to address the issues. IDC felt that a single point of contact was critical, being the SIPs Steering Committee, and noted that matters would be eventually escalated to the Secretariat. The appointment of the SIP coordinators would allow for independent oversight of the projects. He believed that the SIP coordinators might suggest that their authority needed to be expanded, and that might need to happen.
The Steering Committee would also ensure that the correct departments or officials were part of the process and that the right decision makers were represented. State resources would be optimised. One of the main objectives was to ensure that State spending in fact maximised development projects. There would be monitoring and accountability.
IDC had made a detailed written submission but wanted to focus, in this oral submission, on what could be done to enhance implementation of the projects. It noted that the Bill did not appear to differentiate between public and private funded projects, but felt that there should be an allowance to include private sector projects. It was suggested that the duties of the Steering Committee, as set out in clause 14, should in fat e the responsibility of the implementing agency, and the roles needed to be more clearly defined. In terms of access to information, it was noted that government agencies reported to their own ministers and the reporting lines needed to be clarified further. The SIP Steering Committees needed to be empowered to report.
IDC further noted that clause 5 spoke to expropriation, which was in itself a lengthy process. If there was an impediment and expropriation was required, it might be better if this be escalated to the relevant Minister, with the necessary reports.
IDC felt that instead of the current arrangements as set out in the Bill in regard to the budget, the Chairperson of the Steering Committee should be able to delegate the carrying of the budget to another institution.
Finally, IDC did not feel that the Bill went far enough in terms of local content and localisation. There should be reference or accountability on the Steering Committees and implementation agencies. There were 18 SIPs and there had to be consolidation of the State spend. He concluded that the IDC was supportive of the Bill’s attempts to ensure that there was coordination and cooperation, there should be more emphasis on development of the youth, rural development and skills development. Monitoring and accountability mechanisms were needed, preferably to be exercised by the executive authorities, to ensure that the known challenges to infrastructure in the country were addressed.
Mr Mabasa felt that IDC was suitably situated to advise the EDD and to make meaningful input to enhance the Presidential Infrastructure Coordinating Commission (PICC) plans. IDC had heard the comments made earlier and studied the Bill and he asked if it had any specific advice or suggestions.
Mr Motau noted that the IDC's written submission had commented on the definitions, particularly on how “infrastructure” must be defined. He asked IDC to clarify whether it was suggesting that the Bill should specifically cover the issues of whether there would have to be registration of a project, and whether this was the intention.
Mr Beukman said that many of the SOEs were presently being held responsible for service delivery or project implementation – such as dams or power stations – yet one of the powers of the Steering Committee was stated as being to facilitate the delivery. He wondered if there was likely to be any conflict between the Steering Committee and the SOEs responsible for delivery.
Mr Beukman noted the comment on localisation but thought that clause 21 already dealt with the issue, as it was referring to youth employment and localisation.
Mr Ntuli asked how the IDC viewed the status of infrastructure progress at present. The IDC had a mandate for infrastructure development, particularly in the rural areas, and he questioned what particular hindrances or delays it had noted in establishing rural industries, and what was needed to unlock the bottlenecks. He also wanted more clarity on the consultation process had unfolded.
The Chairperson referred to the comment on implementing agencies being given the responsibility to manage budgets, and asked if there was a suggestion that additional budgets were required, or if management was needed in cooperation with other stakeholders involved in the process.
Mr Thaver responded, in regard to the budgets, that the Bill currently stated that budgets came via the National Treasury. However, since all the SIP coordinators were State agencies, he felt it appropriate that the budgets be devolved to them, rather than remaining with the Ministry, as that could lead to delays in hiring the necessary staff and making other arrangements.
Ms Noziswe Mthembu, Legal Manager, IDC, added that all state institutions were already subject to stringent requirements of the Public Finance Management Act, and were audited.
The Chairperson also asked for clarity on the comment that private projects should be identified also.
Mr Thaver said that the Bill contained only one reference to the private sector. It was possible that there might be a major private sector project and there should be allowance for that to be brought into the SIPs under the PICC.
The Chairperson said that clause 8(1) said that the Commission should designate a Strategic Integrated Project, and state whether it should be put out to tender. However, she was really seeking comment on clause 8(3)(b), which said that the accounting officer should be named.
Mr Thaver noted that clause 8(2) required a determination of whether the state had capacity. If this was a private project, IDC felt that it might be appropriate that it also be included under the SIPs, so that it could be administered under this Bill.
The Chairperson said that there was already provision for announcing something as an SIP in the Government Gazette, and suggested that this might be sufficient.
Mr Thaver responded that implementing agencies were responsible. It had discussed with EDD the point that permits might cause difficulties for the implementing agencies,hence the need to clarify the roles more specifically. He suggested that the implementing agency must report to the Steering Committee, but it was necessary to avoid interference by the Steering Committee into corporate governance structures.
In answer to the points on localisation and youth development, Mr Thaver said that youth employment started by building factories and job opportunities, and localisation was essentially about opportunity, and must dovetail with spending. Agencies should have to think about how to include the youth up front, Part of the SIP coordination role was to ensure that every project had elements of localisation, and he gave the example of the existing SIP 5, where localisation was a very important element from the start.
In answer to the question about hindrances and delays experienced at present, Mr Thaver noted that the IDC mandate related to industrial infrastructure, which differed to attend to state infrastructure which may not have an economic return but did have some social return. Typically, if a power station was to be erected, and needed a rail line, IDC would supervise that. The SIP 3 and 5 – relating to iron ore and manganese lines – required consideration of what was needed to support the two industries, and Industrial Development Zones had been set up by using industry, whilst other projects would focus on, for instance, provision of dams to support agriculture. The particular problems that IDC had identified related to access to markets, particularly in the rural areas, consolidation of production and logistics.
Ms Phumeza Radana, Compliance Manager, IDC, responded, in relation to the questions on definitions, that the Bill was not providing for other levels of approval.
Mr Thaver concluded that IDC had held consultation on the Bill at a number of levels.
Centre for Environmental Rights (CER) submission
Ms Melissa Fourie, Executive Director, Centre for Environmental Rights, summarised the CER’s vision and mission, noting that CER was a non-profit law clinic working to guarantee environmental rights in South Africa. The comments it would make were endorsed by the Environmental Monitoring Group and Federation for Sustainable Environment. This oral submission supported the detailed written submission made in November.
The CER supported streamlined and integrated approval processes that would achieve the objectives of government and allow individuals and organisations to participate. In principle, it supported development of public infrastructure, which had the potential to contribute to job creation, economic development and lessening of poverty. A number of areas were covered by the existing SIPs. However, she cautioned that poorly conceived or ill-assessed projects could lead to ecological disaster and further marginalisation of communities and significant long-term costs for the State.
She noted that the Bill appeared to disregard the legal context, government policy and existing government commitments. This comment had been made to the EDD on the draft Bill and applied also to this version. There were concerns that constitutional rights around administrative justice and environmental rights may have been violated. Section 24 of the Constitution set out the rights in terms of the environment, including secure ecologically sustainable development and use or natural resources. She referred briefly to the case law on jurisdictional issues and cooperative governance, which were fully set out in the written submission. Several dealt with the powers of municipalities in relation to environmental planning. Poor coordination and delays were perhaps not ideally to be addressed through legislation. She was concerned about some of the comments made earlier on the EIA process.
Ms Fourie noted that over a number of years there had been substantial improvements to the turn-around time for the processing of applications, and there were a number of revised time-limits imposed. When dealing with the NEMA amendments, not only had there been discussion on setting time frames for authorities, but also for applicants, who could slow down approvals by submitting poor quality documents. Furthermore, there was another important innovation to escalate matters up to the executive authority, if they were not being handled fast enough. There was already a special division within the Department of Environmental Affairs (DEA) to deal with the SIP projects.
She commented that South Africa liked to see itself as a leader in sustainable development, but the decisions made in practice did not always support the goals. In December 2013 the OECD commented that plausibility of identified environmental targets could be questioned, given past outcomes. One of the major inconsistencies was the lack of any reference in this Bill to sustainable development.
CER shared concerns about the conflict also in relation to timeframes set out in other legislation. There were some fast tracking projects that required more time to assess impacts, not less. There was no public consultation on designation of SIPs, and competent authorities could find themselves compromised. CER was also concerned about reliance on statutory dispute resolution instead of compliance with cooperative governance requirements. She cited a hypothetical example that the Department of Water Affairs might find it almost impossible to refuse an application for a water licence, even where there was not sufficient water for completion of a project, if everything else said that the project must be approved. That would create grounds for challenge.
A slide was tabled but not presented on what CER suggested were the necessary changes, and she summarised that further comment and critique could be found on the CER website.
Mr Mohai agreed that an inclusive overview was needed for projects. He pointed out that projects assessed as SIPs would have been done through various processes. For instance, the Durban and Free State industrial corridor had been a priority of the municipal and provincial government to support economic growth and development. He did not understand where the risks were, if the Bill was enhancing the capacity to support and enhance development.
Mr Beukman asked for clarity on the written submission, which suggested that the Bill might violate international obligations.
Mr van der Westhuizen noted the recurrent themes from many of the presentations and said that the EDD would no doubt take note of the comment. He thanked the CER for its constructive proposals. He wondered if a SIP should only be undertaken once the environmental authorisation had been obtained. Projects were often multi-year projects, involving several role players, whereas perhaps environmental authorisation did not need to be coordinated with other planning processes to the same extent.
Mr Ntuli asked if CER was happy with the pace of infrastructure development in the country
Mr Mabasa commented that CER had touched on the marginalisation of poor communities and asked for further elaboration on that. He also questioned whether existing legislation was actually being ignored, and said that this Bill could be seen as operating at a higher level, to hasten delivery in the face of delays. He wondered if environmental interests might not themselves hamper development, particularly in roads and rail construction, and commented that there was a need to find a balance.
The Chairperson asked how long the process of environmental impacts should reasonably take. She noted that her colleagues had made the point that the Bill should not ignore or undermine existing legislation, but was drafted because matters were not happening as they should. Clearly, interventions were needed, but nothing should be perceived as hampering them. Many environmentalists seemed to prefer the approach that the environment should be preserved, not developed, but she questioned whether South Africa would have progressed so far if it had not taken decisions in favour of development. Again, a balance rather than stalling of development should be sought.
Ms Fourie said that many of these questions were very complex. There were not homogenous views held within the environmental sector, but it was generally accepted that there was room for preservation in certain areas, and development must be allowed, but at the same time ensure that some natural resources were preserved, albeit not in their original form – for instance, wildlife should be protected, but not allowed to roam in the streets. The Constitutional Court had addressed these issues. CER did not support preservation at the expense of economic development.
The length of time for EIAs currently would depend on the nature of the proposals, the assessments, the details, assessment of scientific studies that may in themselves have taken years to compile – such as those on water availability and quality. Some developing countries, including Chile, required five years of scientific data to be available before approving a project, but on the other side it must be recognised that the consequences of getting matters wrong could be very serious. However, there were also many “white elephant” projects stalled because of poor impact assessments. A road corridor might involve less environmental projects than open-cast mining. Many environmental projects that were well-conceived and properly undertaken would be job creators, such as the rehabilitation of mines.
Ms Fourie took the point that the Bill was intended to facilitate decisions. The Bill, however, still contained contradictions; for instance time frames were prescribed in the Bill that were at odds with the mining and environmental legislation – for instance, 250 days was mentioned in this Bill as compared with 300 days in other Acts. Any litigation to deal with the conflicts would only slow down the implementation. She urged that there should be further consideration given to this legislation and suggested that it should be fairly easy to tie the legislation together.
The Chairperson asked that the remaining responses be sent through in writing.
Ms Gita Goven, Chairperson, CommuniTgrow, introduced the organisation, a private sector company formed from five companies who aimed to ensure sustainable growth. Over the last five years there had been greater alignment and integrated city development for all, bearing in mind the challenges of affordable housing, urban sprawl and informal settlement development. It was important to build on alignments and synergies. CommuniTgrow worked through six pillars, and operated a social enterprise model, with a focus on building sustainable communities at every level.
Mr Adrian Booysen, Chief Strategic Officer, CommuniTgrow, said that CommuniTgrow had a pilot project, Wescape, which aimed to develop a substantial site on the West Coast, aiming to provide 200 00 households, 800 000 residents, with clinics, schools, sports grounds, and other facilities. This had recently been approved and confirmed as falling within the City of Cape Town urban edge. It identified land on national growth corridors, attended to project design, but on totally new projects. He set out the essentials of project design, implementation and objectives (see attached presentation), stressing how these led to an integrated urban economy which could be replicated.
The Chairperson interrupted him to ask him to focus on the Bill.
Mr Booysen said that CommuniTgrow believed that this model was timed and aligned with the Bill, the NDP, and it endorsed the Bill fully. However, it felt that the Bill overlooked the potential of private sector projects such as Wescape. In Western Cape, private sector projects accounted for 10 out of the 17 approved SIP projects. An enabling regulatory environment was very important as there was currently far too much delay to attract investment and maintain the project. CommuniTgrow would like to see clear mechanisms in the Bill to provide for submission and approval of private sector SIPS to access the Bill as an enabler for strategic integrated delivery. Secondly, it would like to see non-conflicted Steering Committee private sector participation and PICC review of private sector projects.
Noting that at present the private investors were absorbing all of the risk of strategic projects that would benefit the public, he suggested that tax incentives be explored with National Treasury, that preferential access to funding be explored through development finance institutions, and a clear process for equitable risk-sharing should be set out in the Bill.
Mr Beukman noted the mention of the two-year process followed under the current legislative frameworks to get the current approvals for the pilot project, and asked how long total approvals should, or did, take at present.
Mr Mabasa noted that CommuniTgrow supported the Bill, but made suggestions also to enhance and improve it. He would appreciate any comment from CommuniTgrow on the input made earlier by other submissions.
Mr Motau asked how the enactment of this Bill would impact on the types of models that CommuniTgrow used.
The Chairperson commented that the private sector seemed to have access to a lot of money that, if put together, could make a huge impact on the development of communities, and suggested that such a pooling of resources might be appropriate as part of Corporate Social Responsibility programmes. She asked for comment on this suggestion, which could enable the private sector to move in a more concerted effort. National Treasury was part of the cluster of development, and government supported the private-public partnership models. The PICC had the power to designate projects, including private ones.
Mr David Pearson, Chief Executive Officer, thought that the Bill would stimulate the ramping up of the economy. Singapore had been a prime example of stimulating economy. Supplying investment as infrastructure alone was not the answer; instead, there should be close interaction to create a stimulus package that benefitted everyone. In regard to the perception that the private sector had a lot of money, he noted that without government interventions such as this Bill, change would not happen. The Financial Services Charter had tried to stimulate social projects, but this was not receiving as much support and endorsement as hoped. He said, however, that this Bill could firstly help with funding, and it would ensure that the feasibility studies done currently did not run into cost problems several years down the line. CommuniTgrow would like to interact with the EDD. There were currently 2.3 million houses that could be privately constructed, but state assistance and access to funding of about R8 billion would be needed to help the private sector realise the potential of building houses.
Ms Goven said that official capacity to deal with EIA submissions was limited, and it would help if the Bill could assist in providing that capacity on major projects. Some of the EIA processes were not yet looking at evolutionary environments and CommuniTgrow would like to tighten the processes and hopefully reduce the time frames to around two years for all the assessments. If a risk sharing framework could be created, time delays could be anticipated and planned.
Mr Pearson noted that a free download of the model for new cities was available on the website (www.communitgrow.co.za).
The Chairperson noted that apologies were noted from the Legal Resources Centre, Centre for Civil Society and SACCI, who were unable to make oral submissions.
The meeting was adjourned.
- South African Chamber of Commerce & Industry submission
- Business Unity South Africa
- Legal Resource Centre submission
- Centre for Environmental Rights presentation
- Centre for Environmental Rights written submission
- Business Unity South Africa submission
- South African Local Government Association presentation
- Business Unity South Africa presentation
- South African National Roads Agency Limited presentation
- South African National Roads Agency Limited submission
- Western Cape Provincial Government comments
- Western Cape Provincial Government comments
- CommuniTgrow written presentation
- CommuniTgrow written submission
- Industrial Development Corporation presentation
- Industrial Development Corporation submission
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