Transcript Mayoral Committee Presentation

MLM INTEGRATED INFRASTRUCTURE
DEVELOPMENT STRATEGY AND PLAN
Draft Scoping Report
MLM Mayoral Committee
19 July 2012
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CONTENTS
A. BACKGROUND AND OBJECTIVES
B. STUDY PROCESS
C. APPROACH TO THE PROJECT
D. CONTEXT FOR INFRASTRUCTURE PROVISION AND PLANNING
E. INFRASTRUCTURE PROVISION IN MLM
F. THE STATE OF MLM FINANCES
G. TOWARDS AN INTEGRATED INFRASTRUCTURE STRATEGY AND PLAN
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A. BACKGROUND AND OBJECTIVES
•
The availability of infrastructure represents a major platform for promoting
economic growth and access to sustainable and affordable basic services,
such as water, sanitation and power.
•
All municipalities must play a central role in supporting economic development
and alleviating poverty. The services they provide, such as water, sanitation and
electricity, are critical inputs to social wellbeing and economic activity.
•
Municipalities can also guide private investment decisions through the spatial
location of their own infrastructure investments and their powers to regulate
spatial development.
•
Metsimaholo Local Municipality is facing many challenges to improve
infrastructure for economic development and service delivery. Despite the
efforts from the local government, social and economic infrastructure in the
area is under pressure. This is attributed by the backlog of municipal
infrastructure development in certain communities, attributed largely to
increasing population growth and urbanisation.
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A.1 BACKGROUND AND OBJECTIVES
• The overall aim of the infrastructure development strategy
and plan is to:
– asses infrastructure needs, constraints, opportunities and investment
implications to proactively shape decisions about long-term future
development patterns in the local municipality
– establish clear priorities for regional and sub-regional infrastructure
investment.
– consider how MLM should take infrastructure forward in an integrated way at
a strategic level and to help scope further work to inform its local socioeconomic strategies and plans.
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B. STUDY PROCESS
• This study has been undertaken by Mothei Consulting Engineers including a
team of Economists and Development Planners
• The study is focusing on historical trends and the status quo regarding
infrastructure planning and project execution.
• The process has comprised: gleaning information directly and indirectly from
a range of organisations, including the Municipality; local industry players;
and consulting with, inter alia, SASOL, Anglo Coal, Chemcity, and OMNIA on
draft outputs.
• There is lack of communication between the Municipality and local
industry players. Hence there is a misalignment of infrastructure investment
objectives between the two key players in the municipality.
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C. APPROACH TO THE PROJECT
• Phase 1 – Scoping Report
– Focuses on ‘taking stock’ of the existing policy, legal, delivery and
financing structures for infrastructure delivery.
– It signposts where infrastructure constraints and opportunities might
exist that are relevant to the development of spatial options for the
Municipality.
• Phase 2 – Prefeasibility Study
– Identify and explore infrastructure projects that of economic and
strategic importance to the Municipality and the area
– The economic viability of the identified projects will also be assessed at
this stage.
– ‘Scenario-testing’ will also be undertaken. This will assist in exploring
and appraising infrastructure delivery options
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C.1 APPROACH TO THE PROJECT
• Phase 3 – Stakeholder Consultations
– Local industry players;
– Provincial, district and local government representatives; and
– Funders of infrastructure projects including Development Finance
Institutions such as the Development Bank of Southern Africa.
– The aim would be to get a buy-in on the proposed infrastructure
projects strategic to the local government and to agree and set up an
institutional framework for implementation.
• Phase 4 – Feasibility Study
– Will entail assessment of technical, economic and financial viability of
the selected infrastructure projects
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D. CONTEXT FOR PROVISION & PLANNING
• Policy Context
– The National Development Agenda
• economic growth; decent jobs; reduction of poverty & inequalities
• Identifies lack of adequate social and economic infrastructure as impediment
– The New Growth Path
• targets 5 million jobs by 2020
• infrastructure investment seen as a job driver
• energy, transport, water, housing & communications
– National Industrial Policy Framework
• Diversification of industrial production – high value-added manufactures
• Appropriately placed infrastructure could encourage clustering
• Infrastructure programme should support Industrial Parks, Science Parks, etc.
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D.1 CONTEXT FOR PROVISION & PLANNING
• Policy Context
– Free State Growth and Development Strategy
• overarching planning tool articulating the development agenda and strategic
direction of the province
• MLM earmarked as a developmental node for the next 20 years
• universal access goals (water, electricity, sanitation & housing) as per the
MDGs by 2030
– MLM Spatial Development Framework
• guide decisions relating to the location and the nature of physical
development
• ensures physical disparities are reorganised for equitable settlement
patterns
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D.2 CONTEXT FOR PROVISION AND PLANNING
• Regulatory Context
– Constitution
• electricity; water; sanitation; storm water; roads; transport; parks &
recreational facilities; health services; libraries and tourism facilities
• national and/or provincial government can also delegate functions
– Municipal Systems Act
• review of IDPs to assess performance and plan ahead
• introduction of Infrastructure Planning to this process is essential
– Municipal Planning and Performance Management Regulations, 2001
• sets out the requirements for municipal performance management system
• the system must also comply with the requirements of the MSA and be linked
to the municipality’s IDP.
• As an integral component of the IDP, the Infrastructure Planning must also
adhere to the requirements of the Regulations.
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D.3 CONTEXT FOR PROVISION AND PLANNING
• Socio-Economic Context
– Population Growth
• current population estimated at 179,305; growing by 1% annually
• projected to reach 209,724 by 2021
– Regional Economic Growth
•
•
•
•
MLM contributed 55% to the provincial economy in 2010
A growth rate of 6% pa recorded for the period 2003–2010.
MLM earmarked as the provincial developmental node
Sasolburg seen as pivotal growth point for the region
– Migration and Urbanisation
• there are more people staying in urban areas than rural areas and the majority
is located in urban townships and suburbs
• tendency of migration from rural to urban areas is also occurring in
Metsimaholo, focusing towards Sasolburg, Deneysville and Orangeville
• the trend to continue in the foreseeable future
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E. INFRASTRUCTURE PROVISION IN MLM
Between 2007 and 2010 over 110 planned infrastructure projects
were either partially or not completed
• Critical Infrastructure (62)
–
–
–
–
–
–
–
Water (4)
Sanitation (9)
Roads and storm water (23)
Electricity (11)
Housing (5)
Transport (2)
LED (8)
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E.1 INFRASTRUCTURE PROVISION IN MLM
• Social Infrastructure (53)
–
–
–
–
–
–
Sports and recreation (20)
Health (10)
Education (8)
Special programmes (5)
Safety and security (4)
Cemeteries (6)
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E.2 INFRASTRUCTURE PROVISION IN MLM
• Institutional Governance
– MLM seen lacking in capacity and expertise
– Infrastructure planning and LED departments overstretched;
coupled with high staff turnover
– Lack of appetite to jointly work with local industry players,
especially in infrastructure investment and project execution
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E.3 INFRASTRUCTURE PROVISION IN MLM
• Constraints
– Inadequate funding for capital projects
– Delays in confirmation of funding from external sources
– Long lead times in engaging with responsible national and
provincial departments responsible for infrastructure
– High vacancy rate and staff turnover
– Disconnection between development, spatial, and economic
planning and infrastructure provision
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F. THE STATE OF MLM FINANCES
Operational Income
Property rates
Electricity
Sanitation
Water
Refuse removal
Other service charges
Fine/penalties
Interest – external investments
Interest – debtors
License & penalties
Rentals of facilities
Transfers
Other
Gains on disposal of PPE
Grants
Total Operational Income
Capital Income
Government grants
Public contributions & donations
Borrowing (external loans)
Internally generated funds
Total Capital Income
2011/12
2012/13
2013/14
2014/15 Av. Growth
84,208
170,163
15,956
144,177
24,500
6,437
8,472
1,467
7,250
100
6,509
63,599
24,404
11,333
93,627
662 202
90,245
205,117
32,599
152,123
37,112
8,440
18,007
2,300
16,002
163
4,503
107,206
20,695
9,000
107,206
810 718
96,654
217,260
35,022
164,164
40,081
8,000
19,007
2,400
17,175
171
9,101
109,508
24,132
5,000
109,508
857 183
102,330
227,400
37,470
173,975
42,486
8,176
20,007
2,400
18,475
181
9,207
117,692
25,360
7,500
117,692
910 351
6.75%
9.72%
30.12%
6.61%
18.87%
6.86%
30.11%
16.41%
33.34%
20.06%
19.05%
20.53%
2.73%
-16.69%
7.33%
10.63%
104,222
9,042
27,417
21,618
162,299
54,757
0
43,000
71,376
169,133
52,213
0
7,000
53,822
113,035
70,087
0
0
53,401
123,488
-11.64%
27.51%
-11.51%
F.1 THE STATE OF MLM FINANCES
2011/12
2012/13
2013/14
2014/15
178,573
12,402
42,000
33,369
126,211
86,631
13,003
15,476
96,051
24,002
70,805
698,523
230,564
12,863
45,000
53,628
154,594
101,938
251,102
14,020
47,000
273,897
15,119
47,000
16,092
21,076
110,495
31,295
78,084
855,629
57,648
184,345
110,093
18,088
7,966
118,651
35,011
68,107
912,031
61,542
227,426
118,901
20,481
7,134
121,045
38,083
67,474
998,102
1,401
4,628
7,702
2,235
1,776
2,537
1,154
87,720
13,700
14,673
23,735
24,432
8,000
3,180
523
3
3
101,977
16,236
2,568
22,598
6,904
2,497
7,018
6,179
125,683
29,370
36,782
24,420
19,865
2,242
13,004
548
1,500
1,500
169,133
512
2,493
20,200
4,328
15,037
508
327
89,225
16,000
27,905
12,750
30,570
0
2,000
105
500
500
113,035
360
0
31,065
13,436
16,517
567
545
87,054
15,000
21,775
12,959
37,320
0
0
9
5,000
5,000
123,488
800 500
1 024 762
1 025 066
1 121 590
Av. Growth
Operational Expenditure
Employee costs
Remuneration of councillors
Bad debts
Repairs and maintenance
Bulk purchases – electricity
Bulk purchases– water
Contracted services
Finance charges
General expenses
Transfers and grants
Depreciation
Total Operational Expenditure
Capital Expenditure
Exec. & Council
Corporate Services
Social Services
Refuse Removal
Public Safety
Sport and Recreation
Community Services
Technical Services
Streets and Storm water
Sewerage
Water supply
Electricity supply
Mechanical Workshop/Buildings
Administration
Financial Services
Economic Dev. and Planning
Housing & Urban Planning
Total Capital Expenditure
TOTAL EXPENDITURE
14.67%
7.04%
3.88%
21.03%
21.44%
10.81%
15.95%
-28.08%
7.95%
16.15%
-2.77%
12.01%
-52.92%
50.25%
63.46%
133.63%
-50.94%
-40.49%
-3.59%
-3.30%
9.51%
-21.85%
18.55%
-74.94%
729.55%
1.73%
10.65%
G. TOWARDS AN INTEGRATED STRATEGY AND PLAN
• Defining Infrastructure of Strategic Importance to MLM
– is the infrastructure investment/intervention of more than local or
regional significance (i.e. raises cross-boundary issues)?
– would failure to deliver infrastructure investments/interventions impact
on MLM service delivery?
– is the scale of investment/intervention necessary to support the socioeconomic and spatial aspiration unlikely to be delivered privately in any
event?
– is the scale of investment or planning horizon in commensurate with the
likely scale of development (i.e. the investment will not be self-funding)?
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G.1 TOWARDS AN INTEGRATED STRATEGY AND PLAN
• Planning for Infrastructure
– Must be informed by an idea of where growth and change is being
planned
– Establish the nature of the existing infrastructure to form a baseline – is
there existing infrastructure capacity to accommodate planned growth
and development?
– If YES, develop a delivery plan with local players and assemble necessary
funding package
– If NO, determine realistic and deliverable levels of infrastructure
investment needed to accommodate growth
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G.2 TOWARDS AN INTEGRATED STRATEGY AND PLAN
• Critical Infrastructure
– Water
• top priority for MLM and community
• influences development of industry and settlements
• Water Supply Audit and Water Services Development Plan should provide strategic
direction
– Sanitation
• high priority for MLM and community
• MLM plans to maximise MIG and DMF and seek private participation where necessary
• influences development of industry and settlements
– Roads and storm water
• ranked 3rd in the IDP
• backlog of 500 km roads in high density areas
• local Municipality Roads Masterplan needed
– Electricity
• 4th area of importance
• universal access is the target
• huge backlogs impacting industrial development
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G.3 TOWARDS AN INTEGRATED STRATEGY AND PLAN
• Critical Infrastructure
– Housing
•
•
•
•
acquisition of land for formal settlement purpose
caveat: infrastructure planned and managed by Provincial Government
coordination with Provincial Government key
Anglo Coal intending to build 5,000 houses
– Transport
• an important precondition for sustainability
• a need for an Integrated Transport Plan
– LED
• MLM needs to support sectors that are growing and have long term
potential to grow the local economy
• a Local Economic Development Strategy to guide economic infrastructure
investment
• SASOL Eco Industrial Park
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G.4 TOWARDS AN INTEGRATED STRATEGY AND PLAN
• Social Infrastructure
– Sports and recreation
• serious neglect by the municipality to deliver on this infrastructure
• responds to growth patterns
• Construction of Multi Purpose Sports Centre in Ward 12 by Anglo Coal
– Health
• operate as a scale economy, and need critical mass to be viable
• ensure dialogue with the National Department of Health occurs with regard to
the main spatial options at a local level
– Education
• major new residential development tends to increase the demand for school
infrastructure
• caveat: planned for at a national government level and can vary significantly
on the basis of wider national education policy choices
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Merriman Bldg
Merriman Avenue
Vereeniging
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