Hefty budget boost for provinces and local government
CAPE TOWN — Government is to increase spending R97bn over the next three years, and the lion’s share of the additional expenditure — 61% — will go to provinces and local government.
Targets for expenditure across the provinces will be provincial and municipal infrastructure, including massive allocations of R23,5bn over the next three years for the provision of housing.
While some R50bn more will go to provinces and local government, the key to this contributing to accelerated growth will be their capacity to spend it all.
Transfers to the provinces will rise 6,3% in real terms over the three-year period.
This raises the allocations to the provinces from the revised final position for 2005-06 of R209,7bn to an estimated R290bn in 2008-09. This includes both the equitable share allocation and conditional grants for targeted spending.
The increases in equitable share will mainly go to bolstering education, health and social development while conditional grants will focus on housing, HIV/AIDS and infrastructure.
Local government gets an apparent bonus of R24bn in grants from national treasury to replace Regional Services Council (RSC) levies — but this is simply an allocation to metropolitan and district councils, which still have RSC levies, allowing for when RSCs are scrapped next July.
The revised position of local government spending for the current financial year is R17,1bn.
For 2006-07 to 2008-09 the allocation to local government increases more than R2bn. Of this R1,5bn will be for free basic services and basic infrastructure, job creation and poverty relief initiatives, and building capacity and governance.
Currently, local government is owed a massive R40bn in arrears service payments and most municipalities have displayed an inability to collect the money.
Over the three years R1,9bn will be spent on capacity building in local government. There is also an additional R500m over the next three years for the municipal infrastructure grant.
“Local government plans to spend R25,3bn on municipal infrastructure over the next three years,” the policy statement read.
A special amount of R241m has been set aside for capital projects in cities that will host matches in the 2010 Soccer World Cup tournament.
The KwaZulu-Natal government has unveiled plans to ensure the province provides sports infrastructure and talented players even beyond the 2010 soccer World Cup.
These plans involve scouting for young talent, developing it in order to ensure that the province and the country have enough players to beef up the squad to represent South Africa five years from now.
Announcing the plans in the parliamentary sitting here, Sport and Recreation MEC Amichand Rajbansi said R15-million had been set aside to carry out talent identification programmes, some of which were already underway.
MEC Rajbansi said R7.5-million would go towards Sport and Recreation facilities while another R7.5-million would be spent on sport co-ordination.
The process of talent identification had begun in eThekwini, Umzinyathi, Zululand, Mgungundlovu and Amajuba District municipalities, said the MEC.
The work that was being carried out, he said, was under the close and constant scrutiny of the political oversight committee.
"We hope to draw more young people in rural areas, in organized sport and building the necessary infrastructure, including stadiums to support the initiative," added the MEC.
He also urged the Mayor of eMtshezi local municipality Phiwokwakhe Sokhela to submit a business plan to the department so that the area could also benefit from the initiative by having a proper facility for public use.
He also pointed out that the department's mandate of getting the province actively involved in a number of sporting codes was already starting to bear fruit as KZN had participated in a number of events at national level and received accolades for being well organised. -
New taxi terminal to improve service for long-distance travel
By Aziz Hartley
Tax commuters travelling long distances are set to benefit from a R6 million terminal that opened yesterday at the Bellville Transport Interchange.
Taxi associations welcomed the terminal and said they were pleased long-distance taxis could now be better co-ordinated.
The facility, which starts operating today, has a waiting lounge, ablution block as well as other facilities for the comfort of travellers.
It is also equipped with a clinic that will provide free HIV/Aids testing.
Mayoral executive committee member responsible for transport, roads and stormwater, Danile Landingwe, said the terminal was planned after construction of the R27 million transport interchange began.
He said while efficient public transport, especially taxis, was crucial in the city's preparations for the 2010 Soccer World Cup, more should be done to educate taxi operators and motorists about using public roads.
Landingwe said taxi drivers faced various pressures that lead to them flouting regulations.
"The operator tells his driver that he wants the driver to reach a certain target. Then taxis drivers also rush because passengers say they are late. The driver has to face two types of pressures - that of the operator and that of passengers," he said.
He said more should be done to ensure dedicated traffic lanes are used by taxis and buses, and not other vehicles, and that this problem will be addressed in the next three months.
Council of Amalgamated Taxi Associations (Cata) representative Alfred Pupu said taxi operators were determined to clean up their act, but that provincial and national transport departments should do more to have the Operating Licensing Board work
"We also request the government to speed up the taxi recapitalisation programme so all of us can be ready in time for the 2010 Soccer World Cup" Pupu said.
Said Congress of Democratic Taxi Associations (Codeta) deputy chairman Peter Thethani: "This is a good thing as it will make long distance travelling easier for both commuters and drivers.
"We welcome the terminal as an important link in the public transport system."
Nelspruit to Get a Stadium
October 25, 2005
Posted to the web October 25, 2005
By Sizwe samaYende
Even if FIFA does not choose Mpumalanga to host 2010 soccer World Cup matches, plans will go ahead to build a sports stadium in the provincial capital.
Deputy manager at the Mbombela municipality and head of the provincial bidding team, Roelf Kotze, says a proper stadium in the city was long overdue.
"The stadium might be different to what a world cup soccer stadium would be," Mr Kotze said.
"All the hype and excitement about the world cup would be gone, and we'd sit down and re-plan."
He said Mpumalanga still had a good chance to host World Cup games after making a presentation to a 13-member FIFA technical team
Mpumalanga has proposed building a 40 000-seater stadium on a community-owned farm at Mataffin just outside Nelspruit at a cost of R335 million.
The Mdluli clan owns this prime piece of agricultural property after regaining ownership following a successful restitution land claim.
"We're quite confident after showing FIFA what we can offer. We were able to answer all their questions," Mr Kotze said.
The delegation also took a quick tour to inspect potential training venues such as KaNyamazane stadium near Nelspruit, KaBokweni stadium near White River and the Nelspruit rugby stadium.
They then flew to Mozambique and Swaziland, also to inspect potential training venues there since the two countries are merely an average of 100km from Mpumalanga.
Nelspruit is bidding against Kimberley in the Northern Cape, Polokwane in Limpopo and Port Elizabeth in the Eastern Cape to host the world's greatest soccer showpiece.
The 2010 matches will be played on eight stadia across South Africa, the first African country to host the soccer World Cup.
Gautrain to cost R20bn - Manuel
South Africa will spend more than R20-billion over the next 5 years on a high-speed train project and R3-billion more to upgrade sports facilities for the 2010 Soccer World Cup, the government said yesterday.
The 80 km train line is designed to link Johannesburg and its airport to the capital Pretoria and forms a key part of the government's efforts to improve public transport ahead of the event, being held in Africa for the first time.
"This is a project of the Gauteng province, but it is an investment of national economic significance and its place in a larger transport strategy for the Gauteng region is currently under final scrutiny," Finance Minister Trevor Manuel told parliament during his Medium Term Budget Policy Statement.
"The overall costs to the fiscus of Gautrain will exceed R20-billion over the next 5 years," he said.
The train project was originally estimated to cost taxpayers about R7-billion.
It has been described by officials as Africa's biggest public-private partnership and is expected to create 148 000 jobs - a much-needed boost in a country with an official unemployment rate of 26,5%.
The train will carry soccer fans between Johannesburg and Pretoria at speeds of between 160 and 180 km per hour and serve as an alternative to the congested highway linking the two main cities once the tournament is over.
The state has picked the Bombela Consortiumm comprising Canadian train maker Bombardier, South African engineering form Murray & Roberts and French firms Bouygues Travaux Public and RAPT Development to build the train.
Manuel also said that the government would set aside 3 billion rand over the next 3 years to modernise its sports stadia for the Soccer World Cup.
"Decisions need to be taken over the next few months, with a view to constructions beginning next year," he said.
South Africa is hoping to modernise and upgrade its stadia by 2008, two years ahead of the mid-2010 event.
LOC call on Fifa to name 2010 host cities earlier
October 26, 2005, 16:30
The 2010 Local Organising Committee (LOC) has requested world governing body Fifa to bring forward the announcement of the host cities for the 2010 soccer World Cup.
Trevor Manuel, the finance minister, allocated R241 million to the LOC during yesterday's mini budget, but the LOC can only allocate the money once Fifa has approved the host cities. The eight or 10 host cities were only going to be announced in July next year, but because the South African government has lived up to its promise that it is committed to the 2010 World Cup, the LOC will try and get some action from Fifa.
Strenghtening case to Fifa
Irvin Khoza, the LOC chairperson, says the announcement by Manuel stipulating the money allocation for the infrastructure will strengthen their case to Fifa to bring forward the announcement of host cities. The committee which will oversee the process in the build-up to 2010 has also been established. It comprises of members from the LOC, government, corporate South Africa and the legal fraternity.
Khoza says the committee has been assigned to finalise the adjudication and also identifying the host cities so that they can start now in allocating the funds to appropriate projects in the the various cities.
Fifa's national executive committee is meeting again in December when the South African report and the country's progress will be discussed.
Fifa Satisfied With SA's Preparations for 2010 World Cup
October 23, 2005
Posted to the web October 24, 2005
By Themba Gadebe
The Federation of International Football Associations (Fifa) is impressed with the way South Africa is making its preparations for the 2010 Soccer World Cup.
A Fifa delegation was in the country for a week-long inspections of some of the venues identified to host some of the 2010 soccer tournaments.
Stadiums visited were in Kimberly, Orkney, Potchefstroom, Polokwane and Nelspruit.
Addressing the media before the team's departure on Friday, head of delegation Jim Brown expressed their satisfaction at South Africa's "level of preparation and understanding of the requirements" saying the report back to Fifa President Sepp Blatter would be positive.
"We are overwhelmed by the spirit of commitment, cooperation, enthusiasm and willingness to build a successful world cup.
"South Africa's commitment and our relationship with the Local Organising Committee (Loc) has been consistent, giving us a positive indication," Brown said.
The Fifa team included Jerome Valcke, director of marketing and television and Alain Leiblang, head of media operations.
The delegation indicated that it had no concerns but noted that the focus was now on the question of building stadiums and to develop time-frames.
CEO of the 2010 World Cup Loc, Danny Jordaan said the committee showed Fifa an insight into the country's 13 proposed venues.
They also showed the Fifa team an "insight" into the infrastructure of Swaziland and Mozambique.
Stadiums in both countries according to Mr Jordaan would be used for training sessions and friendly matches.
This was in line with the concept of hosting an "African World Cup", he said.
However, an announcement regarding host cities is yet to be made.
"The announcement will be made after required documentation like the report back stadium agreement has been done. There is some work to be done," Mr Jordaan said.
The announcement would be made by Fifa after being informed by Loc.
The delegation further announced that it would be opening its permanent office in the country at the beginning of 2006 which would operate until conclusion of the 2010 soccer World Cup games.
2010 is going to be great. i'm very happy for Africa and S Africa for winning the greatest sporting event in the world. I had to miss Germany because i couldnt get tix and i'm afraid to go without, but i HOPE to get tix to SA. Its going to be FUN!
Africa: Full steam ahead Print This Item Email This Item
Pinsent Masons is supporting South African law firm Ledwaba Mazwai in advising the Gauteng Provincial Government on a major rail link project. Geoff Roberts and Metja Ledwaba report on the venture and the PPP scene in South Africa
The Gautrain rail link project is being seen as an opportunity for South Africa to show its mettle in public-private partnership (PPP) and infrastructure projects. Gautrain consists of an 80km high-speed rail system linking Johannesburg, Tshwane (Pretoria) and Johannesburg International Airport. It is being procured using a PPP model and is the largest transportation infrastructure PPP project undertaken in South Africa (and Africa) to date. The private sector participation entails the design, construction, operation and maintenance and part-financing of the system.
Following the announcement of the Bombela Consortium, comprising Bombardier Transportation, Bouygues Travaux Publics, Murray & Roberts, the Loliwe and SPG companies and RATP Developpement, the Gauteng Provincial Government is negotiating the concession documents with Bombela, with a view to achieving financial closure at the end of this year. The concession period consists of a four-and-a-half-year construction period followed by a 15-year operating period.
PPPs have become an increasingly common method of procurement in South Africa since May 2000, when the South African Treasury brought regulations governing the process into effect. During the procurement lifecycle, there are various stages at which Treasury approval must be sought and granted — feasibility, during the tender process and in the final stages of negotiation — ensuring that key principles such as affordability, value for money and risk allocation are addressed and viable solutions are proposed.
This structured approval process is complemented by standardised PPP agreement and treasury guidelines on implementation of PPPs. Following discussions with the financial sector, lawyers, the construction sector and the facilities management sector, standardised PPP provisions were published in August 2004 setting out detailed explanatory requirements and standard clauses for PPP contracts. This is similar to the Standardisation of PFI Contracts version 3 documentation issued by Partner-ships UK. Standardisation in this way has helped to instil confidence in the method of procurement, give certainty to key contractual terms in PPP agreements and reduce the transaction time and cost of PPP projects.
Gautrain is one of a number of projects, at national and provincial level, procured under the PPP regime, creating a dynamic and exciting market for participation and innovation at all levels and contributing to the socio-economic development of the country.
Gauteng is a very important region economically and industrially in South Africa. The main contributor to South Africa’s economy, it accounts for approximately one-third of the nation’s gross domestic product. However, current traffic problems in the Tshwane-Johannesburg corridor and the legacy of South Africa’s political and cultural history means that there is yet further potential for economic growth.
Gautrain will play an important role in stimulating growth, creating jobs, relieving traffic congestion, promoting the use of public transport, urban restruc-turing and regeneration and achieving the province’s goals in relation to empowerment and equality. For an infrastructure project of this scale, innovative solutions are key to its success in terms of value for money, usage and the achievement of other objectives such as socioeconomic development and environmental issues.
The success of Gautrain will be dependent on its integration with existing transport services in Johannesburg and Tshwane. A bus feeder and distributor network will be put in place as part of the overall scheme. Operators of the feeder and distributor services will be sourced from the pool of existing operators in the area, innovatively combining formal and informal providers of public transport and enabling enhancement of services offered by existing businesses.
The Government has formulated a strategy to encourage economic participation and contribution by historically disadvantaged individuals. This strategy is reflected in the standard PPP provisions, which stipulate an acceptable minimum threshold for participation by black economic empowerment entities. Project agreements can stipulate higher levels. This approach ensures that established businesses are encouraged to identify credible empowerment partners which will participate in the project. Failure to achieve minimum levels of participation may lead to penalties or contract termination under the terms of the concession agreement. These mechanisms have been incorporated into the Gautrain Concession Agreement and formed the basis of the evaluation of the Preferred Bidder’s proposal.
Gautrain is scheduled to be in operation by the advent of the FIFA World Cup in 2010 in South Africa. This will be an opportunity for South Africa to show to its people and to a wider global audience that it can compete on any world stage in the development of infrastructure.
Johannesburg will have two stadiums in the World Cup 2010 and also boasts the opening match, one semi final and the final match of the tournament.
Soccer City is the jewel in South Africa’s crown, built in 1987 and with a capacity of 94,700 (excluding Media and VIP’s) it is sure to offer a great atmosphere for the lucky few that get tickets and hopefully as the stadium to be used for the first game, provide an excellent springboard for a magnificent tournament.
For 2010, the upper tier will be extended around the stadium, an encircling roof will be constructed, new changing room facilities will be developed and new floodlights will be installed.
Ellis ParkEllis Park was built in 1982 and is primarily used as a rugby stadium but for 2010, new upper tiers will be constructed behind each of the goals, at the north and south ends of the venue, increasing the net capacity by 10,149 seats to a total 65 - 70, 000 and the stadium is earmarked as a venue for one of the semi finals.
Local training venues to be used include Orlando Stadium, Dobsonville Stadium, Milpark,Rand Afrikaans University Stadium, Vosloorus, Alexandra, Herman Immelman and Makalareng, Makulong.
Huge sponsorships secured for 2010 World Cup: S. African official
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The 2010 World Cup soccer tournament to be staged in South Africa is already a commercial success thanks to huge international sponsorships secured, an official said.
South Africa has already financially outperformed its 2006 World Cup counterparts in Germany, Danny Jordaan, chief executive of the event's Local Organizing Committee, was quoted as saying by South Africa's government news service BuaNews on Thursday.
He added that the tournament would create unprecedented opportunities for small business enterprises, as the visiting soccer fans would be spending an estimated 9.8 billion rand (1.48 billion US dollars) throughout the country.
Jordaan said all 2010 World Cup projects in South Africa were on course, due to "hard" behind-the-scenes work by the organizing committee, which includes four national cabinet ministers, high profile business leaders and representatives from various other sectors of society.
Jordaan urged South Africans to start learning a few foreign languages, so they could help to make visiting soccer fans feel at home.
He also confirmed that a complete list of matches and venues would be available six months before the start of the tournament.
He noted there were strong indications that most South Africans would be able to watch 2010 matches on their cellphones, due to sophisticated technology which would be introduced in the country, to coincide with the event.
However, he said that the committee's international media publicity campaign for 2010 would only be launched in earnest after the completion of the 2006 tournament in Germany.
Earlier this month, Jordaan said South Africa had signed contracts with five major companies to participate in the World Cup. But he did not elaborate.
Sasfin Fund to Plug Investors Into SA's Infrastructure Blitz
Business Day (Johannesburg)
October 28, 2005
Posted to the web October 28, 2005
By Stephen Gunnion
SASFIN is giving investors the chance to benefit from the spending on infrastructure ahead of the 2010 World Cup, and other social and investment expenditure projects.
The group has launched the Sasfin TwentyTen Fund, a unit trust which will invest in companies that will profit from spending on capital formation, the elimination of disease and social grants.
TwentyTen fund manager David Shapiro said there was a global move to build infrastructure, particularly with the strong growth emerging from China and the lack of capacity to fuel that growth.
Shapiro said there was also a need for government to make its mark on the economy with projects like the Gautrain and the stadiums that will have to be developed for the 2010 Soccer World Cup.
Shapiro said Germany, which is hosting the World Cup next year, would set a standard that SA would have to meet.
In his medium-term budget policy statement this week, Finance Minister Trevor Manuel said the overall cost of the Gautrain would exceed R20bn over the next five years. Development of stadiums would cost about R3bn. Both of these figures are much higher than earlier estimates.
"I think they (government) have very ambitious revenue plans," Shapiro said.
Altogether, government has identified infrastructural development programmes that could cost R200bn, while the private sector is forecast to spend over R100bn on upgrading plants and adding capacity, Shapiro said.
Capital expenditure programmes include the Gautrain, the second network operator and upgrades and expansion spending at Sasol, Eskom and Transnet.
The TwentyTen Fund would invest in companies engaged in infrastructure development, building and construction, transport, telecommunications, health care and pharmaceuticals.
A second new unit trust, the Sasfin Socially Responsible Fund, would invest in companies included in the JSE's Socially Responsible Investment Index, Sasfin said.
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