The expansion and capacitation of Infrastructure South Africa (ISA) is central to the Department of Public Works and Infrastructure’s (DPWI’s) strategy for increased infrastructure investment, says Public Works and Infrastructure Minister Dean Macpherson.

Infrastructure SA was established in 2020 in an attempt to close South Africa's infrastructure investment gap and to meet the infrastructure target set out in the National Development Plan.

In a broad-ranging speech almost 60 days into the job, Macpherson says he wants ISA to function as the single point of entry “for all priority infrastructure projects, streamlining processes and reducing inefficiencies that have previously hampered project delivery”.

“This will…also ensure that we prioritise projects with the greatest economic and social impact.

“And, this will increase investor confidence in public infrastructure projects, knowing that where ISA is involved, construction projects are completed on time and within budget.”

In order to achieve this, Macpherson says his department has identified eight critical pillars in need of urgent reform.

“Our first pillar focuses on establishing ISA as a public entity under the Ministry of Public Works and Infrastructure, whereas it currently has dual reporting lines to both the department and the Presidency.”

The second pillar involves streamlining the planning, identification and prioritisation of infrastructure projects through a centralised system, with ISA to act as the single point of entry for all major infrastructure projects.

Macpherson also aims to accelerate broader budget reforms by collaborating with National Treasury to streamline the public-private partnership (PPP) process and establish an Infrastructure Fund that reports directly to Treasury.

“These reforms will ensure a well-coordinated project pipeline and efficient resource utilisation.

“To remove obstacles that delay infrastructure projects, we are also working with Operation Vulindlela to identify and remove secondary regulatory bottlenecks,” adds Macpherson.

“This includes streamlining permitting and approval processes, particularly for independent power producers (IPPs).”

The fifth pillar focuses on enhancing the capacity of municipalities to prepare and package infrastructure projects addressing the critical lack of infrastructure, such as water, sanitation, roads and electricity.

The sixth pillar aims to diversify funding sources for infrastructure projects by focusing on PPPs, blended finance and social infrastructure programmes.

“ISA will work closely with the National Treasury to direct investments toward projects with the highest GDP impact and job creation potential,” says Macpherson.

The seventh pillar involves strengthening the regulatory framework governing the construction industry.

“We are reviewing the mandates of regulators such as the Construction Industry Development Board and the National Home Builders Registration Council to create a more competitive and transparent construction industry,” notes Macpherson.

The final pillar addresses the impacts of tender cancellations, social unrest, damage to infrastructure and crime.

“We are working closely with law enforcement agencies to mitigate these risks, with a special focus on reducing the influence of the construction mafia,” adds Macpherson.

“One of the most pressing issues we face is the influence of the construction mafia, which has disrupted the construction sector and eroded investor confidence.

“The 30% local procurement rule, intended to empower local communities, has unfortunately been hijacked by criminal syndicates. We are committed to policy changes that will protect legitimate construction businesses and ensure that infrastructure projects proceed without interference.”

Telkom Towers Probe
“As we push forward with these reforms to ignite infrastructure investment, it is important that we get our own house in order,” noted Macpherson.

“This is why, over the past few weeks, we have launched key investigations into failed public-sector projects such as the Telkom buildings project in the Tshwane inner city where nearly a R1-billion was spent on acquiring and redeveloping the buildings, but to date, they remain unusable.

“The department has already issued tenders for the appointment of an independent investigator who, within 60 days following their appointment, will provide my office with a detailed report on what went wrong, who is to blame and what will be the best solution moving forward for the Telkom Towers, which will limit further wastage of taxpayer money.”

In the coming weeks, a tender for a second independent investigation will be released to look at leases which have been established by the DPWI, to ensure that these leases were completed within the confines of the law, and that the State is paying market-related prices.

“Furthermore, shortly after my appointment, we initiated an investigation into an R300-million IT security breach that spans a decade,” says Macpherson.

“I have also authorised our department’s legal services to assist the Special Investigating Unit with litigation at the Special Tribunal to recover up to R20-million against Kroucamp Plumbers.

“This case involves tenders received by Kroucamp Plumbers in 2015 and 2018, where procurement processes were found to be unlawful and unconstitutional.

“The SIU discovered that payments were made to officials in our department amounting to over R300 000.”

Sale of Positions, Skills Audit
Macpherson notes that Carmen-Joy Abrahams has been appointed as acting Corporate Services deputy director-general to address concerns about irregular practices, including the selling of positions within DPWI, and to ensure that all appointments “are made with the highest level of oversight and transparency”.

“Furthermore, there will be increased oversight by both the DG and myself, particularly concerning senior appointments at director level and above.

“I have also tasked [Abrahams] with undertaking a comprehensive skills audit across senior management service level appointees to ensure the department is staffed with the most diverse and talented minds in the fields of construction and infrastructure.”

Financial Powers Revisited
Macpherson says he has restructured financial decision making powers that were previously delegated, and which allowed for expenditure of up to R20-million without the accounting officer’s approval.

“This measure is crucial in preventing the kind of financial mismanagement that contributed to the department's R3-billion overdraft.

“Additionally, the Prestige Unit, which manages State properties such as Parliament, Ministerial houses, the President’s accommodation, the Deputy President’s accommodation, the houses of the Chief Justice and Deputy Chief Justice, has been moved back under the DG’s office to enhance oversight and prevent wasteful spending.”

Macpherson says it was this unit that was responsible for the more than R246-million bill for so-called security upgrades to former President Jacob Zuma’s Nkandla homestead.

“The moving of the oversight of the unit is to ensure that it never happens again.”

Macpherson has also imposed a moratorium on the procurement of new houses or offices for executives, noting that the existing inventory of State-owned homes must be utilised.

SA Property Inc
The DPWI has also begun discussions on the possibility of restructuring the Property Management Trading Entity, or PMTE, into a South Africa Property Company, says Macpherson.

This entity would focus on converting State-owned assets into income-generating properties, with the revenue generated being reinvested into the maintenance of public infrastructure, such as police stations, hospitals and schools.

“Our department is the largest land and building owner in the country, and it is imperative that we leverage these assets to support our broader economic goals,” says Macpherson.