National Treasury has invited national, provincial and municipal spheres of government, as well as public entities, to apply for funding under the Budget Facility for Infrastructure (BFI) that was announced in the 2024 Medium-Term Budget Policy Statement.

The BFI forms part of government’s restructuring of institutional arrangements for infrastructure finance and implementation.

The BFI will comprise an appraisal review process through multiple windows, to consider large-scale infrastructure proposals valued at R1-billion or more that require fiscal support to cover a viability gap.

Treasury plans to open four BFI windows in 2025/26 on a quarterly basis, with dedicated appraisal capacity assessing the proposals.

The first of these windows is now open and will close on April 16.

The other window deadlines have been planned for July 1 and October 1 this year, and January 9 next year.

“The goal is to ensure that investment choices are made in line with effective project development, robust appraisal review, sustainable financing and procurement arrangements and pragmatic delivery of infrastructure,” Treasury states.

A Treasury committee will convene quarterly to make recommendations into the budget process on evaluated proposals and determine the appropriate fiscal mechanisms to support projects and programmes. This could include government guarantees, appropriations and other fiscal instruments.

The scope of the facility will include the consideration of proposals from prefeasibility stage, with varied evaluation processes for proposals at different stages of development.

The BFI will only consider submissions that meet the eligibility criteria and contain sufficient information to inform investment decisions. Notably, submissions received after a submission deadline of a specific window will be evaluated in the subsequent window.

Sponsors should note that Treasury is collaborating with private financiers and funders to support infrastructure projects and programmes. Financing for BFI-supported proposals will be separated from broader borrowing requirements.

As such, sponsors’ cooperation in sharing project or programme information will be critical to enhance monitoring and reporting requirements and to ensure accountability and value for money.

ELIGIBILITY CRITERIA
 

The BFI will consider new and existing infrastructure proposals from public institutions in respect of projects and programmes that meet the following criteria:

• A minimum capital cost threshold of R1-billion. Proposals with a lower cost threshold may be considered in the case of projects or programmes that propose significant private-sector participation in financing and implementation.
• On-budget social interventions, meaning social interventions that are funded by the government to deliver essential services, as well as interventions that have commercial and social components and require capital contribution or financing instruments to de-risk the investment and crowd-in other resources for development purposes.
• Submissions under private sector participation frameworks, including public-private partnerships, concessions and special purpose vehicles, that have a viability gap related to social components, sponsors that require access to financing, transactions that need credit enhancement or where there is a market failure or other reasons that impede the proposal to proceed, must have completed feasibility studies and received Treasury approval or recommendations.
• Proposals in the prefeasibility stage will receive initial feedback to refine or guide the conceptualisation, preparation and packaging of the project in question. Submission at this stage is optional but encouraged, to strengthen proposals before sponsors submit for an investment decision.
• Proposals in the feasibility stage will be assessed for investment worthiness and channelled to the relevant budgetary or other structures within Treasury for consideration.
• Proposals in a post-feasibility stage must have been assessed for investment worthiness and have completed planning processes. These proposals will be considered for support based on the execution capacity and readiness to begin construction.
• Proposals that are fully commercial in nature and those that require 100% funding will not be considered.

The actual submissions must include a concise summary of the proposal not longer than 20 pages; a completed budget statement template to capture key financial information and budget estimates for the project; letters of support from the relevant national department where applicable; and relevant supporting documentation such as conceptual designs depending on the category of the project.

Submissions must be sent electronically to infrastructure@treasury.gov.za.

Sponsors that require assistance with the preparation of proposals should use the above email address for referral to preparation facilities within the Development Bank of Southern Africa, Infrastructure South Africa and Government Technical Advisory Centre.

Treasury confirms that it will organise information sessions for project sponsors to assist with submissions and technical requirements.