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THE INFRASTRUCTURE DEVELOPMENT BILL (2013) COMMENTARY

INTRODUCTION The Durban Chamber of Commerce and Industry supports the Infrastructure Development Bill, 2013, as it seeks to formalise the conceptualisation, implementation and monitoring, through legislation, of Strategic Integrated Projects (SIPs) which constitute an important part of the government infrastructure programme.

The Chamber approves of the Presidential Infrastructure Coordinating Commission (PICC) conducting the work of the Act, as well as the establishment, appointment and functioning of steering committees for each project.

Critics often highlight the lack of connectivity between the various arms of government, which contribute to bureaucratic and regulatory delays. The

Chamber feels that the Bill seeks to address these coordination problems by the establishment of a set of mechanisms which will bring greater organisation and efficiency to the states ability to ensure that funds secured for infrastructure development are spent in an appropriate and timeous manner.

All correspondence to be addressed to: P.O. Box 1506, Durban, 4000, KwaZulu-Natal, South Africa. Tel: 27 031 335 1000, Fax: 27 031 332 1288 Chamber House, 190 Stalwart Simelane Street, Durban, 4001 e-mail:chamber@durbanchamber.co.za Website:www.durbanchamber.co.za

This is considered to be of vital significance since delays in implementation of planned projects add considerably to their cost.

REGULATORY APPROVALS The Bill seeks to ensure the coordinated issuing of permits and licences through a reduction in approval times for projects by local and other licensing authorities. The Chamber welcomes the time-frame of 57 days introduced in the Bill and the intervention by the Secretariat of the commission when this period might be exceeded. The point is made, however, that including such provision within the legislation is no guarantee that the deadlines will be met unless efforts are made to improve the co-operation among departments and other agencies and efficiencies are radically improved. In some instances, legislation itself may prevent this deadline being met. It is strongly

recommended that government scrutinises carefully all other legislation which might prevent the achievement of this legislated target.

At the same time, the Chamber is conscious of the fact that environmental authorisations are not always easy to fast-track on account of seasonal environmental factors which should be taken into account. In order to avoid the delays which often accompany environmental impact assessments, more and earlier consultation with all stakeholders is advocated. Considering the strategic importance of the projects, more human resources may need to be devoted to the pre-authorisation phase. The intervention of the Secretariat may be required earlier than is contemplated in section 15(6)(a).

EXPROPRIATION OF LAND While Section 5, Expropriation of land by Commission, is considered contentious by some, expropriation of land is not uncommon on the part of government at national and local levels. In any event, the Bill confirms that it is constitutional and allows for expropriation in the public interest, where compensation must be deemed fair and equitable. The Bill also provides for the State to commence with the construction of a project while differences over compensation are handled in court. The Chamber approves of the State

carrying the risk while appeals are heard, as this allows the State to proceed with development in spite of pending court decisions.

ABSENCE OF PRIVATE SECTOR INVOLVEMENT The Chambers primary concern with the Bill is its silence on private sector involvement in the programme. The Bill, in its current form, only addresses the inter-departmental coordination mechanisms between the PICC, the

Secretariat of the PICC and the multi-disciplinary steering committees, which will be solely responsible for infrastructure development, implementation and monitoring. Barring Section 8(2), where the Bill makes brief mention of a project being put out to tender in the event of a lack of governmental or state capacity, the Bill fails to make any mention of the role of the private sector in infrastructure development. The likelihood is that private sector investment will be of increasing importance in meeting the countrys infrastructural aspirations. Thus, the Chamber feels that greater inclusion of the private sector in the planning and implementation of strategic infrastructure projects is indicated. This would also make private sector expertise more readily available to the state within an environment where ownership of projects is shared. The development of successful public-private partnerships for

infrastructure development will allow the government to pass operational roles to efficient private sector operators, while retaining focus on core public sector responsibilities. In the long run, this collaboration between the private and public sectors will result in a lower aggregate cash outlay for the government, and improved infrastructure for the general public.

A.J. LAYMAN Chief Executive Officer 26 March 2013