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Infrastructure delays hampers job creation

Plans to improve broadband penetration welcomed but challenging

15 February 2013:- Professional services firm Deloitte welcomes The State of The Nation Address delivered by President Jacob Zuma on Thursday, which highlighted the need to accelerate infrastructure delivery by reducing the time period it takes to conceptualise, design and deliver major infrastructure projects and create jobs. This is according to André Pottas, who is the Infrastructure & Capital Projects leader at Deloitte.

President Zuma said over the past three financial years to end in March this year, government will have spent R 860 billion on infrastructure. He then gave an update on a range of projects in progress.

“What is really needed is project delivery, to provide basic services, enhance economic productivity and opportunities, and to create employment” says Pottas. “It is not the fault of government that major capital projects have a long lead time from planning to delivery, but our planning and decision-making processes do currently take too long. There is room for capacity and process improvements to make the process shorter.”

President Zuma acknowledged as much when he said that “The infrastructure development programme has been a valuable source of learning for government. In the year ahead, we will fast-track many of the projects that the Presidential Infrastructure Co-ordinating Commission has announced. The lessons are that we must coordinate, integrate and focus on implementation.”

Pottas noted that the time lag for tender adjudication and the decision on appointment of a transaction advisor and contractor and from the selection of the bidder to the conclusion of the contract is often long by internationals standards and leads to delays in breaking ground.

Pottas says the front end planning, feasibility studies and environmental impact assessments are important because delivery is in the construction and operations phase. Projects must be able to deliver on job creation and other benefits, however, if the planning is not done effectively then the procurement and delivery process will be longer and the project will not reach the intended beneficiaries.

As part of accelerating infrastructure delivery, the presidency formed The Presidential Infrastructure Co-ordinating Commission (PICC) which Zuma highlighted as being a source of important learning and will be used to better co-ordinate infrastructure delivery.

Pottas welcomed the release of the Infrastructure Development Bill for public comment after being approved by cabinet last December. Pottas welcomes the bill particularly because one of its aims is to make use of Public Private Partnerships (PPP), which allows government to tap into private sector skills. The bill also aims to improve tender management processes and to expedite the issuing of permits and licenses.

Pottas also welcomed the pledge to improve broadband penetration to 100% by 2020. “This will be a challenge” says Pottas “especially when one considers the long distances and low population densities of outlying rural areas. The ambition is, however, very welcome and it’s good to note that universal broadband access was deemed worthy of a mention.”

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