ROELOF VAN DEN BERG: Budget is a chance to capitalise on infrastructure’s ability to drive growth

Public-private partnerships are a catalyst for growth

The recent budget recommitted the government to outsize infrastructure investment. Picture: THULANI MBELE
The national budget must prioritise infrastructure while strengthening public-private partnerships, writes the author. Picture: THULANI MBELE

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The finance minister’s budget speech next week represents an exciting opportunity to place infrastructure development at the heart of South Africa’s growth strategy. Few areas of policy can match the scale at which infrastructure development can strengthen the economy, unlock employment and support confidence across municipalities and the nation.

The next budget cycle is an opportune period to build on the National Planning Commission’s push for inclusive growth, better service delivery and targeted investment, and to align more closely with the supporting National Infrastructure Plan 2050, which outlines the long-term projects needed for sustainable development and reliable core services.

Practical execution of this plan will require innovative funding mechanisms beyond the fiscus, such as the model of raising private capital for public social infrastructure. Public-private partnerships (PPPs) have a crucial role to play in supporting the government’s medium-term plans, which should help guide budgeting decisions moving forward.

Fundamentally, infrastructure remains the foundation of South Africa’s economy. Local businesses rely on stable road, electricity and water systems; trade depends on functioning ports and rail; and communities depend on health facilities, schools, sanitation and housing.

Implemented as one-off projects, these initiatives drive growth, but fragmented execution leaves economic potential out of reach. Infrastructure works best when planned and constructed alongside other infrastructure, keeping in mind one project’s strengths and constraints so that new works and updates extract maximum value from connected projects simultaneously. If successful, the economic gains and benefits to communities adjacent to newly constructed infrastructure at local, regional and even national level are outsized.

What’s needed is a unified framework, or a network of projects working across all provinces under sustained long-term investment, so that infrastructure’s potential as a strategic economic growth driver is maximised to support as many businesses and people as possible.

To get there, the national budget must prioritise infrastructure while strengthening PPPs, making it clear that infrastructure is a crucial growth priority for 2026 and the years ahead.

To align the February national budget with these priorities, public investment should focus on the following:

  • Increase capital allocations for national infrastructure as a central growth priority. Infrastructure should receive a significant, if not the largest, share of growth-focused capital in the budget. All productive sectors depend on supporting infrastructure, and returns begin the moment roads, water and electricity become operational and accessible. It is a crucial cog in supporting the government’s economic growth agenda and demonstrating the multiplier effect of strategic budget allocation. Moreover, stronger allocations will provide the foundation for employment, skills development and local business growth, a vote of confidence in a sector that created 130,000 jobs in the third quarter of last year. These jobs are often created in communities physically distant from cities and centres of commerce, enhancing their effect as life-changing opportunities for community members to earn a wage with dignity.
  • Provide dedicated funding for regional delivery teams to support municipalities on a bespoke basis. Many municipalities lack the internal engineering and project capacity required for complex works. Dedicated funding for regional delivery teams — equipped with expertise and knowledge of local context — can support municipalities in managing contracts and delivery timelines, design oversight and support compliance, collaborating as needed based on each project’s specific needs. This approach can ensure capacity is properly resourced and available to municipalities as needed, without placing undue burden on any single entity.

If approached earnestly with the full weight of South Africa’s fiscal commitment behind it, the budget can build on the momentum established by recent policies and the outstanding work done by Operation Vulindlela, for example, and translate them into tangible outcomes for the benefit of the economy and society.

• Van den Berg is CEO of the Gap Infrastructure Corporation.

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