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COMMENTARY: Underspending on repairs and maintenance impacting Joburg infrastructure

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In January 2014, the National Treasury published Municipal Finance Management Act Circular no. 71, which mandated that municipalities allocate at least 8% of the carrying value of their property, plant, equipment, and investment property to repairs and maintenance activities. This directive aimed to ensure that municipalities prioritize the upkeep and preservation of their assets. A civil society group called Organization Undoing Tax Abuse (Outa) has, through its initiative JoburgCAN, highlighted that the city of Johannesburg consistently under-budgets for essential repairs and maintenance tasks. The city's financial reporting also lacks accuracy and consistency, with significant variations in numbers from year to year without any explanation. JoburgCAN analyzed the city's reported spending on repairs and maintenance from 2014/15 to 2023/24, along with the projected spending for 2024/25. This analysis covered a period of ten years since the Treasury set a standard of 8% for ma
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Post Covid 19: Which infrastructure projects should South Africa priortise?

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James Formby, the chief executive of RMB, called for South Africa to urgently start mobilising the Infrastructure Fund to boost the moribund South African economy and said the country could "not afford to wait". He also  said  we need to ensure priority is given to those projects which improve the lives of many people.

Which  infrastructure projects should the South African Infrastructure Fund  prioritize?

Infrastructure spending now a ‘must do’ for South Africa

The South African economy was already facing recession before the Coronavirus outbreak.


James Formby, the chief executive of RMBF said details of the Infrastructure Fund, which was announced in 2018 as part of government’s Economic Stimulus and Recovery Plan with a commitment of creating a fund size of R100 billion over 10 years, had been scarce. 


RMB said it understood the fund was to be administered by the Development Bank of Southern Africa (DBSA) and a head had now been appointed. 

" Infrastructure by its nature stimulates growth and jobs and boosts gross domestic product while creating lasting benefit to communities,” said Formby.
 “Infrastructure spend has a strong multiplier effect on the economy in general."

“People need to design, build, finance, operate and maintain these projects for a long time. In particular, Public Private Partnerships (PPPs), already so successful in South Africa, have high requirements for manpower.” 

He said indications were that the Infrastructure Fund was a long-term initiative and it would be some time before the fund’s ambitions were announced, but South Africa could not afford to wait. 

“We don’t have much time to get things moving, we need to be bold. The Infrastructure Fund is expected to focus on key sectors identified by government such as water, transport, student accommodation and energy, but we need to ensure priority is given to those projects which improve the lives of many people. The private sector needs to be consulted too as they stand ready to help.”

Source: iol

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