Infrastructure projects face tighter government scrutiny

Cabinet ministers acknowledged yesterday that the financing of big infrastructure projects – including the tolling of urban roads and the building of nuclear power stations – needed to be evaluated carefully to ensure that fiscal problems did not arise in the future. At a briefing in Parliament, chaired by Transport Minister S’bu Ndebele, he acknowledged that the government had “learnt quite serious lessons” from its experience with the Gauteng Freeway Improvement Project (GFIP). He argued that it could not be allowed in future that a project driven by a city – or in this case the province of Gauteng – could end up seeking national funding.

He said Finance Minister Pravin Gordhan had found R5.8 billion for the project “from the fiscus” which meant, in effect, that the money had to be taken from another government programme. In future, such projects had to be planned in a way that they did not “rob Peter to pay Paul”. It has been suggested that this money came from the allocation for the youth training subsidy, which has been put on the back burner by Gordhan. “We have got to have a national consensus on how we pay for this infrastructure,” he said. The tolls to fund the GFIP have been the subject of much controversy, with Cosatu, the ANC’s alliance partner, calling for boycotts and strikes.

With tolls set to be implemented from April 1, excluding taxis and buses, Ndebele said consensus would have to be reached on the implementation of tolls in other areas, like the Cape Winelands. In the Budget Review for 2012/13, a price tag of R300bn appears for Eskom’s nuclear fleet build programme. It is designed to deliver 9 600 megawatts of nuclear capacity by 2029 and is described as being “in the final stages of consideration before financial proposals can be determined”, according to Treasury director-general Lungisa Fuzile.

Energy Minister Dipuo Peters, speaking to the infrastructure briefing from Pretoria, said this was just the start of the spending programme, but added that a technical committee was advising the government’s nuclear energy co-ordinating committee chaired by Deputy President Kgalema Motlanthe. Only once this committee had done its work would the details of the tender and specifications for the programme be clear. Independent Democrats MP Lance Greyling said in a statement that it was instructive that there had been no debate in Parliament and no opportunity for the public to scrutinise a nuclear programme “that could have an impact on all of our lives”.

No only would it cost “nearly a third of the annual Budget but there are serious safety and environmental concerns to consider”. He said that given the arms deal corruption that continued to “darken our democracy, the government should be extra careful about the nuclear build programme”. It must err on the side of more transparency, not less. He suggested that the nuclear build programme should be financed by the winning bidder and not the fiscus. Greyling said environmental impact assessments and feasibility studies for the programme should be placed in the public domain before any project “of this magnitude is seriously considered”.