South Africa: A Plan With Political Will Behind It

This is the second of two articles dealing with legislation aimed at fast-tracking strategic infrastructure delivery and boosting infrastructure development

The Draft Infrastructure Development Bill empowers the Presidential Infrastructure Coordinating Commission (PICC) to determine and develop infrastructure priorities in South Africa, designate Strategic Infrastructure Projects (SIPs) and ensure that infrastructure development in respect of any SIPs is given priority in planning, approval and implementation.

The process for the implementation of SIPs as set out in the bill can be summarised as follows:

• SIPs are identified and designated by the PICC;
• A project plan is prepared by the applicant and must be approved by the relevant steering committee;
• The necessary authorisations are obtained;
• The tender process commences;
• The necessary land rights are acquired through expropriation; and
• Construction commences.

Identification and designation of SIPs

A project will qualify as an SIP if it satisfies the requirements set out in s7 of the bill, namely that the project must be an installation, structure, system, service or process relating to any matter specified in schedule 1:

• Airports;
• Communication and information technology;
• Education institutions;
• Healthcare facilities;
• Mines, oil or gas pipelines, refineries or other institutions;
• Ports and harbours;
• Power stations or other installations for harnessing any source of energy;
• Public roads and railways;
• Human settlements;
• Sewage works, waste management and disposal;
• Water works and water infrastructure; and
• Industrial facilities.

The project must:

• Be of significant economic or social import to South Africa or to a particular region of the country;
• Contribute substantially to any governmental strategy or policy relating to infrastructure development; or
• Be above a certain monetary value prescribed by the Minister of Economic Development.

Once a project qualifies as an SIP, the minister must designate the project as such by publishing a notice to that effect in the Government Gazette.

The PICC must then determine whether the project should be implemented by an organ of state or whether the project must be put out to tender. If it is determined that the state has insufficient capacity to implement the SIP, the minister of the relevant department must call for tenders by publishing a notice in the Government Gazette and in at least two national newspapers.

Conflicts

The bill provides that where an SIP has been designated for implementation or where such project is provided for in any national infrastructure development plan, any state-owned entity or other organ of state must ensure that its planning or implementation of infrastructure, or its spatial planning and land use is not in conflict with any SIP implemented in terms of thebill. If any such conflict arises, it must be resolved in terms of the Intergovernmental Relations Framework Act (IRF Act).

The IRF Act sets out procedures for the resolution of intergovernmental disputes, which are defined in the act as "disputes between different governments or between organs of state from different governments concerning matters that arise from statutory powers or functions assigned to any of the parties". The application of the IRF Act will be subject to any legislation regulating spatial planning and land use management, such as the proposed Spatial Planning and Land Use Management Bill, which was introduced in 2012 at the request of the Minister of Rural Development and Land Reform.

Exproriation In line with the emphasis on streamlining the implementation of infrastructure projects, the PICC is empowered by the bill to expropriate land for the SIPs. The procedure set out in the bill is in line with the constitutional requirements for public process and compensation.

As with traditional expropriation, the PICC may only exercise its powers for a public purpose, and must compensate the land owners. Its actions must comply with the requirements of constitutionality, administrative justice and any other regulatory requirements.

However, the legislature has learnt from past experience that expropriations were often bogged down by negotiations over compensation. In order to expedite the PICC's projects, the expropriation process may not be impeded or stopped solely on the ground that the value of the property is affected by such exercise of power.

Where there are objections to the expropriations, these will not hinder the implementation of the projects, but will be dealt with after development is complete. Minister Patel has stated that "...the state carries on with development even where there is court action. The state will be expected to take that risk".

Time-frames

In line with the overall emphasis on ensuring delivery of infrastructure projects, the bill imposes tight deadlines on authorities tasked with approving aspects of the projects. In order to expedite regulatory hurdles such as approvals, licences or exemptions, the bill provides that such processes must run concurrently. Furthermore, it sets out specific time-frames which may not be exceeded. These include the following:

• Once a project plan has been approved, and the relevant steering committee has determined the applicable legislation and authorisations which are required for the project, the applicant must compile and submit an application and project plan for consideration by the relevant authority within seven days.
• The public consultation process may not exceed 30 days.
• Once public consultation has been concluded, the application and project plan must be amended and re-submitted to the relevant authority for consideration and approval within 52 days.
• Once the project plan is approved, a detailed development and mitigation plan must be prepared and submitted to the relevant authority within 60 days.
• Public consultation on the development and mitigation plan must then take place, and comments must be reviewed by the relevant authority within 44 days.
• The relevant authority has a further 57 days in which to consider and assess the development and mitigation plan, and to make a regulatory decision.

The Management Committee oversees compliance with these time periods. Because it contains representatives from all three spheres of government, it is well placed to pull the relevant levers of power to ensure that infrastructure development projects are not hindered by unnecessary red-tape or slow implementation.

This bill, which clearly has political will behind it, will have widereaching impacts on both government and business. It will bring together numerous departments and spheres of government, and will affect, among others, the construction industry, mining industry, banks, state-owned enterprises and transport industries (including rail and road).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.