The South African government will spend more than R1 trillion on public infrastructure over the next three years in a show of its commitment to driving economic growth.
This is according to Minister of Finance, Enoch Godongwana, who highlighted the plan during his 2025 Budget speech in Parliament on Wednesday.
“[Infrastructure] is a key pillar of our growth strategy. It is the bedrock for economic development, a key source of jobs, and an avenue to scale-up service delivery.
“This budget reflects that understanding. Allocations towards capital payments are the fastest growing area of spending by economic classification. Public infrastructure spending over the next three years will amount to more than R1 trillion,” said Godongwana.
Current infrastructure focus is geared towards spending R402 billion on roads; R219.2 billion on energy and R156.3 billion on water and sanitation.
The Minister highlighted key projects that would get under way.
“In transport, the South African National Roads Agency will spend R100 billion over the medium term to keep the national road network in good condition. Provincial roads departments will reseal over 16 000 lane-kilometres of roads in their areas of authority.”
He said the Passenger Rail Agency of South Africa was making steady progress to rebuild infrastructure to provide affordable commuter rail services.
“In water, we are investing in several large-scale dam projects that are ramping up or entering construction. The Mkhomazi Project is expected to commence construction in November 2027, transferring water to the uMngeni Water Supply System.
“This will increase the total capacity of the system to five million households in eThekwini and four district municipalities in KwaZulu-Natal.”
In the 2025 Budget Review, National Treasury explained that investment in economic infrastructure – mainly by state-owned entities – accounted for 81.5% of the medium-term estimate.
“These funds are used to expand power-generation capacity, upgrade and expand the transport network and improve sanitation and water services. Social services infrastructure accounts for 15.5% of the total, with the two largest sectors, health and education, contributing 4.4 % and 5.5% respectively,” the review read.
The department explained that infrastructure reforms were underpinned by a commitment to significantly increase partnerships with the private sector.
The measures and reforms include:
• From June 2025, projects below a total value of R2 billion will no longer have to clear onerous approval processes intended for large projects before proceeding.
• A clear framework is being established to receive and process unsolicited public-private partner (PPP) proposals or bids from the private sector.
• New legislative amendments and regulations for municipal PPPs will be introduced in 2025.
• Revised manuals and guidelines on PPPs are being produced and will be made available to the public.
“During 2025/26, a single structure overseen by the National Treasury will be established to coordinate state participation in project preparation and planning, public-private partnerships, funding and credit guarantees.
“It will be established by merging two units currently in the Government Technical Advisory Centre that coordinates PPPs and capital appraisals with the Infrastructure Fund in the Development Bank of Southern Africa,” Treasury said. – SAnews.gov.za
