Gordhan commits to investment in infrastructure

Finance minister Pravin Gordhan recognised the crucial role played by the transport and logistics sector in his maiden budget speech on February 17. He also recognised that it was government’s role to create the infrastructure needed to keep the economy moving: “Public sector investment is a crucial component of development as it provides the infrastructure through which we transport goods, power the economy and connect households and businesses to services and markets,” he said. Over the next three years, the public sector aims to spend R846-billion on its infrastructure programme. But, he added, there is more to come: “Extensive planning and consultation is in progress on infrastructure programmes for the next 10-20 years, in recognition of our long-term development challenges. “Upgrading our transport infrastructure and water supply capacity will account for around three quarters of government investment.” Much of the remainder will be taken up by Eskom. It will, however, be a case of “user pays,” he said. “A significant proportion of the public-sector infrastructure investment programme will be undertaken by state owned enterprises and is not directly financed from the fiscus. “The costs of these investments are largely met by users, and will in several cases require higher tariffs to be phased in over the period ahead,” he said.