Infrastructure spending adjunct to social expenditure

Social spending and investment in economic infrastructure are two sides of the same coin in the Eastern Cape provincial budget for 2021/22 presented in the legislature by finance MEC Mlungisi Mvoko.

While the budget emphasised spending on social services, Mvoko was able to confirm R13.9bn in funding for the economic sector.

The economic allocation includes the budgets for the department of public works, rural development and agrarian reform, economic development, environmental affairs and tourism, transport and human settlements.

“This allocation will support a five-point plan for economic recovery of the province,” said Mvoko. He said the pillars of this plan included infrastructure development, industrialisation and sector development, equitable and inclusive transformation, digital transformation and public finances.

Given the province’s long-term goal to invest in bulk infrastructure programmes, Mvoko confirmed that the Umzimvubu Dam, industrial-scale marine tilapia projects such as the land-based fish farm in the Mbhashe district, student accommodation, and the N2 nodal development project in Buffalo City Metro were now part of the national government’s strategic infrastructure projects.

These projects were part of the province’s long-term goal to invest in bulk infrastructure and would be prioritised for immediate implementation, subject to fast-tracked regulatory approvals.

The Coega Development Corporation would be tasked with “project packaging” to improve the level of participation in alternative funding instruments, but the MEC did not provide details of which instruments would be targeted.

He said government was also working on an investment fund to mobilise public and private investment funds for the Eastern Cape to ensure sustainability in service delivery.

Once the fund was established, government would identify mega-projects “that we strongly feel can be achieved through partnership” between the public and private sectors.

Mvoko said the EC government would work alongside the national department of trade, industry and competition to continue investments in industrial infrastructure “to enhance local manufacturing capacity”.

Residents of the Komani area in the Enoch Mgjima local municipality, which has perennially been plagued by power cuts, can anticipate a huge R985m investment in electrification infrastructure in Queendustria, through the provincial stimulus fund.

An amount of R76.8m has been allocated to the historically significant Dimbaza industrial park.

The EC Development Corporation will get R27m to directly limit job cuts by companies battling with the negative economic effects of Covid-19.

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