Consolidated Municipal Infrastructure (CMIP) and Municipal Infrastructure Grant (MIG)

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Consolidated Municipal Infrastructure (CMIP) and
Municipal Infrastructure Grant (MIG)

• DPLG PRESENTATION TO THE PORTFOLIO COMMITTEE ON
  LOCAL GOVERNMENT
• Budget review
• 10 March 2003

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Municipal Infrastructure Grant(MIG)
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PROBLEM STATEMENT

• Supply vs demand driven approach not responsive
  to community needs-unsustainable
• Centralised disbursement from different depts-
  admin burden
• Inequitable allocations to municpalities
• No clear spending accountability
• Programme not supportive municipal capacity and
  development

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OVERVIEW (C0NT)

• Infrastructure is key to social security and
  economic development
• Decentralization recognises municipalities as
  primary agency for infrastructure delivery
• MIG approach seek to to enhance accountability in
  terms of policy outcomes and outputs
• National and provincial departments provide
  support and capacity to municipalities

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BROAD OVERVIEW

• Last 7 years focused on addressing the needs of
  the underserved communities estimated at 15,2
  million in 1994
• Approximately over 5 million (61) have access to
  water, and an estimated 3,4 (66,1)million has
  access to electricity
• Levels of under-servicing remains high and
  requires an integrated strategy to address
• Infrastructure delivery remains governments key
  priority

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PRINCIPLES

• Equity in the allocation and use of funds
• Decentralization of spending authority
• Efficient use of funds
• Promote integrated development objectives of the
  three spheres
• Predictability and transparency

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OBJECTIVES

• Fully subsidize the capital costs of providing
  basic services to the poor
• Distribute funding for MI in an equitable,
  transparent and efficient manner
• Assist developmental capacity of municipalities
  through multi-year planning
• Coordinated pursuit of national policy and
  priorities.
• Increased job creation through higher investment
  in public infrastructure

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INSTITUTIONAL ARRENGEMENTS

• Multi-departmental accountability fund- DPLG take
  financial accountability
• Policy making and regulatory functions of each of
  the national depts. Remains intact
• MIPTT- for policy decisions
• TMITT-for operational coordination

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MIG BUDGET
2003/04 R 47million
2004/05 R117million
2005/06 R97million
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PROCESS

• Pilot phase 2003/04 financial year
• Infrastructure transfers will go directly to
  local government in support of IDPs
• The Grant will be consolidate from CMIP,
  LED,WSCG,CBPWP,UTG,BSR and NEP (post
  restructuring)
• Largely formula driven to ensure proper targeting
  and windows for innovations

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Pilot sites

• Nodal areas were identified as key
• Ethekwini (U) Nelson Mandela(U)
• Sekhukhuni (R) Bohlabela (R)
• Kgalagadi (R) Alfred Nzo (R)
• OR Tambo ( R) Maluti-A-phofung (R)
• Mangaung

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CHALLENGES

• MIG only provides basic services
• Need for concession for poor municipalities with
  no revenue base
• No guarantees for proper OM implementation
  capacity ( sustainability)
• Lack of Technical support for mostly rural
  municipalities to deliver infrastructure

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Consolidated Municipal Infrastructure Grant(CMIP)
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Progress

• Since inception approximately 2,5 million
  households benefited from CMIP
• 1760 projects completed value R 2345m
• Currently 936 projects under construction value
  R2335m

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Consolidated Municipal Infrastructure Programme
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CMIP ACHIEVEMENTS - 2002/2003

• URBAN RENEWAL PROJECTS
• ALLOCATION R70 MILLION

INTERGRATED SUSTAINABLE RURAL DEVELOPMENT
PROJECTS ALLOCATION R230 MILLION
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(No Transcript)
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CMIP BUDGET
2003/04 R2246million
2004/05 R2724million
2005/06 R3016million
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CMIP OUTPUT DELIVERABLES - 2003/2004
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CMIP PROJECTED OUTPUT DELIVERABLES - 2004/2005
2005/2006
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CMIP CHALLENGES

• Lack of technical capacity at municipal sphere
• Lack of monitoring capacity by municipalities
• Too lengthy procurement procedures followed by
  municipalities
• Life cycle costing for OM by municipalities

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THANK YOU