MEDIA RELEASE: Immediate
SANRAL WELCOMES FINANCE MINISTER’S 2023/24 BUDGET SPEECH
Pretoria, 26 February 2023: The South African National Roads Agency SOC Limited (SANRAL) welcomes the decision by Finance Minister Enoch Godongwana to allocate R903bn to infrastructure development over the medium term, emphasising that these investments will lay the foundation for inclusive and sustainable growth.
Delivering his 2023/24 Budget speech last week, Minister Godongwana said that the largest portion of this R903bn – around R448bn – will be spent by state-owned companies, public entities and through public-private partnerships. The Minister said the spend on transport and logistics will be an estimated R351.1bn, including for SANRAL to improve the road infrastructure network.
He also said that there will be a concerted effort by government, together with law enforcement agencies, to crack down on criminality in the construction sector to prevent the ongoing extortion and intimidation of lawfully appointed contractors on infrastructure projects. SANRAL
CEO Reginald Demana welcomed the Minister’s announcement.
“The transport sector gazetted 16 strategic integrated projects in 2020. SANRAL continues to improve the capacity of several routes on toll and non?toll networks and 11 projects with a combined value of about R20 billion have been prioritised. These projects will create an estimated 10 000 jobs during construction,” said Demana.
“Six SANRAL projects to the value of R20 billion are under construction, including the N3 Cato Ridge to Dardanelles, N3 Dardanelles to Lynnfield Park, N3 Ashburton to Murray Road, N2 EB Cloete Interchange, N2 Mtentu Bridge and N2 Msikaba Bridge.”
Apart from the job creation during construction, Demana said an estimated R6 billion of the above-mentioned projects is earmarked for targeted enterprises in line with the country’s SMME development agenda.
“We don’t just develop physical infrastructure in the form of roads and bridges but also ensure that when we execute these projects, we develop the communities in the vicinity. We encourage our contractors to adopt a similar approach to community development. Of course, the element of training and skills development in line with the SETAs functions will also be part of these projects, even more so going forward.” Allocations to SANRAL are made through the Department of Transport’s Road Oversight sub-programme, which is responsible for transferring an estimated R89bn to the agency over the Medium-Term Expenditure Framework (MTEF) period. SANRAL plans to use R56.5bn of its departmental transfer to strengthen and upgrade the national non-toll network, R3.9bn for the N2 Wild Coast Project, R2.9bn for the R573 Moloto Road project, and R2.2bn for the Gauteng Freeway Improvement Project (GFIP).
SANRAL received a special allocation of R23.7bn in 2022/23 as a partial solution to the GFIP not generating enough toll revenue to service the debt raised for its construction.
“This allocation is expected to provide the agency with sufficient funds to service several large debt redemptions and related maintenance in 2023/24. As a result of this one-off allocation in 2022/23, spending in Road Transport programme is expected to decrease at an average annual rate of 4.1 per cent, from R60 billion in 2022/23 to R52.9 billion in 2025/26,” said Demana.