DCoG Deputy Minister Andries Nel

Speech by Deputy Minister Andries Nel at the 3rd Karoo Small Towns Regeneration Conference

Address by Mr Andries Nel, MP, Deputy Minister of Cooperative Governance & Traditional Affairs at the 3rd Karoo Small Towns Regeneration Conference

Programme Director,
Provincial Chairperson of SALGA,  Cllr. Mxolisi Koyo
Deputy President of SALGA, Cllr Sebenzile Ngangelizwe
Leadership of SALGA
Mayor Cllr Deon de Vos
Other Mayors and Councillors
Ladies and gentlemen,

Thank you for the opportunity to address this important conference on the Karoo Small Towns Regeneration Initiative.

The small town regeneration programme is an important contribution to the implementation of our National Development Plan (NDP), and specifically our Integrated Urban Development Framework (IUDF).

On 4-5 October 2018, President Ramaphosa convened a National Jobs Summit at which he emphasised that: “Local government offers huge opportunities in the battle to stimulate economic growth.”

Indeed local government is at the centre of everything that happens in our country, including economic growth and employment creation.

For this reason it essential that we build strong developmental local government through the Back to Basics programme.

All five pillars of Back to Basics:

  1. Putting people first;
  2. Delivering quality basic services;
  3. Good governance;
  4. Sound financial management; and
  5. Building capable and resilient institution,

contribute to creating an enabling environment for economic development and job creation and build public and market confidence in municipalities as places to live, work and invest.

We must ensure that we answer the question: “Are municipalities ready?” in the affirmative.

We are building developmental local government in the context of very rapid urbanisation and the persistence of apartheid spatial patterns.

In response to this reality the National Development Plan (NDP) 2030, chapter 8 deals with ‘Transforming human settlements and the national space economy’.

The current urban challenges facing South African cities according to the NDP Diagnostic report include, but are not limited to:

  • Dysfunctional spatial patterns.
  • Poorly located and maintained infrastructure.
  • Weak spatial planning and governance.
  • Pressure on housing and basic services.

The NDP mandates that a fundamental reshaping of the colonial and apartheid geography may take decades, but by 2030 South Africa should observe meaningful and measurable progress in reviving rural areas and in creating more functionally integrated, balanced and vibrant urban settlements.

For this to happen the country must:

  • Clarify and relentlessly pursue a national vision for spatial development.
  • Sharpen the instruments for achieving this vision.
  • Build the required capabilities in the state and among citizens

In April 2016 Cabinet adopted the Integrated Urban Development Framework (IUDF) and its Implementation Plan.

The IUDF’s overall outcome is to support and guide SA cities and towns (including small towns) to achieve spatial transformation – in other words reversing the inefficient spatial patterns in a way that promotes both social and economic development, while protecting the environment.

The IUDF aims to guide the development of inclusive, resilient and liveable urban settlements, while directly addressing the unique conditions and challenges facing South Africa’s Cities and Towns.

The IUDF strategic goals focus on inclusion and access, inclusive growth, effective governance and spatial integration.

It seeks to achieve these goals through 9 policy levers.

The IUDF proposes an urban growth model of compact, connected and coordinated cities and towns.

Key to achieving the triple C model is land, transport, housing, and jobs, which are strategic structuring elements critical for the attainment of the outcome.

In line with this therefore the South African cities are striving to create efficient urban spaces by:

  1. Aligning land use, transport planning and housing;
  2. Preventing development of housing in marginal areas;
  3. Increasing urban densities and reducing sprawl;
  4. Shifting jobs and investment towards dense peripheral townships;
  5. Improving public transport and the coordination between transport modes

The nine policy levers are supported by and must be read in conjunction with the cross- cutting issues of rural-urban interdependency, urban resilience and urban safety.

Rural-urban interdependency recognises the need for a more comprehensive, integrated approach to urban development that responds to both the urban and the rural environments.

Urban resilience – or disaster risk reduction and mitigation interventions in the planning and management of urban areas.

Urban safety, particularly safety in public spaces, are essential ingredients for creating liveable and prosperous cities.

I want to elaborate on what the IUDF says about the importance of an integrated approach that strengthens urban-rural linkages.

It argues that traditionally, development policy has used a simplfied concept of rural and urban areas, where ‘rural’ refers to more remote farming areas and ‘urban’ to cities.

Similarly, economic activities associated with urban and rural areas have historically been viewed as mutually exclusive.

This dichotomy not only distorts the reality but also fails to address the interdependencies between the rural and urban spaces.

The reality is that there is rarely a sharp division between rural and urban areas, but rather a rural-urban spatial continuum.

New spatial and sectoral patterns have emerged along the rural-urban continuum, as a consequence of migration, road accessibility, information technologies and production flows.

A web of interrelationships and networks both links and blurs the distinction between urban and rural spaces.

Indeed, labour migration, flows of information and services, such as education and healthcare, enable people to keep one foot in the rural economy and the other in the urban economy.

This means that strategies (for example, addressing poverty) must recognise the interdependence between urban and rural spaces.

As these various settlement typologies prove, the vision and proposals in the IUDF should be interpreted and pursued in differentiated and locally relevant ways.

The local interventions should be responsive to the local conditions and aligned with the vision and strategic outcome of this policy framework.

Developing solutions to benefit the whole country is difficult if rural and urban areas are seen as opposites, especially as these areas are becoming increasingly integrated because of better transport and communications, and migration.

Therefore, focusing on linkages (not separateness) can help reframe how development occurs in rural and urban areas.

Strong linkages can enhance growth by facilitating the  flow of resources to where they will have the largest economic and social net benefits.

Some of the challenges affecting the country’s ability to strengthen the linkages between the two spaces include:

  1. Insufficient usage of the spatial planning instruments at local government level;
  2. Tensions between elected councils and traditional leadership over land use and land development planning;
  3. Poor infrastructure, particularly transportation and communication infrastructure;
  4. Stagnation of the economies of most small- and medium-sized towns; and
  5. Weak partnerships between local government and non-governmental institutions.

Rural development and urban development policy frameworks that connect with each other will enhance inclusive development.

An integrated urban-rural system ensures sizeable resource  flows and ladders of opportunity, which enable people in the countryside to participate in the economy and avoid being marginalised.

The focus must be on strengthening linkages between urban and rural development, as a mechanism to achieve sustainable and inclusive development, by:

  1. Linking functional geographical areas through strategic and sectoral (e g  infrastructure, agriculture) initiatives;
  2. Creating synergies between enterprises in urban and rural areas;
  3. Developing value chains between various economic sectors; and
  4. Supporting the economic development of small towns and their regions.

Clearly, the solution to poverty in rural areas cannot be found in the rural economy alone.

Rural growth needs access to urban markets and vibrant non-farm sectors.

Equally, the growth of urban areas can be compromised by inadequate rural development.

Development strategies must recognise the interdependence of rural and urban spaces, while a comprehensive, integrated approach to urban development needs to respond to the reality of migration to peri- urban areas.

It is important to create strong linkages of the programme with the recently announced Stimulus Fund by President Ramaphosa.

President Ramaphosa said:

“Tourism continues to be a great job creator and through these measures we are confident that many more tourists will visit South Africa.

It is imperative that South Africa restores investment and exploration levels in the mining sector as mining and mineral beneficiation activities have significant potential to drive long term growth, exports and job growth.

Separate legislation for the regulation of the oil and gas industry will be drafted through the government’s legislative process.

Agriculture has massive potential for job creation in the immediate and long term.

The interventions we have identified will include a package of support measures for black commercial farmers so as to, increase their entry into food value chains through access to infrastructure like abattoirs and feedlots.

Blended finance will be mobilised from the Land Bank, Industrial Development Corporation and commercial banks.

The Land Bank is currently concluding transactions that will create employment opportunities in the agricultural sector over the next 3 to 5 years.

A significant portion of the funding will go towards export-oriented crops that are highly labour intensive.

Government will finalise the signing of 30 years leases to enable farmers to mobilise funding for agricultural development.

In the second instance, reprioritised funding will also be re-directed towards igniting economic activity in townships and rural areas.

We have prioritised the revitalisation of three regional and 26 township industrial parks as catalysts for broader economic and industrial development in townships and rural areas.

A township and rural entrepreneurship fund is being established to provide finance to either scale up existing projects or provide start-up capital for new projects.”

Important to the announcement by the President and the Karoo Small Town Regeneration Initiative is the Agrarian Revolution programme being spearheaded by CoGTA and the National House of Traditional Leaders.

The Agrarian Revolution Programme seeks to ensure that support is provided to communities to make good use of such land through agricultural interventions, which will in turn also contribute to food security, employment creation, and improved livelihoods.

The major focus is to create technical capacity at district level to support the agrarian revolution, a one-stop-shop where departments and municipalities are represented.

Time does not allow us to elaborate but a comprehensive concept document and progress report are available and will be circulated.

Small towns can contribute to regional and rural development in five main ways:

  1. By acting as centres of demand/markets for agricultural produce from the rural region either for local consumers or as links to national and export markets. – Access to markets is a prerequisite to increase rural agricultural incomes, and the proximity of local small and intermediate centres to production areas is assumed to be a key factor.
  1. By acting as centres for the production and distribution of goods and services to their rural region – Such concentration is assumed to reduce costs and improve access to a variety of services, both public and private and for both rural households and enterprises. Hence, services include agricultural extension, health and education (and access to other government services), as well as banking, post, services of professionals such as lawyers and accountants, lower-order services such as bars and restaurants, and wholesale and retail sales of manufactured goods from within and outside the region.
  1. By becoming centres for the growth and consolidation of rural non-farm activities and employment, through the development of small and medium-sized enterprises or through the relocation of branches of large private or parastatal enterprises.
  1. By attracting rural migrants from the surrounding region through demand for non-farm labour, and thereby decreasing pressure on larger urban centres.
  1. By managing natural resources in ways that respond to the needs of growing rural and urban populations with special attention to protecting resources in the face of local and global environmental change.

For these, and many other reasons, the Small Towns Regeneration Programme is an integral part of the implementation of the IUDF.

The IUDF is being implemented through 3 key areas namely the Cities Support Programme governed by National Treasury, the Intermediate City Municipalities Programme governed by the Department of Cooperative Governance and the Small Town Regeneration Programme administered by SALGA.

Small towns are a necessary and important link to the development of rural regions, and the role of small towns as service centres, within a hierarchy of settlements, is emphasised.

The Karoo Small Towns Regeneration Initiative is of great importance because it gives us a platform to test these policies in a more focused and coordinated manner.

Programme director, to understand the comparative advantage of Karoo small towns, one realizes that there is no “one size fits all” solution to small towns.

This means that many towns within this region should be understood in their regional context.

Significantly, Karoo region does not coincide with municipal or even provincial borders.

Recognising this reality, the success of the IUDF in general and the Small Town Regeneration Programme will depend, amongst others, on the successful implementation of the Back to Basics programme as well as our ability to engage in integrated planning and implementation across the three spheres of government as well as our ability to manage inter-governmental relations.

In announcing the Economic Stimulus Package President Ramaphosa said:

“We also need short term municipal investments to address the challenges that our people face.

We have identified 57 priority pilot municipalities in order to unlock infrastructure spending in the short term.

This spending will cover, among other things, sewerage purification and reticulation, refuse sites, electricity reticulation and water reservoirs.”

In order to assist municipalities in this regards CoGTA is deploying District Support Teams consisting of engineers, construction and project managers, financial accountants, town and regional planners, as well as governance and administration experts in 55 of the priority distressed municipalities.

16 District Support Teams, comprising 84 MISA officials (40 Civil Engineers, 14 Electrical Engineers, 14 Town Planners, 7 Chief Engineers and 9 Provincial Managers) have been established and deployed to support the municipalities

Each of the identified priority municipalities have been supported to develop a municipal capacity development plan as a blueprint towards strengthening internal capacity.

Municipal Project Management Units are used as entry points for building municipal capacity. Capacity development will focus on the individuals, the organisations and the enabling environment.

The following steps have been taken to build capacity and skills in affected municipalities:

  • At least 500 municipal officials will receive technical training in the 2018/19 financial year;
  • 150 young graduates will be placed in municipalities for work exposure and to provide support;
  • The young graduates will be provided with mentors for structured support towards registering as professionals. This is a measure step towards building a skills pipeline in local government and professionalizing the sector;
  • 102 Artisans and process controllers have been placed in municipalities that are struggling with infrastructure operations and maintenance; and
  • There are more than 230 apprentices hosted by municipalities for work exposure and support with operations and maintenance.

We hope that these interventions will also strengthen the capacity of small towns to implement the IUDF and to answer the question: “Are municipalities ready?”

The Intergovernmental Relations Framework Act (No  13 of 2005) establishes IGR structures at national, provincial and district level that are mandated to steer coherent policy and planning among spheres.

These structures are also key vehicles for setting political and strategic direction, overseeing and monitoring the implementation of plans and budgets, and fostering negotiations and agreements between key governmental and non-governmental role-players in the interests of socio-economic development.

However, the emphasis has been on ‘coordination’ rather than on establishing the necessary mechanisms to ensure effective intergovernmental planning.

A proactive approach is required to identify and resolve intergovernmental and planning problems.

This should include the use of mechanisms, such as spatial compacts, to negotiate spatial conflicts among spheres, sectors or other actors.

Intergovernmental and differentiated planning needs to be strongly positioned within the local government governance framework, together with initiatives to build spatial and long-term intergovernmental planning capabilities for growth and development.

This is particularly urgent for metropolitan municipalities, intermediary cities and the city-regions, and, we would argue, for the Karoo Small Town Regions Initiative.

I believe we need to discuss how to ensure that there is a clear and focused strategy that we are using to implement the IUDF in our small towns.

The conversation of rural-urban linkages has to be mainstreamed in our daily programmes and small towns are at the centre of managing urbanisation.

Given that this is a Small Town Regeneration Conference, I would like to invite you to attend the South African Cities Urban Conference on the 30th and 31st October taking place at The Forum in Turbine Hall Gauteng.

I thank you.