1. Review Municipal Infrastructure Grant Policy Framework Review - 2013
MIG Quarterly Workshop
4 – 5 June 2013

2. Municipal Infrastructure Grant development since 1994
EMIP
MIP
BSIG
1994: RDP
LEDF
WSCG
CBPWP
BSRF
UTF
1996: Cabinet decision
CMIP
MIG
INEP
2003: Cabinet decision
MIG Cities
2009 review
RHIG
RBIG
Present 2013
USDG
2013 MTEF
MWIG
Transition
New Conditional Grant dispensation on how to deal with municipal infrastructure
Does the quantum of funding available deal with the total value chain of sector investment . e.g for water and sanitation it is around 30 billion over the MTEF. Does municipalities optimally access funding?

3. Vision
The municipal infrastructure grant programme is aimed at providing all South Africans with at least a basic level of service by the year 2013 through the provision of grant finance aimed at covering the capital cost of basic infrastructure for the poor.
The MIG programme is a key part of government's overall drive to
alleviate poverty in the country and
employment is maximised
opportunities are created for enterprises to flourish.

4. Objectives of the MIG programme
Supplements the capital costs of providing infrastructure (basic/ appropriate infrastructure) improving basic services to poor households.
MIG is a multi-sectoral programme - Involves all spheres of government including sector departments
Implementation at Local level should integrate with provincial and national priorities articulated within the IDP
Due to limited funding and capacity of municipalities, encourage municipalities to prioritise funding
The grant is a key government’s overall drive to alleviate poverty
Infrastructure should be provided in such a way that employment is maximised and opportunities are created for enterprises to flourish Enhance Local Economic Development spin-offs

5. Need for the review - Background
First DoRA was first introduced in 1998, more than R165 billion in infrastructure grants have been made available to municipalities or to national departments 107 to spend on their behalf.
Concern that the substantial resources (R60b MIG since 2004) were and are not being used optimally and that the pace of service delivery rollout suffers as a result.
In response to this, infrastructure conditional grant transfers to local government will be reviewed and reformed to maximise their effectiveness 2014.
This review will be coordinated by the National Treasury, using a collaborative process that will include national departments, SALGA and the FFC, and extensive consultation with municipalities.
In support to above processes the MIG policy Framework Review will bring additional intelligence to the above-mentioned process.

6. Need for the review - Background
First DoRA was first introduced in 1998, more than R165 billion in infrastructure grants have been made available to municipalities or to national departments 107 to spend on their behalf.
Concern that the substantial resources (R60 b MIG since 2004) were and are not being used optimally and that the pace of service delivery rollout suffers as a result.
In response to this, infrastructure conditional grant transfers to local government will be reviewed and reformed to maximise their effectiveness 2014.
This review will be coordinated by the National Treasury, using a collaborative process that will include national departments, SALGA and the FFC, and extensive consultation with municipalities.
In support to above processes the MIG policy Framework Review will bring additional intelligence to the above-mentioned process.
The review of the conditional grant system should take cognisance of the vision stated on services to the poor in the NDP

7. Need for the review – Current status
2014 target for access to basic services:
Water 100%
Sanitation 100%
Electricity 92%
Refuse at 75%
Access figures to basic services as at March 2013 are:
Water: 95,1% (86% functional)
Sanitation: 85%
Electricity: 85% (not part of MIG)
Refuse: 65%

8. Objectives of the review
The MIG Policy Framework should be reviewed through a consultative process with the focus on:
Evaluating the vision, objectives, key principles, institutional arrangements and whether it is still meeting government’s strategic priorities as set out in the National Development Plan such as:
meeting the national infrastructure delivery targets and thus closing the infrastructure delivery gap;
the delivery of sustainable infrastructure in the context of establishing sustainable human settlements, this includes infrastructure investments to cater for environmental considerations;
poverty alleviation; and
local economic growth.

9. Objectives of the review
Evaluating the:
Targeting of the MIG; and
Eligible categories of infrastructure to be funded by the MIG.
Grant design mechanism;
Methods to divide funding between municipalities; and
Any other divisions outside to that of municipalities.
Evaluate the conditions applied to the MIG and the monitoring thereof.
Evaluate the DORA requirements and propose best solutions for the sustainability of infrastructure delivery.

10. Objectives of the review
Evaluate the institutional arrangements across all three spheres of government and propose the best solutions for the appropriate project management, monitoring, reporting on and evaluation of the MIG programme.
The recommendations on the above and changes to the MIG Policy Framework should include the views of stakeholders and a case study of municipalities should be used to confirm and verify the issues mentioned above. It is proposed that the case study be based on a sample of thirty (30) municipalities using the categorisation used in the Municipal Infrastructure Investment Framework.
6 in category B1(local municipalities)
6 in category B2 (local municipalities)
6 in category B3 (local municipalities)
6 in category B4 (local municipalities)
6 in category C2 (district municipalities)

11. Objectives of the review
Coordinate consultative processes at the national, provincial and local levels of government (e.g. workshops)
Thoroughly document the consultative sessions.
Note that the service provider will have to consider work already completed or currently underway which pertains to the local government fiscal and functional review process and the alignment with the National Development Plan

12. Deliverables and timelines
Deliverable by service provider
Estimated dates
Appointment
July 2013
Briefing session with appointed service provider
1 week after appointment (5 working days)
Submission of a project plan
Consultation sessions with stakeholders ends
National
Provincial
Local Government
1 Aug - 31 October 2013
Report with recommendations and first draft of the reviewed Policy Framework document.
November 2013
Final draft of the reviewed Policy Framework, supporting documentation and notes.
1 December - 31 January 2014
Reviewed Policy Framework document with supporting documentation and notes
February 2014

13. Questions