Ortdm Gds Profile

8/12/2019 Ortdm Gds Profile

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c o n t e n t s

I N T R OD U C T I O N . . . . . . . . . . . . . . . . 4

O B J EC T I V E S O F T H E S U M M I T . . . . . . . . . 5

B A C K GR O U ND . . . . . . . . . . . . . . . . . 6

M E T HO D O L OG Y . . . . . . . . . . . . . . . . 6

D I S T R I C T S N A P S HO T . . . . . . . . . . . . . . 7

D E L I V E R Y O F B A S I C S E R V I C E S . . . . . . . . 1 0 Water . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Sanita tion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11

Electr icity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

I M P R O V E P U B L I C S E R V I C E S . . . . . . . . . 2 0

Health . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

HIV & AIDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Education . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Skills Upgrading . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Transport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

J O B C R E A T I O N A N D

L I V E L I H O O D O P P OR T U N I T I E S . . . . . . . . 2 8

Livestock Farming . . . . . . . . . . . . . . . . . . . . . . . . 29

Dryland Farming and Irrigated Horticulture . . 29

Forestr y . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Manufac turing . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Construction And Mining . . . . . . . . . . . . . . . . . . 31

Trade and Business Services/ic t . . . . . . . . . . . . . 31

Tourism . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

B U I L D A N D M A I N T A I N I N F R A S T R U C T U R E . . 3 2

Strategic Infrastructure Project:

Kei Development Corr idor . . . . . . . . . . . . . . . . 37

F I G H T P O V E R T Y . . . . . . . . . . . . . . . 4 0

M U N I C I P A L C A P A C I T Y A ND C O O P E R A T I O N . . 4 1

C O N C L U S I O N . . . . . . . . . . . . . . . . . 4 4

A C R O N Y M S . . . . . . . . . . . . . . . . . . 4 6

G D S AG R E E M EN T . . . . . . . . . . . . . . 4 8

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4

Building on the results of the National Growth and

Development Summit in June 2003, government

proposed that all District and Metropolitan Mu-

nicipalities hold Growth and Development Summits

(GDS) in their area of jurisdiction.

The summits should provide oppor tunities forbuilding partner ships with social partners by bringing

together represent ati ves from the broadest sec tions

of society: labour, business, community sector and

government (local, Province and national).

I N T R O D U C T I O N Government has identied distric t and metropolitan

areas as the pivotal sites on which to build an

understanding of the nature and distribution of

regional economic potential across the country.

Collaborative action between government and

social partners across all the three spheres is vital inforging a common vision for promoting rising levels

of growth, investment, job creation, and people-

centred development.


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The aim of the GDS is to reach broad agreement on:

A development path and development programme

for the district and

What each social partner (government, business,

labour and community sector) should contribute to

the implementation of the programme.

Strengthening the strategic thrust of the district IDPto ensure planning and implementation ali gnment

between the spheres of government, as well as

public entities

In this regard the GDS should seek to address the

following specic questions and issues:

1. The OR Tambo Distric ts economic potential and

which sectors of the economy should be promoted

(this would need, where applicable, to be informed

by the IDP, LED and the RIDS)

2. Commitments by government, business, labour

and community sector to ensure investment in

each of the sectors

3. Actions required by government and each partner

to deal with const ra int s to such inves tments,

including dealing with bureaucratic delays, EIA

processes and land use management

4. Social and economic infrastructure programmes

required to improve investments and provide basic

services to communities

O B J E C T I V E S O F T H E S U M M I T 5. Contribution by each partner to the construction

of such infrastructure, including possibility of PPP

6. Second Economy interventions (EPWP including

roads & ECD, co-operatives, micro-credit,

procurement, land reform, etc) and the role of

each sector in such interventions

7. Promoting local procurement what interven-

tions are requir ed?

8. Improving capacity of local government and

contribution of each social partner: including role

of public sector unions in ensuring efciency, role

of all in ghting corruption, contribution by private

sector and professionals to skills required by the

district/metro

9. Establishing a partnerships and/or regional growth

coalitions which will act as a mechanism for coop-

erative action at all levels and a robust framework

for monitoring and evaluating progress


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6

The document presents the socio-economic

dynamics of the OR Tambo District Municipality.

It is a resultant of a consultative process involving

a number of stakeholders and interest parties

within the district. The stakeholders were required

to compile the ir respec tive interpretations of

the economic conditions and soc ial elementsof the district, and an attempt has been made

at synchronising, aligning and harmonising their

inputs.

In this compilation, the information presented is an

effort to achieve the following objectives:

To ensure that discussion on the above issues takes

place on an informed basis

To present a coherent picture of the social, demo-

graphic, and economic prole and service levels of

the area

To present a picture of the challenges facing local

government especially in relation to capacity

To sugges t the mechanisms & processes for moni-

tor ing progress on the dec isions reached and the

governance framework for ongoing dialogue and

feedback among social partners.

The district GDS presents a unique opportunity

for constructing partnerships and harnessing the

collective energies and contributions of a range of

actors and role players with a view to enhancing

accelerated and shared growth.

The district GDS has the potential to unlock the

potential of all localities, and ensur e that all sectors

of society identif y their role and contribute to the

common national objective to build a better life

for all.

This prole for OR Tambo is based on a number of

documents and information from a range of sources.

These broadly include the following:

ECSECC data, publications and reports

Monitor Group report

District and local municipal IDPs (& other ofcial

documents)

Data from the Rapid Assessment of services in the

Eastern Cape conducted in 2006)

Various research reports

B A C K G R O U N D

M E T H O D O L O G Y


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The OR Tambo Distr ict stretches from the Indian

Ocean coastline in the southeast (the Wild Coast)

to the Mah lah lane and Basiya mountains in the west,

and from the Umthamvuna River in the nor th to the

Mbashe River in the south. The entire District was

part of the former Transkei Bantustan.

D I S T R I C T S N A P S H O T


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The District has a population of about 1.7 million

people. The Distric t is rather densely populated (more

than 100 people per square kilometre , predominantly

rural (93%), with dispersed homesteads (making

basic services provision expensive). Access to basic

services such as potable water, sanitation, electricity

and access roads is relatively low. Sewage owsinto the Mthatha and Tsolo rivers, and outbreaks of

cholera and t yphoid occur.

The GGP per capita of the Distric t is only 30% of

the Provincia l aver age , and rates of unemployment

and poverty are very high. Rates of economic

growth are low and the District lacks an economic

hub. Private sector activity is largely restricted to

the trade sector and a smal l timber i ndust ry. Pr iva te

investment in the Distric t is hindered by a backward

(communal) land tenure system and a physical

planning system still in its infancy (the District will

nalise its Spatial Development Framework later

thi s year, and this wil l form the bas is of a land-use

management system).

On the other hand, because of its poverty prole,

the Dis tr ic t was, and is , a focus of many Sta te

development initiatives. These include:

Wild Coast SDI

Presidential Projec t Team (in the 1990s)

Integrated and Sus tainable Rural Development

Programme (ISRDP)

Urban Renewal Programme (Ngangelizwe)

Increasing scal allocations to address infrastructure

backlogs Project Consolidate

Proposed N2 Toll road

Proposed Pondoland National Park

Kei rail

PGDP Massive Food Programme

Proposed AsgiSA programmes, such as Forestry

Cluster, Umzimvubu Irrigation Project, biofuels, call

centres etc

Ntinga OR Tambo Development Agency

DEAT programmes (Working for Tourism, Working

for the Coast, Working on Waste, Sustainable land-

based livelihoods. Total annual budget presently

nearly R150 million).

The District is divided into seven local municipal

areas, each with at least one urban service centre:

King Sabata Dalindyebo (Mthatha and Mqanduli),

Nyandeni (Libode), Port St Johns, Mhlontlo (Tsolo

and Qumbu), Ntabankulu, Mbizana and Qaukeni

(Flagstaff and Lusikisiki).


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The eight municipalities of OR Tambo had a

combined capital expenditure budget of R692million in 2005/06. This amounts to a capex per

capita of R412, slightly below the provincial average.

70% of this total capex is budgeted by the District

Municipality. One municipality (PSJ) has a capex

budget of just R1 million. 93% of the total capex

budget is to be funded from grants and subsidies.

This is the highest ratio in the Province.

The combined municipalities have an operating

budget of R718 million, equivalent to R428 per

capita, which is very low by provincial standards.

54% of operating revenue is grants and subsidies

(much higher than provincial average). Income

from property rates accounts for nearly 10% of

total operating revenue. 84% of total ra tes income

is budgeted to come from King Sabata Dalindyebo

(KSD) Municipality. Personnel costs account for

about 45% of budgeted operating expenditure

(above average). KSD accounts for 42% of budgeted

personnel costs. The D istrict Municipality accountsfor 23% of total personnel costs.

To address Provincial development challenges

and opportunities, the Provincial Growth and

Development Plan (PGDP) was launched in 2004,

and PGDP nds expression in all the Districts

IDPs. More recently, AsgiSA has been launched

to accelerate economic growth throughout Sou th

Africa. The present document aims to outline the

elements of a development strategy for the OR

Tambo Distric t. Specically, this document considers

how to:

Speed up delivery of basic services

Improve public services (schools, clinics etc)

Create jobs and livelihood opportunities

Build and maintain infrastructure

Fight poverty

Augment Municipal capacities and co-operation


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This section briey outlines servi ce delivery with

respect to water, sanitation, electricity and housing,

drawing mainly on a provincial household survey

conducted in 2006 (RSS). These trends are evaluated

against the benchmark of the 2001 census.

WAT E R The percentage of households in Or Tambo still

relying on natur al water sources (62%) is more than

twice the provincia l Average of 28% . Households

in Mbizana (94%), Qaukeni (82%) and Nyandeni

(66%) reect the highest levels of those suffering

the vulnerabil it y of natur al water sources . All of the

remaining local municipal areas are well above the

provincial average and suggest a crisis in household

water access within the district if RDP standards are

used as the norm.

D E L I V E R Y O F B A S I C S E R V I C E S

Water access by household for the Eastern Capeand loca l Municipalities in OR Ta mbo for 2001 - 2006

Water on Site Borehole/Tank Community Stand Natural water/dam Water Vendor/other

Census2001

RSS 2006Census2001

RSS 2006Census2001

RSS 2006Census2001

RSS 2006Census2001

RSS 2006

% % % % % % % % % %

Eastern Cape 37.4 41.8 4.0 3.8 25.3 25.1 31.4 28.0 1.9 1.4

O.R.Tambo 10.0 10.2 5.9 4.1 17.9 21.1 64.1 62.4 2.1 2.2

Mbizana 2.9 0.7 2.9 0.0 14.9 3.8 77.6 94.2 1.8 1.2

Ntabankulu 3.4 2.3 3.7 9.7 16.1 44.5 75.0 43.5 1.8 0.0

Qaukeni 8.0 4.1 3.8 1.0 13.8 12.6 72.4 81.9 2.0 0.4

Port St Johns 5.7 6.5 5.1 2.7 13.7 39.2 73.8 50.8 1.7 0.8

Nyandeni 3.9 9.3 7.4 5.8 18.7 18.0 67.2 66.0 2.8 0.9

Mhlontlo 6.4 5.3 5.7 7.1 27.5 27.9 58.7 46.8 1.7 12.9King Sabata

Dalindyebo24.1 27.8 8.5 5.3 18.6 21.8 46.4 44.1 2.4 0.9

Source: SSA 2001 and RSS 2006


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S A N I T A T I O N Investment s in household sanitation in the OR

Tambo district over the period 2001 2006 have

clearly not yet begun to address the needs of local

households. Every local municipality in Or Tambo is

way above the provincial norm (22%) for househo lds

not having any formal sanitation and way above RDP

requirements.

Type of sanitation by household forlocal municipalities in OR Thambo and the Eastern Cape for 2001 2006

Flush Toilet(connected to sewerage system)

Flush Toilet(with septic tank)

Chemical ToiletPit Latrine

(with ventilation)

Pit Latrine(without ventilation)

Bucket Latrine None

Census2001

RSS 2006Census2001

RSS 2006Census2001

RSS 2006Census2001

RSS 2006Census2001

RSS 2006Census2001

RSS 2006Census2001

RSS 2006

% % % % % % % % % % % % % %

Eastern Cape 30.9 31.1 2.2 1.3 2.0 0.6 5.6 7.2 23.1 33.9 5.6 4.0 30.6 21.8

O.R .Tambo 7.4 5.8 0.9 0.5 2.8 0.4 6.0 11.0 29.9 44.0 1.4 0.4 51.6 38.0

Mbizana 1.5 0.0 1.1 0.0 5.6 0.0 7.5 0.7 44.8 70.5 0.7 0.0 38.7 28.8

Ntabankulu 1.4 0.5 0.7 0.5 2.7 0.0 3.5 2.3 24.6 29.2 2.0 0.6 65.0 67.0

Qaukeni 2.6 0.0 1.0 0.7 3.1 0.0 5.5 10.0 40.4 61.4 1.8 0.6 45.6 27.3

Por t St Johns 2.8 0.0 1.7 0.0 2.0 0.4 1.7 35.5 16.7 39.0 1.2 0.4 73.9 24.7

Nyandeni 2.0 0.4 0.8 0.0 1.9 2.0 4.7 8.2 28.2 37.5 0.6 0.0 61.7 51.9

Mhlontlo 2.2 0.0 0.5 0.0 3.7 0.0 9.2 11.8 31.9 46.8 1.6 0.0 50.9 41.5

King Sabata

Dalindyebo22.7 24.8 0.7 1.1 1.7 0.3 7.1 13.1 22.1 24.2 1.7 0.2 44.2 36.4


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T H E C O S T S O F E L I M I N A T I N G B A C K L O G S

The estimates for eliminating the backlogs for water

and sanitation are pegged at R1 billion. Almost all

of these backlogs are rural (98% for water and 94%

for sanitation). The greatest proportion of water

backlogs in OR Tambo are in Mbizana (21%), KSD

(19%) and Nyandeni (18%). The remaining local

municipalities all account for at least 10% of the backlog

each reinforcing the point that the district as a whole

suffers from under investment in household water

access. In terms of sanitation backlogs Qaukeni (19%),

Mbizana (18%) and KSD (17%) recorded the greatest

proportion overall.

costs of eliminating backlogs for Water and sanitation

Category Water Sanitation

R % R %

Mbizana Urban 2 362 950 4 291

Rural 194 813 550 186 293

Total 197 176 500 21.0 190 584 17.9

Ntabankulu Urban 4 145 850 5 413

Rural 87 228 450 102 637

Total 91 374 300 9.8 108 050 10.1

Qaukeni Urban 2 023 650 5 269

Rural 114 043 550 191 563

Total 116 067 200 12.6 196 832 18.5

Port St Johns Urban 645 750 3 761

Rural 95 996 550 61 690

Total 96 642 300 10.3 65 451 6.1

Nyandeni Urban 4 082 850 5 330

Rural 160 231 950 160 887

Total 164 314 800 17.5 166 217 15.6

Mhlontlo Urban 0 2 610

Rural 97 245 450 151 400Total 97 245 450 10.4 154 010 14.4

King Sabata Dalindyebo Urban 2 511 000 41 881

Rural 171 647 550 143 742

Total 174 158 550 18.6 185.623 17.4

O.R. Thambo Urban 15 772 050 1.7 68 555 6.4

Rural 921 207 050 98.3 998 212 93.6

Total (approx. R 1 billion) 936 979 100 1 066 767


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C L E A R I N G T H E B A C K L O G

According to DWAFs National Information System

for Water Services (accessed on the DWAF web

site, October 2006), it will require R 1 billion to

eradicate the water supply backlogs and R700m to

eradicate the sanitation backlog. This will mean an

annual expenditure of R500m to achieve the 2008water supply target and an additional R175m per

year to achieve the 2010 sanitation target.

In the next nancial years, the Municipal Infrastructure

Grant (MIG) will allocate:

R295 million for 2006/2007



Even if the total of R 1.6 billion was used by

municipality for basic services and infrastructure

investment in the water and sanitation areas, this

amount falls far short of that necessary to meet

the required target s. There are also many other

areas that make financial demands on MIG funds

(roads, stormwater, electricity, waste management,

community facilities, etc).

E R A D I C A T I N G T H E B U C K E T S Y S T E M

Bucket sanitation has never been widespread in

OR Tambo and consequently bucket eradica tion is a

relatively insignicant priority in terms of sanitation

investments in the District.

Municipality Total No of Buckets Approx Value toReplace (R000)

1,011 9,099

Mbizana 0 0

Ntabankulu 735 6,615

Qaukeni 0 0

Por t St. Johns 0 0

Nyandeni 0 0

Mhlontlo 276 2,484

King Sabata

Dalindyebo

0 0

O.R. Tambo District

Municipality

0 0

Source: DHLGTA September 2005


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M U N I C I P A L I N F R A S T R U C T U R E G R A N T ( M I G )

The National Government provides infras truc ture

subsidies to ensure tha t all households have access to

a basic level of infrastructure services. The benets

of this intervention are well known, particularly

in relation to the public good characteristics of

many municipal services. The key objectives of theMunicipal Infrastructure Grant are to:

fully subsidise the capital costs of providing basic

services to poor households: this implies that

priority must be given to meeting the basic

infrastructure needs of poor households, through

the provis ion of appropriate bulk, connec tor and

internal infrastructure in key services;

distribute funding for municipal infrastructure in an

equitable, transparent and efcient manner, which

support s a co-ordinated approach to local development

and maximises developmental outcomes;

assist in enhancing the developmental capacity

of municipalities, through supporting multi-year

planning and budgeting systems; and,

Provide a mechanism for the co-ordinated pursuit

of national policy priorities with regard to basic

municipal infrastructure programmes, while

avoiding the duplication and inefciency associated

with sectorally fragmented grants.

An amount of over R1.6bn in MIG funding has been

allocated within the OR Tambo District over the

current medium term expenditure framework. O f

thi s amount, app roximately R646m is alloca ted to

addressing water infrastructure requirements, and

over R323m is allocated to sanitation. The balance

of just above R100m is allocated to other socialinfrastructure services.

The allocation of the MIG in OR Tambo sugges ts a

concerted effort to address the social infrastructure

backlogs in the District. However, given the

magnitude of the backlogs in some of the local

municipalities (see earlier section on improving

social services); these signicant infrastructure

allocations are necessary but not sufcient to

eradicate the backlogs in line with Provincial and

National targets.


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The OR Tambo Distr ict Municipality has identied

and prioritised the following water and sanitation

projects that are listed below.

water and sanitation projects: ortdm

Projects Strategy/Activity Amount Time Frames Responsible Department

Water

Umzimvubu Dam Feasibility Study R300 million 2007 2026 Premiers Ofce

Rural Water Supply

(backlog removal)Three-year Infrastructure Plan 2007 2014 ORTDM / DPLG

Regional Water Scheme (bulk) Master Plan R6 billionNot

establishedORTDM

Ten Towns

Refurbishment ProgrammeTen Towns Audi t Repor t R10 0 million

Not

establishedORTDM

Working fo r Water Programme Thr ee-year Act ion Plan R7 m ill ion 2007 2009 DWAF

Zaulu Hill DamFeasibility Study

BP PreparationR11 Million 2007 2011 DWAF

SanitationRural Sanitation Three-year Infrastructure Plan 2007 2016 ORTDM / DPLG

Ten Towns

Refurbishment ProgrammeTen Towns Audi t Repor t R40 0 million

Not

establishedORTDM

OR Tambo District Municipality, 2007

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E L E C T R I C I T Y

Except for KSD (70%) the remaining local municipalities

in OR Tambo fall signicantly below the provincial

average for those who have access to electricity at

least for lighting (67%), worst off is Ntabankulu with

only 18% of households using electricity for lighting.

As is the case in the rest of the country, electri city

supply nation-wide from ESKOM cannot increasesignicantl y until the new R40bn power stations come

online in 2010. It is therefore quite unlikely that there

will be any further electrications in OR Tambo until

the stabili ty of power supply has been sor ted out by

ESKOM. There is a good opportunity for ESKOM or

ay other service provider (if possible) and exploit the

hydro-electric potential of the Mzimvubu Dam and

Catchment area.

energy sources for lighting in the Eastern Capeand loca l Municipalities in OR Ta mbo for 2001 - 2006

Electricity Gas Para n Candles Solar and other

Census2001

RSS 2006Census2001

RSS 2006Census2001

RSS 2006Census2001

RSS 2006Census2001

RSS 2006

% % % % % % % % % %

Eastern Cape 49.7 67.1 0.3 0.4 23.3 14.0 25.9 18.3 0.8 0.2

O.R.Tambo 28.1 49.6 0.3 0.2 12.1 8.0 58.4 41.6 1.2 0.5

Mbizana 25.0 37.0 0.3 0.0 2.9 4.1 69.7 57.7 2.1 1.2

Ntabankulu 14.5 18.4 0.1 0.0 3.4 1.8 80.1 79.4 1.9 0.5

Qaukeni 13.6 42.7 0.2 0.4 8.0 5.8 76.3 50.0 1.8 1.0

Port St Johns 17.2 45.6 0.3 0.4 10.5 1.9 70.8 52.1 1.1 0.0

Nyandeni 32.2 58.4 0.2 0.2 11.5 19.7 55.0 21.7 1.0 0.0

Mhlontlo 30.1 47.1 0.2 0.6 8.8 2.4 60.0 49.1 0.9 0.9

King Sabata

Dalindyebo41.7 70.1 0.4 0.2 24.3 11.5 33.1 18.1 0.6 0.2


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H O U S I N G

The provision of formal housing for low and

middle income residents is a core function of local

municipalities. Within the urban areas, housing

development is generally occurring, however,

within the rural or communal areas, the provision

of housing is only beginning to be addressed.

The primary const raint with regards to the provision

of housing in rural areas relates to issues around

land ownership and registration of title. The current

housing regulations also fail to make provision for

adequate land for making food gardens that these

poor households need for survival.

With the promulgat ion of the Communal Land

Rights Act the process of addressing problems

surrounding land rights commenced. The table

below provides an insight on the current status of

housing delivery in the District.

level of informal housing

Census 2001 RSS 2006

% %

Eastern Cape 10.9 5.7O.R .Tambo 2.7 1.1

Mbizana 1.6 1.1

Ntabankulu 1.6 0.7

Qaukeni 2.3 1.8

Por t St Johns 1.2 2.3

Nyandeni 1.5 0.0

Mhlontlo 4.2 0.0

King Sabata Dalindyebo 4.6 2.0


Low-cost housing backlogs are less prevalent than

those for water and sanitation in OR Tambo, and

the oppor tunit ies provide good st imulus for local

economic activity.

There is an obvious link between housing plans and

existing backlogs with the EPWP and its related

forward-backward linkages to the construction and

mining/quarrying industry and job creation.

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C U R R E N T M U N I C I P A L H O U S I N G P R O J E C T S

The projects listed below are currently implemented

and were approved in the previous nancial years.

No new funding to be allocated until completion of

the cur rently imp lemented projects .

Committed funds to be utilised to complete the

existing project.

For 2007/08 only one new project to be nanced

i.e. Urban Renewal Upgrading Project

(NGANGELIZWE Breaking New Ground)

LocalMunicipality

ProjectTotalUnits

Units Units Total BudgetExpenditureTo Date

Date Of Approval Subsidy Quantum

KSDM MpekoEagertonLindilePrestonUpper CentuleUpper TabaseOld PayneNew PayneKwenxurhaNdlunkukuNtshabeniNcambeleNgqwala

ZidindiWater fal l Phase 4Water fal l Cons Phase 1Water fal l Cons Phase 2Zimbane ValleyIlithaZimbane KuyasaMaydene FarmMqanduli

25045035040 0300300300300300300300300300

3004505004951482463477969500

24437029935413716015046196442810

123

733934880.00635013

889500

780514616314015025410425619

300177

2275712

495847463464800

5 428 493.2210 925 417.007 211 452.009 223 193.009 623 454.009 639 253.009 629 503.0011 000 361.799 539 192.0010 758 016.0 09 506 227.0011 460 117.009 931 437.58

9 090 621.038 853 000.009 700 000.00

0.0044 422 600.0018 506 125.0 07 155 000.0016 731 050.0 08 437 500.00

5 585 745.948 883 663.197 198 976.448 531 493.907 609 650.867 312 486.517 674 280.53

57 476.007 871 217.20

3 256 393.238 420 118.48

0.006 987 244.62

4 214 066.348 758 950.005 450 000.00

0.0021 990 012.3412 571 329.324 830 281.3315 818 375.008 437 500.00

21/09/200221/09/200221/09/200221/09/200209/07/200409/07/200409/07/200409/07/200409/07/200409/07/200409/07/2004

09/07/2004

09/07/200409/07/200401/09/1999

23/03/200025/09/200213/06/199623/04/199819/01/1999

20 300.0020 300.0020 300.0020 300.0025 800.0025 800.0025 800.0025 800.0025 800.0025 800.0025 800.00

25 800.00

25 800.0025 800.0015 000.0 0

8 000.0016 000.0 015 000.0 015 000.0 015 000.0 0

Nyandeni HadiniLibode Rl 3Ngqeleni Ext4

80 0500420

371069

429500351

22 141 206.0014 684 250.0011 086 926.30

15 170 199.065 390 308.006 064 988.17

21/09/2002

19/01/1998

20 300.00

15 000.0 0

Port StJohns

Psj Rural (Caguba)Mthumbane TownshipPsj Rural (Caguba & Maneng)

200425

1000

195383

1000

5420

6 008 370.0014 141 250. 0026 937 000.0 0

5 998 370.006 595 319.50

26 937 000.0 0

21/06/200517/10/199720/08/2003

25 800.0015 000.0 023 100.00

Mhlontlo Qumbu Ext 5Tsolo

504425

179425

3250

11 322 398.0 06 360 000.0 0

8 468 590.625 624 747.11

14/07/1998 15 000.00

Qaukeni NkozoMantlaneniFlagstaffLusikisiki

3003005031117

116762411117

1842242620

9 262 555.009 412 555.0013 708 753.6618 430 500.00

5 439 595.574 758 954.458 623 826.0717 162 149.41

09/07/200409/07/200401/06/200012/12/1997

25 800.0025 800.0016 000.0 015 000.0 0

Ntabankulu Ntabankulu Ext 5 471 113 358 12 254 424.00 10 851 746.65 01/04/2000 16 000.00

Mbizana Mbizana Ext 3Mbizana Ext 4

18880 0

0400

188400

4 850 400.0024 023 687.00

4 368 300.6016 386 174.34

19/08/199928/01/2004

16 000.0 023 100.00

Total 17739 10079 7660 441 890 060.60 309 299 530.80


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19

In conclusion, the housing backlogs need to be

understood in the context of the predominantly rural

nature of the OR Tambo District. Informal housing1

does not include rural dwellings, and therefore

although the District has a very low informal housing

problem, it has a huge rural housing problem

underscoring the continued need for RDP housing inrural communities.

1Informal housing is dened as shacks, and othernon-concrete structures in urban centres.


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20

The data in the table below are perceptions of those

surveyed in the RSS survey in 2006

i m p r o v e p u b l i c s e r v i c e s

Access toClinics

Access toPrimary Schools

Access to Roadsin good Condition

Access toAmbulance Services

InformalHousing

% % % % %

Mbizana 54.0 92.4 51.7 26.8 0.7

Ntabankulu 36.7 77.3 17.6 32.0 0.4

Qaukeni 69.1 72.1 46.0 31.4 1.8

Port St Johns 38.8 88.5 27.7 22.7 2.3

Nyandeni 62.2 87.3 9.5 39.0 0.0

Mhlontlo 44.4 89.1 15.0 32.0 0.0

King Sabata Dalindyebo 86.6 89.5 22.4 62.1 2.0

Source: RSS 2006

H E A L T H

Access to health care has improved considerably in

the OR Tambo However, major challenges remain .

There are 169 clinics in the District resulting in a

ratio of 10 300 people per clinic. According to

national norms of one clinic per 10 000 people, the

OR Tambo District has less clinics than a re needed.

The distribu tion of human resources at health facilities

across the District is however, biased in favour of

the lar ger centres . The national aver age gure fornurses per 100 000 people, is 12 nurses. OR Tambo

appears to be under-resourced showing gures like

4.5 nur ses per 100 000 people, and in some areas (

Ntabankulu) as low as 2.7 nurses per 100 000 people.

Reported access to health care is greater in KSD,

Nyandeni and Qaukeni, and lowest in Ntabankulu

and Port St Johns.


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21

H I V & A I D S

OR Tambo District had an antenatal prevalence

rate1 of 33.8% in 2004, up from 23.6% in 2002,

which is above the provincial average for the Easter n

Cape (28.03% in 2004). It can be assumed that

remnants of the Apartheid migrant labour system

play a role in this high prevalence rate. HIV is often

more prevalent in mobile populations, and migrant

workers return to their homes when they are ill.

This will increase both the number of new infections

and the total number of people living with HIV inthe dist rict .

HIV Prevalencein OR Tambo district

2002 2003 20042

OR Tambo 23.60 % 29.20 % 33.80 %

Eastern Cape 23.60 % 27.10 % 28.03 %

Source: Dept of Health antenatal survey, 2004

Estimates for the total population of the Eastern

Cape, estimate that 10% of the total population

is HIV positive, and 19.2% of adults (20-64 years)

(ASSA 2003 Model). For the province as a whole,

women have higher HIV prevalence than men, the

African population is at higher risk, and the epidemic

is growing fastest among youth (15-25 years). It is

particularly young women that become infected.

Prevalence for males exceed that of women in the

30-34 age group (ECAC, 2005). Early sexual debut,age difference between partners and transactional

relationships is reported to plan a role in driving the

epidemic (ECAC, 2005). Hence, prevention programs

should be targeted towards young people.

1Antenatal prevalence refers to the percentage of pregnant women attending

public clinics who test positive for HIV. Data is only availab le per district, a nd

it is difcult to extrapolate this data for the entire populat ion.2Eastern Ca pe Department of Health has not yet made the provincial 2005

Antenatal survey available.


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22

According to the HSRC 2003 household survey,

HIV prevalence is generally higher in urban informal

and urban formal settlements and lower in farm

and tribal settlements. There is not a signicant

difference in HIV prevalence among those working

and those unemployed, however, HIV and AIDS is

still closely linked to povert y in its many dimensions.The epidemic in the province is expected to reach

a peak by 2010, at about 16% of the population,

before the number of new infections even out

(ECAC, 2004).

Knowing your status is an important weapon in

curbing the spread of HIV. Most public clinics offer

Voluntary Counselling and Testing (VCT) and in

2006 69.26% of those attending public clinic s opted

for VCT (men and women). Only 24.53% of males

who visited clinics opted for VCT. However this

gure does not tell us about the percentage of the

total population who have undergone VCT, the

quality of the services, or whether patients came

back to get their results.

VCT Test r ate (% of peopleattending clinics undergoing VCT)

%

OR Tambo DM King Dalindyebo LSA 65.92

Mhlontlo LSA 75.97

Nyandeni LSA 68.41

Qaukeni LSA 66.73

Total 69.26

Source: District Health Information System, Januar y 2006

The Nelson Mandela Academic Hospital in opened

in Mthatha in 2004, and provide the people of the

district with a new state of the art tertiary health

facility, albeit with some challenges. The hospital

is one of the provincial sites piloting the use of

telemedicine. The H IV and AIDS centre at Walter s

Sisulu University (WSU) is a resource beyond thedistrict, both for research and training of health

professionals and community health workers, and

receives funding from Department of Health.

The Depar tment of Health has embarked on a range

of prevention, care and treatment interventions.

In OR Tambo 9 service points are accredited for

dispensing anti-retroviral treatment, treating a total

of 4934 patients in November 2006. However,

the re is st ill a need to accredit add itiona l point s

and increase the number of people on treatment.

Increasing number of people on TB treatment

and partner treatment for people with STIs is also

a challenge. Attraction and retention of health

professionals is a challenge, at primary as well as

ter tiary facil ity level .

The pioneering ARV program in Lusikisiki, as

collaboration between Doctors without Borders

(MSF), the Department of Health (ECDOH) and

the Treatment Action Campaign (TAC), is now being

handed over to ECDOH. The program provides an

internationally heralded model of ARV rollout in

resource poor setting s, and possibilities for scale up

should be investigated.


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23

In the distric t, HIV and AIDS is given the highest

priority, being placed in the ofce of the Executive

Mayor Programs include awareness, research

capacity development. One of the awareness and

prevention programs that the district support is the

cultural practice of Inkciyo.

The Non Governmental Organisations (NGOs),

Community Based organisations (CBOs) and Faith

Based Organisations (FBOs) play a major role at the

community level. However, integrated approaches

and cooperation between actors need to be

strengthened across the district. The AIDS councils

play a major role here. Among NGOs, CBOs and

FBOs there is also a need for focus on quality and

specialisation in the response to HIV and AIDS

(ECAC, 2004).

The district should develop a multisectoral HIV

and AIDS plan that is integrated into the IDP witha dedicated budget. This should include a response

to what is sometimes called the orphan ep idemic:

the growing numbers of chi ld headed households,

vulnerable children and orphans.


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24

E D U C A T I O N

According to the Education Management Information

System (EMIS), there are a total of 1892 primary

and secondary institutions in the ORTDMA. There

is one University in the ORTDMA, which is the

Walter S isu lu Univers it y of (WSU), which is si tua ted

in Mthatha.

It is estimated that 95% of all the learners walk

to school , of which 36% walk for longer than

30 minutes. This means that there are 245 000

Percentage of OR Tambo, rural nodal and non-noda lpopulations (aged 524) attending educational institutions

children who walk for more than an hour a day

getting to and from school

Compared to the rest of SA and especially to the

other rur al nodes the education level in OR Tambo

District is very low.

Percentage of OR Tambo, rural nodal and non-nodalpopulations (aged 524) attending educational institutions

0%

24% 25%

None Pre-School &

School

Technikon/University/

College/Adult Education

OR Tambo

Rural Nodes

Rest of South Africa

(non-nodes)

30%

75% 74%

67%

1% 1%3%

20%

40%

60%

80%

0%

38%

29%

No Schooling Some Primary/

Secondary Schooling

S td 10/Grade 12 Highe r Educat ion

OR Tambo

Rural Nodes

Rest of South Africa

(non-nodes)

15%

49%53% 53%

9%13%

22%

5% 5%9%

20%

40%

60%

80%


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25

S K I L L S U P G R A D I N G

The District has launched a Human Capital Devel-

opment Approach tha t is based on the following key

areas:

Baseline Research and Benchmarkingon government

impact on lives of local community members.

Government has invested a lot of money over the

years in the various communities around the district.

The challenge is that there is no baseline information

that the government intervention can been measured

against. This makes it extremely difculty to measure

progress and the impact of government services in the

lives of the people of the region. The lack of baseline

information is also not helping future planning as future

budgeting and planning relies on past performance.

The Baseline and Benchmarking programme is aimed

at correcting this dilemma and help provide local

government with the information tools that local

government need for proper planning.

Priority Skills Acquisition -The huge backlog in the

distric t and the need to change the situation around

requires a workfo rce in local government that posses

the right sk ill s. The bui lding of roads, br idges, etc

requires engineers, nancial experts, architects, etc.The Priority Skills Acquisition initiative is a critical

component of service delivery.

Life Skills Acquisition members of the community

need to be trained on life sk ills in order to cope with

the difcu lt s ituations they are confronted wi th on a

daily basis. Some of the skills that are needed are:

Conict management

Dealing with HIV/AIDS

Family values

People relations

Personal hygiene

Community Skilling (CS) the community need

skills that will help them manage community

projects. They need the skills to play their role as

monitors of public service performance.

B U S I N E S S D E V E L O P M E N T S E R V I C E S

One of the key trends in small enterprise develop-

ment has been a move away from direct-market

substitution by international donors and local govern-

ments towards a focus on facilitating private business

development service (BDS) market development.

This approach emphasises the limited ability of the

public sector and/ or donor organisations to deliver

services to small enterpr ises effectively.


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26

This approach is premised on the fact that the

Municipality should encourage and promote

private service providers of business development

services, instead of the municipality itself trying to

be a provider of such services. So this approach

emphasises the need to promote the private sector

suppliers of business services, with the attendant

benets of efciency and efcacy.

Facilitating BDS market development means

conducting an assessment of the BDS market,

identifying weaknesses and opportunities, and

identifying interventions that could stimulate

the provision of more and more relevant BDS

product offerings1.

The OR Tambo Distric t Municipality needs to

strengthen partnerships with the Small Enterprise

Development Agency (SEDA), the ECDC and other

national institutions in the delivering of nancial

and non nancial support to SMMEs. The following

products and services should be offered at dedicated

business support centres:

Information, advice and referrals

Business registration

Business plans Tender Information and advice

Import and Export training

Trade Information

Business assessment and technical support

Business mentoring and

Market access and business linkages

1Oxford 2005

T R A N S P O R T

Despite some investments in new roads and

maintenance in the district many local communities

remain trapped in isolated and disconnected local

communities with very poor road infrastructure.

This disconnection has signicant consequences in

terms of local economic development as wel l as

services deliver y, most evident from the accessibility

to emergency ambulance services .

Currently the process of maintenance and upgrade

is severely hampered by the lack of clarity with

regards to roles and responsibilities between

various roads role players. The process is currently

under discussion at all levels, thus providing some

hope for a resolution in the near future.

Transport whether motorised or non-motorised

experiences many problems within the OR Tambo

District. These can be summarised as follows:

Poor conditions of roads especially rura l

roads and within former urban townships

Stray animals

Inadequate pedestrian signs and markings and off

loading areas especially within the few urban areas

Limited trafc calming measures within areas of

high accidents Low visibility of trafc ofcials and law

enforcement

Non-availability of trafc lights,

let alone at major intersections


27/64

Unavailability of adequate public transport facilities

especially for the disabled

Lack of cooperation between public transport

operators and the municipal authorities

Lack of institutional capacity at Local and

district Municipal level to manage transport

planning and implementation

Insufcient supply of taxi related infrastructure

Outdated/non-existent information

at the taxi registrar

Lack of pedestrian and non-motorised

transpor t fa cil iti es

The road network s in the O. R. Tambo area consists

of the following categories:

National Road = 136km (National Roads Agency)

Provincial Road = 497km (Provincial Department of

Roads and Public Works)

District Road = 2792km (Regional Department of

Roads and Public Works)

Access Road = 2957km (DM, LMs)

Street & Internal Road (Local Municipalities)

In support of Road Construction & Development

of SMMEs, the O.R. Tambo District Municipality has

embarked on an emerging contractor development

programme. Through this programme emerging

contractors are trained formally on site and in

classroom to develop to the status of established

contractors. The initiative commenced with the

purchasing of road construction plant to the value

of R15million funded by the then CMIP. The Plant

items are currently used in the on-site construc tion-

train ing progr amme. The Leng thman system of road

maintenance is currently implemented with a view

of creating employment opportunities.

A I R P O R T S

The Mthatha airport needs to be upgraded and

revitalized in the most cost-effective manner that

will promote socio-economic activity and tourism

for this region. In order to achieve improved air

transport and emergency response in times of

natural disasters there needs to be upgrading of

airelds at key nodes.

27


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28

Working Age& not working

Unemployedand lookingfor work

Householdincome< than

R1500/month

% % %

Eastern Cape 78.1 32.6 65.2

O.R.Tambo 84.6 34.6 71.6

Mbizana 89.5 39.5 84.9Ntabankulu 82.1 30.1 73.0

Qaukeni 87.2 32.8 76.7

Port St Johns 89.6 44.7 5.2

Nyandeni 85.0 33.7 67.9

Mhlontlo 83.2 30.5 71.5

King Sabata

Dalindyebo79.3 34.2 56.6

Source: RSS 2006

In the context of the very high unemployment and

poverty rates mentioned above, there is clearly anurgent need for new investments to create jobs and

improve livelihoods in the OR Tambo Distr ict. Ba sed

on existing economic activity, market opportunities

and present resource/assets/sk ill bases the particular

industries offering potential include:

J O B C R E A T I O N A N DL I V E L I H O OD OP P O R T U N I T I E S

Livestock farming

Dryland farming and irrigated horticulture

Forestry

Manufacturing

Construction and Mining

Trade and Business Services/ICT

Tourism

Each of these industries requires a detailed Action

Plan, specifyi ng investments to be packaged, timelines

and milestones, stakeholders and responsibilities.

Preparatory work has already taken place for all

these industr ies in the OR Tambo Dis tr ic t, and the

main challenge is to galvanise industry role-players

to ensure acceler ated and shared grow th, and good

quality investments.

It is notable that only about 13% of the District s

working-age population have matric or above. This

points to the critical importance of education and

train ing for future employment growth.

Each of the seven industr ies listed above is briey

proled in the following sections:


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29

L I V E S T O C K F A R M I N G

Livestock farming (primarily cattle, sheep and

goats) is very important in the District, but

generally provides very low incomes compared

to commercia l livestock farming elsewhere in the

Province. Livestock farming is being supported by

the Provincia l Depar tment of Agriculture through

construction of stock dams, dipping tanks, shearing

sheds, fencing (under CASP) and veterinar y services

etc. The challenge is to increase incomes from

communal livestock farming. An industr y action plan

would probably include:

Expansion of the effective

NWGA model of support

Improve existing programmes designed to

facilitate skills transfer between commercial

and emerging farmers

Improved Agricultural Extension Services

Improved market access (e.g. drawing on

experience of USAID-funded project in the

Chris Hani District; Middle Eas t goat market)

Building animal feeds industry

Improved veld management

Move to formal land administration

Upgrading access roads/farm logistics

Ntinga Development Agency, in addition to theProvincial Department of Agriculture, is also

supporting livestock farming.

While the Distric t is suitable for dairy farming (and

there is a local market) it is capital and sk ills incentive.

D R Y L A N D F A R M I N GA N D I R R I G A T E D H O R T I C U L T U R E

Rainfall and soil quality make much of the District

well-endowed for agricultural production. Rainfall is

more than 800mm a year (and signicantly higher

in the coastal zone). Dryland farming is generally

of a subsistence nature, and there are large tracts

of uncultivated arable land. There are two large

farming projects in the District: Magwa Tea and

Pondoland Sugar.

There are several initiatives to suppor t increased

production by small-scale subsistence farmers:

PGDP Massive Food Programme

PGDP Siyazondla Programme (to increase

homestead garden food production)

District Municipality programme to support an

additional 30,000 ha of maize production

AsgiSA Biofuels initiative

AsgiSA Umzimvubu Initiative

There needs to be effective co-operation

between the Department of Agriculture and

the Dis tr ic t Munic ipa lit y in supporting inc reased

maize production, and support measures should

be thoroughly evaluated, to identify methods of

improved support.

The Umzimvubu project contains a cropping

component, but this project is very large-scale and

will inevitably take many years to come to fruition.


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30

Irrig ated horticulture is both capital and skills

intensive, indica ting that the growth of the subsector

will require bankable projects, experienced

management and thorough training. Several small-

scale irrigation schemes in the District have failed.

The District also contains larger-scale irrigation

schemes of the former Bantustan (for example,

Ncora) that are being rehabilitated.

Market access for crop-producers has been

improved as a result of the Mthatha Fresh Produce

Market, and will be assisted by the Kei Rail Project.

F O R E S T R Y

The District contains 30,000 ha of forestry

plantations (mainly around Langeni and Ntabankulu).

There is estimated to be a fur ther 50,00 0 ha suitable

for forestry in the District (the greatest potential

in South Africa). AsgiSA has identied forestry as

a priority area for intervention, and the District

Municipality will be working closely with AsgiSA to

develop this sector.

Infrastructure investments for the sector includethe new Langeni-Ugie road and Kei Rail.

M A N U F A C T U R I N G

This is a very small sector of the District economy,

but it does offer growth potential. For example:

Ntinga Development Agency is suppor ting the

development of the timber-using industries at

Langeni (and elsewhere)

There are many small-scale garment manufacturers

(e.g. occupying old Transido workshop premises)

tha t would benet from s tronger business suppor t.

The existing crafts subsector is not insignicant.

For example, a basket-making enterprise in Port St

Johns employs 2,500 home-worker s in the area .

Craft workers would benet from more support

with product development and marketing, and from

growth of the tourism industry in the District.

The agro-processing subsector has the potential

to grow on the bas is of inc reasing its pr imary

production. Examples include the Mthatha Abattoir

and maize milling.

There needs to be good co-operation between

Ntinga, SEDA, ECDC and the Thina Sinako LED

Programmes to realize growth oppor tunities.


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31

C O N S T R U C T I O N A ND M I N I N G

The construction industry in the District is presently

small, but is likely to provide more job opportunities

in the future, based on:

Rapidly increasing scal allocations for public

infrastructure (see section on Building and

Maintaining Infrastructure)

Expansion of the EPWP (there needs to be a

District EPWP Plan, with an M&E capability)

Increased house-building and retail infrastructure.

The District Municipality has initiated a Emergent

Contractor Development Programme.

Mining is presently restricted to quarr ying related

to cons truc tion ac tiv ity. There is also the possi bil ity

of a heavy sands mining project at Xolobeni on

the Pondoland coast , which would provide 250

direct jobs over a 22-year mining period, with an

investment cost of 220 million US dollars.

T R A D E A N D B U S I N E S S S ER V I C E S / I C T

Employment in this sector could be boosted by new

investment in Business Process Outsourcing and

call centres. District agencies need to work withAsgiSA to ensure that this takes place. ICT services

support protable business/co-op growth in all

other sectors.

T O U R I S M

This sector has obvious potential, primarily based on

the 120 km Wild Coast and home of Nelson Mandela.

Development initiatives include the following:

Regional Tourism Organisation established

Tourism Development Plan in place

Proposed new N2

Proposed Pondoland National Park

Wild Coast Spatial Development Initiative

EU Pondoland Community Tourism Programme

Upgrade of Mthatha Airport

Upgrade of access roads to the coast

Hluma Development Local Investment Agency (a

R500 million JV of DBSA and Old Mutual

to prov ide venture capit al for Wild Coast

private investments)

Nelson Mandela Museum/Qunu/Mvezo

Nelson Mandela Freedom Route from

Port St Johns to Aliwal North

Commercialisation of Nature Reserves

(Mkambati, Hluleka, Silaka etc)

Efforts to eradicate coastal illegal cottages.

Despite all these initiatives , potential investors have

frequently been frus trated in their efforts to develop

coastal tourism accommodation facilities, due to

difculties and delays surrounding land acquisitionand planning permission.


32/64

It has been repeatedly suggested that one of the

major factors contributing to the low level of

economic competitiveness and social cohesion, and

in a sense result in a failure to exploit economic

potential, has been the poor state of infrastructure

and infrastructure-related services. This section

of the district prole attempts to summarise thephysical infrastructure development plans that have

been budgeted for over the medium term , and that

are likely to contribu te to a more enabling social and

economic environment in the OR Tambo District.

Like all other regions in the province, OR Tambo

District suffers from acute backlogs in social and

economic infrastructure. The vas t natural land, forest

and water resources that exist within the district,

and the existing albeit limited infrastructure base,

provides the basis for socio-economic development,

but it is well-planned, prioritised, strategic and

complementary infrastructure investments that

will promote social development, and stimulate

sustainable economic growth.

Provincial Department Infrastructure expenditure

plans from 06/07 08/09 in the OR Tambo DistrictMunicipality:

The total infrastructure spend directed towards the

OR Tambo District by the Eastern Cape provincial

government departments amounts to a whopping

total of approximately R2.9bn over the current

medium term expenditure cycle. This represents

signicant public sector infrastructure investment

that hopefully crowds in private investment.

b u i l d a n dm a i n t a i n i n f r a s t r u c t u r e

32


33/64

33

P R O V I N C I A L D E P A R T M E N T O F E D U C A T I O N

Education is a key element of social and economic

development. The Provincial Department of

Education has planned and budgeted up to R710m

on education infrastructure in the OR Tambo

District over the current medium term expenditure

cycle (06/07 08/09). The Provincial Depar tment is spending R190m

in 06/07, R200m in 07/08 and R320 in 08/09,

representing slightly above 25% of total departmental

education infrastr ucture investment over the current

medium term cycle.

The bulk of the spending is targeted at rehabilita tion

and upgrading (R520m) with recurrent maintenance

budgeted at R120m emphasizing a focus on improving

the qua lit y of the education inf ra structure. Up to

214 schools have been targeted in the District for

thi s upgrade through prov inc ial government funding,

involving the eradication of mud-structures and

general routine maintenance of existing concrete-

structures. Therefore a shift towards quality as

opposed to quantity (quantity has been the norm

for previous medium term expenditure cycles).

These upgrading and maintenance amounts are crucial

in two respects, 1) by maintaining and protecting

existing assets ensuring guarantee of returns well into

the future , and 2) direc t and indirec t cash injec tions

boost local economies, as routine maintenance

activities are generally labour-intensive.

A total of approximately R70m over the medium

term is budgeted for New Const ruct ion of ve

schools public special schools in Mbizana, Mthatha,

and Lusikisiki.

Provincial government education infrastructure

spending per capita in the OR Tambo District over

the three year per iod , in total, is R405 per per son .

P R O V I N C I A L D E P A R T M E N T O F H E A L T H

The provincial health department has planned and

budgeted for a total health infrastructure spending

of R685m in the current medium term expenditure

cycle for the OR Tambo Distric t rising from R190m

in 06/07 to R265m in 07/08, before falling to R230m

in 08/09. This provincial health infrastructure expenditure

in OR Tambo amounts to 30% of total health

infras truc ture spending by the provincial government

over the medium term cycle.

The allocation to the District is divided into New

Construction (R106m), Rehabilitation and Upgrading

(R484m), and routine and recurrent maintenance

(R95m). Rehabilitation and upgrading will involve

over 40 clinic revamps and 7 hospital revitalizations

within the District.

The allocation for new construction will target

23 clinics and 5 hospitals. These large allocations

to relati vely few hea lth ins titut ions in the Dis tr ic t

suggests a strategic shift to focus more on

improving the quality of health services, as opposed

to improv ing access to hea lth ser vices . So the issue

is one of quality, not necessarily access.

The provincial health infrastructure spending per

capita in the OR Tambo District over the medium

term amounts to an approximate R390 per per son .


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P R O V I N C I A L D E P A R T M E N T O F A G R I C U L T U R E

The OR Tambo Dis trict has huge untapped

agriculture, forestry and water resources, and these

resources are at the heart of any sustainable growth

potential and economic activity in the Distric t.

Given this existing natural r esource base, the

Provincial Department of Agriculture plays animportant catalyst role in promoting subsistence

farming (food security) and small and large scale

commercial agriculture.

Over the current medium term pe riod (06/07

08/09), the Prov inc ial Depar tment of Agr icu ltu re

will spend approximately R23m on infrastructure

in the OR Tambo District, representing 11% of the

total inf ra structure spend (R200m over the medium

term) by t he prov inc ial depar tment in the D istr ic t.

The allocation rises from R5.5m in 06/07 to R8m

in 07/08 and to over R9m in 08/09 and is targeted

largely at fencing, stock water, irrigation, storage

and shearing sheds, tunnels, dip-tanks, and soil

conservation works..

The Provincial Agriculture infrastructure spend per

capita amounts to approximately R13 per person in

the OR Tambo Dis tr ic t.

P R O V I N C I A L D E P A R T M E N T O F P U B L I C W O R K S

The OR Tambo District is set to receive up to R75m

from the Provincial Department of Public Works.

This amount represents about 17% of the total

provincial allocation to all Districts and the Metro.

The per capita spending on public works amounts

to R43 per per son .

It is not clear what projects the budgeted money

will be spend on.

P R O V I N C I A L D E PA R T M E N T O F R O A D S A N D T R A N S P O R T

Another key element of required infr astructure

development in the District is the road network.

The OR Tambo Distric t suffers from quite signicant

road infrastructure backlogs given the largely r ural

character of the District.

In light of these backlogs, and recognising the keyenabling role that transport infrastructure has for

economic and social development, the provincial

roads and transport department has allocated

approximately R1.4bn to road infrastructure in the

OR Tambo District area, rising from over R327m

in 06/07 to R551m in 07/08 and then a drop to jus t

under R521m in 08/09.

This total allocation over the medium term represents

approximately 27% of the total provincial alloca tion

towards road inf ra structure, and representi ng a per

capita spend of R800 per person in total over the

medium term expenditure framework.

The major transport projec ts envisaged in OR

Tambo are: Kei Rail phases 3, 4 and 5 (R334m),

Isilimela Hospi tal road (R147m), Madwaleni hospita l

road (R136m), Greenville Hospital road (R132m),

Zithulele Hospital road (R130m), and Ugie-Langeni

phase 3 (R95m).

Some of the other spending on road infrastructure

in OR Tambo by the Provincial Department will be

on recurrent and routine maintenance (including

the Vukuzakhe Programme) of R300m, and access

to resor ts , and access to Great Places (R50m).


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P R O V I N C I A L D E P A R T M E N T O F H O U S I N G ,

L O C A L G O V E R N M E N T & T R A D I T I O N A L A F F A I R S

The department has announced expenditure plans

of R76m in OR Tambo for the 07/08 nancia l year.

This amount will result in the construction of a

tota l of 3058 houses in L ibode Ny andeni , Mthatha

Ilitha, Mthatha Zimbane Valley, Mthatha, WaterfallPark, Mantlaneni Village, Nkozo Village, and

Ncambele Village.

P R O V I N C I A L D E P A R T M E N T O F

S P O R T , R E C R E A T I O N , A R T S A N D C U L T U R E

The total Provincial Department allocation to OR

Tambo amounts to just over R12m over the current

medium term expenditure cycle.

The OR Tambo District is receiving a tad above

R4m in the 06/07 financial year for the new

construction of, 1) Mthatha Archives in KSD

(R3m), and 2) the Bumbane Cultural Village in KSD

(R1m). An amount of R5m is allocated for 07/08

for the continuation of the Mthatha Archives in

KSD (R2.5m), and the construction of the new

Flagstaff Arts Centre (R2.5m). Finally, in 08/09, an

amount of R3m is allocated for the completion of

the h is tor ic Mthatha Archives .

The OR Tambo allocation of the Depar tments

infrastructure budget represents 15% of total

departmental infrastructure spending throughout

the Province .

The infra struc ture per capita spending for the

department in the district lies at R7 per person of

infrastructure spend.

Expenditure on the new Mthatha Library (at an

estimated cost of R1.4m) has been planned, but

not budgeted for in the current medium term

expenditure cycle. P R O V I N C I A L D E P A R T M E N T O F S O C I A L D E V E L O P M E N T

The provincial department has allocated almost R16m

in infrastructure spending over the current medium

term expendi ture cyc le to the OR Tambo Distric t.

The expenditure is targeted at new construction of

the Flags taff Service Ofce (R4 .6m over the medium

term), the Qumbu Secure Care Cen tre (R11m over

the med ium term)

A further R0.3m is allocated for maintenance and

upgrade of parkhomes, and routine maintenance of

existing social development infrastructure.

The department has planned, but not yet budgeted

for, phase 2 of the Qunu Day Care Centre (est. cost

of R0.8m), and in addition, several service ofces

(Libode, Port St Johns, Mqanduli and Mbizana at

an estimated cost of R3m each) have been planned

but not budgeted for in the current medium term

expenditure cycle.

The total infrastructure spending in OR Tambo

represents 25% of total Social Development

infrastructure spending in the province.

The social development infrastructure per capita

spending over the medium term is approximately

R9 per person.


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P R O V I N C I A L G O V E R N M E N T

I N F R A S T R U C T U R E E X P E N D I T U R E S : C O N C L U S I O N S

The signicant provincial infrastructure expenditure

plans in the OR Tambo District Municipality will

provide a meaningful platform for social and

economic growth and development arising from the

opportunities such spending opens up in both therst and second economies.

Compared to other Districts and the Metro in the

Eastern Cape, OR Tambo District Municipality will

receive approximately 22% of the total provincial

infrastructure spend, making it the Distr ict with the

highest Provincial infrastructure allocation over the

current medium-term cycle.

It is import ant for social and economic infrastr ucture

to complement each other, thereby mutua lly

reinforcing the sum total of benets derived from

the inf ra st ructure expend itu re and its economy-

wide linkages.

It is necessary, but not sufcient, to just build new

infrastructure. Maintenance of existing infrastructure

needs to also be priori tised. Current ly, maintenance

of the Departments immoveable assets is poor

inevitably leading to rapid deterioration of buildings

and other assets. Maintenance funds have always

and may probably remain limited. Much of thelimitations with respect to maintenance can be

attributed to poor levels of denition with respect

to the respons ibi li ty for maintenance budgeting.

The distinc tion between levels of respons ibility

between Public Works and User departments as

reected by the infrastructure plans will go a long

way towards regularizing maintenance planning.

Finally, it is commendable that a paradigm shift is

evident through the infrastructure allocations,

with the focus on the quality of infrastructure

and services, as opposed simply to the quantity,

especially in education and health.


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S T R A T E G I C I N F R A S T R U C T U R E P R O J E C T :K E I D E V E L O P M E N T C O R R I D O R

The Kei Development Corridor is an initiative

instigated by the Provincial Department of Roads

and Transport to promote economic development

in an area surrounding the Kei Rail link from East

London to Mthatha. Such is the importance of the

Kei Development Corridor that over R300m is

being earmarked for the Kei Rail by the Provincial

Government over the medium term.

It is envisaged that the implementation of the

Kei Rail project will stimulate development of a

development corridor by:

Stimulating economic ac tivities where transpor t

constraints are the primary reason for the

unsustainability and/or non-viability of the projects;

Providing an improved transport option for existing

economic activities and thereby allowing for increased

prot and sustainability and greater efciency;

Providing a general economic catalyst to promote

and develop economic initiatives and improvement s

in social welfare throughout the economy;

Creating other forward-backward linkages with other

major projects (e.g. Bio-fuels, Forestry and Timber)

The Kei Development Corridor falls predominantly

within three Distric t Municipalities, namely: Amat-

hole, Chris Hani and OR Tambo District Municipali-

ties (ORTDM). ORTDM encompasses seven local

municipalities, including three (KSD, Mhlontlo and

Nyandeni) that lie within the KDC project area. The

main urban centres within the ORTDM that fall in-

side the KDC area are Libode, Mthatha, Mqanduli,

and Ngqeleni.

Mthatha is a rst order node of the KDC, which means

that it must form the backbone of the KDC and there-

fore the focus is on industrial and transport related

infrastructure. Libode, Mqanduli and Nqeleni are sec-

ond order nodes in KDC. Second order nodes are

smaller towns or commercial focus points providing in

the basic needs of the sur rounding set tlements.

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It is recognized that stimulating economic develop-

ment in the area surrounding the Kei Rail will be

important in ensuring the viability of the Kei Rail.

Within thi s contex t, the pr inc iple objectives of the

KDC Economic Initiative are:

Identication of the economic acti vities whose

viability (and hence implementation) are solelydependent on the rail corridor or that would

substantially benet from the rail development;

Identica tion of the general economic development

potential within the hinterland serviced by the Kei

Rail Development Corridor (KDC) and

Assessment of potential linkages and benets that

could accrue from the proposed improvements to

rail (and supporting transport) infrastructure.

Identication of key infrastructure investments

required to support the KDC

For the OR Tambo Distr ict, the Kei Development

Corridor provides a unique opportunity for

focused investment in the Corridor area, as the

significant provincial investment in this project

provides a platform for further municipal

interventions to realize the full potential of the

Kei Development Corridor.

Linkages between the KDC and potentially mega

agship projects in OR Tambo:

Bio-Fuels Industry:

The proposed project involves the establishment

of an integrated food crop and canola bio-diesel

industry as an economic anchor for accelerated

agrarian transformation in the Eastern Cape.

The proposal is to develop extensive integrated


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rotational cropping (canola & maize or equivalent)

to supp ly a new canola bio -diesel process ing fac ili ty

in the East London IDZ.

Canola biodiesel is a potentially attractive product

in Europe due to its low freezing point and the

fact that European legislation requires that the

proportion of bio-fuel consumption (in relation tototal fuel s) ri se to 5.75% by 2010.

Forestry & Timber Processing Industry:

Development of timber processing activities around

the Langeni area to ser ve the proposed development

of the Ugie/Matiwane forestry area . Facilities include

saw mills, chipboard manufacturing and potentially

furniture manufacture. The key anchor is the PG

Bison/Steinhoff initiative in Ugie-Maclear.

Essentially, the conservation and efcient utilization

of Kei Rail can only succeed as a partnership between

local communities, government and private sector.

Growth and development in the East London to

Mthatha corridor will succeed if it is government

driven (provincial, district and local), private sector

funded, labour conscious, community based andenvironmentally friendly

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f i gh t p o v e r t y P O V E R T Y I N D I C A T O R S

Levels of household grant dependence in Or Tambo is

signicantly higher that the provincial average of 64%

with three quarters (75%) and more of households

receiving social grants. The exception is KSD where

63% of households rely on social grants.

Household member is receiving social grant

Yes No

% %

Eastern Cape 63.6 36.4

O.R.Tambo 75.1 24.9

Mbizana 80.2 19.8

Ntabankulu 81.3 18.7

Qaukeni 81.7 18.3

Port St Johns 77.7 22.3

Nyandeni 74.5 25.5

Mhlontlo 77.4 22.6

King Sabata

Dalindyebo62.9 37.1

Source: RSS 2006

Unemployment levels in the OR Tambo District are

higher than the provincial average, underscoring

the levels of chronic pover ty and inequali ty withi n

the dis tr ic t. As a result, household incomes in the

district are generally low.

Working Age& not working

Unemployedand lookingfor work

Householdincome< than

R1500/month

% % %

Eastern Cape 78.1 32.6 65.2

O.R .Tambo 84.6 34.6 71.6

Mbizana 89.5 39.5 84.9

Ntabankulu 82.1 30.1 73.0

Qaukeni 87.2 32.8 76.7

Por t St Johns 89.6 44.7 5.2

Nyandeni 85.0 33.7 67.9

Mhlontlo 83.2 30.5 71.5

King Sabata

Dalindyebo79.3 34.2 56.6

Source: RSS 2006


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M U N I C I P A L - M U N I C I P A L C O O P E R A T I O N

Engagement meetings between the ORTDM and

the LMs have rai sed is sues about how municipal ities

can be brought up to speed to address the prior ities

interventions required to unlock the social and

economic potential in the their local areas.

It was identied that the Municipalities need to

address by-laws, policies and performance governing/

in relation to, amongst other issues, trade regulation,

procurement, land use, zoning, plans for the sector s,

resources like staff and funding/budgets required to

implement the priorities.

I D P A L I G N M E N T

All Municipal IDPs in OR Tambo give attention to

building their own delivery capacities. The filling

of critical vacancies (e.g. Municipal Managers etc)

is critical, as are measures to attract and retain

critical skills.

IDPs have improved over the last few years and

are generally aligned to PGDP in terms of agrarian

transformation , public sector transformation, human

resource development, economic diversication

and tourism, infrastructure provision, and ghting

poverty.

However, there are some impor tant gaps in the

context of provincial alignment (e.g. housing, EPWP,

malnutrition).

IDPs do not yet integrate the activities of all three

levels of Government (such as Biofuels (ASGISA).

The OR Tambo IDP devotes considerable attention

to bui lding its own capacit y and tha t of the local

municipalities. Perhaps more attention could be

given to how to improve co-operation with otherarms of Government

M U N I C I P A L B U S I N E S S C O O P E R A T I O N

The ORTDM together with the regional ofce of

the bus iness chamber (NAFCOC) held a work shop

tha t sought to iron out and remove any existing and

potential barriers to economic development in the

region. Studies undertaken indicate hat ORTDM as

the mos t poorest r egiona l economy in the countr y

and the major challenge faced by these two par tners

is turning around this economy.

In a continuous effor t to promote municipal -

business cooperation, the key areas of engagement

were identied as:

Establishment of a partnership between ORTDM

and the regional business chamber (NAFCOC).

Exploration of oppor tunities like, Umzimvubu water

catchment, N2 toll road, the bio-fuels industry etc.

Branding of ORTDM as an economic engine of the

province.

Establishment of an investment centre in the region

by NAFCOC.

m u n i c i p a l c a p ac i t y a n d c o o p e r a t i o n


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Establishment of business incubator and business

advice centers by NAFCOC.

A business ownership/leasing survey to be

undertaken and submitted by NAFCOC.

Expansion of business afliation networks by

NAFCOC to the inclusion of all sectors in business.

The joint development of a regional programme ofaction by the two par ties

Coordination of departmental programmes for the

identication of business opportunities therein.

Development of strategies for business

development advocacy.

The development and submission of factory

occupancy database and submission by ECDC to

the par tne rship programme.

Precise role denition of each partner to the

marriage.

The creation of an enabling business environment

by the DM for the business community to thrive.

Development of by-laws by the DM/LMs

Council business outreach programme.

LED forum meetings for coordination, experiences

and information sharing.

Observer status accorded to business in the LED

standing committee.

Infrastructure development monitoring.

Establishment PPPs to stimulate growth.

Business database establishment.

Business service and advice centre establishment.

Joint planning and programme setting for strategic

infrastructure development and rehabilitation

(airport, transport system, 2010 readiness, airport

conference facility, umzimvubu water cathment,

N2 tool road)

M U N I C I P A L / P R O V I N C I A L

D E P A R T M E N T / A G E N C I E S C O O P E R A T I O N

Among the key issues raised at the OR Tambo

District is the limited participation of provincial

government in the IDP planning processes. As such,

efforts to build participative government at the

local level are being undermined by the provinceoften sending junior ofcials without decision

making powers. The district expressed concern

about the role of the Departmen t of Housing, Local

Government and Traditional Affairs. This revolves

around the department not providing adequate

support and guidance to municipalities.

Other key issues emerged were the provincial

governments inadequate ability to plan spatially

(DMs and LMs) and the absence of alignment with

respect to planning, budgeting and even execution

between the two spheres. These need to be

addressed as they curtail the acceleration of service

delivery wh ich appears to be the major issue need to

be tackled in OR Tambo among other things . On that

score, close cooperation of spheres of government

remains critical as the delivery of social services is

not an exclusive local government competence but

depends on other spheres performance.

It is no doubt that the current Provincial IDP

Engagement process is the step in the right direction,

however the challenge would be to factor into results

of the district GDSs, IDP engagements to feed into

planning and review of both IDPs and PGDP.


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M U N I C I P A L / N A T I O N A L

D E P A R T ME N T S / S O E S C O - O P E R A T I O N

In the case of OR Tambo the Depar tment of Land

Affairs, Department of Housing, Department of

Labour and Department of Roads, Department of

Agriculture is among other key national departments

that the distric t needs to work with besides theDepartment of Trade and Industry. Although the

Department of Water Affairs and Forestry has by

and large been participative at local government level,

the scale and pace of eradicat ing water and sanitation

backlogs in the district leave a lot to be desired.

It goes with out saying that in order to address the huge

electrication and telephone backlogs particularly in

the former homeland areas, close cooperation with

Eskom and Telkom remains critical.

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c o n c l u s i o n The ORTDM is clearly grappling with very

entrenched problems of poverty and unemployment,

and progress seems to have been quite slow so far

in addressing these problems. It is of concern that

while public investment in the District is increasing,

there seem to be ver y few substantial pr ivate sector

projects in the pipe-line.

The Summit is potentially very important for

setting in motion processes to improve municipal

planning and management capacities, particularly

with respect to co-operation with other arms of

Government, and with Business. The private sector,

business-support agencies and the municipalities

need to work together to develop the detailed

priority industry action plans mentioned earlier.

The outcome of the Summit should be the

development of a Framework Agreement that

outlines institutional roles and responsibilities to

accelerate growth and development in the District.

This Agreement should also suggest the mechanisms

and processes for monitoring progress on the decisions

reached and the governance framework for ongoingdialogue and feedback among the social partners.

The district GDS presents a unique opportunity

for constructing partnerships and harnessing the

collective energies and contributions of a range of

actors and role players with a view to enhancing

accelerated and shared growth.


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The district GDS has the potential to unlock the

potential of all localities, and ensur e that all sectors

of society identif y their role and contribute to the

common national objective to build a better life

for all.

Generally speaking, there are six key drivers tounlocking economic potential and job creation

as well as enhancing competitiveness in the

OR Tambo Distric t:

1. Agriculture and agri-business remains at the heart

of the district economy in spite of its stagnant and

even declining contribution to the district economy.

And its importance could not be more emphasised

than through its potentia l to contr ibu te towards

two mega pro jec ts that a re be ing rolled ou t by both

National and Provincial government:

a) Forestry and Timber Industries Development,

b) Bio-fuels,

c) Umzimvubu Basin

2. Processed agricul tural goods offer signicant ly

more economic value than the non-processed

products. It is therefore important to consider the

encouragement of the processing and manufacturing

of goods within the District

3. Tourism is an untapped resource within the District. An

integrated approach must be taken in the promotion

and development of potential tourism sites.

4. Massive infrastructure roll-outs (including enhance-

ments and developments in ICT) envisaged under

ASGI-SA, the PGDP and the district and local in-frastructure development plans to address backlogs

and maintain existing and refurbish aging infrastruc-

ture, could be used to st imulate economic activ ity

throughou t the construc tion value chain .

5. Local procurement cou ld offer a wide range of

economic opportunities throughout all sectors of

the local economy.

6. Investing in , and aligning skills development to the

identied key growth sectors will further enhance

the locationa l compet it ivenes s of the OR Tambo

District Area.


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46

A C R O N Y M SASGISA Accelerated Shared Growth

Initiative of South Afr

Ortdm Gds Profile

Documents