Budget Speech 2018

Madam Speaker,

Cities are the heart of the national economy and hold the potential to drive our economic renewal.

South Africa’s eight metros are home to 39 per cent of our population but account for half of all employment (formal and informal) and 57 per cent of the country’s economic output.

The economic importance of cities is likely to increase.

We must take advantage of this dynamic to drive inclusive growth.

The Integrated Urban Development Framework sets out government’s policy commitment to improving the productivity of South Africa’s urban areas.

Achieving this will require us to re-think approaches to South Africa’s urban development challenges, and to find new ways in which to stimulate faster and more inclusive growth.

On a visit to the Bridge City hub in eThekwini, I saw first-hand the transformative potential of coordinated public investment in reviving township economies through public and economic infrastructure investments and catalysing private sector investments.

Let all urban development stakeholders work imaginatively to transform township economies.

Let us think beyond car washes and spaza shops, important as they are, and find ways to foster productive, high value economic activity in townships owned and managed by township residents.

We need to see factories, workshops, tech hubs and locally-owned retail operations being established in our townships.

By revitalising the township economy and reconfiguring our urban centres, we are radically transforming the unequal spatial planning of our cities.

Government is also alert to the potential of our intermediate cities, that are smaller than the metros, but still significant urban centres.

The better to respond to the urban development challenges they face, this Budget proposes to introduce a new, more flexible grant funding arrangement for these cities over the medium term.

Cities will be able to opt to join this new grant, which will require more integrated long-term planning and a greater contribution to infrastructure investment form their own resources.