Theme: public_private_partnership
Responsible: National Treasury / DPWI
National Treasury PPP regulations are designed for mega-projects and are prohibitively burdensome for smaller social infrastructure. The DBSA small-scale PPP pilot showed the concept works. Requires Treasury approval for simplified frameworks and standardised contracts. Political resistance from unions who view PPPs as privatisation may complicate implementation.
Who backs this reform, who needs convincing, and which interests or red lines shape political feasibility.
Backers
9
1 stakeholders
Negotiation weight
0
0 conditional actors
Opposition weight
9
1 opposing actors
Review coverage
0/2
All mapped stance notes are still draft
Provenance warning
Every mapped stakeholder stance for this idea is still draft. The coalition score is directional only until at least the high-influence actors are reviewed.
Coalition Read
Anchor: National Treasury. Most serious blocker: COSATU.
Political Tractability
No reviewed signals · 0% of mapped influence has been reviewed.
Treasury supports PPP regulatory reform for social infrastructure as it leverages private capital for public service delivery.
Interest: Fiscal consolidation with public debt stabilising below 75% of GDP; structural reforms that improve revenue without expanding contingent liabilities;…
Concern: Unfunded mandates in energy transition (JETP co-financing); Eskom's R400bn+ debt and how restructuring socialises costs; reform proposals that create…
Engagement path: Reforms must be fiscally neutral or revenue-positive over the MTEF window; SOE restructuring must demonstrably reduce contingent liabilities; credible…
COSATU opposes PPPs for social infrastructure, viewing them as privatisation of public services that raises costs for communities.
Interest: Worker protections under the Labour Relations Act and Basic Conditions of Employment Act; collective bargaining rights; equitable wage growth; just tr…
Concern: Labour market flexibility reforms that erode LRA and BCEA protections; Eskom unbundling without adequate just transition planning for NUM members; pri…
Engagement path: Meaningful social dialogue through NEDLAC before structural reforms are finalised; just transition funding ring-fenced in MTEF; skills retraining and…
National Treasury's PPP Unit administers South Africa's public-private partnership framework under Treasury Regulation 16, which requires extensive feasibility studies, value-for-money assessments, and multi-stage National Treasury approval. While this oversight protects public finances, the process has been criticised as too slow and costly — particularly for smaller social infrastructure PPPs covering schools, health centres, and correctional facilities — with fewer than 40 PPP agreements reaching financial close since 2000. DPWI and National Treasury are reviewing streamlined approval pathways for social infrastructure PPPs below a defined threshold, an off-balance-sheet framework for municipal-level PPPs, and better alignment with the Infrastructure Fund's blended finance model established in 2020.
Referenced in OECD Economic Surveys: South Africa
OECD SA Survey (2017, 2020, 2022, 2025). The 2025 survey calls for boosting public investment especially in electricity, water and rail.
Botswana's Pula Fund, established 1994 within the Bank of Botswana, saves long-term diamond revenues above a sustainable drawdown rate. The fund reached USD 5.7 billion by 2020. During diamond price crashes (2009, 2020) the fund provided counter-cyclical fiscal support without external borrowing. Botswana's debt-to-GDP has never exceeded 30% despite being a single-commodity economy. The institutional key: diamond revenues flow through the fund before reaching Treasury, reversing the political economy that typically prevents savings. SA's mineral revenue enters the general fiscus with no ring-fencing or savings mandate.
Botswana's Pula Fund (1994) saved diamond export revenues above the economy's absorptive capacity under a statutory fiscal rule capping non-mining recurrent expenditure at 90% of recurrent revenues. The fund grew to USD 7.9 billion (2022), ~75% of GDP. External debt remained below 20% of GDP throughout. During the 2009 global financial crisis the fund provided fiscal buffer without IMF conditionality. SA has no commodity revenue stabilisation fund; mineral royalties and tax windfalls are fully consumed rather than saved, leaving the fiscus highly exposed to commodity cycles.
Approach
Botswana's Pula Fund was established in 1994 to save diamond export revenues that exceeded the economy's absorptive capacity. A statutory fiscal rule required that non-mining recurrent expenditure not exceed 90% of recurrent revenues. The fund grew to USD 7.9 billion (2022), equivalent to ~75% of GDP. Withdrawals require parliamentary approval and are capped at the long-run sustainable income from diamond revenues.
Anti-Extortion and Construction Mafia Task Force
National Treasury PPP Unit and Infrastructure Financing Reform
Fiscal Consolidation and Debt Stabilisation
SAPS Detective Service Capacity and Case Clearance
NPA Prosecution Capacity and Independence
SARS Capacity Expansion and Revenue Recovery
How to cite
Wilse-Samson, L. (2026). PPP Regulatory Reform for Social Infrastructure. SA Policy Space. NYU Wagner School of Public Policy. Retrieved 11 May 2026, from https://sa-policy-space.vercel.app/ideas/ppp-regulatory-reform-for-social-infrastructure?snapshot=2026-05-11
Data as of 2026-05-11 · latest PMG meeting 2026-05-08
Timeline: Fiscal rules operationalised within 2 years; fund reached scale by early 2000s
Lessons for South Africa
SA has no commodity revenue stabilisation fund. Mineral royalties and corporate tax windfalls from commodity cycles have historically been consumed rather than saved, leaving the fiscus exposed to downturns. National Treasury's Medium-Term Fiscal Framework implicitly acknowledges this; a legislated counter-cyclical fiscal rule — with an explicit savings mechanism — would strengthen credibility and reduce borrowing costs. The COP28 transition finance context also creates a potential use case for a Just Transition Fund analogous to the Pula structure.
Norway's Government Pension Fund Global (GPFG), established 1990, accumulated USD 1.4 trillion in oil revenue savings — the world's largest sovereign wealth fund. The 4% rule caps annual fiscal spending at the fund's estimated real return, protecting the principal. Independent Norges Bank Investment Management (NBIM) manages assets across 9,000 companies in 70 countries. Norway's non-oil fiscal balance is structurally managed to avoid Dutch Disease. SA's gold and platinum revenue streams, though smaller, could follow an analogous savings rule to rebuild fiscal space without raising tax rates or cutting services.