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									 PRO-POOR SERVICE DELIVERY WITH AN
EMPOWERMENT & JOB CREATION FOCUS

         CITY OF TSHWANE

             Dr Hein Wiese
          Strategic Executive Officer
                      CONTENT

•   Focusing on critical mass
•   Broadening economic base
•   Co-ordination & prioritization of projects
•   Objectives of EDA
•   Building PPPs
•   Making economic development a reality



                          2
3
       AUDITING STRATEGIES & PLANS

• We don’t have Great LA, because we have Good
  LA

• It is possible to turn Good into Great in the most
  unlikely situations

• It is not to contrast the Good-to-Great LA

• What do the Great LA share in common?

                           4
               CHALLENGE
                                   Great results




               What‟s inside the
                 BLACK BOX

Good results




                       5
                 Employment & Population
      City       Employed      Population     Population
                  Total          Total          White     Dependency ratio   % black
Polokwane             93,768       508,277         31,238       5.4               94%
Buffalo City         139,087       701,890         59,208       5.0               92%
Msunduzi             120,822       553,223         45,030       4.6               92%
Nelson Mandela       226,617     1,005,779        166,026       4.4               83%
Sol Plaatje           46,411       201,465         26,220       4.3               87%
Emfuleni             153,656       658,420         92,213       4.3               86%
Mangaung             156,827       645,440         78,049       4.1               88%
eThekwini            782,934     3,090,121        277,428       3.9               91%
Ekurhuleni           761,047     2,480,277        482,089       3.3               81%
Mossel Bay            22,135        71,494         20,349       3.2               72%
George                42,095       135,409         29,904       3.2               78%
Cape Town            939,440     2,893,247        542,580       3.1               81%
Tshwane              654,485     1,985,983        474,553       3.0               76%
Joburg             1,085,545     3,225,812        515,185       3.0               84%
Sample above      5,224,869     18,156,837      2,840,072       3.5               84%
Rest of SA        4,358,893     26,662,941      1,453,568       6.1               95%

South Africa       9,583,762    44,819,7786     4,293,640        4.7             90%
                           TSHWANE THE MOST
                           PROSPEROUS METRO
        Growth Indicator
                              Tshwane   Joburg      Cape     eThekweni   Ekurhuleni
                                                    Town
GGP (1996-2001) (%)             4,7          2,6     1,8        2,1         2,9

Annual per capita income      R57,168   R47,521    R26,033   R21,374      R23,848
in 2001

% people living in             12,3      16,6       21,0       31,5        29,3
poverty in 2001
% employment growth
1999                            -1,6      0,0        2,7       -3,2         2,6
2000                            -0,1     -5,0       -7,8       -2,0         1,4
2001                             0,7     -0,1       -4,1       -0,5         1,6



                                         7
8
          SECTORAL CONTRIBUTION
               TO SA‟S GGP
                         (CONSTANT PRICES)




40
                                                 36
35

30

25

     19
20

15                           13

                                                       9
10                                                           8
           7
                    6                        6
                                                                 4
 5
               2

 0
     WC   EC   NC   FS     KZN          NW       G    CTMM   M   L
                                  9
  SECTORAL CONTRIBUTION TO
     TSHWANE‟S ECONOMY

       6%   15%
                          TRADE

                          TRANSPORT
                    13%
24%
                          FINANCING

                          GOV

                          OTHER
                   19%
                          MANUFACTURING
      23%



              10
                BIG VS SMALL
   Turnover   % Firms          % Turnover         % Salaries


R500m +             0.2                 55.2              34.7


R20-R500m           1.2                 24.5              32.5


R1 – R20m          28.0                 17.4              22.4


- R1m              70.6                     2.9           10.4


TOTAL             100.0                100.0             100.0


                          11
             SETTING THE CONTEXT
• Key characteristics of success:
   – Successful cities provide high quality living
     experiences in which people want to settle &
     invest
   – Successful cities are well–connected
   – Successful cities provide agglomeration benefits
• Tshwane’s challenge is to ensure all people have
  access within current context of prosperity &
  poverty duality



                          12
                 A DUAL CITY…
• Need – The North
  – 67% of households live in formal dwellings
  – 46% had access to piped water in their homes in
    1996 (although 95% now has access to a water
    scheme, but not necessary piped water in the
    home)
  – 58% (up from 47% in 1996) have access to
    sanitation & 68% (up form 59% in 1996) have
    access to electricity.
  – Tshwane inherited some 72 500 additional
    households requiring basic municipal services

                         13
                  A DUAL CITY…
• Governance complexity
   – Cross boundary with 2 provinces
   – Sphere of influence over three provinces
• Urban efficiency
   – Shape of city makes municipal service delivery
     inefficient
      • Low densities
      • Discontinuous
      • Vast
• Inequality
                          14
               WHERE TO INVEST?
• Areas of greatest need?

• Areas of greatest potential for successful growth?

• The North of Tshwane unites need with potential
   – The North can gain leverage from the strong &
     diverse base of the rest of the Tshwane
     economy, with which it already intersects.



                            15
16
                                    Babelegi

            Winterveld
                                                                        DEVELOP THE NORTH
                                                                        •Rudimentary household services
                                                                        •Public facility/ space clusters
                                                                        •Circular public transport
                                                                        •Urban agriculture
                 Shoshanguwe



           Ga-Rankuwa
                                                                        DEVELOP THE “URBAN PORT”
                                                                        •Rosslyn
                                                       Dinokeng         •Dinokeng
                                                                        •Bon Accord
                                                                        •Wonderboom Airport
                                           Capital/ Inner City
                                                                         CELEBRATE THE CAPITAL
                                                                         •Cultural heritage
                                                                         •Housing

Atteridgeville                                               Mamelodi


                                                                        MAINTAIN THE REST
                               Centurion                                •Guide the market
                                                                        •Strengthen links between north and
                                                                        south
                                                  17
STRATEGIC FRAMEWORK


                      Developing the North




                                                                 Maintaining existing
  economic clusters



                        Celebrating the




                                               Building Social
   Strengthening




                                                                     Urban Areas
                                                  Cohesion
                            capital




              Sound Financial Fundamentals

Strong Developmental Municipal Institution

                                          18
            COLUMN 1: STRENGTHENING
                   CLUSTERS
• Automotive, Metal Industries & Defence clusters

• Support for research & development, teaching &
  knowledge based institutions

• International marketing & networking

• Engagement with major economic stakeholders

• Structured BEE & SMME support
                                                                         Developing the North




                                                                                                      Building Social Cohesion
                                                                            Celebrating the capital




                                                                                                                                 Maintaining existing
                                                     economic clusters
                                                       Strengthening




                                                                                                                                    Urban Areas
• Supporting Blue IQ initiatives
                                                                   Sound Financial Fundamentals


                              19                    Strong Developmental Municipal Institution
      COLUMN 4: CONTINUED
      DEVELOPMENT OF EXISTING URBAN
      AREAS THROUGH MAINTAINING
      SERVICES

• Maintenance & expansion of service partnerships

• Strengthening economic development promotion

• Expedited development approval mechanism

• Support Blue IQ initiatives

• Maximising infill opportunities                                        Developing the North




                                                                                                      Building Social Cohesion
                                                                            Celebrating the capital




                                                                                                                                 Maintaining existing
                                                     economic clusters
                                                       Strengthening




                                                                                                                                    Urban Areas
                                                                   Sound Financial Fundamentals


                                20                  Strong Developmental Municipal Institution
                 KEY OBJECTIVES

•   Creation of short, medium and long term - Jobs
•   Sector specific development – SMME’s
•   Black Economic Empowerment
•   Extended Public Works Programme
•   Growing the economy of CoT by 5% over 5 years
•   Reducing unemployment rate by 5% over 5 years




                          21
     TRUE PARTNERSHIP


   The initiator/
                           Service Provider
   government

                    Growing
                      the
                      City
                    Together

                           Business – The
The Private Sector
                            Private Sector


                     22
            SERVICE DELIVERY
        PRINCIPLES OF BATHO PELE

•   Consultation
•   Service standards
•   Access to services
•   Courtesy
•   Information
•   Openness & transparency
•   Value for money
•   Economic empowerment
                      23
                 PROGRAMMES

•   Economic Development Agency
•   Entrepreneurial Development Centres
•   Skills Development Centres
•   Incubators / Production Centres
•   Tshwane Manufacturing Advisory Centre
•   Trade & Investment Centres



                       24
                CLUSTER ONE
        MICRO ECONOMIC DEVELOPMENT

• Focusing on Development. Costly. The Initial Investment is
  high with long term benefit. Linkages with the Extended
  Public Works Programme, DBSA, IDC, IDT, NDA, NEF

• Promotion of community-based, informal sector & micro-
  enterprise development
• Promotion of formal sector SME establishment & growth
• Promotion of inward investment & development facilitation
• Promotion of rural economic development
• Management of the socio-economic impact of HIV/Aids
• Promotion of agricultural development

                             25
                CLUSTER TWO
        MICRO ECONOMIC DEVELOPMENT

• Development for Growing the Economy
• Linkages to the National, Provincial Manufacturing
  & Trade Policies & Programmes (IDC, DBSA,
  TISA, GEDA, Provincial Government, SADC
  schemes & NEPAD)

• Promotion of various industrial & service sectors
• Business retention, expansion & attraction
• Promotion of trade & exports

                          26
                  CLUSTER THREE
                CONTINOUS PROCESS

• Creating an enabling environment through interpretation &
  implementation of policy & legislative directorates, BEE, EE
  & AA

• Promotion of strategic & spatial development initiatives
• Research, policy impact assessment & information
  management
• Promotion of gender-responsive economic empowerment
• Promotion of a diversified spectrum of financial & venture
  capital, equity investment & corporate venturing institutions
• Promotion of localization & Tshwane economic branding

                               27
                   LED PROCESS
               IMPLEMENTATION PLAN
•   Appointment of EDA Steering Committee
•   Confirm availability of financial resources
•   Identify 3 facilitators
•   Finalize report to Mayoral Committee
•   Mobilize funding
•   Implementation within two months




                             28
               IMPLEMENTATION PLAN
EDA                  Setting up Steering Committee & End Oct 2004
                     finalising access to IDC funding
                     – approve process plan

Urban-agriculture    Submission of 4 final business   End Nov 2004
                     plans


Incubators/produc Finalise process plan through       End Nov 2004
tion centres      Steering Committee


Fundraising road     Establish Fundraising Committee Mid Dec 2004
show                 & programme for road show



                                29
30
31
               URBAN AGRICULTURE
Project              Investment    Jobs
Flowers                 R30m        250

Strawberries               R9m     200

Goat milk                  R3m      20

Vegetables             R12m        450

Citrus trees           R12m        200

                      32
33
                         BBBEE
                     INTRODUCTION
• Constitution mandates LG to transform itself so it can play
  a developmental role
• National policy is based on the belief that strategies for
  economic growth, development, BBBEE are mutually
  supportive strategies
• BBBEE Act 53 of 2003 seeks to promote ownership,
  control & management of enterprises by Black people incl
  women, youth & people with disabilities
• Tshwane Business Week 2003 resolved that BBBEE be
  prioritised in LED
• CTMM has no overall strategy on BBBEE


                              34
                   BBBEE
             GOALS & OBJECTIVES
• Develop a BBBEE plan of action
• Use its local economic development & service
  delivery activities
• CTMM must comply with EE & Skills Development
  Act
• Establish partnerships for growth, development &
  transformation – PPPs
• Develop a BBBEE Charter for Tshwane



                         35
                  BBBEE
          MONITORING & REPORTING
• Balance score card will be used to measure
  progress

• Reviewing the milestones of BBBEE projects

• CTMM engage in discussions with its
  stakeholders to develop a consensus around the
  use of specific tools & systems for black economic
  empowerment targets & objectives


                          36
37
                     EDA
                  ROLE OF EDA
• Full the gap in LED as delivery vehicle for
  development projects
• Co-ordinate & manage public resources, potential
  investors & regional investment opportunities
• Extension of the development role of local
  government
• Supporting the networks that catalyze local
  economic development



                        38
                    EDA
            KEY CRITERIA FOR IDC
• Poor & under-developed areas
• Rural bias
• Jobs to be created
• Empowerment opportunities created
• Local business development opportunities
• SMME development opportunities
• Social, economic, environmental & physical
  benefits
• Use of un/under utilized assets

                         39
                              EDA
                            PROCESS
Phase      Description                      Objectives


  1     Pre-funding        Political buy-in of the Agency concept


  2     Pre-establishment Prepare internal & external systems &
                          procedure & initiate operational planning
  3     Establishment      Agency establishment & project planning


  4     Operational        Programme & project implementation


  5     Exit               Final evaluation & IDC withdrawl


                                  40
41
                             STRATEGY

‘Strategy is not rocket science. It’s common
  sense & creativity combined. The best ideas
  are so obvious that everyone overlooks
  them, or so extraordinary that no one thinks
  about them. Either way, it’s how you
  execute them that finally matters.’

(Manning, T. 1998. Radical strategy)




                                       42
              STRATEGY TO IMPROVE
               ECONOMIC GROWTH

• Value-added production: Realigning the manufacturing
  sector away from traditional heavy industries towards
  sophisticated, high value-adding
• „Smart‟ industries: Creating an environment in which ie
  information technology, telecommunications, research &
  development and bio-medical industries can thrive
• Financial services: Developing the finance & business
  service sector by focusing on, technology, business
  services & business tourism

                             43
               STRATEGY TO SPECIFIC
                    CLUSTERS
• Automotive – Blue IQ project where Tshwane are hosting
  40% of all automotive activities in SA
• Information, Communication and Technology &
  Innovation Hub – Blue IQ project, currently in the process of
  bulding the site at CSIR & University of Pretoria
• Medical & Pharmaceutical – a new focus area
• Biotechnology – a new focus area
• Education & research & development – well developed
• Tourism – to be developed based on Government and
  business tourism
• Metals – well developed but need new focus after ISCOR has
  down scalled
• Agriculture & processing – Urban agriculture in the process
  of attracting investors for business case plans
                              44
       IMPROVING OUR PERFORMANCE?
• Major new investment growth – private sector partners
• World class research & development industry –
  relationships with centres of excellence
• New export markets – Trade Point
• Tourism boost – improved co-ordination
• World class education levels – new investment in facilities
• Priority for infrastructure projects – for target sectors
• Strategic land developments – incentive
• Small business initiatives – services to assist
• Integrated development planning process


                              45
             ROLE OF CTMM

• Influence the components of Porter Diamond
• Improve the quality of the inputs (factors)
  firms can draw upon & define a competitive
  environment
• Incentives is important part in shaping the
  pressures
• Working in tandem with favourable
  underlying conditions in the diamond
• Create environment where business can
  gain competitive advantage
• Catalyst & challenger
• Encourage companies
                      46
                      AUTOMOTIVE CLUSTER
    ENGINES                     WELDERS
                                                      SUB-
                                                   ASSEMBLERS              FINANCE
 TRANSMISSIONS
                       JIGS           PRODUCTION
                                         LINE               PAINT SHOP
                                                                                  INSURANCE
METAL PRODUCTS
                   PRESSES

    POWER                                                  PASSENGER
                                                              CARS                     COMPA-
                                                                                        NIES
GLASS PRODUCTS                                                BUSES
                          ASSEMBLERS                                                   GOVERN-
                          * MANAGING LOGISTICS                              DEALERS
                                                                                        MENT
     BASIC                                                    LIGHT
   CHEMICALS                                               COMMERCIALS
                                                                                        INDIVI-
                                                                                        DUALS
   TEXTILES &                                                 HEAVY
                   LOGISTIC                                COMMERCIALS
    LEATHER
                   SUPPORT
    RUBBER &
PLASTIC PRODUCTS   QUALITY                                     SAP
                   CONTROL                                                           TAX
                                                             PHASE VI
                                                                                  STRUCTURE
     PAINTS
                                 MANAGEMENT
                                                       MARKETING
                                   SYSTEM
  ELECTRONIC
                     ROBOTICS                                            AFTER SALES
  EQUIPMENT
                                                                           SERVICE
                                               TRANSPORT


                                          47
                                 DEFENCE CLUSTER
Manufacturing
Equipment

                        Customised
Nuclear                 Weapon
                        Systems
                                             Weapons
                                                           SA and other
Electronics                                  Aerospace     Governments
                                             Navigation
                        Commodity
Metal Products          Product
                        Manufacture
Chemical
Products


                                           Info Services
              R&D          Finance            and IT

                    Technology    Government


                                      48
 IRON &
                                   METAL PRODUCTS
 STEEL        DESIGN                                ELECTRICAL   MACHINERY
                                 FURNACES          INSTRUMENTS
ALUMINIUM                                                        SHIPPING
                    MIS
                                    MOULDS
STAINLESS                                             WELDERS    PACKAGING
  STEEL
                                                                 BUILDING
 SCRAP                                             CONTAINERS
                                                     TANKS       WHITE-GOODS
                                                     SHEET
 POWER                                               STRIP       TRANSPORT
               METAL PRODUCTS                         CANS
               * ROLLING, SHAPING,                    FOIL       AGRICULTURE
 OTHER                                                BARS
 METALS          CASTING & WELDING
                                                     TUBES       VEHICLES
                                                     RODS
  PAINT                                               WIRE
                                                    PROFILES     ENGINEERING

                                                                 DEFENCE
 WOOD                         ROLLING
                               MILL                              MINING
 PETRO-                                            CUTTERS
CHEMICALS              DIES                                      PETRO-CHEM
                                             HEAVY LIFTING
 RUBBER                           JIGS                           FURNITURE
            SPRAYING &                       & TRANSPORT
             PAINTING                         EQUIPMENT
            EQUIPMENT                                            WHOLESALERS
PLASTICS
                                                                 CONSUMERS


                                        49
   Additives
                                       BIOMEDICAL CLUSTER
                Active                                                      • Prescription
Fine                                                Pharmaceutical            products
                Compounds
Chemicals       Manufacture
                                                    Manufacture             • Over the counter
                                                                              products



                                                                                                       Hospitals &
                                                                                                         Clinics
• Spare parts                                                               • Hospital furniture
• Support                                          Medical Equipment        • Hi-tech medical           Private
                Machine       Manufacturing
  services                                         Manufacturing /            equipment
                Assembly       Equipment                                    • Small Surgical
                                                                                                        Practice
• Machine                                          Assembly
  components                                                                  equipment

                                                                                                       Pharmacies



    Steel                                          Surgical                 • Syringes / Needles
    Glass                                          Disposable               • Suture material
    Plastics                                       Manufacture              • Bandages
    Textiles
    Rubber


  Government           R&D                    IT       Medical Training                Logistics   Health Insurance

                                                           l   GP’s
                                                           l   Specialists
                                                           l   Allied Professional
                                                           l   Dentists
                                                           l   Vets


                                                      50
                                      TOURISM AND LEISURE
                HOLIDAY                         TRAINING         MEDICAL           CATERING
                RESORTS
                                 SUPPORT
                                                FINANCE              LEGAL        FOOD & BEV.
             HISTORICAL PLACES   SERVICES
                                               REAL ESTATE      INSURANCE         CONSTRUCTION
              SIGHT SEEING

              ACTION HOLIDAY
                FACILITIES

               GAME PARKS
LEISURE
                                                                                                                 INDIVIDUALS
ATTRAC-      CULTURAL OFFER                                                                            TOUR       FAMILIES
TIONS                              TRAVEL AGENTS                       TOUR OPERATORS
                                                                                                     PACKAGES    TOUR GROUPS
             SPORT FACILITIES
                                                                                                                STUDY GROUPS
                SHOPPING                                                                                         SPORT TEAMS
                                                                                                                  PATIENTS
              RESTAURANTS                                                                                        DELEGATIONS
                                                                                                                 POLITICIANS
              PUBL. EVENTS                                                                                      BUSINESS PEOPLE

                                                                                    LOCAL TRANSP.
                BUSINESS
                                                ACCOMMODATION
                                                                                     TELECOMM.
                 STUDY           CORE                                ADDITIONAL
BUSINESS
                                 SERVICES                            SERVICES       INFO. SERVICES
ACTIVITIES                                      INTERNATIONAL
              CONGRESSES
                                                  TRANSPORT
                                                                                      SECURITY
             POLITICAL EVENTS




                                              LOCAL                             GENERAL
                                            AUTHORITIES                      INFRASTRUCTURE




                                                                51
         PREFERENTIAL PROCUREMENT
           KEY RECOMMENDATIONS

• Preferential procurement policy should be
  reviewed & updated in line with applicable
  legislations & best practice
• Preferential procurement should be integrated
  seamlessly with procurement
• More preferential procurement strategies should
  be incorporated to reduce undue reliance on
  price preference
• Comprehensive targets for preferential
  procurement should be set


                        52
      PREFERENTIAL PROCUREMENT
        KEY RECOMMENDATIONS

• Preferential procurement process should be
  mapped & procedures documented
• Cross functional responsibility on preferential
  procurement implementation
• Preferential procurement performance targets
  should be incorporated into performance
  contracts of staff & committees
• Preferred BEE supplier database should be
  created
• Monitoring & reporting should be implemented


                       53
54
                 HOW DOES IT ALL FIT?

            3-5 year IDP       Medium-Long Term Strategy


                            MTIEF Review
Budgets
                 MTIEF
Sectoral                     Gov Grants    City Development Strategy
 plans
                      IDP

Community
  input                      IDP Review




                              55
                                             RE-ENGINEERING

• Don’t reengineer but say that you are
• Do not spend a lot of time analysing
• Proceed with strong & committed leadership
• Bold & imaginative thinking
• Once decided, implement
• The wrong style of implementation = waiting to get
  all ducks neatly lined up & in a row
• Attend to the concerns of the people

Hammer, Michael. 1995. ‘The Reengineering Revolution, the Handbook’.




                                                                       56
         THANK YOU

              Dr Hein Wiese
        Strategic Executive Officer
         Economic Development
City of Tshwane Metropolitan Municipality
            Tel: 082-783-0735
         heinw@tshwane.gov.za

								
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