Minister Velenkosini Hlabisa: SIDSSA 2026
Remarks by Minister Velenkosini Hlabisa at the Sustainable Infrastructure Development Symposium South Africa 2026 (SIDSSA), Ministerial panel discussion: Reimagining municipal trading services – building financially sustainable cities through infrastructure investment, Century City Conference Centre, Cape Town 25 August 2026
Programme Director,
Ministers and Deputy Ministers,
Distinguished government leaders from South Africa and across the world, Representatives of Infrastructure South Africa,
Mayors and municipal leaders, International development partners,
Investors and development finance institutions,
Industry leaders, Infrastructure experts,
Organised business and labour,
Professional bodies,
Civil society, Distinguished guests, Ladies and gentlemen.
Good day.
It is a privilege to participate in this important discussion at SIDSSA 2026, particularly in the presence of government leaders, investors, infrastructure specialists and industry partners from South Africa and beyond. The diversity of this audience is important because the challenge before us cannot be addressed by government alone. The infrastructure challenges and opportunities facing our cities and municipalities require government, businesses, investors, development finance institutions, technical experts, and communities to work together around a common objective: building infrastructure that enables sustainable economic growth and improves the lives of our people.
Our discussion on reimagining municipal trading services and building financially sustainable cities through infrastructure investment speaks directly to that challenge. It calls on us to look beyond the traditional understanding of municipal water, electricity, sanitation, waste management and related services as simply functions that municipalities must perform. We must understand these services as economic foundations upon which our cities and towns are built.
When municipal services are consistently reliable, businesses can operate with greater certainty, industries can expand, investors can make long-term decisions and communities can participate more meaningfully in the economy. When municipal services are unreliable, the consequences extend far beyond the municipal balance sheet. They affect investment decisions, business confidence, productivity, employment, property values and the overall competitiveness of a city or region.
This is why reimagining municipal trading services is ultimately about reimagining the economic future of our municipalities.
Since the advent of democracy, South Africa has made significant progress in expanding access to basic services for the majority of our people. Millions of households have gained access to water, sanitation, electricity and refuse removal. These achievements, which represent some of the most important gains of our democratic era, must be protected. Yet we have now reached a point where the conversation must evolve. We must move from simply asking whether infrastructure exists to asking whether it is reliable, resilient, financially sustainable, and capable of supporting economic growth.
This is particularly important because municipalities are operating in an increasingly complex environment. They must respond to urbanisation, population growth, infrastructure backlogs, climate change, technological change, and rising expectations from citizens and businesses, while also confronting financial and institutional pressures. Our concern, therefore, is not simply to build more infrastructure. It is to build better infrastructure, finance it responsibly, maintain it effectively and ensure that it generates long-term public and economic value.
In South Africa, the ongoing Review of the White Paper on Local Government is particularly significant in this regard. The review provides an opportunity to rethink the architecture and functioning of local government in response to present realities and future demands. The reform process recognises that municipal sustainability cannot be achieved through financial interventions alone. We need capable institutions, professional administrations, appropriate governance arrangements, stronger accountability, better infrastructure management and financing models suited to different municipal realities.
The review process provides a platform to bring together questions of municipal finance, institutional capability, infrastructure, spatial development, service delivery and economic growth. It challenges us to create a local government system capable of attracting and managing investment while remaining accountable to the communities it serves.
The review also recognises that South Africa does not have a single municipal reality. Our metropolitan municipalities, secondary cities, intermediate cities, small towns and rural municipalities have very different economic bases, infrastructure requirements and institutional capacities. Our approach must therefore be differentiated, but our ambition must be universal: every municipality must work.
One of the most important shifts we need to make is to move from viewing infrastructure primarily as expenditure to viewing it as a long-term investment in economic productivity and public value. For investors, this means understanding municipal infrastructure not only in terms of the immediate construction project but also in terms of the broader economic ecosystem it enables.
A reliable electricity network supports industrial activity. A well-managed water system supports households, businesses and agriculture. Efficient waste management contributes to healthier and more attractive urban environments. Reliable roads and transport infrastructure connect people and businesses to markets, while digital infrastructure creates new opportunities for innovation and more efficient municipal administration.
Infrastructure therefore has a multiplier effect. But for that multiplier effect to be realised, infrastructure must be properly planned, financed, operated and maintained. This is why the conversation about investment must include the entire infrastructure life cycle. We must consider not only the cost of construction but also the costs of operation, maintenance, renewal, and eventual replacement.
South Africa's infrastructure needs are significant, and the government alone cannot provide all the capital needed to close the infrastructure gap. We therefore need to mobilise additional sources of finance, including development finance, blended finance, public-private partnerships, infrastructure bonds, institutional investment and other appropriate financing mechanisms.
The financing challenge is not simply to borrow more. It is to structure an affordable, value-for-money investment that combines grants, municipal revenues, development finance, and private capital in ways that do not impose unsustainable debt burdens on municipal balance sheets or compromise service affordability.
We also recognise an important reality: capital follows confidence. Investors need predictable regulation, credible financial information, transparent procurement, reliable revenue models, clear risk allocation and capable project management. They need confidence that municipal institutions have the capacity to manage complex infrastructure projects and honour their commitments.
This means that our objective cannot simply be to find money for projects. We must build investable municipalities. That requires strengthening municipal financial management, asset management, revenue systems, technical capability, project preparation and governance.
A technically sound project does not automatically become a bankable project. Bankability requires an enabling institutional environment in which investors can understand the risks, revenue model, regulatory framework, and long-term obligations associated with the investment.
This is where local government reform and infrastructure investment come together. Better institutions create better investment conditions. Better investment conditions attract capital. Capital supports infrastructure. Infrastructure supports economic growth. Economic growth strengthens the municipal revenue base. Stronger municipal revenues enable further investment. That is the virtuous cycle we seek to build.
We must also be frank about municipal financial sustainability. Customer debt, non-revenue water, electricity losses, billing weaknesses, deferred maintenance and growing municipal obligations all undermine the sustainability of trading services.
The solution cannot simply be higher tariffs. Financial sustainability requires municipalities to understand the true cost of providing each service, improve billing and collection, reduce losses, protect infrastructure assets and ensure that revenue generated from trading services is appropriately managed.
Councils, communities and investors need greater visibility of the costs, revenues, subsidies, losses and investment requirements associated with these services. At the same time, our approach must remain socially responsible. Those who can afford to pay for services must do so, while households that genuinely cannot afford to pay must be properly identified and supported through municipal indigent programmes.
The objective is not commercialisation for its own sake. The objective is financial sustainability in service of public value.
Investment in infrastructure must also be matched by investment in institutional capability. We cannot build world-class infrastructure and then manage it through weak systems, inadequate asset registers, poor maintenance planning or insufficient technical capacity.
Professionalisation is therefore central to our reform agenda. Municipalities need engineers, planners, financial specialists, procurement professionals, contract managers, asset managers and data specialists who can manage increasingly complex infrastructure environments.
Technology must also become central to this transformation. Digital billing, smart metering, asset management systems, predictive maintenance and data analytics can help municipalities improve efficiency, reduce losses and make better investment decisions. The objective is to move from municipalities that react to infrastructure failure to municipalities that predict, prevent and manage infrastructure risk.
Our infrastructure investment must also contribute to spatial transformation. South Africa's cities and towns cannot be sustainable if economic opportunity remains concentrated in limited areas while communities remain disconnected from jobs, markets and services. Infrastructure must help connect people to opportunities. It must support township economies, rural economies, industrial areas, logistics corridors, tourism destinations and emerging economic centres.
Reliable municipal services, serviced land, functioning roads, predictable development processes and resilient infrastructure create the conditions for businesses to invest and for communities to participate in economic activity. This is where infrastructure investment becomes more than an engineering exercise. It becomes an economic development strategy.
Climate resilience is another important consideration. Climate change is already affecting infrastructure planning and municipal finances through flooding, drought, extreme heat and other climate-related events. Resilient infrastructure is therefore not simply about protecting the environment. It is about protecting investments, municipal balance sheets and economic activity. When we invest in infrastructure today, we must ask whether it will remain fit for purpose decades from now.
The scale of the challenge before us demands partnerships. The government has a critical role in creating the policy, regulatory, and institutional environment in which investment can take place. Investors and the private sector bring capital, technology, innovation and expertise. Development finance institutions help structure projects and manage risk. Professional institutions provide technical capability. Communities remain central stakeholders in determining whether infrastructure ultimately creates meaningful public value.
Our approach must therefore be one of partnership rather than working in silos. But partnerships must also be responsible. They must be transparent, protect the public interest, allocate risks appropriately, safeguard affordability and public assets, and be structured around measurable outcomes.
South Africa's municipal infrastructure landscape is diverse, and with that diversity comes a range of investment and partnership opportunities. Some municipalities may be better positioned for large-scale public-private partnerships, while others may require development finance, grant funding, blended finance or regional approaches to achieve the necessary scale. Our responsibility as government is to create the conditions in which those opportunities can be responsibly developed and translated into sustainable infrastructure and economic value.
Ultimately, all of this brings us back to one central objective: making every municipality work.
A municipality works when infrastructure is reliable, finances are sustainable, officials are capable, councils exercise effective oversight, revenue is collected fairly, suppliers are paid, procurement delivers value for money and communities, and businesses can depend on the services they receive.
For government, this is a constitutional responsibility. For communities, it is about dignity and quality of life. For businesses, it is about certainty and productivity. For investors, it is about confidence and long-term opportunity.
These interests are not contradictory. They are deeply connected. A municipality that works is good for residents, good for business, good for investors and, ultimately, good for South Africa's economic growth.
This is why local government reform must be understood not simply as an internal government programme, but as an integral part of South Africa's broader economic development and investment strategy.
As I conclude, let me return to the central theme of our discussion.
Reimagining municipal trading services means recognising that water, electricity, sanitation, waste management and other municipal services are not simply functions to be administered. They are foundations upon which our economies, communities and cities depend.
Building financially sustainable cities means ensuring that municipalities can generate, manage and protect the resources necessary to operate, maintain and renew their infrastructure.
Investing in infrastructure means recognising that the right infrastructure, properly planned and sustainably financed, can unlock economic opportunity, attract investment, support businesses, create jobs and transform communities.
South Africa is therefore not simply looking for capital. We are looking for long-term partnerships that combine capital, expertise, innovation and institutional capability to build infrastructure that works and lasts.
We want municipalities that are financially resilient, professionally managed, technologically enabled, investment-ready and responsive to their communities. We want cities and towns where infrastructure is not a constraint on growth, but a platform for growth.
Let us therefore move from dialogue to partnerships, from projects to investment pipelines, and from infrastructure expenditure to long-term value creation.
Let us collaborate across sectors, integrate planning with investment, and sustain the infrastructure, institutions and partnerships that will carry our municipalities into the future.
Because ultimately, when municipalities work, economies work. When infrastructure works, investment works. And when investment works, communities prosper.
That is the future we must build together.
I thank you.
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