Presentation to the Portfolio Committee on Provincial and Local Government May 2006

1. Harmonising and aligning The National Spatial Development Perspective, Provincial Growth and Development Strategies and Municipal Integrated Development Plans Presentation to the Portfolio Committee on Provincial and Local Government May 2006 PCAS, The Presidency

2. - Better performance by the state -developmental state Make govt as a whole work better in meeting common objectives and outcomes Need for decisive, coordinated interventions to improve the state's capacity to spend & deliver services Overview and context What is the rationale for greater alignment? Need to specifically include a geographical dimension to growth and employment. PCAS, The Presidency

3. Conceptual overview and context Structured and systematic dialogue Process Coordinated and integrated action Common objectives and maximise development impact. What do we mean by alignment and harmonisation? PCAS, The Presidency

4. Approved by Cabinet in 2003 as an overarching national spatial framework with set of guidelines clearly spelling out spatial priorities of govt How does the NSDP frame the parameters for greater alignment? • Provides a geographical dimension to growth and employment and poverty – policy impact • Facilitate decisive, coordinated interventions to improve the state's capacity to spend and deliver services • Puts forward mechanisms aimed at ensuring better alignment i.t.o infrastructure investment and development programmes. PCAS, The Presidency

5. Modalities Such alignment should be guided by: • Alignment of infrastructure investment and development spending in 46 district and 6 metropolitan municipalities in accordance with the NSDP principles • The reaching of agreement on the spatial distribution of development potential and need/poverty in provinces and district/metropolitan municipalities • Reaching of agreement on socio-economic vision and development trajectory • The mutual monitoring and assessment of govt development planning and implementation. PCAS, The Presidency

6. Practical Steps • Review and update NSDP on basis of latest data and comments • Finalised guidelines on PGDS with Provinces. Guidelines to reflect link with NSDP • Team (Presidency, dplg, dti, NT, DLA, DEAT) worked with provinces to assess each PGDS against the guidelines • Team will work with Provinces to supervise the development of District/metro IDPs. PCAS, The Presidency

7. NSDP 2005/6 Strategic Purpose (issues and premise) Reading of the national space economy Alignment – current initiatives PCAS, The Presidency

8. Purpose NSDP – Assists govt to confront three key questions: • To address poverty and the challenge of economic growth and job creation, where should government direct its investment and development initiatives to ensure sustainable and maximum impact? • Given the extreme spatial disparities what kinds of spatial forms and arrangements are more conducive to the achievement of our objectives of democratic nation building and social and economic inclusion? • How can govt as a whole: • Capitalise on complementarities and ensure consistent decision-making; • Move beyond mere focusing on integration & coordination procedures to establishing processes & mechanisms to bring about strategic coordination, interaction and alignment. PCAS, The Presidency

9. key issues • Dynamic qualities of areas develop historically and culturally over long periods of time. • Social and economic development not evenly distributed –spatial disparities a normal feature of economic activity and restructuring. • In SA, spatial disparities aggravated by apartheid spatial planning – especially in terms of human settlement formation creating a disjuncture between where people live and where social and economic opportunities are concentrated. • Government plans often not spatially referenced – thus plans developed in an analytical and empirical vacuum – as apparent from discussions with provinces around PGDS and IDP hearings PCAS, The Presidency

10. 30% of land: • 93% of the national economy; • 79% of the population live; • 70% of all people living below the MLL PCAS, The Presidency

11. Theory and empirical research • Convergence between regions more successful where poor regions are functionally linked and connected to centres of economic activity – examples Uganda and Ghana • Unfocused infrastructure spending does not improve economic growth – former East Germany • Unfocused human development does not address poverty or improve incomes • South African example of locating industries in Bantustans – example of unsustainable approaches to locating jobs where people reside. • Migration to economic centres a reality – produce economies of scale, but also serious diseconomies. • Regions succeed when institutions and incentives work & institutions are locally specific. • More successful where dynamics & social, economic, env, demographic trends understood in spatial terms. PCAS, The Presidency

12. Spatial disparities: Questions / implications for policy • What types of investments are effective in poor areas with poor natural resources and economic potential? • What kinds of environments afford the poor with greater protection against shocks and to diversify incomes? • Is the aggregate impact on poverty reduction greater by focusing on areas with high poverty rates or high poverty densities? • How to overcome spatial dysfunctionalities and inefficiencies particularly where they undermine poverty eradication and retard economic growth? PCAS, The Presidency

13. NSDP premise • Primary premise – the diverse and disparate spatial contexts suggests a policy approach which is itself differentiated and conducive to the respective requirements of the different contexts – (avoid one size fits all) • Hence the people not places approach when considering regions where economic potential is low. PCAS, The Presidency

14. Reasons for the NSDP • Resources limited by the extent to which the economy can grow/redistribute them; • All government programmes involve choices about allocating limited resources; • In the absence of an explicit perspective, such choices may become ad-hoc and unfocused. PCAS, The Presidency

15. NSDP: • Seeks to focus Government’s investment on the basis of an areas potential - sustainable development • Suggests that Government’s objectives of promoting growth & alleviating poverty will best be accomplished when unique potential of regions is harnessed PCAS, The Presidency

16. NSDP: • Recommends that in areas with limited potential Government, over & above other initiatives/ constitutional obligations, should focus on social investment & HCD (HRD, labour market info and social transfers) to give people more sustainable opportunities PCAS, The Presidency

17. NSDP 2005 • The National Space Economy PCAS, The Presidency

18. POPULATION DISTRIBUTION NATIONAL SPATIAL DEVELOPMENT PERSPECTIVE 79% of the population live on 30% of the land STATS SA2001

19. Districts/metros with highestpopulation

20. INTERNAL MIGRATION:DMs & MMs with biggest in-migration NATIONAL SPATIAL DEVELOPMENT PERSPECTIVE Of the 53 district and metropolitan municipalities: 19 experienced a net in-migration of people STATS SA 2001-2006 Source: Stats SA 2001

21. INTERNAL MIGRATIONDMs with biggest out-migration NATIONAL SPATIAL DEVELOPMENT PERSPECTIVE Of the 53 district and metropolitan municipalities, 34 experienced a net out-migration of people. Table indicates 20 DMs with the greatest out-migration STATS SA 2001-2006 Source: Stats SA 2001

22. Employment Figure 5: Employment figures per provinces as percentage of Economic Active Population (2004) PCAS, The Presidency

23. Formal employment per NSDP category of economic potential as a % of formal employment

24. POVERTY DISTRIBUTION NATIONAL SPATIAL DEVELOPMENT PERSPECTIVE 70% of all people living below the MLL live on 30% of the land

25. POVERTY DISTRIBUTION PER MUNICIPALITY NATIONAL SPATIAL DEVELOPMENT PERSPECTIVE 7 6 Twenty district and metropolitan municipalities with the highest percentages of those living below MLL in the country 5 4 % of national population 3 2 1 0 Central DM Mopani DM Vhembe DM Amatole DM Zululand DM Bojanala DM Nkangala DM Ehlanzeni DM Capricorn DM Ethekwini MM Chris Hani DM Uthungulu DM Ekurhuleni MM O R Tambo DM Sekhukune DM Gert Sibande DM Umgungundlovu DM City of Cape Town MM Thabo Mofutsanyane DM City of Johannesburg MM Source: Ricon (Pty) Ltd, Regional Economic Explorer (version 190)

26. ECONOMIC DISTRIBUTION NATIONAL SPATIAL DEVELOPMENT PERSPECTIVE Economic activity is spread over the country, but bulk of the generated GVA in about 26 strong growth points

27. Top twenty contributors to total national GVA (2004)

28. 30% of land (26 core regions): • 93% of the national economy; • 79% of the population live; • 70% of all people below the MLL

29. NATIONAL SPATIAL DEVELOPMENT PERSPECTIVE Space Economy at a macro scale The space economy consists of core areas (high potential, high need) and poverty pockets (high need)

30. Space Economy at a macro scale NATIONAL SPATIAL DEVELOPMENT PERSPECTIVE … CONTINUE

31. Taking the NSDP forward • Our ability as a country to accelerate growth and reduce poverty & unemployment is tied to growth potential of regions. • Districts/metros identified as pivotal sites. • Medium-term vision is to make district/metro IDPs local expressions of the plans of all three spheres. • Seek to contextualise and apply NSDP – use NSDP mechanisms and principles to identify the potential of districts/metros • Provide government with an appreciation of the development potential and dynamics of each district/metro – basis for improving alignment and coordination – credible IDPs. • This year pilot the NSDP approach in select districts;

32. - End - PCAS, The Presidency