LED AND
STRATEGIC
PLANNING IN
SOUTH
AFRICA
March 2011
CLGF Conference (Cardiff)
SALGA
Economic Development
And Planning:
Mayur Maganlal
CONTENTS
• Introduction: Development of LED
Strategies in SA
• Strategic Planning in SA:
– Integrated Development Planning
– LED Planning
• Importance of LED Planning
• Challenges of LED Planning
• Salga focus on promoting effective LED
planning
INTRODUCTION:
DEVELOPMENT OF LED
STRATEGIES IN SA
• A history of strong centralised planning and apartheid
spatial development policies = little to no LED prior to the
1996 local government elections
• Heralding in of a new local government structure (1996) –
as an independent sphere of government in terms of the
constitution
• “Backlash” to apartheid planning has given strong impetus
to local community-based planning (governance)
• LED is now compulsory, through the Integrated
Development Planning (IDP) process
– Strong divergence between big urban (metro) and smaller urban/
rural Local Authorities, both with respect to the LED process, and
actual LED results.
– Also considerable questions around capacity to implement
STRATEGIC PLANNING IN SA:
INTEGRATED DEVELOPMENT
PLANNING (IDP)
• The IDP is an strategic development plan for a the 5 year
Mayoral Term and is reviewed annually with budget cycle.
(Municipal Systems Act, 32 of 2000)
• Components of the IDP include:
– Long term strategic plan (also intergovernmental alignment)
– Stakeholder needs and political priorities (consultation)
– Sector plans (environment, LED, transport, Water Services
Development Plans)
– Intergovernmental alignment,
– Financial Plan (budget alignment and SDBIP)
– Institutional plan (HRD and governance)
– Performance indicators (basis of organisation and individual PMS)
• Provincial government provides oversight and responsible
for vertical and horizontal alignment
• Regular reporting with budget and PMS (oversight by AG
and annual report)
4
STRATEGIC PLANNING
IN SA: EVOLUTION OF
IDP’S
2nd Generation
3rd Generation
1st Generation
Aim:
• Introduce IDP in mun areas
• Inform equitable services in new
municipal entities (backlogs)
• Community participation methodology
GAP?
• Budget format
• Performance management systems
• Sector planning link to IDP
Aim:
• “Credible” IDPs across province
Shift:
• IDP as ‘whole of govt plan’
• Stronger ‘long term strategy’ in IDP
• Strengthen ward-level engagement
• Sector Department engagement
(incl. LGMTEC)
• Improve IDP-Budget link
GAP?
• Provincial investment plan
• Weak local spatial plan
• Citizens not well-connected to IDP
(local responsibility and impact)
2009 11
2001 - 2005
STABILISATION
Dec 2000 – 2002
2006 –2010
MUNICIPAL CONSOLIDATION
Jan 2003 – Dec 2010
Aim:
• Clear geographic investment plan
• IDP embedded in neighbourhoods
Shift:
• IDP ownership by leadership
• Spatial logic guides 5yr investment
per mun area by whole of govt
• Ward-neighbourhood plan with
clear service action (marginalised)
• Harness resources of partners
- business, civil society, labour
Prepare:
- Good information per mun area
- Execute participation method
- Spatial planning logic
- Ward/neighbourhood plan
2011 - 2015
SUSTAINABILITY
Dec 2010 - Beyond
STRATEGIC PLANNING
IN SA: LED PLANNING
• Constitution gives local government the responsibility to
promote social and economic development
• The 2006 LED National Framework & associated toolkit, issued
by dplg bridges many debates and provides clarification on
roles & responsibilities
• No clear indication of implementation of this National
Framework
• IDP’s and LED Plans have to be aligned to
– National and Provincial Strategies (GDS, PGDS, NSDP and more
recently the New Growth Path)
– National, Provincial and Agency plans and policies and vice-versa
IMPORTANCE OF LED
PLANNING
• Local economic development (LED) creates opportunities for
local government, the private and not-for-profit sectors and
local communities to work collectively in creating better
conditions for competitiveness and inclusive, sustainable
economic growth.
• It is also seen as one of the most important ways of
decreasing poverty and bringing together key municipal
stakeholders to promote economic growth and development.
• Strategic planning around LED focuses on key principles like:
– Creating local partnerships
– Using local resources
– Adopting a flexible approach to respond to changing
circumstances
IMPORTANCE OF LED
PLANNING
• A credible LED Strategy should include the following:
– Alignment of critical pieces of strategies and policies - As
outlined above and new growth path etc)
– Consideration of spatial issues (alignment to SDF)
– The empirical and statistical evidence to support
development thrusts: socio – economic, census and other
data (and means to unpack it)
– Consideration for the financial implications
– Must have evidence of stakeholder and community
involvement
– Objectives should be obtainable and measureable
– Timeframe for critical milestones during implementation
– Make considerations management arrangements and
SMME support (establishment of agencies and entities)
IMPORTANCE OF LED
PLANNING
• LED policies and plans will be council’s declaration of what they intend to
do to support LED in respect of:
–
–
–
–
–
–
–
Procurement
Support and development of key business sectors and types
SMME support
Creation of a conducive LED climate
LED incentives
Focus on formal and informal sectors
Other key priority areas
• Alignment of plans
– The alignment of LED with IDP
– The monitoring and appraisal of LED projects and programmes through the
PMS
– The importance of LED in the context of IGR (district, provincial and national)
– The existence of LED strategies and related implementation plans
CHALLENGES TO LED
PLANNING
Planning and alignment:
• Process for intergovernmental alignment of LED (strategy and
programmes) happens mainly at legislation level:
– Poor integration with national programmes such as EPWP, industrial
incentives, tourisms, etc
– Integration of municipal and Provincial plans
• Need for a close relationships between established business and
municipalities (increasing antagonism)
• Very little reporting and M&E in place to provide any kind of feedback and
support
• Access to data for LED limited
Content of plans
• Missing LED success factors such as:
− Market access strategies and demand versus supply side strategies
− Integration into existing value chains versus new initiatives
− An inability to correctly identify capacity constraints
CHALLENGES TO LED
PLANNING
Oversight and capacity
• LED Leadership is often not being given the political weight
and attention it deserves as one of the key priorities of local
government
• Big cities have dedicated Economic Development
departments or Units, while most smaller LAs don’t even have
a dedicated counselor
• There are some Local Municipalities that have very limited
capacity to develop effective LED strategies and implement
them
CHALLENGES TO LED
PLANNING
Quality of plans
• In poorer areas plans are still project-driven, have unrealistic targets,
strong belief that having a plan = success and limited M&E in place
to provide feedback
• Question: support and building capacity vs rethink some areas of
decentralisation
• In urban municipalities need special attention and must be
supported to understand their unique LED role in contributing to the
national economy.
• Specific interventions for urban centres will include:
– Focusing on making urban land markets work for the poor;
– Promoting more competitive city business environments and
facilitating the movement of information, people and products
within and between cities
– Promoting appropriate economic integration zones
– Market Access strategies and demand versus supply side
strategies (planning unit issue?)
– Integration into existing value chains versus new initiatives
UNDERSTANDING
ROLES AND
RESPONSIBILITIES
Macroeconomic and
Micro
economic
Trade Promotion (international, continental and local)
Incentives
Tourism
Mining, Agriculture, Forestry, Fisharies
Sector Education and Training Authorities
Transportation
Pubic Enterprises (SITA, Tourism, Small Business Support and Financing)
National Planning Commission
Police
Marketing
Broadbased Black Economic Empowerment
Labour
National Regulation (competition commission)
Provincial Agencies Interventions
Tourism
Marketing
Infrastructure
Provincial Traffic
Safety
(Traffic)
Informal
Trading
Local
Regulation
(planning,
building,
environ’tal
health, other
bylaws)
ICT Projects
SMME
Support
Infrastructure
NEW GROWTH
PATH DRIVERS
1. Address cost drivers and inflationary pressures
across the economy
2. Active industrial policy based on increasing
competitiveness and targeting sectors that can
create employment directly and indirectly
3. Comprehensive rural development
4. Stronger competition policy
5. Stepping up education and skills development
6. Enterprise development
7. Reform of Broad-Based BEE
8. Reform labour policies to support productivity and
improve protection for vulnerable workers
9. Technology policies geared to improving
innovation in ways that support employment
creation and small- and micro-enterprise
10. Developmental trade policies with a strong
orientation to new growth centres
11. Investment to support African development
SoNA:
– R9 billion in the Jobs
Fund over the next 3
years – public
employment schemes
plus subsidies to
private employers
– R10 bn from the IDC in
next 5 years for jobcreating projects
– R20 billion in
investment subsidies
– Comprehensive
support for SMEs
14
SALGA FOCUS ON
PROMOTING BETTER
LED PLANNING
• Encouraging a greater focus on LED (pro-growth
strategies) as a separate priority within IDP
• Working to establish better relationships with
established business, and better integrate them into
the planning process (business environment
surveys, forums, etc)
• Gathering and disseminating LED practices and
experiences and developing sustainable knowledge
platforms
• Support and encourage better planning and
alignment between District and Local Municipality
strategies and across spheres
SALGA FOCUS ON
PROMOTING BETTER
LED PLANNING
• Increasing alignment of national government
initiatives and the ability to access government
funding by:
− Municipalities increased participation in EPWP
(promoting labour intensive job creation)
− Municipal Tourism Development
− Access to DTI Incentives and other areas of
National Stimulus Package
• Improving technical and analytical skills at a local
level