Councils must double infrastructure spending to survive: Geordin Hill-Lewis

Metropolitan municipalities need to substantially increase their spending on infrastructure to meet present and future needs, says Cape Town mayor Geordin Hill-Lewis.

He was speaking at the second full day of the Sustainable Infrastructure Symposium South Africa 2026 (SIDSSA2026) in Cape Town on Tuesday morning.

His remarks come amid growing financial challenges at local government level that have hindering infrastructure development and service delivery, including failure to pay allocated grants for infrastructure. This prompted the National Treasury to withhold funds from some councils.

Hill-Lewis said if a city is investing at record levels but still regards that investment as the minimum required, we need to ask what level of infrastructure investment South Africa’s cities and towns across the country will require to prepare for the years ahead.

He said he had spent a lot of time studying the infrastructure budgets of every major city in the country and had developed what he believed was a helpful rule of thumb.

“I believe every major metro should be investing R10bn-R15bn every year in order to keep up with the pressure and start preparing for the size of the city that is coming,” he said.

To those who have lent to us, let me say thank you very much, and please sharpen your pencils for next time. The availability of capital is not the issue—  Geordin Hill-Lewis, Cape Town mayor

“From that rule of thumb, we have developed a budget rule that we have implemented here in Cape Town called our infrastructure budget rule. It is not law; future governments may change it if they want to, but we hope that they do not because if we stick to this budget rule of thumb we can actually make sure that our budgets cater for the future.”

According to Statistics South Africa (Stats SA), municipalities spent R532bn in 2022 on both operational and capital expenditure, published in two separate statistical releases. This equates to an average municipal expenditure of R8,572 per resident.

Hill-Lewis said if future governments stick to his budget rule of thumb, local government can make sure the budgets cater for the future.

“Once a municipality has achieved the minimum required level of investment, somewhere between R10bn and R15bn a year, that budget should grow every year by at least the combination of inflation and population growth in your city,” he said.

“So it should grow by inflation plus population. Population growth in the cities is much higher than national population growth, so it has to be a higher number.”

Minister of public works and infrastructure Dean Macpherson addresses the Sustainable Infrastructure Symposium in Cape Town on Tuesday morning. (Khulekani Magubane) He said the city had been working with stakeholders in recent years on the key determinant of success in infrastructure: project preparation, to help bolster capital from the private sector and development finance institutions (DFIs).

“It does not help simply to have big budgets. There is lots of money available for infrastructure investment in South Africa. Lots of wonderful DFI’s that are here and banks that are here, I’m sure. To those who have lent to us, let me say thank you very much, and please sharpen your pencils for next time. The availability of capital is not the issue.”

Minister of public works and infrastructure Dean Macpherson told the symposium that South Africa had 81 strategic integrated projects, comprising 263 individual projects with an estimated value of R2-trillion.

WATCH | Minister of public works and Infrastructure Dean Macpherson addresses the Sustainable Infrastructure Development Symposium 2026. Video: Khulekani Magubane pic.twitter.com/J01eCig9zr— Times LIVE (@TimesLIVE) August 25, 2026

“This includes high-value, high-impact infrastructure investments led by both the public and private sectors. Over the past 18 months, 37 projects with approximately R70bn have now been completed. And 82 projects worth R502bn are now under construction,” he said.

“A further 54 projects worth R206bn are in documentation and procurement. Infrastructure South Africa has now processed more than 500 regulatory facilitation cases and resolved nearly 90% of them, helping projects move through critical approval and permitting processes.”

Feasibility work is incomplete, funding models are uncertain, and regulatory approvals are delayed, as well as projects not being packaged in a form that investors and financiers can understand or support.—  Dean Macpherson, public works and infrastructure minister

He said South Africa did not suffer from a shortage of infrastructure ideas; too many projects fail because they are not adequately prepared.

“Feasibility work is incomplete, funding models are uncertain, and regulatory approvals are delayed, as well as projects not being packaged in a form that investors and financiers can understand or support.”

South Africa has launched a first-of-its-kind Project Preparation Big Window initiative, he said.

“Through our R600m commitment to project delivery support, Infrastructure South Africa is now helping public institutions transform promising concepts into bankable, investment-ready projects.

“The first big window received 277 submissions, with an estimated capital value of R322bn. Infrastructure South Africa is now providing preparation support to more than 26 projects with an estimated value of nearly R150bn.”

Minister of co-operative governance and traditional affairs Velenkosini Hlabisa told the symposium that local government would require reform in trading services, building sustainable cities and partnerships across sectors and value chains.