Water, Sewage & Effluent January February 2019 | Page 18

technology also produces benefits such as
the creation of 34 765 direct employment
opportunities per annum and a platform
for approximately 62 new emerging
contractors, each with an annual turnover
of R20 million as shown in Table 7.
3.2.2. Redistributing required funding
If the ideal situation arises, where the
full proposed funding of R89.9 billion
per annum for reticulation is spent, the
results are even more favourable. With an
estimated budget of R3.34 billion and 60%
of the work done by trenchless techniques,
the emergence of approximately 100 new
contractors in the trenchless industry,
each generating turnover of R20 million
per annum, is possible. This equates to a
market size of approximately R2 billion for
these new contractors only. This, along
with the corresponding taxable revenue
generated and the multiplier effect in
creating further employment opportunities
for others, serves as a significant catalyst
for economic upliftment across all spheres.
The economic surge will also impact
on related sectors servicing infrastructure
construction, such as consulting engineers,
product manufacturers and service
providers. Progress in the infrastructure
sector, combined with the corresponding
upsurge in business confidence, will attract
much-needed investment into South Africa
and the infrastructure market segment.
The ultimate benefactors will be
the citizens, where approximately
57 000 direct sustainable employment
opportunities can be created by the
installation of 5 248km of new pipelines,
while simultaneously reversing the
service delivery issues caused by ageing
pipeline infrastructure.
WATER INFRASTRUCTURE
Funding
Trenchless technology component
Combined pipeline installation
length (km)
Combined direct employment
opportunities created
Trenchless market value (R bil)
New contractors (R20mil/annum)
CURRENT REQUIRED
R2,05 bil R3,34 bil
10% TT 60% TT 10% TT 60% TT
2 447 3 221 3 986 5 248
26 403 34 760 43 017 56 633
0.205 1.230 0.334 2.004
10 62 17 100
Table 8: Sewer infrastructure derivatives based on NWIF funding estimates
SEWER INFRASTRUCTURE
Funding
Trenchless technology component
Combined pipeline installation
length (km)
Combined direct employment
opportunities created
Trenchless market value (R bil)
New contractors (R20mil/annum)
CURRENT REQUIRED
R1,58 bil R2,34 bil
10% TT 60% TT 10% TT 60% TT
2 592 3 303 3 839 4 892
55 942 71 298 82 851 105 593
0.158 0.948 0.234 1.404
8 47 12 70
3.3. Sewer pipeline infrastructure
spending Figure 4: Possible prosperity cycle.
The same calculation can be done for
the sewer infrastructure. By considering
the ideal situation where the budget of
R89.9 billion is spent and approximately
60% of the pipeline work is apportioned
to trenchless methods, it is possible
to produce 70 new contractors for the
sewer pipeline market. Due to the varying
depths of typical sewer installations,
these projects take longer to complete
and consume more labour resources.
Accordingly, more than 105 000 direct
sustainable employment opportunities
could be created; see Table 8. Table 9: Government response plan proposed by SASTT
4. Reversing the trend
Table 7: Water infrastructure derivatives based on NWIF funding estimates
The economic potential arising from
the use of trenchless technology, when
combined with conventional open-cut
excavation methods for both water and
sewer projects, is able to generate more
18
Authority
Action required
Address prohibitive procurement policies which inhibit innovation and
progress. Redirect funding to enable growth in the trenchless sector in
order to unlock the economic opportunity.
Empower government agencies, municipal managers and decision-
makers with regard to the innovative solutions available to them. Non-
profit organisations such as SASTT exist to promote and facilitate
Mid-level
the use of trenchless technology. As a neutral party, SASTT is ideally
positioned to facilitate engagement between government, contractors,
engineers and suppliers.
Identify work opportunities for emerging contractors to undertake minor
infrastructure works by using trenchless technology — especially within
municipalities where service delivery is problematic. These low-risk
opportunities allow for the entry of a large contingent of new contractors
Operational
into the trenchless sector. Work opportunities can be scaled up in size
level
and complexity as these emerging contractors develop and grow.
Simultaneously, other complex infrastructure projects can be identified
as trenchless work, where more experienced contractors will be able to
meet the demand.
High level
Water Sewage & Effluent January/February 2019
www.waterafrica.co.za