cont e nts

I N T R O D U C T I O N . . . . . . . . . . . . . . . . 4
O B J E C T I V E S O F T H E S U M M I T . . . . . . . . . 5
B A C K G R O U N D . . . . . . . . . . . . . . . . . 6
M E T H O D O L O G Y . . . . . . . . . . . . . . . . 6
D I S T R I C T S N A P S H O T . . . . . . . . . . . . . . 7
D E L I V E R Y O F B A S I C S E R V I C E S . . . . . . . . 10
Water . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Sanitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
Electricity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
I M P R O V E P U B L I C S E R V I C E S . . . . . . . . . 2 0
Health . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
HIV & AIDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Education . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Skills Upgrading . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Transpor t . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
J O B C R E A T I O N A N D
L I V E L I H O O D O P P O R T U N I T I E S . . . . . . . . 2 8
Livestock Farming . . . . . . . . . . . . . . . . . . . . . . . . 29
Dryland Farming and Irrigated Hor ticulture . . 29
Forestry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Manufacturing . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Construction And Mining . . . . . . . . . . . . . . . . . . 31
Trade and Business Services/ict . . . . . . . . . . . . . 31
Tourism . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
B U I L D A N D M A I N T A I N I N F R A S T R U C T U R E . . 3 2
Strategic Infrastructure Project:
Kei Development Corridor . . . . . . . . . . . . . . . . 37
F I G H T P O V E R T Y . . . . . . . . . . . . . . . 4 0
M U N I C I P A L C A P A C I T Y A N D C O O P E R A T I O N . . 41
C O N C L U S I O N . . . . . . . . . . . . . . . . . 4 4
A C R O N Y M S . . . . . . . . . . . . . . . . . . 4 6
G D S A G R E E M E N T . . . . . . . . . . . . . . 4 8
3
4
Building on the results of the National Growth and
Development Summit in June 2003, government
proposed that all District and Metropolitan Mu-
nicipalities hold Growth and Development Summits
(GDS) in their area of jurisdiction.
The summits should provide oppor tunities for
building par tnerships with social par tners by bringing
together representatives from the broadest sections
of society: labour, business, community sector and
government (local, Province and national).
I NT RODUC T I ON
Government has identifed district and metropolitan
areas as the pivotal sites on which to build an
understanding of the nature and distribution of
regional economic potential across the country.
Collaborative action between government and
social par tners across all the three spheres is vital in
forging a common vision for promoting rising levels
of growth, investment, job creation, and people-
centred development.
5
The aim of the GDS is to reach broad agreement on:
A development path and development programme
for the district and
What each social par tner (government, business,
labour and community sector) should contribute to
the implementation of the programme.
Strengthening the strategic thrust of the district IDP
to ensure planning and implementation alignment
between the spheres of government, as well as
public entities
In this regard the GDS should seek to address the
following specifc questions and issues:
1. The OR Tambo Districts economic potential and
which sectors of the economy should be promoted
(this would need, where applicable, to be informed
by the IDP, LED and the RIDS)
2. Commitments by government, business, labour
and community sector to ensure investment in
each of the sectors
3. Actions required by government and each par tner
to deal with constraints to such investments,
including dealing with bureaucratic delays, EIA
processes and land use management
4. Social and economic infrastructure programmes
required to improve investments and provide basic
services to communities
OBJ E C T I V E S OF T HE S UMMI T
5. Contribution by each par tner to the construction
of such infrastructure, including possibility of PPP
6. Second Economy interventions (EPWP including
roads & ECD, co-operatives, micro-credit,
procurement, land reform, etc) and the role of
each sector in such interventions
7. Promoting local procurement what interven-
tions are required?

8. Improving capacity of local government and
contribution of each social par tner: including role
of public sector unions in ensuring effciency, role
of all in fghting corruption, contribution by private
sector and professionals to skills required by the
district/metro
9. Establishing a par tnerships and/or regional growth
coalitions which will act as a mechanism for coop-
erative action at all levels and a robust framework
for monitoring and evaluating progress
6
The document presents the socio-economic
dynamics of the OR Tambo District Municipality.
It is a resultant of a consultative process involving
a number of stakeholders and interest par ties
within the district. The stakeholders were required
to compile their respective interpretations of
the economic conditions and social elements
of the district, and an attempt has been made
at synchronising, aligning and harmonising their
inputs.
In this compilation, the information presented is an
effor t to achieve the following objectives:
To ensure that discussion on the above issues takes
place on an informed basis
To present a coherent picture of the social, demo-
graphic, and economic profle and service levels of
the area
To present a picture of the challenges facing local
government especially in relation to capacity
To suggest the mechanisms & processes for moni-
toring progress on the decisions reached and the
governance framework for ongoing dialogue and
feedback among social par tners.
The district GDS presents a unique oppor tunity
for constructing par tnerships and harnessing the
collective energies and contributions of a range of
actors and role players with a view to enhancing
accelerated and shared growth.
The district GDS has the potential to unlock the
potential of all locali ties, and ensure that all sectors
of society identif y their role and contribute to the
common national objective to build a better life
for all .
This profle for OR Tambo is based on a number of
documents and information from a range of sources.
These broadly include the following:
ECSECC data, publications and repor ts
Monitor Group repor t
District and local municipal IDPs (& other offcial
documents)
Data from the Rapid Assessment of services in the
Eastern Cape conducted in 2006)
Various research repor ts
B ACKGROUND
ME T HODOL OGY
7
The OR Tambo District stretches from the Indian
Ocean coastline in the southeast (the Wild Coast)
to the Mahlahlane and Basiya mountains in the west,
and from the Umthamvuna River in the nor th to the
Mbashe River in the south. The entire District was
par t of the former Transkei Bantustan.
DI S T R I C T S NA P S HOT
8
The District has a population of about 1.7 million
people. The District is rather densely populated (more
than 100 people per square kilometre, predominantly
rural (93%), with dispersed homesteads (making
basic services provision expensive). Access to basic
services such as potable water, sanitation, electricity
and access roads is relatively low. Sewage fows
into the Mthatha and Tsolo rivers, and outbreaks of
cholera and typhoid occur.
The GGP per capita of the District is only 30% of
the Provincial average, and rates of unemployment
and pover ty are very high. Rates of economic
growth are low and the District lacks an economic
hub. Private sector activity is largely restricted to
the trade sector and a small timber industry. Private
investment in the District is hindered by a backward
(communal) land tenure system and a physical
planning system still in its infancy (the District will
fnalise its Spatial Development Framework later
this year, and this will form the basis of a land-use
management system).
On the other hand, because of its pover ty profle,
the District was, and is, a focus of many State
development initiatives. These include:
Wild Coast SDI
Presidential Project Team (in the 1990s)
Integrated and Sustainable Rural Development
Programme (ISRDP)
Urban Renewal Programme (Ngangelizwe)
Increasing fscal allocations to address infrastructure
backlogs
Project Consolidate
Proposed N2 Toll road
Proposed Pondoland National Park
Kei rail
PGDP Massive Food Programme
Proposed AsgiSA programmes, such as Forestry
Cluster, Umzimvubu Irrigation Project, biofuels, call
centres etc
Ntinga OR Tambo Development Agency
DEAT programmes (Working for Tourism, Working
for the Coast, Working on Waste, Sustainable land-
based livelihoods. Total annual budget presently
nearly R150 million).
The District is divided into seven local municipal
areas, each with at least one urban service centre:
King Sabata Dalindyebo (Mthatha and Mqanduli),
Nyandeni (Libode), Por t St Johns, Mhlontlo (Tsolo
and Qumbu), Ntabankulu, Mbizana and Qaukeni
(Flagstaff and Lusikisiki).
9
The eight municipalities of OR Tambo had a
combined capital expenditure budget of R692
million in 2005/06. This amounts to a capex per
capita of R412, slightly below the provincial average.
70% of this total capex is budgeted by the District
Municipality. One municipality (PSJ) has a capex
budget of just R1 million. 93% of the total capex
budget is to be funded from grants and subsidies.
This is the highest ratio in the Province.
The combined municipalities have an operating
budget of R718 million, equivalent to R428 per
capita, which is very low by provincial standards.
54% of operating revenue is grants and subsidies
(much higher than provincial average). Income
from proper ty rates accounts for nearly 10% of
total operating revenue. 84% of total rates income
is budgeted to come from King Sabata Dalindyebo
(KSD) Municipality. Personnel costs account for
about 45% of budgeted operating expenditure
(above average). KSD accounts for 42% of budgeted
personnel costs. The District Municipality accounts
for 23% of total personnel costs.
To address Provincial development challenges
and oppor tunities, the Provincial Growth and
Development Plan (PGDP) was launched in 2004,
and PGDP fnds expression in all the Districts
IDPs. More recently, AsgiSA has been launched
to accelerate economic growth throughout South
Africa. The present document aims to outline the
elements of a development strategy for the OR
Tambo District. Specifcally, this document considers
how to:
Speed up delivery of basic services
Improve public services (schools, clinics etc)
Create jobs and livelihood oppor tunities
Build and maintain infrastructure
Fight pover ty
Augment Municipal capacities and co-operation
10
This section briefy outlines service delivery with
respect to water, sanitation, electricity and housing,
drawing mainly on a provincial household survey
conducted in 2006 (RSS). These trends are evaluated
against the benchmark of the 2001 census.

WA T E R
The percentage of households in Or Tambo still
relying on natural water sources (62%) is more than
twice the provincial Average of 28%. Households
in Mbizana (94%), Qaukeni (82%) and Nyandeni
(66%) refect the highest levels of those suffering
the vulnerability of natural water sources. All of the
remaining local municipal areas are well above the
provincial average and suggest a crisis in household
water access within the district if RDP standards are
used as the norm.
DE L I V E RY OF B A S I C S E RV I CE S
Water access by household for the Eastern Cape
and local Municipalities in OR Tambo for 2001 - 2006
Water on Site Borehole/Tank Community Stand Natural water/dam Water Vendor/other
Census
2001
RSS 2006
Census
2001
RSS 2006
Census
2001
RSS 2006
Census
2001
RSS 2006
Census
2001
RSS 2006
% % % % % % % % % %
Eastern Cape 37.4 41. 8 4. 0 3. 8 25. 3 25.1 31.4 28. 0 1.9 1.4
O. R.Tambo 10. 0 10. 2 5.9 4.1 17.9 21.1 64.1 62.4 2.1 2. 2
Mbizana 2.9 0.7 2.9 0. 0 14.9 3. 8 77.6 94. 2 1. 8 1. 2
Ntabankulu 3.4 2. 3 3.7 9.7 16.1 44. 5 75. 0 43. 5 1. 8 0. 0
Qaukeni 8. 0 4.1 3. 8 1. 0 13. 8 12. 6 72.4 81.9 2. 0 0.4
Por t St Johns 5.7 6. 5 5.1 2.7 13.7 39. 2 73. 8 50. 8 1.7 0. 8
Nyandeni 3.9 9. 3 7.4 5. 8 18.7 18. 0 67. 2 66. 0 2. 8 0.9
Mhlontlo 6.4 5. 3 5.7 7.1 27. 5 27.9 58.7 46. 8 1.7 12.9
King Sabata
Dalindyebo
24.1 27. 8 8. 5 5. 3 18.6 21. 8 46.4 44.1 2.4 0.9
Source: SSA 2001 and RSS 2006

S A N I T A T I O N
Investments in household sanitation in the OR
Tambo district over the period 2001 2006 have
clearly not yet begun to address the needs of local
households. Every local municipality in Or Tambo is
way above the provincial norm (22%) for households
not having any formal sanitation and way above RDP
requirements.
Type of sanitation by household for
local municipalities in OR Thambo and the Eastern Cape for 2001 2006
Flush Toilet
(connected to sewerage system)
Flush Toilet
(with septic tank)
Chemical Toilet
Pit Latrine
(with ventilation)
Pit Latrine
(without ventilation)
Bucket Latrine None
Census
2001
RSS 2006
Census
2001
RSS 2006
Census
2001
RSS 2006
Census
2001
RSS 2006
Census
2001
RSS 2006
Census
2001
RSS 2006
Census
2001
RSS 2006
% % % % % % % % % % % % % %
Eastern Cape 30.9 31.1 2. 2 1. 3 2. 0 0.6 5.6 7. 2 23.1 33.9 5.6 4. 0 30.6 21. 8
O. R.Tambo 7.4 5. 8 0.9 0. 5 2. 8 0.4 6. 0 11. 0 29.9 44. 0 1.4 0.4 51. 6 38. 0
Mbizana 1. 5 0. 0 1.1 0. 0 5. 6 0. 0 7. 5 0.7 44. 8 70. 5 0.7 0. 0 38.7 28. 8
Ntabankulu 1.4 0. 5 0.7 0. 5 2.7 0. 0 3. 5 2. 3 24. 6 29. 2 2. 0 0. 6 65. 0 67. 0
Qaukeni 2. 6 0. 0 1. 0 0.7 3.1 0. 0 5. 5 10. 0 40.4 61.4 1. 8 0. 6 45. 6 27. 3
Por t St Johns 2. 8 0. 0 1.7 0. 0 2. 0 0.4 1.7 35. 5 16.7 39. 0 1. 2 0.4 73.9 24.7
Nyandeni 2. 0 0.4 0. 8 0. 0 1.9 2. 0 4.7 8. 2 28. 2 37. 5 0. 6 0. 0 61.7 51.9
Mhlontlo 2. 2 0. 0 0. 5 0. 0 3.7 0. 0 9. 2 11. 8 31.9 46. 8 1. 6 0. 0 50.9 41. 5
King Sabata
Dalindyebo
22.7 24. 8 0.7 1.1 1.7 0. 3 7.1 13.1 22.1 24. 2 1.7 0. 2 44. 2 36.4
Source: SSA 2001 and RSS 2006
11
12
T H E C O S T S O F E L I M I N A T I N G B A C K L O G S
The estimates for eliminating the backlogs for water
and sanitation are pegged at R1 billion. Almost all
of these backlogs are rural (98% for water and 94%
for sanitation). The greatest propor tion of water
backlogs in OR Tambo are in Mbizana (21%), KSD
(19%) and Nyandeni (18%). The remaining local
municipalities all account for at least 10% of the backlog
each reinforcing the point that the district as a whole
suffers from under investment in household water
access. In terms of sanitation backlogs Qaukeni (19%),
Mbizana (18%) and KSD (17%) recorded the greatest
proportion overall.
costs of eliminating backlogs for Water and sanitation
Category Water Sanitation
R % R %
Mbizana Urban 2 362 950 4 291
Rural 194 813 550 186 293
Total 197 176 500 21.0 190 584 17.9
Ntabankulu Urban 4 145 850 5 413
Rural 87 228 450 102 637
Total 91 374 300 9.8 108 050 10.1
Qaukeni Urban 2 023 650 5 269
Rural 114 043 550 191 563
Total 116 067 200 12.6 196 832 18. 5
Por t St Johns Urban 645 750 3 761
Rural 95 996 550 61 690
Total 96 642 300 10.3 65 451 6.1
Nyandeni Urban 4 082 850 5 330
Rural 160 231 950 160 887
Total 164 314 800 17. 5 166 217 15.6
Mhlontlo Urban 0 2 610
Rural 97 245 450 151 400
Total 97 245 450 10.4 154 010 14.4
King Sabata Dalindyebo Urban 2 511 000 41 881
Rural 171 647 550 143 742
Total 174 158 550 18.6 185.623 17.4
O. R. Thambo Urban 15 772 050 1.7 68 555 6.4
Rural 921 207 050 98. 3 998 212 93.6
Total (approx. R 1 billion) 936 979 100 1 066 767
13
C L E A R I N G T H E B A C K L O G
According to DWAFs National Information System
for Water Services (accessed on the DWAF web
site, October 2006), it will require R 1 billion to
eradicate the water supply backlogs and R700m to
eradicate the sanitation backlog. This will mean an
annual expenditure of R500m to achieve the 2008
water supply target and an additional R175m per
year to achieve the 2010 sanitation target.
In the next fnancial years, the Municipal Infrastructure
Grant (MIG) will allocate:
R295 million for 2006/2007
R363 million for 2007/2008
R380 million for 2008/2009

Even if the total of R 1. 6 billion was used by
municipali ty for basic services and infrastructure
investment in the water and sani tation areas, this
amount falls far shor t of that necessary to meet
the required targets. There are also many other
areas that make f inancial demands on MIG funds
(roads, stormwater, electrici ty, waste management,
communi ty facili ties, etc).
E R A D I C A T I N G T H E B U C K E T S Y S T E M
Bucket sanitation has never been widespread in
OR Tambo and consequently bucket eradication is a
relatively insignifcant priority in terms of sanitation
investments in the District.
Municipality Total No of Buckets Approx Value to
Replace (R000)
1,011 9,099
Mbizana 0 0
Ntabankulu 735 6,615
Qaukeni 0 0
Por t St. Johns 0 0
Nyandeni 0 0
Mhlontlo 276 2,484
King Sabata
Dalindyebo
0 0
O. R. Tambo District
Municipality
0 0
Source: DHLGTA September 2005
14
M U N I C I P A L I N F R A S T R U C T U R E G R A N T ( M I G )
The National Government provides infrastructure
subsidies to ensure that all households have access to
a basic level of infrastructure services. The benefts
of this intervention are well known, par ticularly
in relation to the public good characteristics of
many municipal services. The key objectives of the
Municipal Infrastructure Grant are to:
fully subsidise the capital costs of providing basic
services to poor households: this implies that
priority must be given to meeting the basic
infrastructure needs of poor households, through
the provision of appropriate bulk, connector and
internal infrastructure in key services;
distribute funding for municipal infrastructure in an
equitable, transparent and effcient manner, which
supports a co-ordinated approach to local development
and maximises developmental outcomes;
assist in enhancing the developmental capacity
of municipalities, through suppor ting multi-year
planning and budgeting systems; and,
Provide a mechanism for the co-ordinated pursuit
of national policy priorities with regard to basic
municipal infrastructure programmes, while
avoiding the duplication and ineffciency associated
with sectorally fragmented grants.
An amount of over R1.6bn in MIG funding has been
allocated within the OR Tambo District over the
current medium term expenditure framework. Of
this amount, approximately R646m is allocated to
addressing water infrastructure requirements, and
over R323m is allocated to sanitation. The balance
of just above R100m is allocated to other social
infrastructure services.
The allocation of the MIG in OR Tambo suggests a
concer ted effor t to address the social infrastructure
backlogs in the District. However, given the
magnitude of the backlogs in some of the local
municipalities (see earlier section on improving
social services); these signifcant infrastructure
allocations are necessary but not suffcient to
eradicate the backlogs in line with Provincial and
National targets.
The OR Tambo District Municipality has identifed
and prioritised the following water and sanitation
projects that are listed below.
water and sanitation projects: ortdm
Projects Strategy/Activity Amount Time Frames Responsible Department
Water
Umzimvubu Dam Feasibility Study R300 million 2007 2026 Premiers Offce
Rural Water Supply
(backlog removal)
Three-year Infrastructure Plan 2007 2014 ORTDM / DPLG
Regional Water Scheme (bulk) Master Plan R6 billion
Not
established
ORTDM
Ten Towns
Refurbishment Programme
Ten Towns Audit Repor t R100 million
Not
established
ORTDM
Working for Water Programme Three-year Action Plan R7 million 2007 2009 DWAF
Zaulu Hill Dam
Feasibility Study
BP Preparation
R11 Million 2007 2011 DWAF
Sanitation
Rural Sanitation Three-year Infrastructure Plan 2007 2016 ORTDM / DPLG
Ten Towns
Refurbishment Programme
Ten Towns Audit Repor t R400 million
Not
established
ORTDM
OR Tambo District Municipali ty, 2007
15
E L E C T R I C I T Y
Except for KSD (70%) the remaining local municipalities
in OR Tambo fall signifcantly below the provincial
average for those who have access to electricity at
least for lighting (67%), worst off is Ntabankulu with
only 18% of households using electricity for lighting.
As is the case in the rest of the country, electricity
supply nation-wide from ESKOM cannot increase
signifcantly until the new R40bn power stations come
online in 2010. It is therefore quite unlikely that there
will be any further electrifcations in OR Tambo until
the stability of power supply has been sorted out by
ESKOM. There is a good opportunity for ESKOM or
ay other service provider (if possible) and exploit the
hydro-electric potential of the Mzimvubu Dam and
Catchment area.
energy sources for lighting in the Eastern Cape
and local Municipalities in OR Tambo for 2001 - 2006
Electricity Gas Paraf n Candles Solar and other
Census
2001
RSS 2006
Census
2001
RSS 2006
Census
2001
RSS 2006
Census
2001
RSS 2006
Census
2001
RSS 2006
% % % % % % % % % %
Eastern Cape 49.7 67.1 0. 3 0.4 23. 3 14. 0 25.9 18. 3 0. 8 0. 2
O. R.Tambo 28.1 49.6 0. 3 0. 2 12.1 8. 0 58.4 41.6 1. 2 0. 5
Mbizana 25. 0 37. 0 0. 3 0. 0 2.9 4.1 69.7 57.7 2.1 1. 2
Ntabankulu 14. 5 18.4 0.1 0. 0 3.4 1. 8 80.1 79.4 1.9 0. 5
Qaukeni 13. 6 42.7 0. 2 0.4 8. 0 5. 8 76. 3 50. 0 1. 8 1. 0
Por t St Johns 17. 2 45.6 0. 3 0.4 10. 5 1.9 70. 8 52.1 1.1 0. 0
Nyandeni 32. 2 58.4 0. 2 0. 2 11. 5 19.7 55. 0 21.7 1. 0 0. 0
Mhlontlo 30.1 47.1 0. 2 0.6 8. 8 2.4 60. 0 49.1 0.9 0.9
King Sabata
Dalindyebo
41.7 70.1 0.4 0. 2 24. 3 11. 5 33.1 18.1 0. 6 0. 2
Source: SSA 2001 and RSS 2006
16
H O U S I N G
The provision of formal housing for low and
middle income residents is a core function of local
municipalities. Within the urban areas, housing
development is generally occurring, however,
within the rural or communal areas, the provision
of housing is only beginning to be addressed.
The primary constraint with regards to the provision
of housing in rural areas relates to issues around
land ownership and registration of title. The current
housing regulations also fail to make provision for
adequate land for making food gardens that these
poor households need for survival.
With the promulgation of the Communal Land
Rights Act the process of addressing problems
surrounding land rights commenced. The table
below provides an insight on the current status of
housing delivery in the District.
level of informal housing
Census 2001 RSS 2006
% %
Eastern Cape 10.9 5.7
O. R.Tambo 2.7 1.1
Mbizana 1.6 1.1
Ntabankulu 1.6 0.7
Qaukeni 2. 3 1. 8
Por t St Johns 1. 2 2. 3
Nyandeni 1. 5 0. 0
Mhlontlo 4. 2 0. 0
King Sabata Dalindyebo 4.6 2. 0
Source: SSA 2001 and RSS 2006
Low-cost housing backlogs are less prevalent than
those for water and sanitation in OR Tambo, and
the oppor tunities provide good stimulus for local
economic activity.
There is an obvious link between housing plans and
existing backlogs with the EPWP and its related
forward-backward linkages to the construction and
mining/quarrying industry and job creation.
17
18
C U R R E N T M U N I C I P A L H O U S I N G P R O J E C T S
The projects listed below are currently implemented
and were approved in the previous fnancial years.
No new funding to be allocated until completion of
the currently implemented projects.
Committed funds to be utilised to complete the
existing project.
For 2007/08 only one new project to be fnanced
i.e. Urban Renewal Upgrading Project
(NGANGELIZWE Breaking New Ground)
Local
Municipality
Project
Total
Units
Units Units Total Budget
Expenditure
To Date
Date Of Approval Subsidy Quantum
KSDM Mpeko
Eager ton
Lindile
Preston
Upper Centule
Upper Tabase
Old Payne
New Payne
Kwenxurha
Ndlunkuku
Ntshabeni
Ncambele
Ngqwala
Zidindi
Waterfall Phase 4
Waterfall Cons Phase 1
Waterfall Cons Phase 2
Zimbane Valley
Ilitha
Zimbane Kuyasa
Maydene Farm
Mqanduli
250
450
350
400
300
300
300
300
300
300
300
300
300
300
450
500
495
1482
463
477
969
500
244
370
299
354
137
160
150
46
196
44
281
0
123
73
393
488
0. 00
635
0
13
889
500
7
80
51
46
163
140
150
254
104
256
19
300
177
227
57
12
495
847
463
464
80
0
5 428 493. 22
10 925 417. 00
7 211 452. 00
9 223 193. 00
9 623 454. 00
9 639 253. 00
9 629 503. 00
11 000 361.79
9 539 192. 00
10 758 016. 00
9 506 227. 00
11 460 117. 00
9 931 437. 58
9 090 621. 03
8 853 000. 00
9 700 000. 00
0. 00
44 422 600. 00
18 506 125. 00
7 155 000. 00
16 731 050. 00
8 437 500. 00
5 585 745.94
8 883 663.19
7 198 976.44
8 531 493.90
7 609 650. 86
7 312 486. 51
7 674 280. 53
57 476. 00
7 871 217. 20
3 256 393. 23
8 420 118.48
0. 00
6 987 244.62
4 214 066. 34
8 758 950. 00
5 450 000. 00
0. 00
21 990 012. 34
12 571 329. 32
4 830 281. 33
15 818 375. 00
8 437 500. 00
21/09/2002
21/09/2002
21/09/2002
21/09/2002
09/07/2004
09/07/2004
09/07/2004
09/07/2004
09/07/2004
09/07/2004
09/07/2004
09/07/2004
09/07/2004
09/07/2004
01/09/1999
23/03/2000
25/09/2002
13/06/1996
23/04/1998
19/01/1999
20 300. 00
20 300. 00
20 300. 00
20 300. 00
25 800. 00
25 800. 00
25 800. 00
25 800. 00
25 800. 00
25 800. 00
25 800. 00
25 800. 00
25 800. 00
25 800. 00
15 000. 00
8 000. 00
16 000. 00
15 000. 00
15 000. 00
15 000. 00
Nyandeni Hadini
Libode Rl 3
Ngqeleni Ext4
800
500
420
371
0
69
429
500
351
22 141 206. 00
14 684 250. 00
11 086 926. 30
15 170 199. 06
5 390 308. 00
6 064 988.17
21/09/2002
19/01/1998
20 300. 00
15 000. 00
Por t St
Johns
Psj Rural (Caguba)
Mthumbane Township
Psj Rural (Caguba & Maneng)
200
425
1000
195
383
1000
5
42
0
6 008 370. 00
14 141 250. 00
26 937 000. 00
5 998 370. 00
6 595 319. 50
26 937 000. 00
21/06/2005
17/10/1997
20/08/2003
25 800. 00
15 000. 00
23 100. 00
Mhlontlo Qumbu Ext 5
Tsolo
504
425
179
425
325
0
11 322 398. 00
6 360 000. 00
8 468 590.62
5 624 747.11
14/07/1998 15 000. 00
Qaukeni Nkozo
Mantlaneni
Flagstaff
Lusikisiki
300
300
503
1117
116
76
241
1117
184
224
262
0
9 262 555. 00
9 412 555. 00
13 708 753.66
18 430 500. 00
5 439 595. 57
4 758 954.45
8 623 826. 07
17 162 149.41
09/07/2004
09/07/2004
01/06/2000
12/12/1997
25 800. 00
25 800. 00
16 000. 00
15 000. 00
Ntabankulu Ntabankulu Ext 5 471 113 358 12 254 424. 00 10 851 746.65 01/04/2000 16 000. 00
Mbizana Mbizana Ext 3
Mbizana Ext 4
188
800
0
400
188
400
4 850 400. 00
24 023 687. 00
4 368 300.60
16 386 174. 34
19/08/1999
28/01/2004
16 000. 00
23 100. 00
Total 17739 10079 7660 441 890 060.60 309 299 530.80
19
In conclusion, the housing backlogs need to be
understood in the context of the predominantly rural
nature of the OR Tambo District. Informal housing
1

does not include rural dwellings, and therefore
although the District has a very low informal housing
problem, it has a huge rural housing problem
underscoring the continued need for RDP housing in
rural communities.

1
Informal housing is defned as shacks, and other
non-concrete structures in urban centres.
20
The data in the table below are perceptions of those
surveyed in the RSS survey in 2006
i mp rov e p ubl i c s e rv i ce s
Access to
Clinics
Access to
Primary Schools
Access to Roads
in good Condition
Access to
Ambulance Services
Informal
Housing
% % % % %
Mbizana 54. 0 92.4 51.7 26. 8 0.7
Ntabankulu 36.7 77. 3 17. 6 32. 0 0.4
Qaukeni 69.1 72.1 46. 0 31.4 1. 8
Por t St Johns 38. 8 88. 5 27.7 22.7 2. 3
Nyandeni 62. 2 87. 3 9. 5 39. 0 0. 0
Mhlontlo 44.4 89.1 15. 0 32. 0 0. 0
King Sabata Dalindyebo 86.6 89. 5 22.4 62.1 2. 0
Source: RSS 2006
H E A L T H
Access to health care has improved considerably in
the OR Tambo However, major challenges remain.
There are 169 clinics in the District resulting in a
ratio of 10 300 people per clinic. According to
national norms of one clinic per 10 000 people, the
OR Tambo District has less clinics than are needed.
The distribution of human resources at health facilities
across the District is however, biased in favour of
the larger centres. The national average fgure for
nurses per 100 000 people, is 12 nurses. OR Tambo
appears to be under-resourced showing fgures like
4. 5 nurses per 100 000 people, and in some areas (
Ntabankulu) as low as 2.7 nurses per 100 000 people.
Repor ted access to health care is greater in KSD,
Nyandeni and Qaukeni, and lowest in Ntabankulu
and Por t St Johns.
21
H I V & A I D S

OR Tambo District had an antenatal prevalence
rate
1
of 33. 8% in 2004, up from 23.6% in 2002,
which is above the provincial average for the Eastern
Cape (28.03% in 2004). It can be assumed that
remnants of the Apar theid migrant labour system
play a role in this high prevalence rate. HIV is of ten
more prevalent in mobile populations, and migrant
workers return to their homes when they are ill.
This will increase both the number of new infections
and the total number of people living with HIV in
the district.
HIV Prevalence
in OR Tambo district
2002 2003 2004
2

OR Tambo 23.60 % 29. 20 % 33. 80 %
Eastern Cape 23.60 % 27.10 % 28. 03 %
Source: Dept of Heal th antenatal survey, 2004
Estimates for the total population of the Eastern
Cape, estimate that 10% of the total population
is HIV positive, and 19.2% of adults (20-64 years)
(ASSA 2003 Model). For the province as a whole,
women have higher HIV prevalence than men, the
African population is at higher risk, and the epidemic
is growing fastest among youth (15-25 years). It is
particularly young women that become infected.
Prevalence for males exceed that of women in the
30-34 age group (ECAC, 2005). Early sexual debut,
age difference between partners and transactional
relationships is reported to plan a role in driving the
epidemic (ECAC, 2005). Hence, prevention programs
should be targeted towards young people.

1
Antenatal prevalence refers to the percentage of pregnant women attending
public clinics who test posi tive for HIV. Data is only available per district, and
i t is dif fcul t to extrapolate this data for the entire population.

2
Eastern Cape Depar tment of Heal th has not yet made the provincial 2005
Antenatal survey available.
22
According to the HSRC 2003 household survey,
HIV prevalence is generally higher in urban informal
and urban formal settlements and lower in farm
and tribal settlements. There is not a signifcant
difference in HIV prevalence among those working
and those unemployed, however, HIV and AIDS is
still closely linked to pover ty in its many dimensions.
The epidemic in the province is expected to reach
a peak by 2010, at about 16% of the population,
before the number of new infections even out
(ECAC, 2004).
Knowing your status is an impor tant weapon in
curbing the spread of HIV. Most public clinics offer
Voluntary Counselling and Testing (VCT) and in
2006 69. 26% of those attending public clinics opted
for VCT (men and women). Only 24. 53% of males
who visited clinics opted for VCT. However this
fgure does not tell us about the percentage of the
total population who have undergone VCT, the
quality of the services, or whether patients came
back to get their results.
VCT Test rate (% of people
attending clinics undergoing VCT)
%
OR Tambo DM King Dalindyebo LSA 65.92
Mhlontlo LSA 75.97
Nyandeni LSA 68.41
Qaukeni LSA 66.73
Total 69. 26
Source: District Heal th Information System, January 2006
The Nelson Mandela Academic Hospital in opened
in Mthatha in 2004, and provide the people of the
district with a new state of the ar t ter tiary health
facility, albeit with some challenges. The hospital
is one of the provincial sites piloting the use of
telemedicine. The HIV and AIDS centre at Walters
Sisulu University (WSU) is a resource beyond the
district, both for research and training of health
professionals and community health workers, and
receives funding from Depar tment of Health.
The Depar tment of Health has embarked on a range
of prevention, care and treatment interventions.
In OR Tambo 9 service points are accredited for
dispensing anti-retroviral treatment, treating a total
of 4934 patients in November 2006. However,
there is still a need to accredit additional points
and increase the number of people on treatment.
Increasing number of people on TB treatment
and par tner treatment for people with STIs is also
a challenge. Attraction and retention of health
professionals is a challenge, at primary as well as
ter tiary facility level.
The pioneering ARV program in Lusikisiki, as
collaboration between Doctors without Borders
(MSF), the Depar tment of Health (ECDOH) and
the Treatment Action Campaign (TAC), is now being
handed over to ECDOH. The program provides an
internationally heralded model of ARV rollout in
resource poor settings, and possibilities for scale up
should be investigated.
23
In the district, HIV and AIDS is given the highest
priority, being placed in the offce of the Executive
Mayor Programs include awareness, research
capacity development. One of the awareness and
prevention programs that the district suppor t is the
cultural practice of Inkciyo.
The Non Governmental Organisations (NGOs),
Community Based organisations (CBOs) and Faith
Based Organisations (FBOs) play a major role at the
community level. However, integrated approaches
and cooperation between actors need to be
strengthened across the district. The AIDS councils
play a major role here. Among NGOs, CBOs and
FBOs there is also a need for focus on quality and
specialisation in the response to HIV and AIDS
(ECAC, 2004).
The district should develop a multisectoral HIV
and AIDS plan that is integrated into the IDP with
a dedicated budget. This should include a response
to what is sometimes called the orphan epidemic:
the growing numbers of child headed households,
vulnerable children and orphans.
24
E D U C A T I O N
According to the Education Management Information
System (EMIS), there are a total of 1892 primary
and secondary institutions in the ORTDMA. There
is one University in the ORTDMA, which is the
Walter Sisulu University of (WSU), which is situated
in Mthatha.
It is estimated that 95% of all the learners walk
to school, of which 36% walk for longer than
30 minutes. This means that there are 245 000
Percentage of OR Tambo, rural nodal and non-nodal
populations (aged 524) attending educational institutions
children who walk for more than an hour a day
getting to and from school
Compared to the rest of SA and especially to the
other rural nodes the education level in OR Tambo
District is very low.
Percentage of OR Tambo, rural nodal and non-nodal
populations (aged 524) attending educational institutions
0%
24%
25%
None Pre-School &
School
Technikon/University/
College/Adult Education
OR Tambo
Rural Nodes
Rest of South Africa
(non-nodes)
30%
75%
74%
67%
1% 1%
3%
20%
40%
60%
80%
0%
38%
29%
No Schooling Some Primary/
Secondary Schooling
Std 10/Grade 12 Higher Education
OR Tambo
Rural Nodes
Rest of South Africa
(non-nodes)
15%
49%
53% 53%
9%
13%
22%
5% 5%
9%
20%
40%
60%
80%
25
S K I L L S U P G R A D I N G
The District has launched a Human Capital Devel-
opment Approach that is based on the following key
areas:
Baseline Research and Benchmarking on government
impact on lives of local community members.
Government has invested a lot of money over the
years in the various communities around the district.
The challenge is that there is no baseline information
that the government intervention can been measured
against. This makes it extremely diffculty to measure
progress and the impact of government services in the
lives of the people of the region. The lack of baseline
information is also not helping future planning as future
budgeting and planning relies on past performance.
The Baseline and Benchmarking programme is aimed
at correcting this dilemma and help provide local
government with the information tools that local
government need for proper planning.
Priority Skills Acquisition - The huge backlog in the
district and the need to change the situation around
requires a workforce in local government that posses
the right skills. The building of roads, bridges, etc
requires engineers, fnancial exper ts, architects, etc.
The Priority Skills Acquisition initiative is a critical
component of service delivery.
Life Skills Acquisition members of the community
need to be trained on life skills in order to cope with
the diffcult situations they are confronted with on a
daily basis. Some of the skills that are needed are:
Confict management
Dealing with HIV/AIDS
Family values
People relations
Personal hygiene
Community Skilling (CS) the community need
skills that will help them manage community
projects. They need the skills to play their role as
monitors of public service performance.
B U S I N E S S D E V E L O P M E N T S E R V I C E S
One of the key trends in small enterprise develop-
ment has been a move away from direct-market
substitution by international donors and local govern-
ments towards a focus on facilitating private business
development service (BDS) market development.
This approach emphasises the limited ability of the
public sector and/ or donor organisations to deliver
services to small enterprises effectively.
26
This approach is premised on the fact that the
Municipality should encourage and promote
private service providers of business development
services, instead of the municipality itself trying to
be a provider of such services. So this approach
emphasises the need to promote the private sector
suppliers of business services, with the attendant
benefts of effciency and effcacy.
Facilitating BDS market development means
conducting an assessment of the BDS market,
identif ying weaknesses and opportunities, and
identif ying interventions that could stimul ate
the provision of more and more relevant BDS
product of ferings
1
.
The OR Tambo District Municipality needs to
strengthen par tnerships with the Small Enterprise
Development Agency (SEDA), the ECDC and other
national institutions in the delivering of fnancial
and non fnancial suppor t to SMMEs. The following
products and services should be offered at dedicated
business suppor t centres:
Information, advice and referrals
Business registration
Business plans
Tender Information and advice
Impor t and Expor t training
Trade Information
Business assessment and technical suppor t
Business mentoring and
Market access and business linkages

1
Oxford 2005
T R A N S P O R T
Despite some investments in new roads and
maintenance in the district many local communities
remain trapped in isolated and disconnected local
communities with very poor road infrastructure.
This disconnection has signifcant consequences in
terms of local economic development as well as
services delivery, most evident from the accessibility
to emergency ambulance services.
Currently the process of maintenance and upgrade
is severely hampered by the lack of clarity with
regards to roles and responsibilities between
various roads role players. The process is currently
under discussion at all levels, thus providing some
hope for a resolution in the near future.
Transpor t whether motorised or non-motorised
experiences many problems within the OR Tambo
District. These can be summarised as follows:
Poor conditions of roads especially rural
roads and within former urban townships
Stray animals
Inadequate pedestrian signs and markings and off
loading areas especially within the few urban areas
Limited traffc calming measures within areas of
high accidents
Low visibility of traffc offcials and law
enforcement
Non-availability of traffc lights,
let alone at major intersections
Unavailability of adequate public transpor t facilities
especially for the disabled
Lack of cooperation between public transpor t
operators and the municipal authorities
Lack of institutional capacity at Local and
district Municipal level to manage transpor t
planning and implementation
Insuffcient supply of taxi related infrastructure
Outdated/non-existent information
at the taxi registrar
Lack of pedestrian and non-motorised
transpor t facilities
The road networks in the O. R. Tambo area consists
of the following categories:
National Road = 136km (National Roads Agency)
Provincial Road = 497km (Provincial Depar tment of
Roads and Public Works)
District Road = 2792km (Regional Depar tment of
Roads and Public Works)
Access Road = 2957km (DM, LMs)
Street & Internal Road (Local Municipalities)
In suppor t of Road Construction & Development
of SMMEs, the O. R. Tambo District Municipality has
embarked on an emerging contractor development
programme. Through this programme emerging
contractors are trained formally on site and in
classroom to develop to the status of established
contractors. The initiative commenced with the
purchasing of road construction plant to the value
of R15million funded by the then CMIP. The Plant
items are currently used in the on-site construction-
training programme. The Lengthman system of road
maintenance is currently implemented with a view
of creating employment oppor tunities.
A I R P O R T S
The Mthatha airpor t needs to be upgraded and
revitalized in the most cost-effective manner that
will promote socio-economic activity and tourism
for this region. In order to achieve improved air
transpor t and emergency response in times of
natural disasters there needs to be upgrading of
airfelds at key nodes.
27
28
Working Age
& not working
Unemployed
and looking
for work
Household
income
< than
R1500/month
% % %
Eastern Cape 78.1 32.6 65. 2
O. R.Tambo 84.6 34.6 71.6
Mbizana 89. 5 39. 5 84.9
Ntabankulu 82.1 30.1 73. 0
Qaukeni 87. 2 32. 8 76.7
Por t St Johns 89.6 44.7 5. 2
Nyandeni 85. 0 33.7 67.9
Mhlontlo 83. 2 30. 5 71. 5
King Sabata
Dalindyebo
79. 3 34. 2 56.6
Source: RSS 2006
In the context of the very high unemployment and
pover ty rates mentioned above, there is clearly an
urgent need for new investments to create jobs and
improve livelihoods in the OR Tambo District. Based
on existing economic activity, market oppor tunities
and present resource/assets/skill bases the par ticular
industries offering potential include:
J OB CR E AT I ON A ND
L I V E L I HOOD OP P ORT UNI T I E S
Livestock farming
Dryland farming and irrigated hor ticulture
Forestry
Manufacturing
Construction and Mining
Trade and Business Services/ICT
Tourism
Each of these industries requires a detailed Action
Plan, specifying investments to be packaged, timelines
and milestones, stakeholders and responsibilities.
Preparatory work has already taken place for all
these industries in the OR Tambo District, and the
main challenge is to galvanise industry role-players
to ensure accelerated and shared growth, and good
quality investments.
It is notable that only about 13% of the Districts
working-age population have matric or above. This
points to the critical impor tance of education and
training for future employment growth.
Each of the seven industries listed above is briefy
profled in the following sections:
29
L I V E S T O C K F A R M I N G
Livestock farming (primarily cattle, sheep and
goats) is very impor tant in the District, but
generally provides very low incomes compared
to commercial livestock farming elsewhere in the
Province. Livestock farming is being suppor ted by
the Provincial Depar tment of Agriculture through
construction of stock dams, dipping tanks, shearing
sheds, fencing (under CASP) and veterinary services
etc. The challenge is to increase incomes from
communal livestock farming. An industry action plan
would probably include:
Expansion of the effective
NWGA model of suppor t
Improve existing programmes designed to
facilitate skills transfer between commercial
and emerging farmers
Improved Agricultural Extension Services
Improved market access (e.g. drawing on
experience of USAID-funded project in the
Chris Hani District; Middle East goat market)
Building animal feeds industry
Improved veld management
Move to formal land administration
Upgrading access roads/farm logistics
Ntinga Development Agency, in addition to the
Provincial Depar tment of Agriculture, is also
suppor ting livestock farming.
While the District is suitable for dairy farming (and
there is a local market) it is capital and skills incentive.
D R Y L A N D F A R M I N G
A N D I R R I G A T E D H O R T I C U L T U R E
Rainfall and soil quality make much of the District
well-endowed for agricultural production. Rainfall is
more than 800mm a year (and signifcantly higher
in the coastal zone). Dryland farming is generally
of a subsistence nature, and there are large tracts
of uncultivated arable land. There are two large
farming projects in the District: Magwa Tea and
Pondoland Sugar.
There are several initiatives to suppor t increased
production by small-scale subsistence farmers:
PGDP Massive Food Programme
PGDP Siyazondla Programme (to increase
homestead garden food production)
District Municipality programme to suppor t an
additional 30,000 ha of maize production
AsgiSA Biofuels initiative
AsgiSA Umzimvubu Initiative
There needs to be effective co-operation
between the Depar tment of Agriculture and
the District Municipality in suppor ting increased
maize production, and suppor t measures should
be thoroughly evaluated, to identify methods of
improved suppor t.
The Umzimvubu project contains a cropping
component, but this project is very large-scale and
will inevitably take many years to come to fruition.
30
Irrigated hor ticulture is both capital and skills
intensive, indicating that the growth of the subsector
will require bankable projects, experienced
management and thorough training. Several small-
scale irrigation schemes in the District have failed.
The District also contains larger-scale irrigation
schemes of the former Bantustan (for example,
Ncora) that are being rehabilitated.
Market access for crop-producers has been
improved as a result of the Mthatha Fresh Produce
Market, and will be assisted by the Kei Rail Project.
F O R E S T R Y
The District contains 30,000 ha of forestry
plantations (mainly around Langeni and Ntabankulu).
There is estimated to be a fur ther 50,000 ha suitable
for forestry in the District (the greatest potential
in South Africa). AsgiSA has identifed forestry as
a priority area for intervention, and the District
Municipality will be working closely with AsgiSA to
develop this sector.
Infrastructure investments for the sector include
the new Langeni-Ugie road and Kei Rail.
M A N U F A C T U R I N G
This is a very small sector of the District economy,
but it does offer growth potential. For example:
Ntinga Development Agency is suppor ting the
development of the timber-using industries at
Langeni (and elsewhere)
There are many small-scale garment manufacturers
(e.g. occupying old Transido workshop premises)
that would beneft from stronger business suppor t.
The existing craf ts subsector is not insignifcant.
For example, a basket-making enterprise in Por t St
Johns employs 2, 500 home-workers in the area.
Craf t workers would beneft from more suppor t
with product development and marketing, and from
growth of the tourism industry in the District.
The agro-processing subsector has the potential
to grow on the basis of increasing its primary
production. Examples include the Mthatha Abattoir
and maize milling.
There needs to be good co-operation between
Ntinga, SEDA, ECDC and the Thina Sinako LED
Programmes to realize growth oppor tunities.
31
C O N S T R U C T I O N A N D M I N I N G
The construction industry in the District is presently
small, but is likely to provide more job oppor tunities
in the future, based on:
Rapidly increasing fscal allocations for public
infrastructure (see section on Building and
Maintaining Infrastructure)
Expansion of the EPWP (there needs to be a
District EPWP Plan, with an M&E capability)
Increased house-building and retail infrastructure.
The District Municipality has initiated a Emergent
Contractor Development Programme.
Mining is presently restricted to quarrying related
to construction activity. There is also the possibility
of a heavy sands mining project at Xolobeni on
the Pondoland coast, which would provide 250
direct jobs over a 22-year mining period, with an
investment cost of 220 million US dollars.
T R A D E A N D B U S I N E S S S E R V I C E S / I C T
Employment in this sector could be boosted by new
investment in Business Process Outsourcing and
call centres. District agencies need to work with
AsgiSA to ensure that this takes place. ICT services
suppor t proftable business/co-op growth in all
other sectors.
T O U R I S M
This sector has obvious potential, primarily based on
the 120 km Wild Coast and home of Nelson Mandela.
Development initiatives include the following:
Regional Tourism Organisation established
Tourism Development Plan in place
Proposed new N2
Proposed Pondoland National Park
Wild Coast Spatial Development Initiative
EU Pondoland Community Tourism Programme
Upgrade of Mthatha Airpor t
Upgrade of access roads to the coast
Hluma Development Local Investment Agency (a
R500 million JV of DBSA and Old Mutual
to provide venture capital for Wild Coast
private investments)
Nelson Mandela Museum/Qunu/Mvezo
Nelson Mandela Freedom Route from
Por t St Johns to Aliwal Nor th
Commercialisation of Nature Reserves
(Mkambati, Hluleka, Silaka etc)
Effor ts to eradicate coastal illegal cottages.
Despite all these initiatives, potential investors have
frequently been frustrated in their effor ts to develop
coastal tourism accommodation facilities, due to
diffculties and delays surrounding land acquisition
and planning permission.
It has been repeatedly suggested that one of the
major factors contributing to the low level of
economic competitiveness and social cohesion, and
in a sense result in a failure to exploit economic
potential, has been the poor state of infrastructure
and infrastructure-related services. This section
of the district profle attempts to summarise the
physical infrastructure development plans that have
been budgeted for over the medium term, and that
are likely to contribute to a more enabling social and
economic environment in the OR Tambo District.
Like all other regions in the province, OR Tambo
District suffers from acute backlogs in social and
economic infrastructure. The vast natural land, forest
and water resources that exist within the district,
and the existing albeit limited infrastructure base,
provides the basis for socio-economic development,
but it is well-planned, prioritised, strategic and
complementary infrastructure investments that
will promote social development, and stimulate
sustainable economic growth.
Provincial Department Infrastructure expenditure
plans from 06/07 08/09 in the OR Tambo District
Municipality:
The total infrastructure spend directed towards the
OR Tambo District by the Eastern Cape provincial
government departments amounts to a whopping
total of approximately R2.9bn over the current
medium term expenditure cycle. This represents
signifcant public sector infrastructure investment
that hopefully crowds in private investment.

bui l d a nd
ma i nta i n i nf r a s t ruc t ur e
32
33
P R O V I N C I A L D E P A R T M E N T O F E D U C A T I O N
Education is a key element of social and economic
development. The Provincial Depar tment of
Education has planned and budgeted up to R710m
on education infrastructure in the OR Tambo
District over the current medium term expenditure
cycle (06/07 08/09).
The Provincial Department is spending R190m
in 06/07, R200m in 07/08 and R320 in 08/09,
representing slightly above 25% of total departmental
education infrastructure investment over the current
medium term cycle.
The bulk of the spending is targeted at rehabilitation
and upgrading (R520m) with recurrent maintenance
budgeted at R120m emphasizing a focus on improving
the quality of the education infrastructure. Up to
214 schools have been targeted in the District for
this upgrade through provincial government funding,
involving the eradication of mud-structures and
general routine maintenance of existing concrete-
structures. Therefore a shif t towards quality as
opposed to quantity (quantity has been the norm
for previous medium term expenditure cycles).
These upgrading and maintenance amounts are crucial
in two respects, 1) by maintaining and protecting
existing assets ensuring guarantee of returns well into
the future, and 2) direct and indirect cash injections
boost local economies, as routine maintenance
activities are generally labour-intensive.
A total of approximately R70m over the medium
term is budgeted for New Construction of fve
schools public special schools in Mbizana, Mthatha,
and Lusikisiki.
Provincial government education infrastructure
spending per capita in the OR Tambo District over
the three year period, in total, is R405 per person.

P R O V I N C I A L D E P A R T M E N T O F H E A L T H
The provincial health depar tment has planned and
budgeted for a total health infrastructure spending
of R685m in the current medium term expenditure
cycle for the OR Tambo District rising from R190m
in 06/07 to R265m in 07/08, before falling to R230m
in 08/09.
This provincial health infrastructure expenditure
in OR Tambo amounts to 30% of total health
infrastructure spending by the provincial government
over the medium term cycle.
The allocation to the District is divided into New
Construction (R106m), Rehabilitation and Upgrading
(R484m), and routine and recurrent maintenance
(R95m). Rehabilitation and upgrading will involve
over 40 clinic revamps and 7 hospital revitalizations
within the District.
The allocation for new construction will target
23 clinics and 5 hospitals. These large allocations
to relatively few health institutions in the District
suggests a strategic shif t to focus more on
improving the quality of health services, as opposed
to improving access to health services. So the issue
is one of quality, not necessarily access.
The provincial health infrastructure spending per
capita in the OR Tambo District over the medium
term amounts to an approximate R390 per person.
34
P R O V I N C I A L D E P A R T M E N T O F A G R I C U L T U R E
The OR Tambo District has huge untapped
agriculture, forestry and water resources, and these
resources are at the hear t of any sustainable growth
potential and economic activity in the District.
Given this existing natural resource base, the
Provincial Depar tment of Agriculture plays an
impor tant catalyst role in promoting subsistence
farming (food security) and small and large scale
commercial agriculture.
Over the current medium term period (06/07
08/09), the Provincial Depar tment of Agriculture
will spend approximately R23m on infrastructure
in the OR Tambo District, representing 11% of the
total infrastructure spend (R200m over the medium
term) by the provincial depar tment in the District.
The allocation rises from R5. 5m in 06/07 to R8m
in 07/08 and to over R9m in 08/09 and is targeted
largely at fencing, stock water, irrigation, storage
and shearing sheds, tunnels, dip-tanks, and soil
conservation works..
The Provincial Agriculture infrastructure spend per
capita amounts to approximately R13 per person in
the OR Tambo District.
P R O V I N C I A L D E P A R T M E N T O F P U B L I C WO R K S
The OR Tambo District is set to receive up to R75m
from the Provincial Depar tment of Public Works.
This amount represents about 17% of the total
provincial allocation to all Districts and the Metro.
The per capita spending on public works amounts
to R43 per person.
It is not clear what projects the budgeted money
will be spend on.
P R O V I N C I A L D E P A R T M E N T O F R O A D S A N D T R A N S P O R T
Another key element of required infrastructure
development in the District is the road network.
The OR Tambo District suffers from quite signifcant
road infrastructure backlogs given the largely rural
character of the District.
In light of these backlogs, and recognising the key
enabling role that transpor t infrastructure has for
economic and social development, the provincial
roads and transpor t depar tment has allocated
approximately R1.4bn to road infrastructure in the
OR Tambo District area, rising from over R327m
in 06/07 to R551m in 07/08 and then a drop to just
under R521m in 08/09.
This total allocation over the medium term represents
approximately 27% of the total provincial allocation
towards road infrastructure, and representing a per
capita spend of R800 per person in total over the
medium term expenditure framework.
The major transpor t projects envisaged in OR
Tambo are: Kei Rail phases 3, 4 and 5 (R334m),
Isilimela Hospital road (R147m), Madwaleni hospital
road (R136m), Greenville Hospital road (R132m),
Zithulele Hospital road (R130m), and Ugie-Langeni
phase 3 (R95m).
Some of the other spending on road infrastructure
in OR Tambo by the Provincial Depar tment will be
on recurrent and routine maintenance (including
the Vukuzakhe Programme) of R300m, and access
to resor ts, and access to Great Places (R50m).
35
P R O V I N C I A L D E P A R T M E N T O F H O U S I N G ,
L O C A L G O V E R N M E N T & T R A D I T I O N A L A F F A I R S
The depar tment has announced expenditure plans
of R76m in OR Tambo for the 07/08 fnancial year.
This amount will resul t in the construction of a
total of 3058 houses in Libode Nyandeni , Mthatha
Ili tha, Mthatha Zimbane Valley, Mthatha, Water fall
Park, Mantlaneni Village, Nkozo Village, and
Ncambele Village.
P R O V I N C I A L D E P A R T M E N T O F
S P O R T , R E C R E A T I O N , A R T S A N D C U L T U R E
The total Provincial Depar tment allocation to OR
Tambo amounts to just over R12m over the current
medium term expenditure cycle.
The OR Tambo District is receiving a tad above
R4m in the 06/07 f inancial year for the new
construction of, 1) Mthatha Archives in KSD
(R3m), and 2) the Bumbane Cul tural Village in KSD
(R1m). An amount of R5m is allocated for 07/08
for the continuation of the Mthatha Archives in
KSD (R2. 5m), and the construction of the new
Flagstaf f Ar ts Centre (R2. 5m). Finally, in 08/09, an
amount of R3m is allocated for the completion of
the historic Mthatha Archives.
The OR Tambo allocation of the Depar tments
infrastructure budget represents 15% of total
depar tmental infrastructure spending throughout
the Province.
The infrastructure per capita spending for the
depar tment in the district lies at R7 per person of
infrastructure spend.
Expenditure on the new Mthatha Library (at an
estimated cost of R1.4m) has been planned, but
not budgeted for in the current medium term
expenditure cycle.
P R O V I N C I A L D E P A R T M E N T O F S O C I A L D E V E L O P M E N T
The provincial department has allocated almost R16m
in infrastructure spending over the current medium
term expenditure cycle to the OR Tambo District.
The expenditure is targeted at new construction of
the Flagstaff Service Offce (R4.6m over the medium
term), the Qumbu Secure Care Centre (R11m over
the medium term)
A fur ther R0.3m is allocated for maintenance and
upgrade of parkhomes, and routine maintenance of
existing social development infrastructure.
The depar tment has planned, but not yet budgeted
for, phase 2 of the Qunu Day Care Centre (est. cost
of R0.8m), and in addition, several service offces
(Libode, Por t St Johns, Mqanduli and Mbizana at
an estimated cost of R3m each) have been planned
but not budgeted for in the current medium term
expenditure cycle.
The total infrastructure spending in OR Tambo
represents 25% of total Social Development
infrastructure spending in the province.
The social development infrastructure per capita
spending over the medium term is approximately
R9 per person.
36
P R O V I N C I A L G O V E R N M E N T
I N F R A S T R U C T U R E E X P E N D I T U R E S : C O N C L U S I O N S
The signifcant provincial infrastructure expenditure
plans in the OR Tambo District Municipality will
provide a meaningful platform for social and
economic growth and development arising from the
oppor tunities such spending opens up in both the
frst and second economies.
Compared to other Districts and the Metro in the
Eastern Cape, OR Tambo District Municipality will
receive approximately 22% of the total provincial
infrastructure spend, making it the District with the
highest Provincial infrastructure allocation over the
current medium-term cycle.
It is impor tant for social and economic infrastructure
to complement each other, thereby mutually
reinforcing the sum total of benefts derived from
the infrastructure expenditure and its economy-
wide linkages.
It is necessary, but not suffcient, to just build new
infrastructure. Maintenance of existing infrastructure
needs to also be prioritised. Currently, maintenance
of the Depar tments immoveable assets is poor
inevitably leading to rapid deterioration of buildings
and other assets. Maintenance funds have always
and may probably remain limited. Much of the
limitations with respect to maintenance can be
attributed to poor levels of defnition with respect
to the responsibility for maintenance budgeting.
The distinction between levels of responsibility
between Public Works and User depar tments as
refected by the infrastructure plans will go a long
way towards regularizing maintenance planning.
Finally, it is commendable that a paradigm shif t is
evident through the infrastructure allocations,
with the focus on the quality of infrastructure
and services, as opposed simply to the quantity,
especially in education and health.
S T R A T E G I C I N F R A S T R U C T U R E P R O J E C T :
K E I D E V E L O P M E N T C O R R I D O R
The Kei Development Corridor is an initiative
instigated by the Provincial Depar tment of Roads
and Transpor t to promote economic development
in an area surrounding the Kei Rail link from East
London to Mthatha. Such is the impor tance of the
Kei Development Corridor that over R300m is
being earmarked for the Kei Rail by the Provincial
Government over the medium term.
It is envisaged that the implementation of the
Kei Rail project will stimulate development of a
development corridor by:
Stimulating economic activities where transpor t
constraints are the primary reason for the
unsustainability and/or non-viability of the projects;
Providing an improved transport option for existing
economic activities and thereby allowing for increased
proft and sustainability and greater effciency;
Providing a general economic catalyst to promote
and develop economic initiatives and improvements
in social welfare throughout the economy;
Creating other forward-backward linkages with other
major projects (e.g. Bio-fuels, Forestry and Timber)

The Kei Development Corridor falls predominantly
within three District Municipalities, namely: Amat-
hole, Chris Hani and OR Tambo District Municipali-
ties (ORTDM). ORTDM encompasses seven local
municipalities, including three (KSD, Mhlontlo and
Nyandeni) that lie within the KDC project area. The
main urban centres within the ORTDM that fall in-
side the KDC area are Libode, Mthatha, Mqanduli,
and Ngqeleni.
Mthatha is a frst order node of the KDC, which means
that it must form the backbone of the KDC and there-
fore the focus is on industrial and transport related
infrastructure. Libode, Mqanduli and Nqeleni are sec-
ond order nodes in KDC. Second order nodes are
smaller towns or commercial focus points providing in
the basic needs of the surrounding settlements.
37
38
It is recognized that stimulating economic develop-
ment in the area surrounding the Kei Rail will be
impor tant in ensuring the viability of the Kei Rail.
Within this context, the principle objectives of the
KDC Economic Initiative are:
Identifcation of the economic activities whose
viability (and hence implementation) are solely
dependent on the rail corridor or that would
substantially beneft from the rail development;
Identifcation of the general economic development
potential within the hinterland serviced by the Kei
Rail Development Corridor (KDC) and
Assessment of potential linkages and benefts that
could accrue from the proposed improvements to
rail (and suppor ting transpor t) infrastructure.
Identifcation of key infrastructure investments
required to suppor t the KDC
For the OR Tambo Di stri ct, the Kei Devel opment
Corri dor provi des a uni que oppor tuni ty for
focused i nvestment i n the Corri dor area, as the
si gni f i cant provi nci al i nvestment i n thi s proj ect
provi des a pl atform for fur ther muni ci pal
i nter venti ons to real i ze the ful l potenti al of the
Kei Devel opment Corri dor.
Linkages between the KDC and potentially mega
fagship projects in OR Tambo:
Bio-Fuels Industry:
The proposed project involves the establishment
of an integrated food crop and canola bio-diesel
industry as an economic anchor for accelerated
agrarian transformation in the Eastern Cape.
The proposal is to develop extensive integrated
rotational cropping (canola & maize or equivalent)
to supply a new canola bio-diesel processing facility
in the East London IDZ.
Canola biodiesel is a potentially attractive product
in Europe due to its low freezing point and the
fact that European legislation requires that the
propor tion of bio-fuel consumption (in relation to
total fuels) rise to 5.75% by 2010.
Forestry & Timber Processing Industry:
Development of timber processing activities around
the Langeni area to serve the proposed development
of the Ugie/Matiwane forestry area. Facilities include
saw mills, chipboard manufacturing and potentially
furniture manufacture. The key anchor is the PG
Bison/Steinhoff initiative in Ugie-Maclear.
Essentially, the conservation and effcient utilization
of Kei Rail can only succeed as a par tnership between
local communities, government and private sector.
Growth and development in the East London to
Mthatha corridor will succeed if it is government
driven (provincial, district and local), private sector
funded, labour conscious, community based and
environmentally friendly
39
40
f i ght p ov e rt y
P O V E R T Y I N D I C A T O R S
Levels of household grant dependence in Or Tambo is
signifcantly higher that the provincial average of 64%
with three quarters (75%) and more of households
receiving social grants. The exception is KSD where
63% of households rely on social grants.
Household member is receiving social grant
Yes No
% %
Eastern Cape 63.6 36.4
O. R.Tambo 75.1 24.9
Mbizana 80. 2 19. 8
Ntabankulu 81. 3 18.7
Qaukeni 81.7 18. 3
Por t St Johns 77.7 22. 3
Nyandeni 74. 5 25. 5
Mhlontlo 77.4 22.6
King Sabata
Dalindyebo
62.9 37.1
Source: RSS 2006
Unemployment levels in the OR Tambo District are
higher than the provincial average, underscoring
the levels of chronic pover ty and inequality within
the district. As a result, household incomes in the
district are generally low.
Working Age
& not working
Unemployed
and looking
for work
Household
income
< than
R1500/month
% % %
Eastern Cape 78.1 32.6 65. 2
O. R.Tambo 84.6 34.6 71.6
Mbizana 89. 5 39. 5 84.9
Ntabankulu 82.1 30.1 73. 0
Qaukeni 87. 2 32. 8 76.7
Por t St Johns 89.6 44.7 5. 2
Nyandeni 85. 0 33.7 67.9
Mhlontlo 83. 2 30. 5 71. 5
King Sabata
Dalindyebo
79. 3 34. 2 56.6
Source: RSS 2006
41
M U N I C I P A L - M U N I C I P A L C O O P E R A T I O N
Engagement meetings between the ORTDM and
the LMs have raised issues about how municipalities
can be brought up to speed to address the priorities
interventions required to unlock the social and
economic potential in the their local areas.
It was identifed that the Municipalities need to
address by-laws, policies and performance governing/
in relation to, amongst other issues, trade regulation,
procurement, land use, zoning, plans for the sectors,
resources like staff and funding/budgets required to
implement the priorities.
I D P A L I G N M E N T
All Municipal IDPs in OR Tambo give attention to
building their own delivery capacities. The f illing
of critical vacancies (e.g. Municipal Managers etc)
is critical, as are measures to attract and retain
critical skills.
IDPs have improved over the last few years and
are generally aligned to PGDP in terms of agrarian
transformation, public sector transformation, human
resource development, economic diversifcation
and tourism, infrastructure provision, and fghting
poverty.
However, there are some impor tant gaps in the
context of provincial alignment (e.g. housing, EPWP,
malnutrition).
IDPs do not yet integrate the activities of all three
levels of Government (such as Biofuels (ASGISA).
The OR Tambo IDP devotes considerable attention
to building its own capacity and that of the local
municipalities. Perhaps more attention could be
given to how to improve co-operation with other
arms of Government
M U N I C I P A L B U S I N E S S C O O P E R A T I O N
The ORTDM together with the regional offce of
the business chamber (NAFCOC) held a workshop
that sought to iron out and remove any existing and
potential barriers to economic development in the
region. Studies under taken indicate hat ORTDM as
the most poorest regional economy in the country
and the major challenge faced by these two par tners
is turning around this economy.
In a continuous effor t to promote municipal -
business cooperation, the key areas of engagement
were identifed as:
Establishment of a par tnership between ORTDM
and the regional business chamber (NAFCOC).
Exploration of oppor tunities like, Umzimvubu water
catchment, N2 toll road, the bio-fuels industry etc.
Branding of ORTDM as an economic engine of the
province.
Establishment of an investment centre in the region
by NAFCOC.
muni ci pa l c a paci t y
a nd coop e r at i on
42
Establishment of business incubator and business
advice centers by NAFCOC.
A business ownership/leasing survey to be
under taken and submitted by NAFCOC.
Expansion of business affliation networks by
NAFCOC to the inclusion of all sectors in business.
The joint development of a regional programme of
action by the two par ties
Coordination of depar tmental programmes for the
identifcation of business oppor tunities therein.
Development of strategies for business
development advocacy.
The development and submission of factory
occupancy database and submission by ECDC to
the par tnership programme.
Precise role defnition of each par tner to the
marriage.
The creation of an enabling business environment
by the DM for the business community to thrive.
Development of by-laws by the DM/LMs
Council business outreach programme.
LED forum meetings for coordination, experiences
and information sharing.
Observer status accorded to business in the LED
standing committee.
Infrastructure development monitoring.
Establishment PPPs to stimulate growth.
Business database establishment.
Business service and advice centre establishment.
Joint planning and programme setting for strategic
infrastructure development and rehabilitation
(airpor t, transpor t system, 2010 readiness, airpor t
conference facility, umzimvubu water cathment,
N2 tool road)
M U N I C I P A L / P R O V I N C I A L
D E P A R T M E N T / A G E N C I E S C O O P E R A T I O N
Among the key issues raised at the OR Tambo
District is the limited par ticipation of provincial
government in the IDP planning processes. As such,
effor ts to build par ticipative government at the
local level are being undermined by the province
of ten sending junior offcials without decision
making powers. The district expressed concern
about the role of the Depar tment of Housing, Local
Government and Traditional Affairs. This revolves
around the depar tment not providing adequate
suppor t and guidance to municipalities.
Other key issues emerged were the provincial
governments inadequate ability to plan spatially
(DMs and LMs) and the absence of alignment with
respect to planning, budgeting and even execution
between the two spheres. These need to be
addressed as they cur tail the acceleration of service
delivery which appears to be the major issue need to
be tackled in OR Tambo among other things. On that
score, close cooperation of spheres of government
remains critical as the delivery of social services is
not an exclusive local government competence but
depends on other spheres performance.
It is no doubt that the current Provincial IDP
Engagement process is the step in the right direction,
however the challenge would be to factor into results
of the district GDSs, IDP engagements to feed into
planning and review of both IDPs and PGDP.
M U N I C I P A L / N A T I O N A L
D E P A R T M E N T S / S O E S C O - O P E R A T I O N
In the case of OR Tambo the Department of Land
Affairs, Department of Housing, Department of
Labour and Department of Roads, Department of
Agriculture is among other key national departments
that the district needs to work with besides the
Department of Trade and Industry. Although the
Department of Water Affairs and Forestry has by
and large been participative at local government level,
the scale and pace of eradicating water and sanitation
backlogs in the district leave a lot to be desired.
It goes with out saying that in order to address the huge
electrifcation and telephone backlogs particularly in
the former homeland areas, close cooperation with
Eskom and Telkom remains critical.
43
44
concl us i on
The ORTDM is clearly grappling with very
entrenched problems of pover ty and unemployment,
and progress seems to have been quite slow so far
in addressing these problems. It is of concern that
while public investment in the District is increasing,
there seem to be very few substantial private sector
projects in the pipe-line.
The Summit is potentially very impor tant for
setting in motion processes to improve municipal
planning and management capacities, par ticularly
with respect to co-operation with other arms of
Government, and with Business. The private sector,
business-suppor t agencies and the municipalities
need to work together to develop the detailed
priority industry action plans mentioned earlier.
The outcome of the Summit should be the
development of a Framework Agreement that
outlines institutional roles and responsibilities to
accelerate growth and development in the District.
This Agreement should also suggest the mechanisms
and processes for monitoring progress on the decisions
reached and the governance framework for ongoing
dialogue and feedback among the social partners.
The district GDS presents a unique oppor tunity
for constructing par tnerships and harnessing the
collective energies and contributions of a range of
actors and role players with a view to enhancing
accelerated and shared growth.
45
The district GDS has the potential to unlock the
potential of all locali ties, and ensure that all sectors
of society identif y their role and contribute to the
common national objective to build a better life
for all .
Generally speaking, there are six key drivers to
unlocking economic potential and job creation
as well as enhancing competi tiveness in the
OR Tambo District:
1. Agriculture and agri-business remains at the hear t
of the district economy in spite of its stagnant and
even declining contribution to the district economy.
And its impor tance could not be more emphasised
than through its potential to contribute towards
two mega projects that are being rolled out by both
National and Provincial government:
a) Forestry and Timber Industries Development,
b) Bio-fuels,
c) Umzimvubu Basin
2. Processed agricultural goods offer signifcantly
more economic value than the non-processed
products. It is therefore impor tant to consider the
encouragement of the processing and manufacturing
of goods within the District
3. Tourism is an untapped resource within the District. An
integrated approach must be taken in the promotion
and development of potential tourism sites.
4. Massive infrastructure roll-outs (including enhance-
ments and developments in ICT) envisaged under
ASGI-SA, the PGDP and the district and local in-
frastructure development plans to address backlogs
and maintain existing and refurbish aging infrastruc-
ture, could be used to stimulate economic activity
throughout the construction value chain.
5. Local procurement could offer a wide range of
economic oppor tunities throughout all sectors of
the local economy.
6. Investing in, and aligning skills development to the
identifed key growth sectors will fur ther enhance
the locational competitiveness of the OR Tambo
District Area.

46
ACRONY MS
ASGI SA Accelerated Shared Growth
Ini tiative of South Africa
CASP Continuous Agricul tural Suppor t
Programme
CBO Communi ty-Based Organisation
CDW Communi ty Development Worker
DEAET Depar tment of Economic Af fairs
Environment and Tourism
COSATU Congress of
South African Trade Unions
DHLGTA Depar tment of Housing,
Local Government
and Tradi tional Af fairs
DPO Disabled Peoples Organisation
ECAC Eastern Cape Aids Council
ECDC Eastern Cape
Development Corporation
ECSECC Eastern Cape Socio
Economic Consul tative Council
EIA Environment Impact Assessment
EPWP Expanded Public
Works Programme
EU European Union
FBO Fai th Based Organisations
GDS Growth and Development Summi t
GGP Gross Geographic Product
HSRC Human Science Research Council
I DP I ntegrated Development Plan
I DT Independent Development Trust
IGR Inter-Governmental Relations
I SRDP I ntegrated Sustainable Rural
Development Programme
KDC Kei Development Corridor
KSD King Sabata Dalindyebo
LED Local Economic Development
MTEF Medium-Term
Expendi ture Framework
NAFCOC National African Federated
Chamber of Commerce
NGO Non-Government Organisation
NGWA National Wool
Growers Association
ORTAFA OR Tambo Farmers Association
ORTDM OR Tambo District Municipali ty
PGDP Provincial Growth and
Development Programme
PPP Public Private Par tnership
RDP Reconstruction and
Development Programme
RI DS Regional Industrial
Development Strategy
SDI Spatial Development Ini tiative
SEDA Small Enterprise
Development Agency
STI Sexually Transmi tted Infections
USAI D Uni ted States Agency for
International Development
VCT Voluntary Counselling and Testing
WSU Wal ter Sisulu Universi ty
GDS Agr e e me nt
2
b
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y
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5
8
6
3
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E
E A S T ER N C A PE S OC I O- EC ONOMI C C ONS ULTAT I V E C OUNC I L
Tel. : +27 (0)40 635 1590 | Fax: +27 (0)40 635 1571
E-Mail : info@ecsecc.org | Internet: www.ecsecc.org
OR TA MBO DI S T R I C T MUNI C I PA L I T Y
Tel. : +27 (0)47 501 6400 | Fax: +27 (0)47 532 4166
Internet: www.or tambodm.org. za