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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

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led and strategic planning in south africa

March 2011

CLGF Conference (Cardiff)


Economic Development

And Planning:




  • 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
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)
strategic planning in sa evolution of idp s


Dec 2000 – 2002


Jan 2003 – Dec 2010


Dec 2010 - Beyond

1st Generation

2nd Generation

3rd Generation

Strategic Planning in SA: Evolution of IDP’s
  • 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:
  • Clear geographic investment plan
  • IDP embedded in neighbourhoods
  • Shift:
  • IDP ownership by leadership
  • Spatial logic guides 5yr investmentper mun area by whole of govt
  • Ward-neighbourhood plan withclear 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
  • 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

2006 –2010

2011 - 2015

strategic planning in sa led planning
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:
    • Alignmentof 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
new growth path drivers
New Growth Path Drivers
  • 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 job-creating projects
  • R20 billion in investment subsidies
  • Comprehensive support for SMEs
  • Address cost drivers and inflationary pressures across the economy
  • Active industrial policy based on increasing competitiveness and targeting sectors that can create employment directly and indirectly
  • Comprehensive rural development
  • Stronger competition policy
  • Stepping up education and skills development
  • Enterprise development
  • Reform of Broad-Based BEE
  • Reform labour policies to support productivity and improve protection for vulnerable workers
  • Technology policies geared to improving innovation in ways that support employment creation and small- and micro-enterprise
  • Developmental trade policies with a strong orientation to new growth centres
  • Investment to support African development


salga focus on promoting better led planning
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