How much basic infrastructure investment - water and sanitation systems, new electricity lines, roads, stormwater drainage, and other services provided at municipal level - can South African society afford? What levels and types of subsidies for recurrent operating and maintenance costs assure that low-income people can meet their basic infrastructural service needs? These questions continue to bedevil policy makers. One reason is their failure to integrate into investment decision-making some basic aspects of socio-economic cost-benefit analysis, covering a variety of direct, indirect, developmental, ecological and geographical factors. The direct economic benefits of infrastructure for low-income people have long been recognised, and include construction jobs, improvements in work productivity; and the growth of small enterprises. Indirect benefits include more time and resources for women; dramatic environmental benefits, public health benefits (which require infrastructure of a sufficient quality so as to enhance rather than endanger health), and the desegregation of urban society (with respect to enhanced employment, educational and cultural opportunities). While there are often costs associated with large, new basic-infrastructure programmes, the benefits justify increased investment. If subsidies and tariffs are restructured to assure entitlement ("lifeline") provision to all South Africans, plus rising block tariffs for higher use of resources, it appears possible to significantly augment what the government is presently suggesting as a minimum set of investment and service provision in its Municipal Infrastructure Investment Framework. (C) 1999 Published by Elsevier Science Ltd. All rights reserved.
