department: water affairs and forestry dam/10. regional and national... · p wma 10/c31/00/0408...

REPORT NUMBER: P WMA 10/C31/00/1408

DEPARTMENT: WATER AFFAIRS AND FORESTRY

Directorate: Options Analysis

Lead Consultant: In association with:

JULY 2008 - Final

VAAL RIVER SYSTEM: FEASIBILITY STUDY FOR

UTILIZATION OF TAUNG DAM WATER

REGIONAL AND NATIONAL ECONOMY

Feasibility Study for Utilisation of Taung Dam Water (i)

PWMA 10/C31/00/1408 Regional and National Economy July 2008

LIST OF REPORTS

REPORT NO DESCRIPTION REPORT NAME

P WMA 10/C31/00/0408 Main Feasibility Report FEASIBILITY STUDY FOR UTILIZATION OF TAUNG DAM WATER: MAIN REPORT

P WMA 10/C31/00/0508 Supporting Report 1 DEMOGRAPHICS

P WMA 10/C31/00/0608 Supporting Report 2 WATER DEMAND AND USE

P WMA 10/C31/00/0708 Supporting Report 3 YIELD AND SYSTEM ANALYSIS

P WMA 10/C31/00/0808 Supporting Report 4 GROUNDWATER RESOURCES

P WMA 10/C31/00/0908 Supporting Report 5 IRRIGATION

P WMA 10/C31/00/1008 Supporting Report 6 WATER DEVELOPMENT AND SUPPLY PLANS

P WMA 10/C31/00/1108 Supporting Report 7 WATER QUALITY AND POLLUTION

P WMA 10/C31/00/1208 Supporting Report 8 EXISTING AND PROPOSED INFRASTRUCTURE

P WMA 10/C31/00/1308 Supporting Report 9 CONVEYANCE SYSTEM SCENARIOS AND ECONOMIC ANALYSIS

P WMA 10/C31/00/1408 Supporting Report 10 REGIONAL AND NATIONAL ECONOMY

P WMA 10/C31/00/1508 Supporting Report 11 EIA AND PUBLIC PARTICIPATION

REFERENCE

This report is to be referred to in bibliographies as:

Department: Water Affairs and Forestry, South Africa, 2007. Feasibility Study for Utilisation of Taung Dam Water: Regional and National Economy: prepared by Kayamandi Development Services (Pty) LTD.

Report No.: P WMA 10/000/00/0407/10

Project No.: WP8950

Project File: 14/2/C300/2/2



EXECUTIVE SUMMARY

Naledi local municipality has consistently been the highest GGP contributor in the study area

followed by Phokwane local municipality, and Greater Taung local municipality. Naledi Local

Municipality experienced the highest average annual GGP growth rate of all the three

municipalities in the study area on par with that of the country as a whole between the ten-year

period from 1995 to 2005. However, the economy of the Greater Taung Local Municipality only

grew at nearly a quarter than that of the country as a whole and Phokwane Local Municipality

experience growth at nearly half than that of the country as a whole. The study area, mostly

Phokwane and Greater Taung Local Municipalities are thus areas with relatively low growth

compared to the country as a whole. The study area also has a small economy in relation to its

GGP contribution to the Districts and Provinces in which they are situated. Unemployment is also a

major problem in the area, hence the low GGP contribution, which serves as fertile ground for

other social problems that hinder economic development and social well being. Many people in the

area are uneducated, or have low level of skills that are incompatible with the desired level of

economic activity in the municipality. Those who are employed are usually employed in low-income

industries such as farm workers or domestic workers. There are very few professional workers in

the area. The result is that a large portion of the population has limited to no income.

This area will thus benefit from economic injection in the form of this proposed bulk water

infrastructure development. The following regional and national economic impacts are foreseen

should the demand for increased water be met:

• Stimulation of economy: The potential economic benefits that are perceived include:

increased financial spending in the economy, increased infrastructure investment, and

increased expenditure by employees. The additional GDP arising from the capital investment

during the construction phase of the bulk water supply infrastructure could be approximately

R60 million. Approximately R5 million of this impact will accrue to the North-West Province.

The additional GDP arising from the operating expenditure during the operational phase is

approximately R400 000 per annum. Furthermore, based on expected procurement,

approximately R40 000 per annum will accrue to the North-West Province.

• Employment and decrease in local unemployment level: Increased employment is expected

in the economy during construction and operation of the bulk water infrastructure. With an

increase in employment, a definite transfer of skills will result. The proposed infrastructure

development and mechanical manufacturing of infrastructure requirements will lead to the

creation of additional jobs to the approximate amount of 1,800 during the construction phase.

Feasibility Study for Utilisation of Taung Dam Water (ii)


During the operation phase the project will lead to the creation of an additional approximately

5 jobs per annum. Note that a job is defined as one person employed for one year.

• An increase in new business sales and standard of living: The increased employment

expected, will impact positively upon the regional and local economy. Increased employment

is associated with increased income and consequently with increased buying power in the

area, thus leading to new business sales to accommodate the new demand for services and

goods required. Direct investment in the construction sector during the construction phase

will yield new business sales to the value of approximately R490 million for the bulk

infrastructure. During the operating phase the investment in the economy, associated with

the maintenance and operation of the infrastructure only, will generate new business sales to

the approximate value of R2 million per annum.

• Increased government income: the supply of water can be seen as an economic injection to

the area as it would lead to increased government income. Local benefits could accrue to the

government through an increased tax base and increasing the capacity of the local

municipality and other social and service support actions.

• Inflow and outflow of temporary/external workers: Local socio-economic impacts of large-

scale development projects tend to be closely associated with the relocation (immigration) of

project workers and their families to communities near the project site. The large direct

employment will mean that a substantial amount of external workforce is required. This will

thus lead to a substantial local population growth, demands on local services and

infrastructure, fiscal problems for local governments, and increased problems of social

assimilation. Therefore, an emphasis on use of local labour is suggested as the use of

outside or imported labour may have negative implications for the surrounding economic

status quo.

• Stimulation of income generating activities and opening up area for development: Since

households need 100% assurance of water supply, the water from the Taung Dam would be

utilised to provide in primary domestic water needs only. The higher supply of domestic water

during operation could result in the stimulation of economic activities reliant on water such as

tourism related development, laundry and cleaning facilities, sport related clubs and facilities,

amusement and recreation services, hotels and lodging places, eating and drinking

establishments, car washes, hair dressers and other personal services, butchery, farming:

horticulture and livestock, food and beverages and others.

• Free up time from fetching water and obstacles to economic development: Water is one of

the most important resources to people. Access to this scarce resource remains the most

Feasibility Study for Utilisation of Taung Dam Water (iii)


critical and worrying constraint for many rural people, and many of them spend several hours

a day securing supplies. Women (and children) are mostly affected by having to walk longer

distances to collect smaller amounts of water. The time lost is invaluable to most women and

children. The provision of water will release women and children from spending several

hours a day securing supplies to being able to search for work, undertake education, etc. All

of these will have profound effects on the regional economy. With access to potable water

the obstacles in the development of the following impoverished communities will be

addressed: 14 villages south-east of Taung Dam, 6 villages being supplied by the Bogosing

Water Supply, and 11 villages in the Taung area. The provision of domestic water will also

improve the spatial distribution of water and enable improved matching of supply with

demand.

• Decrease economic decline related to water shortages: Water projects have long been

advocated for their claimed contribution to regional economic development. However

investment in water supply does not automatically guarantee economic growth. While water

does not automatically generate growth, it may be the case that areas which persist in

lacking an adequate water supply (regardless of whether or not they started out with

adequate water) will not flourish economically, people will eventually leave those areas and

migrate to other areas that do have an adequate water supply. Thus, lack of water could be a

sufficient condition for economic decline or, to put it another way, water may be necessary,

but not sufficient for economic growth.

• Provide essential final good and opening up additional household end-uses: Water obviously

fits the definition of an essential final good as human life is not possible without access to

water. In addition to being essential for human life, water contributes in important ways to the

enjoyment of the satisfactions of life. Consequently, there are many other residential end

uses of water besides its use for drinking. When a piped water supply first became available,

the initial household uses were the same that had existed when family members had to fetch

water from an external source – drinking, cooking, hand washing, and limited bathing. As

time passed, many other uses came up – tubs for bathing, outdoor landscape and garden

watering, automatic clothes washers, swimming pools, automatic dish washers, car washing,

garbage disposal, indoor evaporative cooling, hot-tubs, lawn sprinklers, etc.

• Decrease in poor health related economic burdens: The lack of access to adequate water

supply brings the risk of ill-health or even death and undermines people’s dignity. Ill-health

and death have a profound impact on the regional and national economy. The positive

impact which providing a workable amount of clean water will have on the overall health of

the population far outweighs the direct financial costs of providing the water. Women

Feasibility Study for Utilisation of Taung Dam Water (iv)


therefore have the most to gain from a successful water project since they are primarily

responsible for health and hygiene.

• Open-up opportunity for home gardening: The access to water could also enable water for

home-grown vegetables and micro agriculture. It should, however, be noted that water

usually used for irrigation is cheaper than urban water supply. The reason is the difference in

costs. Water used for agriculture does not need to be treated. Enabling water usage for

home gardening would require two separate supply networks, one for potable water supply

via the water purification works. This two-tier system would however be too costly and thus

not possible to establish separate physical infrastructure and capital for the establishment of

a separate hard water supply to households. The result will be that home gardens will require

utilising more expensive treated domestic water and thus use thereof for other than domestic

uses will result in lower assurance for domestic supply. Opportunities for home gardening are

thus limited to the development of home-grown vegetables for own consumption making use

of domestic water supply.

• Freeing up water supply for other user sectors: The Taung Dam was initially constructed to

augment supply to the Taung Irrigation Scheme. However, currently there is no infrastructure

to convey water from the Taung Dam to the irrigation area. A need within the study area

exists for irrigation water supply. However the water from the Taung Dam has been identified

as being best put to use for domestic needs. However, using the water from the Taung Dam

to augment water to the Bogosing area and the Taung area could possibly free up water to

be transferred to Vryburg to augment water demand in that area. The exact water sector

beneficiary of this possibility is however not known. With regards to water for the irrigation

sector, it should be known that, separate from this study, Vaalharts Water is currently

working with the Department of Agriculture to compile a business plan for the upgrading of

the entire Vaalharts Irrigation Scheme’s canal network.

Feasibility Study for Utilisation of Taung Dam Water (v)


FEASIBILITY STUDY FOR UTILISATION OF TAUNG DAM

WATER

Table of Contents

PAGE

EXECUTIVE SUMMARY ...............................................................................................................(I)

TABLE OF CONTENTS................................................................................................................(v)

1. INTRODUCTION.............................................................................................................. 1.1

1.1. BACKGROUND OF STUDY ................................................................................................. 1.1

1.2. STUDY AREA .................................................................................................................... 1.1

1.3. PROPOSED INFRASTRUCTURE DEVELOPMENT: TAUNG DAM PURIFICATION WORKS ...... 1.2

2. REGIONAL ECONOMIC PROFILE.................................................................................. 2.1

2.1. GROSS GEOGRAPHIC PRODUCT ...................................................................................... 2.1

2.1.1. GGP Per Sector Of Naledi Local Municipality ................................................................... 2.6

2.1.2. GGP Per Sector Of Phokwane Local Municipality............................................................. 2.9

2.1.3. GGP Per Sector Of Greater Taung Local Municipality .................................................... 2.13

2.2. EMPLOYMENT................................................................................................................. 2.16

2.3. INCOME DISTRIBUTION................................................................................................... 2.20

2.4. LEVEL OF EDUCATION .................................................................................................... 2.22

2.5. CONCLUSION.................................................................................................................. 2.23

3. REGIONAL AND NATIONAL ECONOMIC IMPACTS ..................................................... 3.1

3.1 IMPACT ASSESSMENT ASSUMPTIONS .............................................................................. 3.1

3.2 IMPACT ASSESSMENT TECHNIQUE FOR QUANTIFICATION OF ECONOMIC IMPACTS........ 3.1

3.3 NATIONAL AND REGIONAL ECONOMIC IMPACTS DURING CONSTRUCTION ...................... 3.3

3.3.1. Stimulation Of The Economy ............................................................................................ 3.3

3.3.2. Employment Creation, Decrease In Local Unemployment Level And Skills Transfer ........ 3.5

Feasibility Study for Utilisation of Taung Dam Water (vi)


3.3.3. Business Output/Sales And Increased Standards Of Living.............................................. 3.7

3.3.4. Government Income And Expenditure .............................................................................. 3.8

3.3.5. Inflow And Outflow Of Temporary Workers....................................................................... 3.9

3.4. NATIONAL AND REGIONAL ECONOMIC IMPACTS DURING OPERATION ........................... 3.10

3.4.1. Stimulation Of The Economy .......................................................................................... 3.11

3.4.2. Employment Creation, Decrease In Local Unemployment Level And Skills Transfer ...... 3.11

3.4.3. Business Output/Sales And Increased Standards Of Living............................................ 3.12

3.4.4. Government Income And Expenditure ............................................................................ 3.13

3.5. ECONOMIC VALUE OF DOMESTIC WATER SUPPLY ......................................................... 3.13

3.5.1. Stimulation Of Income Generating Activities And Open Up Area For Development ........ 3.14

3.5.2. Free Up Time From Fetching Water And Obstacles To Economic Development ............ 3.16

3.5.3. Decrease Economic Decline Related To Water Shortages ............................................. 3.17

3.5.4. Provide Essential Final Good And Opening Up Additional Household End-Uses............ 3.18

3.5.5. Decrease In Poor Health Related Economic Burdens..................................................... 3.20

3.5.6. Open-Up Opportunity For Home Gardening.................................................................... 3.20

3.5.7. Freeing Up Water Supply For Other User Sectors .......................................................... 3.21

BIBLIOGRAPHY .......................................................................................................................... 23

Feasibility Study for Utilisation of Taung Dam Water (vii)


LIST OF ABBREVIATIONS

BD Bophirima District

DWAF Department: Water Affairs and Forestry

GTLM Greater Taung Local Municipality

FBD Frances Baard District

LMI Local Municipality

NLM Naledi Local Municipality

PLM Phokwane Local Municipality

NC Northern Cape

NW North West

RSA Republic of South Africa

Feasibility Study for Utilisation of Taung Dam Water 1.1


1. INTRODUCTION

1.1. Background of Study

The Taung Dam is a rollcrete dam located on the Harts River upstream of the Vaalharts

Irrigation Scheme in the Lower Vaal System. A recent survey indicated that the capacity

of the dam at full supply level is 62.97 million m3. The Taung Dam was constructed to

augment supply to the Taung Irrigation Scheme, but there is currently no infrastructure to

convey water from the Taung Dam to the irrigation area.

As a result, the Taung Dam is at present not utilised and the purpose of the feasibility

study was to establish if the resource could be economically used for water supply,

irrigation or other purposes within the project area.

Downstream from the Taung Dam the Spitskop Dam collects return flows from the Vaal-

Harts Irrigation Scheme, as well as runoff from the upstream catchments which has not

been utilised by existing developments. Surplus water is available in Spitskop Dam but is

of poor quality.

The project area extends over the whole of Taung Dam catchment and the Vaal-Harts

River system and the study took existing and planned regional development of the area

into account. Peri-urban areas around Greater Taung are currently served only with

groundwater, but in future both surface and groundwater resources will be required to

satisfy the increasing demand.

The purpose of this report, prepared by Kayamandi Development Services (Pty) Ltd, is to

provide the impacts of the regional and national economy from the utilisation of the Taung

Dam Water.

1.2. Study Area

The study area extends over the whole Taung Dam catchment and the Vaal-Harts River

System and includes the Naledi Local Municipality (NLM), Greater Taung Local

Municipality (GTLM) and Phokwane Local Municipality (PLM). The former two

municipalities form part of the Bophirima District Municipality in the North-West Province

and the latter forms part of the Frances Baard District Municipality in the Northern Cape.

Urban centres in the region include Vryburg and Stella in Naledi, Pudimoe and Taung

Station in Greater Taung, with Pampierstad, Hartswater and Jan Kempdorp in Phokwane.



1.3. Proposed infrastructure development

Taung Dam has a capacity of 62.97 million m³ and a historic firm yield of 6.13 million m3/a

of which none is currently used due to the absence of infrastructure to convey water to

potential users. A system is thus required to transfer water from the dam to the Taung

Main Supply System (TMSS) and extension of the TMSS needs to be considered to

supply new irrigation areas not served by the current system. It is understood that there

were two options available to supply the additional water demand, namely: increasing the

capacity of the Main Vaalharts Canal to supply additional demand from the Vaal River;

and provide a system to transfer water from the Taung Dam to the Taung Main Supply

System in order to utilise water from the Taung Dam on the Harts River upstream of

Taung. This regional and economic impact is based on the option of transferring water

from the Taung Dam to the Taung Main Supply System.

Figure 1.1 below provides an indication of the proposed infrastructure development for the

utilisation of the Taung dam water. Three areas have been identified as possible

beneficiaries of water from the Taung Dam, these are as follows:

• Villages south-east of Taung Dam: There are 14 villages in this south eastern corner

of the Greater Taung area that source all of their water from rudimentary borehole

schemes. If water from the Taung Dam is supplied to a storage reservoir at a high

enough point in the area, distribution networks would be installed to supply the area.

• Bogosing Water Supply Area: The Bogosing Water Supply Scheme supplies water to

six villages. Water is abstracted from the Vaalharts Canal and is then purified at a

package treatment plant with a capacity of 1.2 Ml/day. However, this package plant is

highly inefficient with water losses accumulating to approximately 35-40% and turbidity

in the water being a problem for communities along certain sections of the scheme. If

water from the Taung Dam is used to supply the Bogosing area, then Bogosing’s

allocation from the Vaalharts Canal Scheme could be transferred to Vryburg to

augment the water demand in this area. This would require upgrading of the Pudimoe

Water Treatments Works and the Pudimoe Canal delivering water to the treatment

works (both planned for the near future), as well as the Pudimoe-Vryburg pipeline

which was recently upgraded only to replace the old pipe. The capacity of this pipe is

not enough to carry the extra supply.

• Taung Water Supply Area: The Pudimoe Water Supply Scheme supplies water to 11

villages in Taung area. Water is supplied through the Vaalharts North Canal and the



Taung Main Canal via the Pudimoe Canal and purified at the Pudimoe Treatment

Works near Pudimoe. Water could be sourced from the Taung Dam to augment the

future demand. If water from the Dam is used to augment supply to the Taung area,

then water from the Vaalharts Canal Scheme could possibly be freed up to be

transferred to Vryburg to augment water demand in this area.

The proposed option for the utilisation of water from Taung Dam (as shown in Figure 1.1

below), on which the regional economic impact is based entails constructing a new water

treatment plant at the Taung Dam from where purified water could be distributed to the

Bogosing and Taung Water Supply Schemes as well as to the villages south-east of the

dam. Storage reservoirs will be constructed in both areas.

The main components of this scheme would be as follows.

• Water Treatment Works at Taung Dam;

• New storage reservoir on the highest point near Manokwane from where water would

gravitate to the Bogosing Water Supply Scheme as well as to the existing 5 Kl Taung

Reservoir in Taung Village;

• New storage reservoir on the highest point south-east of Taung Dam near Manokweng

to supply water to surrounding villages;

• Pump station at the WTW at the Taung Dam to pump purified water to the proposed

reservoirs at Manokwane and Manokweng villages;

• Pumping mains to convey purified water from the proposed WTW at the Taung Dam to

the proposed reservoirs at Manokwane and Manokweng villages;

• Gravity main from proposed reservoir at Manokwane to the sump of the existing pump

station at the Bogosing Water Treatment Works from where the water could be

pumped into the existing Bogosing Water Supply Scheme;

• Gravity main from proposed reservoir at Manokwane to the existing 5 Kl Taung

Reservoir in Taung Village; and

• Gravity main from proposed Manokweng reservoir to supply surrounding villages.



Figure 1.1 Infrastructure developments for utilisation of Taung Dam water

GROUND RESEVOR

TOWER RESEVOR

PUMP STATION

WATER TREATMENT WORKS

BALANCING DAM

PUMP MAIN

GRAVITY MAIN



The advantages of this option include that water losses of approximately 7% should be

allowed for at any water treatment plant. Pumping raw water to treatment works far away

from the source would result in pumping more water than would eventually be available to

use and is therefore considered an expensive exercise. Constructing a new treatment

works to purify the water near the Taung Dam would eliminate this long-term loss of

energy. Water will be purified relatively close to the end users. This will result in the cost

of the distribution network (pumping and gravity mains) to be less. The only disadvantage

of this option is that new treatment works at Taung Dam would require operation and

maintenance.



2. REGIONAL ECONOMIC PROFILE

This economic profile delves into the underlying structures and sectors that make up the

study area’s macro economy providing insight into trends and issues of economic

significance, relating to:

• Gross Geographic Product (GGP);

• Employment per sector;

• Level of education; and

• Income distribution.

2.1. Gross Geographic Product

Gross Geographic Product (GGP) is defined as the total value of final production goods

and services produced within a geographic boundary in a given period. Changes in the

local economy can therefore be expressed as an increase or decrease in GGP. Only the

results of the activities which are intended to satisfy the needs of other people through

trade are considered to form part of the GGP.

The Gross Geographic Product (GGP) contribution per sector between 1995 and 2005 for

each of the three local municipalities that form the study area is presented below in Figure

2.1.

Figure 2.1 GGP contribution (Rand million)

0

200

400

600

800

1000

1200

1400

1600

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

PLM NLM GTLM

Source: Quantec 2007 and Kayamandi calculations



It is evident that Naledi LM has consistently been the highest GGP contributor in the study

area followed by Phokwane LM. Greater Taung LM has consistently been the lowest GGP

contributor.

Table 2.1 provides an indication of the annual growth rate of GGP in the study area.

Table 2.1 Annual growth rate of GGP per municipality and country

Annual Growth rate of GGP LOCAL MUNICIPALITY

1995-2000 2000- 2005 1995-2005

PHOKWANE 1.9% 2.2% 2.0%

NALEDI 3.0% 4.2% 3.6%

GREATER TAUNG 0.7% 1.4% 1.0%

FRANCES BAARD DISTRICT

2.1% 2.0% 2.1%

BOPHIRIMA DISTRICT 2.7% 2.9% 2.8%

NORTHERN CAPE 2.8% 2.3% 2.6%

NORTH WEST PROVINCE

1.8% 3.9% 2.8%

RSA 2.9% 4.8% 3.7%


Between 1995 and 2005, Naledi Local Municipality experienced the highest average

annual GGP growth rate of all the three municipalities in the study area, at 3.6% on par

with that of the country as a whole. Naledi Local Municipality’s economy grew at a higher

average per annum than that of the Bophirima District (2.8%) and that of the North West

Province (2.8%). Higher per annum average growth rates in Naledi were experienced in

the 2000 to 2005 period when compared to the 1995 to 2000 period.

Between the ten-year period from 1995 to 2005, the economy of the Greater Taung Local

Municipality only grew at an average per annum of 1%, which is far lower than that of the

Bophirima District and the North West Province in which it is located. A higher than

average growth rate was however experienced in the latter half of the ten year period

which equates an average per annum growth rate double than that of the first 5 years.

Greater Taung’s economy grew at nearly a quarter than that of the country as a whole.

Phokwane Local Municipality experienced higher than average economic growth rates

than that of Greater Taung, but lower than that of Naledi Local Municipality at 2% per



annum over the ten-year period. The growth of Phokwane’s economy is similar to that of

the Frances Baard District at 2.1% growth and slightly lower than that of the Northern

Cape Province in which it is situated at 2.6%. The economy of Phokwane grew at nearly

half that of the country as a whole.

It is however important to note how each sector contributed to the aforementioned

growths, as each sector has been growing at varied rates between the ten-year periods.

Table 2.2 below reveals the average growth rate of the different economic sectors in each

of the local municipalities that make up the study area.

Table 2.2. Average Annual GGP growth by sector and municipality

AVERAGE ANNUAL GROWTH 1995 TO 2005 SECTOR

PLM GTLM NLM FBD BD NW NC RSA

Agriculture 2.5% 9.2% 5.3% 1.4% 6.2% 8.5% 4.9% 3.6%

Mining 6.7% 4.4% 4.5% 0.4% 5.4% 1.8% 2.3% 1.0%

Manufacturing 0.1% 0.6% 2.8% 0.5% 2.8% 2.7% 1.0% 2.8%

Electricity and water

-7.6% 0.7% -1.0% -1.4% 1.7% 0.5% -2.1% 1.8%

Construction 0.2% -2.4% 0.0% 0.2% -2.4% 3.5% 1.6% 4.6%

Wholesale and retail

5.0% 1.3% 1.4% 3.5% 2.2% 3.0% 3.8% 4.8%

Transport and communication

3.6% 6.7% 12.8% 2.3% 10.0% 6.5% 3.7% 7.1%

Business services

-0.3% -2.2% -3.1% 3.3% -1.8% 3.2% 2.0% 6.2%

Community services

3.9% 4.9% 3.5% 3.0% 4.1% 3.4% 3.3% 3.4%

Government services

1.9% -1.8% 2.2% 2.0% -0.6% 0.7% 1.9% 0.5%

Total 2.0% 1.0% 3.6% 2.1% 2.8% 2.8% 2.6% 3.7%


The above table shows different average annual growth rates for the different sectors in

each of the municipalities over the ten-year period from 1995 to 2005.

The following is noted with regards to the primary sectors, namely agriculture and mining.



Agriculture, hunting, fishing and forestry involve enterprises primarily engaged in farming

activities or the rendering of agricultural services. Commercial hunting, game farming,

forestry, logging and fishing are also included in this category. Regarding the agriculture

sector, Greater Taung LM had the highest growth with 9.2% followed by Naledi and

Phokwane each with 5.3% and 2.5% growth respectively in this sector. The high average

per annum growth in the agriculture sector is far higher than that of the Bophirima District

and slightly higher than that of the North West Province at 8.5% growth. In relation to the

growth of agriculture in the country as a whole, at 3.6%, the study area has shown quite

an aggressive growth in agriculture which far outweighs that of the country’s growth in

agriculture.

Mining and quarrying involves the extracting, dressing and benediction of minerals

occurring naturally. Phokwane’s mining sector has the highest growth, at 6,7% with Naledi

and Greater Taung’s mining sectors growing at 4.5% and 4.4% respectively. The growth

in mining in Phokwane is far higher than that of the growth in the Frances Baard District

and the Northern Cape at 0.4% and 2.3% respectively. The growth experienced in the

mining sector in Greater Taung and Naledi show similar patterns to the growth in the

mining sector of the Bophirima District at 5.4% albeit at a far higher growth than that of the

North West Province (1.8%). The study area experienced far higher growth rates in the

mining sector, compared to the low average per annum growth over the aforementioned

period for the country as a whole at 1%.

The following is noted with regards to the secondary services sectors in the study area,

namely manufacturing, electricity and water, and the construction industry.

Manufacturing is defined as a process of transforming materials physically, chemically or

by means of assembly into new products. Insignificant growth in the manufacturing sector

is noted over the aforementioned ten-year period in Phokwane and Greater Taung Local

Municipalities with 0.1% and 0.6% growth respectively. The manufacturing sector of

Naledi local municipality has however grown at an average per annum of 2.8%, which is in

line with the growth experienced in the Bophirima, North West and the country as a whole,

with 2.8%, 2.7% and 2.8% respectively.

Electricity, water and gas involve production, collection and distribution of electricity as

well as the manufacture of gas and the collection and distribution of water. The electricity

and water services sectors showed average per annum declines in both Phokwane with -

7.6% decline and Naledi with -1% decline. Greater Taung only showed relatively

insignificant growth over the aforementioned period at 0.7% growth in line with that of the

North West Province in which it is located. The study area as a whole experienced lower



than per annum average growth in the electricity and water services sectors for the

country as a whole.

The construction industry is also considered a secondary activity. It involves site

preparation, demolition, building, civil engineering, installation, plumbing, decorating, etc.

The construction sector also experienced insignificant growths in Phokwane and in Naledi

Local municipalities over the aforementioned period, whilst Greater Taung municipalities

experienced relatively high decrease in the construction sector in line with that of the

Bophirima District. The North West Province however showed significantly higher growth

over the period than of Naledi and Greater Taung local municipalities. The country as a

whole also experienced far higher annual growth rates than of the study area at 4.6%

growth per annum.

The following is noted with regards to the tertiary sector industries, namely wholesale and

retail trade, transport and communication, business and financial services, and

government and community sectors.

Trade entails the wholesale or retail sale of new and used goods in stores, stalls, markets

by mail order or by other means as well as hotels, restaurants, bars and other tourist

activities. The wholesale and retail sectors have shown significant growth in Phokwane

Local Municipality at 5% growth, which is on par with the growth in the aforementioned

sector for the country as a whole. Phokwane’s wholesale and retail sector experience

higher than average growth rates than its district and province. Both Greater Taung and

Naledi Local Municipalities showed relatively low growth rates in the wholesale and retail

sector at 1.3% and 1.4% respectively, far below that of the province and the country as a

whole.

Transport and communication involves the provision of passenger and or freight transport

by rail, road, water or air. It includes cargo handling and storage and postal activities,

courier activities and the transmission of sound images and data or other information.

Higher than average growth in the country in the transport and communication sector at

approximately 12.8% was experienced in the Naledi Local Municipality which is greater

than the national average of 7%. Greater Taung Local Municipality also grew at a

relatively high rate in the aforementioned sector. Both Naledi and Greater Taung local

municipalities grew in line with the average per annum growth experienced in the

aforementioned sector in the Bophirima District and that of the North West Province.

Phokwane Local Municipality’s transport and communication sector grew in line with that

of the Frances Baard District and Northern Cape, albeit at nearly half the growth rate of

the country as a whole for this sector.



Business and financial services sector includes the activity of obtaining and redistributing

funds, financial intermediation, insurance and pension funding. The buying, selling, renting

and operating of owned and leased real estate. The business services sector showed

declining rates over the last ten years since 1995 for all three of the local municipalities,

which jointly comprise the study area. The decline within these tertiary sectors are

concerning, especially if viewed in relation to far higher average per annum growth rates

in the sector in the district, provinces and for the country as a whole.

Community services involve provision of community services e.g. education, health

services, social work and activities of professional organisations. The community services

sector in each of the three local municipalities within the study area grew at relatively

average per annum growth rates in comparison with that of the country as a whole.

Government services involve activities of central, provincial and local government. The

government service has grown relatively insignificantly over the ten-year period, and in

Greater Taung this sector has actually declined by nearly 2% per annum. This is a good

indication in that lower dependencies in the government service sector are created, since

government services sector is not responsible for growing the economy.

Having looked into the average annual growth rate, the following is a detailed account of

the growth of GGP per sector over a ten year period (1995 to 2005) for each of the three

municipalities that comprise the study area.

2.1.1. GGP per sector of Naledi Local Municipality

Table 2.3 below provides an indication of the GGP contribution per sector and Figure 2.2

below provide an indication of the growth of GGP per sector from 1995 to 2005.

In Naledi municipality the Transport and Communication sector has shown a steady

increase from R 151,4 million in 1995 to R 448,7 million in 2005. It has been leading

contributor to the GGP from the year 2000 to 2005. The Finance and business services

sector was the leading contributor to the GGP from 1995 to 2000 and gradually declined

to second place. The government services sector, the wholesale and retail sector,

manufacturing sector as well as the community social and personal services sector have

been consistent middle order contributors to the economy. The agriculture and forestry

and fishing sector, which falls below the middle order contributors showed a rapid

increase between 1995 and 1996 (R 48,5 million to R 119.1 million) and then declined

gradually. The mining sector, the construction sector as well as electricity and water have

consistently been the lowest contributors to the municipality’s economy.



Table 2.3. GGP per sector (constant 2000 values) for Naledi Municipality

Sector 1995 2000 2005

Agriculture 48,557,121 93,917,830 77,276,929

Mining 7,221,518 7,701,558 10,771,911

Manufacturing 116,324,942 142,590,219 149,781,456

Electricity and water 19,763,919 15,908,056 18,056,610

Construction 13,464,352 12,078,013 13,416,484

Trade 151,683,316 172,101,777 172,121,370

Transport 151,416,928 242,914,938 448,706,500

Business services 272,194,048 219,413,234 204,242,104

Community services 102,119,516 122,918,548 139,075,417

Government services 148,147,441 167,842,952 180,132,783

Total 1,030,893,103 1,197,387,125 1,413,581,563


Figure 2.2 GGP per sector (constant 2000 values) of Naledi Local Municipality

0

10000000

20000000

30000000

40000000

50000000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Agriculture Mining Manufacturing Electricity Construction

Trade Transport Finance Community Government

Source: Quantec 2007 and Kayamandi Calculation

Table 2.4 below provides an indication of the percentage distribution of the GGP per

sector.



Table 2.4. Percentage distribution of GGP per sector, 2005

Sector NALEDI LM BOPHIRIMA DM NORTH WEST RSA TOTAL

Agriculture 5% 9% 3% 3%

Mining 1% 7% 30% 7%

Manufacturing 11% 9% 7% 18%

Electricity & water 1% 2% 1% 2%

Construction 1% 2% 2% 3%

Trade 12% 13% 13% 15%

Transport 32% 18% 10% 11%

Business services 14% 11% 14% 21%

Community services 10% 12% 8% 6%

General Government services

13% 17% 12% 14%

Total 100% 100% 100% 100%


In 2005 in Naledi LM the transport and communication sectors contributed the most to

GGP at 32% while the least contributors were the mining (0.8%) and construction (0.9%)

sectors. The trade and manufacturing sectors are also responsible for providing a

relatively high percentage contribution to the GGP of the municipality as a whole at 12%

and 11% respectively.

Table 2.5 below provides an indication of the sectoral share of Naledi Local Municipality’s

economy per sector.

Table 2.5 Naledi’s GDP sectoral share per sector to municipality, district and province

Sector Share Naledi’s

sectoral share to Naledi

Naledi’s sectoral share to Bophirima

District

Naledi’s sectoral share to North West Province

Agriculture 5% 25% 4%

Mining 1% 5% 0%

Manufacturing 11% 52% 3%

Electricity and water 1% 31% 3%






District


Construction 1% 18% 1%

Trade 12% 39% 2%

Transport 32% 73% 7%

Business services 14% 56% 2%

Community services 10% 35% 3%

Government services 13% 32% 2%

Total 100% 42% 2%


As is evident from the above, Naledi local municipality is responsible for more than 40% of

the district’s GDP and nearly more than 2% of the Provinces GDP. With regards to the

municipality’s sectoral share to the Provincial GDP per sector, it is noted that transport

followed by agriculture, manufacturing, electricity and water, and community services, are

responsible for larger than average provincial GDP share of the same sectors. The

following sectors, from highest to lowest, have also contributed to higher than average

GDP contribution to the district’s economy (42%), namely:

• Transport 73%

• Business Services 56%

• Manufacturing 52%

2.1.2. GGP per sector of Phokwane Local Municipality


below provides an indication of the growth of GGP per sector from 1995 to 2005.

Table 2.6. GGP per sector (constant 2000 values) for Phokwane Municipality

Sector 1995 2000 2005

Agriculture 8,592,777 98,162,937 97,747,265

Mining 22,655,979 31,536,938 40,730,272

Manufacturing 46,907,058 47,429,609 47,459,022



Sector 1995 2000 2005


Construction 24,195,784 21,615,516 24,547,909

Trade 165,811,944 213,528,400 256,723,415

Transport 88,702,425 101,030,485 122,448,670




Total 934,443,871 1,027,200,805 1,118,562,925


As indicated above and depicted below, the general government services sector has

consistently been the leading contributor to the local municipality’s GGP. The wholesale

and retail, trade, catering and accommodation sector is the second highest contributor to

the economy. The finance and business services, the transport and communication sector

as well as the agriculture, and the community, social and other personal services have

been consistent middle order contributors to the municipality’s economy. The electricity

and water sector underwent a rapid decline from R 88,8 million in 1995 to R43.3 million in

2005 and became part of the lowest contributors. The lower contributors to the

municipality’s economy are: manufacturing, mining and the construction sectors.

Figure 2.3 GGP per sector (constant 2000 values) of Phokwane

0

50000000

10000000

15000000

20000000

25000000

30000000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005



Source: Quantec 2007 and Kayamandi Calculations




sector.


Sector PHOKWANE

LM FRANCES BAARD DM

NORTHERN CAPE

RSA TOTAL


Mining 4% 16% 28% 7%




Trade 23% 13% 12% 15%

Transport 11% 14% 10% 11%




23% 17% 13% 14%

Total 100% 100% 100% 100%


In 2005 in Phokwane LM the trade and government services sectors contributed the most

to GGP at 23% each while the least contributor was the construction sector at 2% of the

GDP for the municipality as a whole. The transport and business services sectors are also

responsible for providing a relatively high percentage contribution to the GGP of the

municipality each contributing 11% to the GDP. The agriculture sector is also a relatively

high contributor at 9%. Phokwane municipality’s GDP contribution differs significantly to

the rest of the district and the province which have relatively higher contributions to their

respective GDPs from the mining sector.

Table 2.8 below provides an indication of the sectoral share of Phokwane Local

Municipality’s economy per sector.



Table 2.8 PLM’s GDP sector share per sector to that municipality, district, province, 2005

Sector share Phokwane’s

sectoral share to Phokwane

Phokwane’s sectoral share

to Frances Baard District

Phokwane’s sectoral share to Northern Cape


Mining 4% 3% 1%




Trade 23% 26% 10%





Total 100% 15% 5%


As is evident from the above, Phokwane local municipality is responsible for only 15% of

the district’s GDP and more than 5% of the province’s GDP. With regards to the

municipality’s sectoral share to the provincial GDP per sector, it is noted that trade,

followed by electricity and water, government services, agriculture, construction, and

transport, are responsible for larger than average provincial GDP share of the same

sectors. The following sectors, from highest to lowest, have also contributed to higher

than average GDP contribution to the district’s economy (15%), namely:

• Agriculture 56%;

• Trade 26%;

• Construction 21%;

• Manufacturing 21%;

• Government services 20%; and

• Electiricty and wtaer 18%.



The municipality’s contributes to more than half of the district’s share of agriculture, which

shows the relative importance of the agriculture sector in this municipality to the

agriculture sector of the district.

2.1.3. GGP per sector of Greater Taung Local Municipality



As indicated and depicted below, the government services sector proved to be the

consistently overwhelming contributor to the GGP of the Greater Taung Local Municipality

(contributing R183,5 million to the economy in 2005). The other sectors are closely knit

together in terms of contribution to the economy. The community, social and other

personnel services sector as well as the mining sector have shown a marked increase in

production from the year 2000 to 2005. The electricity and water sector is the lowest

contributor to the economy in this municipality.

Table 2.9. GGP per sector (constant 2000 values)

Sector 1995 2000 2005

Agriculture 13,229,900 29,805,023 29,291,764

Mining 49,924,581 52,134,180 73,368,835

Manufacturing 18,630,210 18,994,859 19,639,204


Construction 28,765,826 23,635,528 23,105,656

Trade 62,051,296 68,744,040 69,531,215

Transport 31,387,235 42,804,341 56,428,843




Total 13,229,900 29,805,023 29,291,764




Figure 2.4 Growth of GGP per sector of Greater Taung Municipality

0

50000000

10000000

15000000

20000000

25000000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005





sector.


Sector GREATER TAUNG LM

BOPHIRIMA DM NORTH WEST RSA TOTAL


Mining 12% 7% 30% 7%




Trade 12% 13% 13% 15%

Transport 9% 18% 10% 11%




30% 17% 12% 14%

Total 100% 100% 100% 100%


In Greater Taung LM in 2005, the government services sector contributed the most to

GGP at 30.4% while the electricity and water sector is the least contributor at 1.7%.



Community services (13.8%), trade (12.1%) and Mining (12.1%) are also significant

contributors to the GGP in Greater Taung LM. The contribution of the government

services to the economy of Greater Taung indicates a skewed economy, with a high

dependence on the government sector, which is not the case in the district, nor the

province or the country as a whole.

Table 2.11 below provides an indication of the sectoral share of Greater Taung Local


Table 2.11 GTLM’s GDP sectoral share per sector to municipality, district, province, 2005

Sector share GTLM’s

sectoral share to GTLM

GTLM’s sectoral share to Bophirima

District

GTLM’s sectoral share to North

West


Mining 12% 32% 0%




Trade 12% 16% 1%

Transport 9% 9% 1%




Total 100% 18% 1%


As is evident from the above table, Greater Taung local municipality is responsible for only

18% of the districts GDP and only 1% of the province’s GDP. With regards to the

municipality’s sectoral share to the provincial GDP per sector, it is noted that construction

and government and community services sectors are responsible for larger than average

provincial GDP share of the same sectors. The following sectors, from highest to lowest,

have also contributed to higher than average GDP contribution to the district’s economy

(18%), namely:

• Government services 33%;



• Mining 32%;


• Community services 21%; and

• Electricity and water 18%

The municipality’s contributes approximately a third to the district’s share of government

services and mining. This shows the relative importance of the mining sector in this

municipality to the mining sector of the district.

2.2. Employment

According to Statistics South Africa 2004, employment is defined as an activity in which

an economic active person is engaged for pay, profit or family gain or a combination of

any of the three. The definition applies to both the informal and formal sectors. Formal

employment is an important sector in the economy of a local municipality as it fosters

more sophisticated economic activities that would eventually improve the macro economy

of a particular local municipality.

Unemployment is a major problem in the area, which serves as fertile ground for other

social problems that hinder economic development and social well being. Many people in

the area are uneducated and have no income. Those who are employed are usually

employed in low-income industries i.e. as farm workers or domestic workers. There are

very few professional workers in the area.

Table 2.12. below provides an indication of the employment status of the potentially

economically active population of persons aged between the ages of 15-64 years as well

as the employment status of the economically active population (actively employed

population). It should be understood that the potentially economically active people

together with the total number of workers in an area and the number of people believed to

be available for work create what is known as the labour force, i.e. the population between

the ages of 15 to 64 years (as defined by Stats SA).

Table 2.12 below reveals that a significant percentage of the potentially active population

are not economically active. Greater Taung Municipality has the highest disparity of a

potentially active population as only 25% of the potentially economically active population

are indeed economically active, whereas in Phokwane and Naledi local municipalities this

is 55% and 59% respectively.



Table 2.12. Percentage distribution of formal employment status of economically active

population, 2007

PLM NLM GTLM FBD BD NW NC RSA

Employment status (%) of potentially economically active population (total population aged 15-64 years of age)

Employed 38% 31% 14% 37% 22% 37% 39% 40%

Unemployed 17% 28% 11% 18% 16% 20% 17% 19%

Not economically active

42% 38% 73% 41% 60% 39% 40% 37%

Not applicable 3% 3% 2% 3% 2% 4% 4% 4%

Total 100% 100% 100% 100% 100% 100% 100% 100%

Employment status (%) - Economically active population

Employed 69% 53% 55% 67% 58% 65% 69% 67%

Unemployed 31% 47% 45% 33% 42% 35% 31% 33%

Total 100% 100% 100% 100% 100% 100% 100% 100%

Source: Community survey 2007 and Kayamandi calculations

Phokwane LM has a significant percentage of the population of working age employed,

accounting for 38% of the potentially economically active population. This is in line with

that of the Frances Baard District (37%), the Northern Cape (39%) and South Africa (40%)

as a whole, in which it is situated.

Within Naledi local municipality only 31% of the potentially economically active population

is employed. This is however far higher than that of the Bophirima District (22%) although

far lower than that of the North West Province (37%) and the country as a whole.

Greater Taung LM has only 14% of its potentially economically active population

employed, which is far lower than that of its district and province. The above table also

reveals that the higher the disparity between the potentially economically active to the

economically active, the lower the amount of people actively employed or searching for

employment in order to improve their economic situation.

The level of unemployment prevalent in a particular area is a good indicator of the

intensity for the demand of job creation. Statistics South Africa defines the unemployed as

economically active people who: did not work in the past seven days, want to work and



are available to start work within a week from the interview, and have taken steps to look

for work or to start some form of work within the past 4 weeks. As shown in the above

table, 31% of Phokwane’s, 47% of Naledi’s and 45% of Greater Taung’s economically

active population are unemployed.

Table 2.13 indicates the sectoral distribution of the formal employment.

Table 2.13: Sectoral distribution of formal employment, 2005


Agriculture 17% 19% 8% 8% 18% 7% 19% 8%

Mining 1% 0% 5% 9% 8% 32% 10% 5%

Manufacturing 12% 9% 4% 8% 7% 7% 7% 14%

Electricity 3% 1% 1% 1% 1% 0% 1% 1%

Construction 3% 3% 7% 5% 5% 3% 5% 5%

Wholesale, retail, trade

17% 17% 15% 14% 14% 14% 13% 16%

Transport 3% 3% 2% 4% 2% 2% 3% 4%

Finance 9% 13% 8% 13% 8% 10% 10% 17%

Community services

12% 14% 13% 13% 15% 10% 12% 14%

Government services

24% 19% 37% 25% 21% 14% 20% 17%

TOTAL 100% 100% 100% 100% 100% 100% 100% 100%

Source: Kayamandi Development Services Calculations from Quantec, 2005

The main sectoral employment providers in Phokwane are government services (24%),

trade (17%), agriculture (17%), and manufacturing and community services each at 12%.

Agriculture is not such a high contributor to employment within the Frances Baard District

(8%), although within the Northern Cape it contributes 19% of all employment generated.

This shows the relative importance of the agriculture sector for employment in the study

area. The employment in trade is more in line with that of the district, province and country

as a whole. Trade however, remains an important contributor to employment within the

study area.



The top three sectors of employment in Naledi local municipality are agriculture and

government services sectors each contributing 19% of the municipality’s employment,

followed by the trade sector which employs 17% of the formal employees. The agriculture

sector is also a key employment sector for the Bophirima District (18%), but it is not such

a major employment sector in the North West Province (7%). Trade is also a key sectoral

employment sector in the district, province and country as a whole.

Figure 2.5 below provides an indication of the sectoral distribution of those formally

employed and enables comparison of the sectoral employment per municipality within the

study area and South Africa as a whole.

Figure 2.5 Percentage distribution of formal employment per sector, 2005

0%5%

10%15%20%25%30%35%40%

PLM NLM GTLM RSA


From the above Figure, the relative importance of the agriculture and manufacturing

sector in Phokwane, and Naledi Local Municipalities can be noted. The importance of the

trade sector to all the municipalities within the study area is also noted. High dependence

of Greater Taung on employment from the government services sector is also noted.

Figure 2.6 below provides an indication of change in formal employment from 1995 to

2005.

From the figure below it is noted that Phokwane Local Municipality has a greater number

of persons formally employed, followed by Naledi Local Municipality and then Greater

Taung Municipality. A general decline in the number of persons formally employed is

however noted from 1995 to 2005. This reveals that the level of employment is worsening,

which will have dire consequence for the economy of the municipalities and the region if

not addressed adequately and timeously.



Figure 2.6 Formal employment per municipality


2.3. Income distribution

Based on the relatively high unemployment figures and relatively high percentage of

employment in lower paying primary sectors such as agriculture the income distribution of

the municipalities within the study area is expected to be relatively low and needs to be

taken into consideration.

Disposable income is defined as the net income available to a particular person to either

save or spend. Income is an important factor to consider in a macroeconomic analysis as

it indicates the amount of money households have available to participate (buy and sell) in

the local economy.

Table 2.14 below provides an indication of the distribution of annual household income

per municipality.

Table 2.14 Percentage Distribution of annual household income per municipality

INCOME CATEGORY


No income 14% 13% 34% 17% 28% 23% 17% 23%

R 1- R 4800 15% 16% 11% 9% 14% 9% 9% 8%

R 4801-R 9600 25% 25% 26% 21% 25% 19% 22% 18%



INCOME CATEGORY


R9601-R 19200 17% 18% 15% 18% 16% 19% 18% 16%

R19201-R 38400 12% 12% 7% 14% 9% 16% 14% 13%

R38401- 76800 8% 7% 4% 10% 5% 7% 9% 9%

R76801- R 153600

5% 5% 2% 7% 3% 4% 6% 6%

R 153601 and more

3% 3% 1% 5% 2% 3% 4% 6%

TOTAL 100% 100% 100% 100% 100% 100% 100% 100%

Source: Census 2001 and Kayamandi Calculations

Greater Taung Local Municipality has the highest percentage of households with no

income accounting for approximately one third of the households (34%) as compared to

only approximately 14% of households in both Naledi and Phokwane Local Municipalities

with no household income. This reveals that the study area has a high indigent status. In

Phokwane (14%) and Naledi (13%) Local Municipalities there are however fewer

households without income than that of the country as a whole (23%).

In Phokwane, Naledi and Greater Taung approximately 15%, 16% and 11% respectively

of the municipality’s households are situated under the R1- R4 800 income category while

the most common income scale is between R4801 and R9600 of the study area. This

category describes the household income levels of approximately a quarter of each of the

municipality’s households. The R9 601 to R19 200 category has a significant amount of

the study area’s households indicating about 17%, 18%, and 15% of the population of

Phokwane, Naledi and Greater Taung Local Municipalities respectively.

Figure 2.7 below provides an indication of the household income distribution per

municipality.

In each of the municipalities a scenario is presented in which the majority of the

municipality’s households have an income (lower than R9600) while a minority have high

incomes. On the one hand there is a significant amount of people with no household

income while on the other hand there are a few households in the study area with very

high annual incomes of R153 600 and more. This indicates a huge income disparity which

is an obstacle to economic development in the study area.



Figure 2.7 Household income distribution per municipality

Source: Census 2001 and Kayamandi calculations

2.4. Level of Education

The following section provides an indication of the level of education. Education has a

huge bearing employment and income level. It enables people through training to be more

productive in the various sectors of the economy. Education is an important factor to

consider in a regional economic analysis as it plays a crucial role in the potential rate for

development. Table 2.15 provides an indication of the highest education levels reached.

Table 2.15 Level of education of the population aged 20 years and older

LEVEL PLM NLM GTLM FBD BD NW NC RSA

No Schooling 22% 21% 25% 13% 27% 15% 14% 11%

Primary 31% 29% 36% 27% 32% 31% 31% 26%

Secondary 37% 39% 31% 47% 32% 42% 44% 48%

Tertiary 9% 9% 6% 10% 7% 8% 9% 12%

Unspecified 1% 1% 2% 3% 2% 4% 3% 3%

TOTAL 100% 100% 100% 100% 100% 100% 100% 100%

Source: Kayamandi Development Services Calculations from Community Survey 2007

Figure 2.8 provides an indication of the percentage distribution of education of people

aged 20 years and above.



Figure 2.8: Percentage distribution of level of education (20 years and older)

Source: Community Survey 2007 and Kayamandi calculations

The above table and figure reveals that approximately 25% of the population aged 20

years and older living in Greater Taung Local Municipality have had no schooling, which is

extremely high compared to the national average of 11%. Approximately 36% of the

population have however had primary school education and 31% secondary education.

The tertiary level of education is very low at 6%. These figures reveal a generally low

level of skills that are incompatible with some economic activities in the municipality.

For Naledi Local Municipality the figures reveal a similar picture to the Greater Taung

Local Municipality as half the people living in the municipality, have either had no

schooling or only primary school education. The level of secondary school accounts for

39% of the population. The tertiary level of education is however more on par with that of

the country as a whole at 9%.

Phokwane Local Municipality shows a population above the age of 20 with 22% of

persons with no schooling. Approximately 9% of the population aged 20 years and older

have obtained tertiary education.

2.5. Conclusion

Naledi LM has consistently been the highest GGP contributor in the study area followed

by Phokwane LM. Greater Taung LM has consistently been the lowest GGP contributor.

Greater Taung thus has a very low GGP in relation to its population size which exceeds

that of the other two municipalities. The economy of Naledi Local Municipality experienced

the highest average annual GGP growth of all the three municipalities in the study area on

par with that of the country as a whole between the ten-year period from 1995 to 2005.



However, the economy of the Greater Taung Local Municipality only grew at nearly a

quarter than that of the country as a whole and Phokwane Local Municipality experienced

growth at nearly half than that of the country as a whole. The study area, mostly

Phokwane and Greater Taung Local Municipalities are thus areas with relatively low

growth compared to the country as a whole. The area also has a small economy in

relation to its contribution to the districts and provinces in which they are situated. This

area will thus benefit from economic injections in the form of the proposed development.

Unemployment is also a major problem in the area, hence the low GGP contribution,

which serves as fertile ground for other social problems that hinder economic

development and social well being. Many people in the area are uneducated, or have low

levels of skills that are incompatible with the desired level of economic activity in the

municipality. Those who are employed are usually employed in low-income industries

such as farm workers or domestic workers. There are very few professional workers in the

area. The result is that that a large portion of the population has limited to no income.



3. REGIONAL AND NATIONAL ECONOMIC IMPACTS

This section outlines the possible economic impacts that can be expected to occur in the

local and regional economy as a result of utilisation of water from the Taung dam. It is

important to note that the quantification of economic impacts on the regional and national

economy as determined with the input/output analysis is not based on local population

figures, but on additional expenditure in the economy during the construction and

operation phase associated with the infrastructure development required to enable supply

of domestic use of water from the Taung Dam to the villages south-east of Taung Dam,

Bogosing Water Supply area, and the Taung Water Supply area.

The following aspects are covered in this Section:

• Impact assessment assumptions;

• Impact assessment technique for quantification of regional and national impacts;

• National and Regional Economic Impacts during Construction;

• National and Regional Economic Impact during Operation; and

• Economic value of domestic water supply.

3.1 Impact Assessment Assumptions

This economic impact is based on the following knowledge and assumptions of utilisation

of Taung dam water at this stage:

• The pipeline will be installed outside of the road reserve outside of towns and

villages and inside the road reserve where the road goes through towns and

villages;

• A 12 metre wide servitude is required for the pipeline;

• No new fences will be installed alongside the servitude;

• The water of the Taung Dam will be utilised to provide in primary water needs only; and

• The construction phase will take place during 2010 and 2011.

3.2 Impact assessment technique for quantification of regional and economic impacts

In terms of quantifying the impacts on the regional and national economy an input-output

model was utilised. An input-output model has various analytical applications that can be

used to determine the direct, indirect and induced impact of the proposed transformation

process on the economy. The approach takes into account the interdependence between



different sectors (i.e. agriculture, mining, manufacturing, government, etc) in the local

economy as well as economic flows of goods and services to and from the economy.

This technique provides a snapshot of economic production at a given point in time and,

as such, has numerous application possibilities. The most prominent application of this

technique involves modelling the impact of changing production functions on general

economic equilibrium. In other words, the impacts that increased expenditure in the

economy resulting from the construction and operation of the civil and mechanical

components required for the utilisation of water from the Taung Dam were modelled.

Economic impacts are those impacts that affect the level of economic activity in a region.

For instance they directly affect the economic well-being of area residents and businesses

by changing employment levels and retail expenditures. An economic impact assessment

traces spending through an economy and measures the cumulative effects of that

spending.

Estimating the economic impact of a project or development is very helpful in

understanding the potential benefits of various forms of growth. It should be noted,

however, that the means of estimating these benefits are more useful in understanding

the likely order of magnitude of impacts rather than specific amounts.

Typically the effects of the input/output technique are as follows:

• The direct effects: this takes into account direct purchases made within the economy

by the project, the number of people employed, etc. This effect is the initial,

immediate economic activities (jobs and income) generated by a project or

development. Direct impacts associated with the development coincide with the first

round of spending in the economy.

• The indirect effects (backward linkages): this takes into account the fact that the

supplying industries (such as construction related industries, catering industries,

transport industries, etc) will also have to purchase more inputs, employ more labour

and pay more wages, and that there will be a chain reaction or multiplier of effects

as a result of increased spending in the economy. In other words indirect impacts

are the production, employment and income changes occurring in other

businesses/industries in the community that supply inputs to the project industry.

• The induced effects (forward linkages): this takes into account the fact that the

increased household income leads to an increase in household expenditure and to

increases in national production. Furthermore, the project will pay large amounts of



revenue to the different tiers of government, which in turn will increase overall

government expenditure in the economy. For instance, the induced effects arise

when employees who are working on the project spend their new income.

• The sum of the direct, indirect and induced effects is the total effect.

3.3 National and Regional Economic Impacts during construction

The following national and regional economic impacts (described hereunder) are

anticipated during the short-term construction phase:

• Stimulation of economy;

• Employment creation, decrease in local unemployment level and skills transfer;

• Business output/sales and increased standards of living;

• Government income and expenditure; and

• Inflow and outflow of temporary workers.

3.3.1. Stimulation of the economy

The construction of the infrastructure required for the provision of domestic water supply

will have a positive impact on the economy due to: increased financial spending in the

economy related to increased infrastructure investment, civil construction, mechanical

purchases, and increased expenditure by employees. This impact on the economy can be

manifested in terms of the sectoral impact on GDP.

In many instances goods do not reach the consumer via the market and it is also difficult

to calculate the value of these goods. As a rule therefore only the results of the activities,

which are intended to satisfy the needs of other people through trade, are considered to

form part of the GDP. If this is to be stated by way of formula, taking into account the

concept of value added, it can be put as follows: Gross value of production less value of

intermediate goods and services equates to gross value added. If the gross value added

of all the trading sectors is added together the GDP is obtained.

Change in gross domestic product essentially reflects the sum of wage income and

corporate profit generated in the study area as a result of an exogenous change in the

economy, in this case bulk water infrastructure.

In order to determine the increased financial spending in the economy the current

estimates of expenditure during construction were obtained.



It is important to realise that the construction impact is experienced during the

construction period. Thus, it is only sustainable for the duration of the development, i.e.

two years. Once the development phase nears its end, the construction impact

diminishes.

The local area and its activities (businesses and shops, etc) are expected to be stimulated

economically, due to the increased spending expected from the increased salaries and

wages paid to employees during construction and service industries in the region will thus

benefit from the activity. This will have a knock-on effect on suppliers of goods and

services in other areas.

The capital investment during the construction is thus expected to have a positive impact

on the economy resulting in increased financial spending in the economy in terms of

construction related activities, the increased infrastructure investment as well as increased

expenditure from the construction workers. This positive impact is likely to be experienced

in terms of the increased markets for the sale of local goods to construction staff and

direct employment by construction contractors.

The exogenous change in the economy will impact different sectors in different ways, with

some sectors such as manufacturing, trade and finance and business services benefiting

more than others. Sectoral impacts could include:

• Agriculture - during the construction phase the agriculture sector will be stimulated due

to the need for minor primary inputs from the agriculture sector for the infrastructure

development (such as lubricants) as well as for the increased purchases from

construction workers;

• Mining - During the construction phase the mining sector will be stimulated due to the

need for construction materials such as quarry for sand and gravel, and materials

used in the production of cement, iron, steel, etc;

• Manufacturing – Positive stimulation. Possible industries to be stimulated include

construction vehicles, concrete and cement, iron, steel and machinery, including

pumps;

• Construction – this sector will receive a large boost during the construction phase of

the option which include canals, pipelines, weirs, reservoirs, etc as well as indirect

construction. As construction is fairly labour intensive it is expected that a large

number of employment opportunities will be created although only temporary in nature

during construction;



• Trade- the trade sector includes retailers, wholesalers, restaurants and

accommodation establishments which are all expected to be stimulated mainly during

construction. The increase in people employed will lead to increased buying power in

the area which directly stimulates the wholesalers and retailers. Trade will be

stimulated by the large number of people either staying or moving around the area;

and

• Transport, finance and services: These sectors will be simulated mainly during the

construction phase through the increased number of people in the area.

The additional GDP arising from the capital investment during the construction phase of

the bulk water supply infrastructure could be approximately R60 million, approximately

half of which is due to the direct impact, R25 million due to the indirect impacts and R5

million due to the induced impacts. Approximately R5 million of this impact will accrue to

the North-West Province. During the construction phase the majority of the impact will be

felt in the construction, manufacturing, trade, and transport sectors.

The multiplier or spin-off effects associated with this economic contribution (namely capital

expenditure, salaries and wages, etc) include improved standards of living, decreased

dependence on pensions, increased disposable income and ability to purchase additional

goods and/or establish other business enterprises. Apart from having the potential to

create occupational opportunities, the proposed development could also stimulate

economic growth in the region by attracting other commercial activities. If this is the case,

indirect local benefits may accrue in the form of job opportunities in other sectors and

industries. The proposed development may also serve as a catalyst for the improvement

of services and infrastructure in the longer term.

3.3.2. Employment creation and skills transfer

During the construction phase, temporary employment will be created. The increased

temporary employment in the area during the construction phase will also result in

increased expenditure, which, in addition, will mean that more than just the proposed jobs

required for the construction will be created due to economic spin-offs that will result.

During and towards the end of the construction period, the temporary employment

contracts awarded need to be terminated. This could result in sudden loss of income,

wealth, new business sales, etc. The employees, surrounding community, businesses, etc

would all need to be informed of this from the start so that expectations are not created

and that the negative effects associated with the termination of temporary employment

contracts can be absorbed as far as possible.



The unemployment rate of the economically active population within the communities in

the affected municipalities is currently high. The proposed development will thus bring

some relief to the high unemployment figures in the area during the construction phase.

Most of the indirect and induced jobs will be created in the manufacturing, finance and

business sector, mining, trade and accommodation sectors and transport sectors. During

the construction phase, local contractors and service providers need to be utilised as far

as practically possible.

The benefit of increased jobs in the area can also be translated into economic terms, and

the additional jobs would in essence result in additional income creation. This increase in

income in the area can be translated into specific impacts ranging from black economic

empowerment (BEE) to poverty alleviation depending on the procurement policy and the

construction technology applied. More previously disadvantaged people could be provided

with an opportunity to become involved in the formal economy and also provided with an

annual income that would place them in the financial position to acquire all the goods and

services that are required to maintain a basic level of living.

Total employment generation reflects the number of jobs created or lost as a result of the

exogenous change in the economy. A job is defined as one person employed for one

year. This does not mean that new job opportunities arise per year, but that new man

days of work arise each year some of which could be fulfilled by existing employees

others requiring new temporary employment, etc.

The proposed infrastructure development and mechanical manufacturing of infrastructure

requirements will lead to the creation of additional jobs to the approximate amount of

1,800 during the construction phase. The direct temporary employment opportunity during

the construction phase is approximately 600 jobs. Approximately 10% of the national

employment effect will accrue to the North West Province. The sectors mostly stimulated

by additional employment generation during the construction phase are the construction

sector, services and household sector and the manufacturing sector.

With an increase in employment, a definite transfer of skills will result. Skills development

is a requisite for human resource development, and will have a lasting impact on the

economy. Allied to the additional jobs created during the construction phase there will be

an element of skill acquisition. This skill acquisition is valuable in that people that have

acquired these skills will be able to search elsewhere for similar construction employment

after the completion of the construction phase, and will be better equipped to handle the

D.I.Y household jobs. It should however be noted that the skill acquisition will probably be



limited to on the job training although skill acquisition is expected to take place since the

construction phase is estimated to last two years.

3.3.3. Business output/sales and increased standards of living

The increased employment expected with the construction of the bulk water infrastructure,

will impact positively upon the regional and local economy.

Increased employment is associated with increased income and consequently with

increased buying power in the area, thus leading to new business sales. With the

increased employment and a subsequent increase in monthly incomes, increased

business opportunities can be experienced. The economic benefits mostly include an

increase in trade such as local shops, restaurants, accommodation and transport

services. These increases in businesses are as a result of the following factors:

• Increased market size;

• Higher disposable incomes;

• Satisfaction of identified needs (such as building materials, or foodstuffs); and

• Increased consumer spending and increase entrepreneurial opportunities.

New Business Sales refers to the value of all inter- and intra-sectoral business sales

generated in the economy as a consequence of the introduction of an exogenous change

in the economy. Explained more simply, new business sales equates to additional

business turnover as a result of the introduction of a change in the economy.

Direct investment in the construction sector during the construction phase will yield new

business sales to the value of approximately R490 million for the bulk infrastructure.

Approximately R50 million of the total national effect is likely to accrue to the North West

Province. During the construction phase the sectors that will mostly be stimulated by new

business sales include the electricity and water sector, the construction sector, the

manufacturing sector, and the household sector.

As such it is evident that over and above the originally invested money during the

construction phase, a large amount of revenue is generated due to the multiplier effect in

the different sectors of the economy.

The sectors that will experience the highest demand for additional output are

manufacturing (i.e. manufacturing and supply of building materials), trade (i.e. supply of



final goods and services), finance, real estate and business services (i.e. professional

services).

It is also anticipated that a positive local impact will be felt at Taung due to increased local

shopping and accommodation requirements during construction. The injection of

employment and money into the local community will be beneficial to the

towns/settlements as a whole. The increased employment expected with the

development, will also impact positively upon the regional and local economy. Increased

employment is associated with increased income and consequently with increased buying

powers in the area, thus raising the standards of living of the area. Given the current high

unemployment rate in the surrounding towns/settlements, the project therefore has the

potential to bring much needed economic relief to the local population.

With the increased employment and a subsequent increase in monthly income, increased

business opportunities can be experienced with the development. The economic benefits

that could be obtained include an increase in trade, and the development of new trade

such as local spazas, shops, stalls, etc as a result of the patronage of construction staff.

3.3.4. Government income and expenditure

The bulk water infrastructure can be seen as an economic injection to the area as it would

lead to increased government income.

The economic impacts will lead to fiscal impacts, which are changes in government

revenues and expenditures. For example, economic impacts on total business sales,

wealth or personal income can affect government revenues by expanding or contracting

the tax base. Due to the jobs that will be created as a result of the proposed development

as well as the increased business activity levels, the salaries and wages of those jobs

along with the increased turnover of the companies can be translated into increased

personal and business income tax.

In other words, government income will be increased as a result of the increase in tax it

will receive from the proposed construction of the bulk water infrastructure. The increased

government income from tax will mostly be as a result of increased economic activity.

Increased tax received by the government will be in the form of:

• Company tax;

• PAYE;

• UIF (Unemployment Insurance Fund);

• Skills development Levy (SDL); and



• Rates and taxes.

The proposed bulk infrastructure can thus be seen as an economic injection into the area

as it would lead to increased government income. The development could thus lead to the

creation of other economic spin-offs that benefit the entire region. Local benefits could

accrue to the government through an increased tax base increasing the capacity of the

local municipality and other social and service support actions. In other words, the

increased income received by the government will enable increased spending locally. This

means that increased government services such as community facilities could be provided

by the increased income generated.

3.3.5. Inflow and outflow of temporary workers

Impacts of large-scale development projects tend to be closely associated with the

relocation (immigration) of project workers and their families to communities near the

project site. This will thus lead to a substantial local population growth, demands on local

services and infrastructure, fiscal problems for local governments, and increased

problems of social assimilation.

These problems are typically exacerbated by fluctuations in workforce size, which could

occur during the construction based on the different construction components and the

length of the construction period. The influx of people could be brought about by a number

of factors. Through its positive economic impacts, the construction phase can attract

squatters in search for employment (both directly and indirectly related to the project).

Squatter camps can have a number of environmental impacts, which in turn impact upon

the economy, such as an increase in crime, increase in STDs and related illnesses,

increased pressure on social facilities and bulk infrastructure, potential loss of power

amongst local traditional leaders, etc.

Key factors affecting the number of workers and dependents who move to the site include

the size of the project workforce, the magnitude of secondary employment effects, the

proportion of the jobs that are filled by local project workers (including daily commuters),

the extent to which non-local project workers are accompanied by their families, and the

size of those families.

In the event of imported workers entering the area during the construction phase, conflict

may arise with the local population due to different cultures, traditions and habits.

Imported workers may be relatively well paid compared to the local workforce around

towns and farms, which could lead to conflict.



Therefore, an emphasis on use of local labour is suggested as the use of outside or

imported labour may have negative implications for the surrounding economic status quo.

The ‘outside’ persons could create a new social class with different behaviours and

lifestyles. Employment of a large outside workforce could lead to conflict between

‘outsiders’ and locals due to differences in culture and values, competition for employment

opportunities, a perception among local residents that facilities are being provided for

outsiders while their own needs are not being addressed, etc.

The accommodation of staff in the absence of their family members - has the potential to

result in more incidences of sexually transmitted diseases (STDs) and AIDS. In these

instances employees are away from home and are not accountable to family structures

that assist in providing the checks-and-balances often necessary for the control of sexual

promiscuity. In addition, the disposable income available to employees makes them an

attractive target for sex workers. Furthermore, local men and women may become

romantically involved with construction staff that have previously contracted STDs or

AIDS. These may all negatively impact the regional economy.

Increase in local population could also trigger indirect impacts such as a higher crime rate.

This will be impacted by the rate of influx of persons due to the construction activities.

Crime in the area is currently controlled by virtue of the fact that residents know each

other and are familiar with the comings-and-goings of their neighbours and fellow

residents. The in-migration of outsiders (including construction staff) will therefore dilute

the extent of familiarity within the area and undermine the role of familiarity as a system of

control. In addition, outsiders may not respect the judiciary roles of the traditional leaders

and the part that they play in controlling the extent of crime in the area.

3.4. National and Regional Economic Impacts during operation


anticipated during the long-term operation phase:



• Business output/sales and increased standards of living; and

• Government income and expenditure.




The operation and maintenance of the infrastructure associated with the delivery of

domestic water supply will have a positive impact on the economy due to increased

financial spending in the economy, and increased expenditure by employees. During the

operation phase, GDP will be stimulated but to a far lesser degree than in the construction

phase due to far less jobs being created and far less expenditure. However, the operation

impact will be sustained for a longer period and the impacts associated are thus far more

sustainable.

Possible regional economic influences that may impact on the growth of the study area

during operation include:

• Regional development initiatives - the development policies of the North West

compared to other provinces as well as the status of the study area in the province;

• Agriculture- possible expansion of irrigation (although not as a direct result of the

infrastructure developed for the supply of domestic water); and

• Capital development projects – the study area will receive an economic boost from

employment of local labour and purchasing of supplies. The injection of capital in the

operation phase is however small in comparison to the value of the project.


approximately R400 000 per annum. This means that the economy will experience a

direct growth effect during the operation period of approximately R200 000, and an

indirect growth effect of approximately R150 000 and a relatively small induced effect of

R50 000. Furthermore, based on expected procurement, approximately R40 000 per

annum will accrue to the North-West Province. During the operation phase the sector

mostly stimulated by additional GDP generation is the water and electricity sector.

3.4.2. Employment creation, decrease in local unemployment level and skills transfer

Full-time employment during the operation of bulk water distribution and purification works

will have a permanent effect on the economy, although probably far less than during the

construction phase. Apart from the permanent directly created jobs there will be scope for

other jobs to be created by the local population due to spin-off effects in the economy as

well as due to stimulation of additional income generating activities consequent upon

greater water supply. Stated differently, during operation the access to potable water will



also result in the avoidance of job losses due to current water supply not meeting

demands.

During the operation phase the project will lead to the creation of an additional 5 jobs per

annum approximately. Note that a job is defined as one person employed for one year. It

is relevant to note here that the operating expenditure impact is expected to be relatively

small and will most probably be absorbed by the existing management and maintenance

personnel. It is also assumed that most of the operating expenditure will be spent on the

maintenance of the facilities/infrastructure.

Apart from the permanent directly created jobs there will be scope for other

entrepreneurial jobs to be created by the local population. The majority of the indirect and

induced employment will be in the retail and trade sector. For instance, women can

engage in economic activity, household chores, obtain education rather than spend time

and energy collecting water – opportunity benefits of piped water. These are explained in

detail in the following sub-section relating to the economic value of increased domestic

water provision.

Transfer of skills during the operation/maintenance phase will probably take place but on

a far smaller and relatively insignificant level as permanent positions will probably be filled

by existing staff.


During operation, it is anticipated that fewer people will be employed than during the

construction, although persons will be permanently employed during operation. These

persons will experience a substantial and lasting increase in their standards of living. In

addition the increased income earned by permanent employees as well as the increased

income earned from the stimulation of income generating activities consequent upon

larger quantities of water supply will result in increased buying powers and hence an

increase in local business sales and standards of living.

During the operation phase the investment in the economy, associated with the

maintenance and operation of the infrastructure only, will generate new business sales to

the approximate value of R2 million per annum of which approximately R1 million is a

direct impact and the remaining is due to indirect and induced effects. Approximately

R240 000 of the total national effect is likely to accrue to the North West Province per

annum. During the operation phase the sectors that will mostly be stimulated by new

business sales include the electricity and water sectors, the household sector, the

manufacturing sector and the financial services sector.



As such it is evident that over and above the annual investment during the operation

phase, additional revenue is generated due to the multiplier effect in the different sectors

of the economy.


The operation and maintenance of the bulk water infrastructure can be seen as an

economic injection into the area as it would lead to increased government income.


revenues and expenditures. During the operation phase, the expected permanent jobs per

annum will bring in a constant income to the government in the form of personal tax. In

addition company tax and VAT, other indirect taxes and services will also be a sustained

income for the government during the operation.

The operation and maintenance of the proposed bulk infrastructure can thus be seen as

an economic injection into the area as it would lead to increased government income. The

development could thus lead to the creation of other economic spin-offs that benefit the

entire region. Local benefits could accrue to the government through an increased tax

base increasing the capacity of the local municipality and other social and service support

actions. In other words, the increased income received by the government will enable

increased spending locally for a sustained long-term period.

3.5. Economic value of domestic water supply

The following economic impacts (described hereunder) are anticipated once the bulk

water supply infrastructure is operational and domestic water supply is provided to the

villages south-east of Taung Dam, Bogosing Water Supply area, and the Taung Water

Supply area:

• Stimulation of income generating activities and opening up area for development;

• Freeing up time from fetching water and obstacles for economic development;

• Decrease economic decline related to water shortages;

• Provide essential final good and opening up additional household end-uses;

• Decrease in poor health related economic burdens;

• Opening up opportunity for home gardening; and

• Freeing up water supply for other user sectors.



3.5.1. Stimulation of income generating activities and opening up area for development

Currently the Taung Dam has spare capacity and the purpose of the project is to best use

the spare capacity of water. Water is a scarce resource and it can be reasoned that water

should be rationed to competing uses according to economic criteria or maximisation of

returns. However water is not a private good but a public or merit good since it is a scarce

natural resource consumed collectively and provision necessitates both government

intervention and finance. The price of water is thus not determined by the market forces of

supply and demand. Since the market mechanism is not functioning in the water market,

the price of water is not known. It is therefore necessary to determine the economic value

of water which will serve as a proxy for the market price of water. The value of water is

important in two distinct, albeit related roles:

• Firstly where the supply of water is insufficient in relation to the demand in certain

short-term circumstances such as severe drought, the value of water serves as a

proxy for a component of the price system in targeting water restrictions so as to

cause least harm; and

• Secondly, the financial resources spent on providing the appropriate level of water

supply in the long-term to consumers and the economic optimal level of development.

Demand from each water using sector must be viewed in relation to the total available

water supply. Sectors compete for available water supplies, but each sector’s continued

existence is partially dependent upon the output of other sectors and hence their need for

water. Sectors are thus economically interdependent and each is dependent upon water

availability. A shortage of water in a particular sector may indirectly restrict output of

several sectors.

It is however generally not economically feasible to develop and operate a water resource

system to meet all the sectoral demands at all times. This means that 100% of the

demand cannot be supplied for 100% of the time and shortfalls in the supply will occur

from time to time. If shortfalls occur frequently the supply will have a low assurance and

relatively few shortfalls represent a high assurance in supply. It is important here to note

that different types of user groups or categories will require a different assurance of

supply. Irrigation will typically be supplied at a lower assurance than water for domestic

and industrial purposes and water for strategic industries such as power generation will be

supplied at even a higher assurance. It is also logical to sub-divide the supply to irrigation

into different assurance levels, as permanent crops such as export grapes would require a

higher assurance than for example a cash crop.



Since households need 100% assurance of water supply, the water of the Taung Dam

would be utilised to provide in primary domestic water needs only. Households supplied

with water in house need a guaranteed supply and it is thus not sensible to take some of

the water from the Taung Dam for other uses such as irrigation when some households

could suddenly have insufficient water for essential domestic use.

The higher supply of domestic water during operation could result in the stimulation of

economic activities reliant on water such as tourism related development, as well as a

stimulation of irrigation (indirectly due to freeing up water supply in other areas), industrial

and agricultural water users, and other economic activities. This will cause a permanent

economic upliftment in the area.

The Taung Dam is reportedly an attractive dam site and tourism developments are

already in place and underway. As the dam offers tourism and recreational opportunities,

the North West Parks and Tourism Board is in the process of establishing a protected

environment around the Taung Dam. This will mean additional job opportunities for local

people in the tourism sector. It is expected that the development of existing towns within

the area as service centres for tourism will be crucial in ensuring maximized use of

products and services from the area and avoiding leakages. This will ensure that tourism

development in the area is to the maximum benefit of the area.

Access to water could lead to economic spin-offs for the local community, particularly

women. Water is a holistic resources - water supply is not just about drinking water and

domestic use. Effective projects around the world have shown that water supply can also

be linked to income generating activities and local economic upliftment. Water is an

essential input in agriculture, and also in several manufacturing industries. Economic

development opportunities in sectors that are heavily dependent upon water to provide

their services include:

• Laundry and cleaning facilities;

• Sport related clubs and facilities;

• Amusement and recreation services;

• Hotels and lodging places;

• Eating and drinking establishments;

• Car washes;

• Hair dressers and other personal services;

• Butchery;



• Farming: horticulture and livestock and irrigation; and

• Food and beverages.

3.5.2. Free up time from fetching water and obstacles to economic development

In textbook economics, entrepreneurs use resources to produce goods and services that

they have to sell at a profit in order to survive. The owners of those resources earn an

income by either selling or hiring out their resources or by using them themselves in

production. Without productive resources there can be no economic activity. Some of the

most important resources available to people are land, water, capital (finance) and human

skills. In the study area (and South Africa as a whole) there has been a long history of

proscribed access to these resources. This has affected rural people and rural areas in

many different ways, and lies at the heart of the ‘rural problem’.

Access to potable water remains the most critical and worrying constraint for many rural

people, and many of them spend several hours a day securing supplies. Women (and

children) are mostly affected by having to walk longer distances to collect smaller amounts

of water. The time lost is invaluable to most women and children.

The provision of potable water for domestic use will have profound and far reaching

impacts on the population and will release them for spending several hours a day securing

supplies to being able to search for work, undertake education, etc. All of these will have

profound effects on the regional economy.

Economics is essentially about the way in which tradeoffs, seen from a human welfare

point of view, influence decision-making. Tradeoffs are always made when making

decisions about scarce resources, and the funds that are expended on ensuring access to

potable water represent a scarce resource. Thus in allocating the water to domestic use,

the opportunity to use them for another use is foregone, and the value of this other use is

the opportunity cost of putting them to the first use.

Key aspects to be noted in supply of domestic water are:

• The element of equity: addressing the past inequity between communities in service

access which encompasses the social component of water use;

• The element of sustainability: the environmental need for water (as well as that of

downstream users including neighbouring states); and



• Economic efficiency, cost recovery, user-payments and private sector involvement:

water is seen as an economic good, to be used in the most efficient setting possible

to promote the overall economic development of the country.

The regional economic effects of potable water provision have most obviously been noted

under the previous system where water ownership was tied to ownership of land, and as a

result the majority of South Africans were “condemned to a life of poverty, insecurity and

contentious exposure to diseases that would otherwise be avoidable. With access to

potable water the obstacles in the development of the following impoverished

communities will be addressed:

• 14 villages south-east of Taung Dam who currently obtain all their water from

rudimentary borehole schemes;

• 6 villages being supplied by the Bogosing Water Supply which is highly inefficient and

turbidity in the water is problematic for the communities; and

• 11 villages in the Taung area currently being supplied by the Pudimoe Water Supply

Scheme with insufficient capacity for future water demand.

Unemployment is high in these villages and many people rely on income from family

members working in the cities. Many communities struggle to find water for domestic use.

Development opportunities in the area have been few, hampered inter alia by a lack of

water. The provision of potable water to these communities will also result in a key

regional economic impact namely the improved spatial distribution of water and the

matching of supply with demand. This project will thus improve the quality of life of the

poor and will enable keeping intact the onslaught in the fight against poverty.

Furthermore, access to domestic water includes water that people use in their homes for

things such as cooking, bathing, drinking and removing household waste and for outdoor

purposes including lawn watering, car-washing and swimming pools. Shortage of water

would mean that households would probably have to eliminate some or all outdoor water

use, which could have implicit and explicit economic costs including losses to the

horticultural and landscaping industry.

3.5.3. Decrease economic decline related to water shortages

The effects of water shortages can be social or economic. Distinctions between the two

are both semantic and analytical in nature – more so analytic in the sense that social

impacts are much harder to measure in quantitative terms. Nevertheless, social effects



associated with drought, water shortages or limited access to water (as in this case)

usually have close ties to economic impacts. For example, they might include:

• Demographic effects such as changes in population -which impact upon the

economy;

• Disruptions in institutional settings including activity in schools and government;

• Conflicts between water users such as farmers and urban consumers;

• Health related low flow problems (e.g., cross connection contamination, diminished

sewage flows, increased pollutant concentrations);

• Mental and physical stress (e.g., anxiety, depression, domestic violence);

• Loss of aesthetic and property values;

• Reduced recreational opportunities; and

• Decrease in demand for workers due to unmet water needs which could affect

migration patterns in a region.

However, the notion that water supply contributes to economic growth and development is

highly intuitive. It is known that many of the world’s major cities owe their origin to their

location along coasts or rivers where water-borne transportation was facilitated. But, the

relevant question is whether an increment in water availability would generate an

increment in economic activity today, and how much. Water projects have long been


investment in water supply does not automatically guarantee economic growth. But this

does not mean that there is never an economic case for investing in water supply. While

water does not automatically generate growth, it may be the case that areas which persist

in lacking an adequate water supply (regardless of whether or not they started out with

adequate water) will not flourish economically. For example, one can expect that people

will eventually leave those areas and migrate to other areas that do have an adequate

water supply. Thus, lack of water could be a sufficient condition for economic decline or,

to put it another way, water may be necessary, but not sufficient for economic growth.

3.5.4. Provide essential final good and opening up additional household end uses

Water is essential for life – human, animal, or plant. In economics, there is a concept, also

called essentialness that formalizes this notion. The concept can be applied either to

something that is an input to production or to something that is directly enjoyed by people



as a consumption commodity. In the case of an input, if an item has the property that no

production is possible when this input is lacking, the item is said to be an essential input.

In the case of a final good, if it has the property that no amount of any other final good can

compensate for having a zero level of consumption of this commodity, then it is said to be

an essential commodity. Water obviously fits the definition of an essential final good:

human life is not possible without access to water.

In addition to being essential for human life, water contributes in important ways to the


uses of water besides its use for drinking. Water consumption has grown over time

through the steady accretion of end uses, each representing the discovery of a new way

to employ water for people’s use and enjoyment. When a piped water supply first became

available, the initial household uses were the same ones that had existed when family

members had to fetch water from an external source – drinking, cooking, hand washing,

and limited bathing. As time passed, many other uses were found – tubs for bathing,

water borne sanitary waste disposal, outdoor landscape and garden watering, automatic

clothes washers, swimming pools, automatic dish washers, car washing, garbage

disposal, indoor evaporative cooling, hot-tubs, lawn sprinklers, etc. The result has been a

constantly rising trajectory of per capita household water use.

It is common to talk of the value of water as though it were a single, homogenous

commodity. This is obviously false: water has many dimensions besides just quantity.

These include: (a) location, (b) timing, (c) quality, and (d) variability/uncertainty. To a user,

one litre of water is not necessarily the same as another litre of water if it is available at a

different location, at a different point in time, with a different quality, or with a different

probability of occurrence.

There are numerous ways in which an increment in water might produce benefits, whether

to those who use the water directly or to others. Examples include: the use of water for

agricultural or industrial production, its use for hydropower or for navigation, residential

use, water based recreation, or aquatic habitat.

It is however important to note that it is not the responsibility of the Department of Water

Affairs and Forestry to provide water to individual households. This remains the

responsibility of the relevant local authorities. The project will include reservoirs from

which local authorities will be able to source water for domestic reticulation. Importantly,

the Department should however engage with the relevant stakeholders to ensure the

required plans and programmes are in place. The Department should also support



municipalities in securing funding for water services infrastructure. This is an important

aspect in terms of successful cooperative governance.

3.5.5. Decrease in poor health related economic burdens

The lack of access to adequate water supply brings the risk of ill-health or even death and

undermines people’s dignity. Ill-health and death have a profound impact on the regional

and national economy.

The access to an assured supply of domestic water could be sufficient to respond to

special needs for the sick, particularly relevant in the light of the HIV/AIDS crisis. The

positive impact which providing a workable amount of clean water will have on the overall

health of the population far outweighs the direct financial costs of providing the water.

However, for water supply to be effective in improving health, interactive/participatory

health and hygiene education is critical.

Women and children are the primary managers of water at household level and have to

bear the burden of increased sickness in the household associated with waterborne

diseases. Women therefore have the most to gain from a successful water project.

Women are also primarily responsible for health and hygiene, so their meaningful

involvement is equally important.

3.5.6. Open-up opportunity for home gardening

The access to water could also enable water for home-grown vegetables and micro

agriculture. Micro agriculture can be described as farming on a small scale incorporating

irrigated community gardens, food plots and homestead based livestock enterprises.

When potable water supply is made available to the aforementioned communities, micro-

agriculture has the potential to substantially alter the water usage patterns in the study

area if implemented on a large scale. The broad concept of micro-agriculture in an urban

or peri-urban area has been referred to as agro-urban development which embraces the

following key components:

• The identification and allocation of an area or areas adjacent to or within an informal

settlement or an area demarcated for informal settlement for the purposes of irrigated

food production or other appropriate forms of agriculture. The selected site should

have soils that are appropriate for irrigated agriculture;

• The supply of affordable water for irrigation;



• The identification and development of such a site should form part of the basic

skeleton of the informal settlement;

• The development of such an area should be undertaken with maximum involvement

and commitment of the community itself with emphasis on community based self-help

development;

• Food production for home consumption and the sale of surpluses for cash generation;

and

• Production can be by individuals, food garden clubs or co-operatives from community

gardens or individually owned food-plots or even the smaller individual homestead

gardens.

It should, however, be noted that water usually used for irrigation is cheaper than urban

water supply. The reason is the difference in costs. Water used for agriculture does not

need to be treated. Enabling water usage for home gardening would require two separate

supply networks, one for potable water supply via the water purification works. The

second system is the direct supply for garden water via a separate reticulation system. In

other words raw water used for gardening and potable water used for consumption

purposes. This two-tier system would however be too costly and it won’t be feasible to

establish a separate physical infrastructure and capital for the establishment of a separate

raw water supply to households. The result will be that home gardens, will require utilising

more expensive treated domestic water and thus use thereof for other than domestic uses

will result in less assurance for domestic supply.

Opportunities for home gardening are thus limited to the development of home-grown

vegetables for own consumption making use of domestic water supply.

3.5.7. Freeing up water supply for other user sectors

The Taung Dam was initially constructed to augment supply to the Taung Irrigation

Scheme. However, currently there is no infrastructure to convey water from the Taung

Dam to the irrigation area. A need within the study area exists for irrigation water supply.

In the late 1970’s the existing flood irrigation scheme in the Taung area was converted

into a centre pivot scheme. Through the redesign activities, 175 households were

excluded and have been waiting since the 1970’s for restitution. The re-constituted flood

irrigation scheme was designed on the basis of 10 ha per person, thus the expectations of

these 175 individuals are for similar allocations. It is thus considered by the local people

that the Taung Dam will be the source of water for this expansion.



However the water from the Taung dam has been identified as being best put to use for

domestic needs. However, according to the Existing and Proposed Infrastructure Study

as part of this feasibility study, if water from the Taung Dam is used to supply the

Bogosing area, then Bogosing’s allocation from the Vaalharts Canal Scheme could be

transferred to Vryburg to augment the water demand in this area. Furthermore, if water

from the Taung Dam is used to augment supply to the Taung area, then water from the

Vaalharts Canal Scheme could possibly be freed up to be transferred to Vryburg to

augment the water demand in this area.

In other words, using the water from the Taung Dam to augment water to the Bogosing

area and the Taung area could possibly free up water to be transferred to Vryburg to

augment water demand in that area. The exact water sector beneficiary of this possibility

is however not known.

It is however important to note that, separate from this study, Vaalharts Water is currently


the entire Vaalharts Irrigation Scheme’s canal network, including the main canal, side

canals and drainage canals. This business plan should be submitted before the end of

2008 for construction to commence early in 2009. In short, the provision of water for

irrigation, should this be implemented, would have far reaching regional economic effects.

Water security however is a pressing need for the irrigation sector as without it, farming is

uneconomic. In collaboration with farmers and other stakeholders a look at alternative

crops of high value that will increase profitability in the Vaalharts scheme has already

been initiated to empower black farmers and contribute to sustainable jobs in the area.



BIBLIOGRAPHY

Department: Water Affairs and Forestry, South Africa, 2007. Feasibility Study for Utilisation of Taung Dam Water: Existing and Proposed Infrastructure: prepared by Kwezi V3 Engineers

Department: Water Affairs and Forestry, South Africa, 2007. Feasibility Study for Utilisation of Taung Dam Water: Water demand and use: prepared by WRP Consulting Engineers

Greater Taung Local Municipality, 2006. Reviewed Integrated Development Plan. 2006/2007

Naledi Local Municipality, 2006. Integrated Development Plan Review 2006/2007.

Phokwane Local Municipality, 2006. Integrated Development Plan.

Stats SA, 2001. Census 2001

Stats SA, 2007. Community Survey 2007

Quantec database, 2007.

Urban Dynamics Town and Regional Planners, 2006. Spatial Development Framework of Phokwane Local Municipality.

0.90% 57 356 Year STUDY AREA PHOKWANE LM NALEDI LM LM GREATER TAUNG 183 313 1996 2.80% 264 077 5.20% 31 045 2.80% 53 921 2.35% 179 111 1995 Growth 0.40% 185 948 1999 1.00% 277 262 3.50% 35 391 1.00% 56 772 0.50% 185 099 1998 1.10% 274 277 3.80% 34 082 1.20% 56 117 0.60% 184 078 7 199 1.10% 271 385 4.30% 32 664 1.30% 55 408 0.42% AREA Persons Growth Persons Growth Persons Growth Persons 36 614 3.20% 279 918 0.90% 2000 186 651 0.30% 57 893 0.70% 37 773 2.90% 282 317 0.70% 2001 187 119 0.10% 58 312 0.60% 38 873 2.60% 284 304 0.50% 2002 187 291 0.00% 58 678 0.40% 39 887 2.40% 285 856 0.40% 2003 187 298 - 0.20% 58 941 0.30% 40 833 2.10% 287 072 0.30% 2004 187 000 - 59 114 -

Feasibility Study for Utilisation of Taung Dam Water


Project Name: FEASIBILITY STUDY FOR UTILISATION OF TAUNG DAM WATER

Authors: Russell Aird (Kayamandi Development Services)

Title: REGIONAL AND NATIONAL ECONOMY

DWAF Report No: P WMA 10/C31/00/1408

Status of Report: FINAL

First Issue: June 2008

Final Issue: July 2008

Consultants:

Kwezi V3 Engineers in association with Kayamandi Development Services, WRP Consulting Engineers, Golder Associates, WSM Leshika, DMM Development Consultants

Approved for Consultants:

…………………………………………

A J Smook Study Leader

DEPARTMENT: WATER AFFAIRS AND FORESTRY Directorate: Options Analysis Approved for the Department: Water Affairs and Forestry by:

…………………………………………………

P Pyke Chief Engineer: Options Analysis (Central) (Project Manager)

…………………………………………………

L S Mabuda Director: Options Analysis



LIST OF REPORTS














REFERENCE



Report No.: P WMA 10/000/00/0407/10

Project No.: WP8950




EXECUTIVE SUMMARY


























































status quo.























demand.




























WATER

Table of Contents

PAGE



1. INTRODUCTION.............................................................................................................. 1.1


1.2. STUDY AREA .................................................................................................................... 1.1







2.2. EMPLOYMENT................................................................................................................. 2.16



2.5. CONCLUSION.................................................................................................................. 2.23

























BIBLIOGRAPHY .......................................................................................................................... 23











NC Northern Cape

NW North West




1. INTRODUCTION













of poor quality.








Dam Water.

1.2. Study Area











GROUND RESEVOR

TOWER RESEVOR

PUMP STATION


BALANCING DAM

PUMP MAIN

GRAVITY MAIN











maintenance.



















2.1.


0

200

400

600

800

1000

1200

1400

1600

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

PLM NLM GTLM






contributor.




1995-2000 2000- 2005 1995-2005

PHOKWANE 1.9% 2.2% 2.0%

NALEDI 3.0% 4.2% 3.6%



2.1% 2.0% 2.1%



NORTH WEST PROVINCE

1.8% 3.9% 2.8%

RSA 2.9% 4.8% 3.7%





























Agriculture 2.5% 9.2% 5.3% 1.4% 6.2% 8.5% 4.9% 3.6%

Mining 6.7% 4.4% 4.5% 0.4% 5.4% 1.8% 2.3% 1.0%

Manufacturing 0.1% 0.6% 2.8% 0.5% 2.8% 2.7% 1.0% 2.8%


-7.6% 0.7% -1.0% -1.4% 1.7% 0.5% -2.1% 1.8%

Construction 0.2% -2.4% 0.0% 0.2% -2.4% 3.5% 1.6% 4.6%


5.0% 1.3% 1.4% 3.5% 2.2% 3.0% 3.8% 4.8%


3.6% 6.7% 12.8% 2.3% 10.0% 6.5% 3.7% 7.1%

Business services

-0.3% -2.2% -3.1% 3.3% -1.8% 3.2% 2.0% 6.2%

Community services

3.9% 4.9% 3.5% 3.0% 4.1% 3.4% 3.3% 3.4%

Government services

1.9% -1.8% 2.2% 2.0% -0.6% 0.7% 1.9% 0.5%

Total 2.0% 1.0% 3.6% 2.1% 2.8% 2.8% 2.6% 3.7%
















agriculture.





























country as a whole.









growth per annum.












whole.
















Sector 1995 2000 2005

Agriculture 48,557,121 93,917,830 77,276,929

Mining 7,221,518 7,701,558 10,771,911

Manufacturing 116,324,942 142,590,219 149,781,456


Construction 13,464,352 12,078,013 13,416,484

Trade 151,683,316 172,101,777 172,121,370

Transport 151,416,928 242,914,938 448,706,500




Total 1,030,893,103 1,197,387,125 1,413,581,563



0

10000000

20000000

30000000

40000000

50000000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005





sector.






Mining 1% 7% 30% 7%




Trade 12% 13% 13% 15%

Transport 32% 18% 10% 11%




13% 17% 12% 14%

Total 100% 100% 100% 100%








economy per sector.





District



Mining 1% 5% 0%








District



Trade 12% 39% 2%





Total 100% 42% 2%









• Transport 73%







Sector 1995 2000 2005

Agriculture 8,592,777 98,162,937 97,747,265

Mining 22,655,979 31,536,938 40,730,272

Manufacturing 46,907,058 47,429,609 47,459,022



Sector 1995 2000 2005


Construction 24,195,784 21,615,516 24,547,909

Trade 165,811,944 213,528,400 256,723,415

Transport 88,702,425 101,030,485 122,448,670




Total 934,443,871 1,027,200,805 1,118,562,925












0

50000000

10000000

15000000

20000000

25000000

30000000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005







sector.


Sector PHOKWANE

LM FRANCES BAARD DM

NORTHERN CAPE

RSA TOTAL


Mining 4% 16% 28% 7%




Trade 23% 13% 12% 15%

Transport 11% 14% 10% 11%




23% 17% 13% 14%

Total 100% 100% 100% 100%





















Mining 4% 3% 1%




Trade 23% 26% 10%





Total 100% 15% 5%










• Trade 26%;





















Sector 1995 2000 2005

Agriculture 13,229,900 29,805,023 29,291,764

Mining 49,924,581 52,134,180 73,368,835

Manufacturing 18,630,210 18,994,859 19,639,204


Construction 28,765,826 23,635,528 23,105,656

Trade 62,051,296 68,744,040 69,531,215

Transport 31,387,235 42,804,341 56,428,843




Total 13,229,900 29,805,023 29,291,764





0

50000000

10000000

15000000

20000000

25000000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005





sector.





Mining 12% 7% 30% 7%




Trade 12% 13% 13% 15%

Transport 9% 18% 10% 11%




30% 17% 12% 14%

Total 100% 100% 100% 100%

















District


West


Mining 12% 32% 0%




Trade 12% 16% 1%

Transport 9% 9% 1%




Total 100% 18% 1%








(18%), namely:




• Mining 32%;







2.2. Employment



























population, 2007



Employed 38% 31% 14% 37% 22% 37% 39% 40%

Unemployed 17% 28% 11% 18% 16% 20% 17% 19%


42% 38% 73% 41% 60% 39% 40% 37%

Not applicable 3% 3% 2% 3% 2% 4% 4% 4%

Total 100% 100% 100% 100% 100% 100% 100% 100%


Employed 69% 53% 55% 67% 58% 65% 69% 67%

Unemployed 31% 47% 45% 33% 42% 35% 31% 33%

Total 100% 100% 100% 100% 100% 100% 100% 100%


























Agriculture 17% 19% 8% 8% 18% 7% 19% 8%

Mining 1% 0% 5% 9% 8% 32% 10% 5%

Manufacturing 12% 9% 4% 8% 7% 7% 7% 14%

Electricity 3% 1% 1% 1% 1% 0% 1% 1%

Construction 3% 3% 7% 5% 5% 3% 5% 5%


17% 17% 15% 14% 14% 14% 13% 16%

Transport 3% 3% 2% 4% 2% 2% 3% 4%

Finance 9% 13% 8% 13% 8% 10% 10% 17%

Community services

12% 14% 13% 13% 15% 10% 12% 14%

Government services

24% 19% 37% 25% 21% 14% 20% 17%

TOTAL 100% 100% 100% 100% 100% 100% 100% 100%









study area.













0%5%

10%15%20%25%30%35%40%

PLM NLM GTLM RSA







2005.



















the local economy.


per municipality.


INCOME CATEGORY


No income 14% 13% 34% 17% 28% 23% 17% 23%

R 1- R 4800 15% 16% 11% 9% 14% 9% 9% 8%

R 4801-R 9600 25% 25% 26% 21% 25% 19% 22% 18%



INCOME CATEGORY


R9601-R 19200 17% 18% 15% 18% 16% 19% 18% 16%

R19201-R 38400 12% 12% 7% 14% 9% 16% 14% 13%

R38401- 76800 8% 7% 4% 10% 5% 7% 9% 9%

R76801- R 153600

5% 5% 2% 7% 3% 4% 6% 6%

R 153601 and more

3% 3% 1% 5% 2% 3% 4% 6%

TOTAL 100% 100% 100% 100% 100% 100% 100% 100%
















municipality.



















No Schooling 22% 21% 25% 13% 27% 15% 14% 11%

Primary 31% 29% 36% 27% 32% 31% 31% 26%

Secondary 37% 39% 31% 47% 32% 42% 44% 48%

Tertiary 9% 9% 6% 10% 7% 8% 9% 12%

Unspecified 1% 1% 2% 3% 2% 4% 3% 3%

TOTAL 100% 100% 100% 100% 100% 100% 100% 100%






















2.5. Conclusion





























villages;
























spending.


























diminishes.
























pumps;













and
































services).




























• Company tax;

• PAYE;












sustainable.



























demands.













water provision.



by existing staff.





















of the economy.




















Supply area:
































several sectors.












































• Car washes;


• Butchery;






economy;


































development;


and



gardens.


























BIBLIOGRAPHY








