Treasury Updates PPP Regulations to Boost Infrastructure Investment and Ease Fiscal Pressure

According to the National Treasury, the changes aim to increase private-sector participation and streamline the PPP process across all three spheres of government.

The Minister of Finance, Enoch Godongwana, has announced significant amendments to the Public Private Partnership (PPP) regulations under the Public Finance Management Act (PFMA) to drive infrastructure development and alleviate strain on public finances. The amendments to National Treasury Regulation 16 (NTR 16) mark the first major update to the PPP framework in 15 years.

According to the National Treasury, the changes aim to increase private-sector participation and streamline the PPP process across all three spheres of government. The amendments, which were issued for public comment from 19 February to 15 April 2024, have been finalized and published in Gazette Notice 5841 of 7 February 2025.

Key Amendments to NTR 16:

• Simplified Approvals for Smaller Projects: Projects below a specified threshold are now exempt from Treasury Approvals IIA and IIB, as outlined in the Gazette notice.
• Enhanced Role of the PPP Advisory Unit: The unit's responsibilities have been clarified to support planning, procurement, and fast-track financial closure of PPP projects.
• Institutional Role Clarification: The amendments delineate distinct responsibilities between advisory and regulatory functions in PPP processes.
• Dedicated Sectoral Units: National departments are empowered to establish units for programmatic PPP support within strategic sectors, collaborating with the PPP Advisory Unit for effective execution.
• Improved FCCL Reporting: Mechanisms for tracking fiscal commitments and contingent liabilities have been introduced through structured reporting requirements at Treasury Approvals I, IIB, and III.
• Streamlined Exemption Processes: Governance improvements have been made to the process of granting exemptions from NTR 16.
• Clear Framework for PPP Agreement Amendments: Provisions for amending PPP agreements are now more transparent and structured to promote good governance.
• Guidelines for Unsolicited Proposals: A new framework, including incentives, has been introduced to encourage private-sector proposals for PPP projects.

The Treasury announced that responses to public comments on NTR 16 will be issued, and further details will be provided in the 2025 Budget Review.

Additionally, while the Municipal PPP Regulation 309 amendments are still under review due to procedural and parliamentary consultations, they are expected to be finalized by June 2025.

For further details, see the official notice at: Amendments to PFMA Treasury Regulation 16 Notice.