The implementation if Operation Vulindlela structural reforms continue to gather pace across several sectors.
This according to the 2026 Quarter 2 progress report released on Friday.
The reform implementation programme is a joint initiative of the National Treasury and the Presidency aimed at accelerating structural reforms to achieve rapid and inclusive economic growth, improve service delivery and strengthen state capability.
These reforms are critical to creating the conditions needed for higher investment, economic growth and job creation in South Africa.
“In particular, significant momentum was built on the restructuring of state-owned enterprises to create a level playing field for competition and enable higher levels of investment in network infrastructure, with key decisions taken on the vertical separation of Eskom and Transnet.
“Progress was also made in establishing an enabling policy and regulatory framework for competitive markets in electricity and freight rail, as well as in advancing major private sector participation opportunities.
“These reforms will be the most important drivers of investment in the medium term, laying the basis for higher growth and job creation while supporting a positive fiscal trajectory,” the report read.
Electricity, water and freight sector reforms
Momentum in these sectors continues to gather pace with “steady progress” recorded towards a competitive wholesale electricity market.
“Progress was made during the past quarter in finalising the policy and regulatory framework for market reform, including the Electricity Sector Market Transformation Position Paper, the revised Electricity Pricing Policy and NERSA's Electricity Trading Platform Regulatory Framework.
“Progress continues to be made through the Eskom Restructuring Task team towards unbundling the National Transmission Company South Africa [NTCSA] and establishing a fully independent Transmission System Operator [TSO],” the report read.
Additionally, work continues to develop a detailed implementation plan for the TSO establishment as part of Phase II.
On freight logistics reform is bearing fruit, providing support to both operational improvements and a return to profitability at Transnet.
In September, Transnet announced a profit of R4.6 billion for the financial year ended 31 March 2026, marking a contrast to the R1.9 billion net loss recorded in the previous financial year.
“Cabinet has approved the approach to establishing an independent state-owned National Ports Authority [NPA] separate from Transnet, while the publication of the revised Network Statement marks an important step towards enabling open access to the rail network.
“Progress in private sector participation also advanced, with the launch of a Request for Qualifications process to select a strategic partner for the Ngqura Manganese Export Corridor.
“The National Rail Bill was developed to establish a coherent legislative framework for open access to the freight rail network and will be published for public comment once approved by Cabinet,” the report explained.
The report noted that water sector reforms continue to focus on “strengthening institutions, improving regulation and accelerating investment in infrastructure”.
“Progress has been made in the implementation of the National Water Action Plan as well as the establishment of the South African National Water Resources Infrastructure Agency, with the appointment of a board completed, and strengthening of partnerships between water boards and municipalities to improve water service delivery and infrastructure development.
“Regulatory reforms are advancing through the Water Services Amendment Bill, the establishment of an independent economic water regulator, and implementation of the revised water pricing strategy,” the report said.
Visa and immigration reform
In August, South Africa launched its Electronic Travel Authorisation (ETA) system, modernising the country’s immigration system.
“The reforms implemented to date have improved the efficiency of tourist visa processing and lay the foundation for expansion of the ETA to additional visa categories, including work and study visas.
“The implementation of Phase II of the Trusted Employer Scheme will facilitate the recruitment of highly skilled personnel while enhancing the country’s attractiveness to investors,” the report stated.
Local government reform
Sharp focus in this sector is placed on strengthening municipal governance, improving service delivery and enhancing the long-term sustainability of municipal finance.
“The Metro Trading Services Reform Programme has progressed to full implementation, and incentive allocations to participating metros will be made in 2027/28 based on their performance in implementing the required institutional and financing reforms to ring-fence trading services.
“Cabinet has approved the revised White Paper on Local Government, and the President has signed the Public Service Commission Act into law, laying the foundation for the comprehensive reform of the local government system.
“In addition, the Municipal Finance Management Amendment Bill has been published for public comment, and the review of the Local Government Fiscal Framework is underway to improve the management of local government finances,” the report explained.
Turning to the spatial integration and housing reform, the report noted that the Inner-City Affordable Rental Pilot Framework is being refined and is expected to be piloted in the next financial year.
The reform is aimed at increasing the availability and accessibility of well-located affordable housing for South Africans.
“Work is also underway to address the title deeds backlog through the development and piloting of digital systems and tools to support verification, administration and monitoring of the backlog.
“In addition, progress has been made in identifying suitable state-owned land and buildings for affordable housing development, while a streamlined methodology for releasing public land and buildings is being developed to support private investment in affordable housing projects,” the report noted.
Digital public infrastructure reform
Implementation of the MyMzansi platform progressing from initial development into a functional prototype operating in a controlled testing environment.
The platform is aimed at allowing citizens to access government services from one digital platform.
“The successful end-to-end demonstration of the Umalusi matric service established a foundation for the phased introduction of additional digital credentials and government services.
“Progress was also made on the Gov.za shared website platform, which became operational for testing by participating departments, while the MzansiXchange data-sharing pilot is progressing towards completion in December.
“In parallel, modernisation of the payments system continues to advance, including recent steps to open the National Payment System to non-bank players under the Payments Ecosystem Modernisation Programme. Together, these initiatives are laying the groundwork for more integrated and user-centred digital public services and broader financial inclusion,” the report stated.
On the road ahead, the report notes that as reforms move from design to implementation, focus is “increasingly shifting towards delivery and measurable outcomes”.
“While progress remains uneven in some areas, continued implementation is expected to support higher infrastructure investment, improved service delivery and stronger economic growth.
“Continued implementation of structural reforms has strengthened South Africa’s resilience to external shocks, contributed to higher levels of fixed investment, and created renewed confidence in our growth trajectory,” the report stated. – SAnews.gov.za
