Project Preparation Trust of KwaZulu-Natal (PPT) Site last updated 25 June 2010

PPT is an independent public interest organization that specializes in the preparation of projects for historically disadvantaged communities and special needs groups.PPT is not for profit and was registered with the Master of High Court in 1993, the year before the election of South Africa's first democratic government.

PPT's primary beneficiaries or clients are historically disadvantaged communities, and especially those who are the poorest of the poor and those in special need such as people infected or affected by HIV/AIDS, vulnerable children, and people residing in highly marginalized rural or informal settlements.

PPT's Vision and Mission

PPT's vision is a society in which all citizens have equitable access to basic services and economic opportunities. PPT's mission is to enable sustainable socio-economic and built environment development for the benefit of disadvantaged communities. Our mission is achieved mainly through:

  • Providing project preparation and related services to disadvantaged communities, their local governments, government departments and other development stakeholders
  • Obtaining funding for project preparation
  • Unlocking capital and other resources for project implementation
  • Transferring skills to government and other stakeholders
  • Promoting best practice, including holistic and sustainable development.















Core function

PPT's core function remains that of preparing projects and mobilizing capital and other resources for disadvantaged communities. In many instances the projects with which PPT is involved are innovative pilots, which test improved development solutions and approaches PPT takes a holistic and integrated approach ensuring the involvement of a range of complementary government departments, funders and support agents. Funding for preparing projects is sourced mainly from municipalities, government departments, or donors.

PPT's main focus is on:

Services

PPT operates primarily as a management core that assists clients in managing project preparation. This includes briefing and managing professional project teams, ensuring broad stakeholder participation, troubleshooting, and submitting and following through on applications for development funds. In executing these services, PPT ensures the support and participation of all key stakeholders including the beneficiary community, local municipality, key government departments and project funders.

PPT's preparation management services include:

  • Project selection and prioritisation,
  • Assessment of candidate projects,
  • Pre-feasibility management,
  • Feasibility management and
  • Training and mentorship in project preparation.

Overview of Achievements

Capital approvals: The projects PPT has prepared have resulted in R1.21 billion in capital funding being awarded for over 64,000 disadvantaged households in 128 "pro-poor" development projects. The projects range from housing and infrastructure to special needs housing and HIV/AIDS relief and pro-poor local economic development to sustainable energies and capacity building, skills transfer and organisation development.

Projects under preparation: PPT is currently preparing 161 projects benefiting over 70,000 households with a projected capital value of R1.13 billion.

Programmes: PPT runs a range of development programs including housing, special needs housing and HIV/AIDS relief, economic development, training and skills transfer, land reform and integrated development.

Gearing: The effectiveness of PPT's focus on project preparation is evident in the high gearing it achieves on both its operating overheads and the preparations funds utilized when measured against the capital unlocked. There is also additional and un-quantified gearing which relates to such benefits as improvements in people's quality of life, livelihoods, income generation and operating funds flowing into projects.


Message from the CEO

There have been significant strides in development in South Africa since the advent of democracy in 1994 and PPT is proud to have played a part in the changes and transformation that have occurred. Our contributions include the leverage of over R816 million in capital for over 45 000 disadvantaged households in 85 projects ranging from infrastructure and housing to HIV/AIDS relief and economic development. PPT has also made significant contributions in respect of building capacity within government and civil society and in developing and mainstreaming improved development practices at various levels.

However, despite progress on many fronts, further challenges must be surmounted if transformation is to be made meaningful to those who are most disadvantaged or in special need. Daily life for many in our country is still characterized by poverty and hardship and there remain many areas where service delivery is inadequate. The challenges are numerous. Despite commitments to more integrated and co-operative governance, co- ordination between different spheres of government and delivery agents continues to be weak, with the result that development strategies have not been optimised. Integrated and sustainable development is thus seldom achieved, although its pursuit remains a top priority. The situation is compounded by acute capacity constraints, especially within the public sector. Addressing these capacity constraints is critical. In addition, insufficient attention is typically paid to the preparation and feasibility stages of the project cycle. This often results in projects which are poorly conceptualised or which encounter a range of problems during the implementation or operating and maintenance phases. This also adversely affects the rate of expenditure of capital and other developmental funding. The HIV AIDS pandemic also continues to be a critical factor. Of particular concern are large numbers of orphans and vulnerable children and the threat of another "lost generation" if efforts are not re- doubled to address the crisis.

Going forward, PPT will continue to concentrate on the preparation phase of projects since this remains a key weakness in the development sector and represents a strategy that delivers significant results relative to resource costs. The organization will continue to diversify its programmes and make them more integrated and will increasingly focus on the development of human capacity both within civil society and government. The development of partnerships and alliances will continue to be a central strategy. Attaining a balance between an urban and rural focus will also be a major objective as well as achieving greater equilibrium between physical forms of development such as infrastructure and soft forms of development focusing on developing people. PPT commits itself to continuing to address the many challenges that face the poor and marginalised and to assist other organisations as well as government at different levels to meet the challenge.

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Sustainability

Sources of funding

Operational funding: Over the years, PPT has utilized a combination of grant funding from USAID, fee income and interest on its reserves to cover its operating costs. From 1994 to 2001, PPT received an operating grant from USAID that covered most of these costs, but subsequently they have been covered mainly by means of fee income and interest on capital. Going forward, PPT will prioritise raising additional grant funding to more adequately provide for its operational costs, both to enhance the scale and quality of its development work as well as to enhance its sustainability.

Preparation funding: PPT has been, by necessity, creative and opportunistic in terms of the sources of preparation funding it utilises. Initially most preparation funding was obtained from donors, in particular USAID, but the trend over time has been increasingly towards utilising and mobilizing government funding. This is in keeping with PPT's policy to encourage government to invest in project preparation, transfer its preparation skills to government, and promote greater awareness of the need for systematic and adequately funded project preparation. Going forward PPT will prioritise raising preparation funds in larger more cost effective blocks (as opposed to on an ad-hoc project basis or for relatively small programs). This will significantly enhance PPT's ability to increase the scale and quality of development projects that it can deliver. Grant funding from donor funders will be one of the important sources to be targeted.

The changing face of non-governmental organizations

Changes in terms of sustainability have occurred in many public interest organizations (often referred to as non- governmental organizations). Those that have been operating in the development sector for sustained periods are generally efficient, innovative and have high calibre human resources. The trend has been for them to move away from total dependency on donor funds by also taking on some fee earning work. However, such organizations are not able to operate purely on a fee income basis. They require supplementary sources of funding if they are to retain their public interest nature.

PPT's charge out practice

PPT charges its services out at a cost recovery rate. This means that its fees are benchmarked in order for it to break even in financial terms. Adding PPT's other sources of funding together, the organization's clients collectively get an effective subsidy of about R1 million per annum. This subsidy is provided in the form of time for which PPT does not bill, including the time to develop and set up new programmes, partnerships and initiatives.

Financial controls and audits

PPT maintains high standards of financial accounting and control, as expected of an organization responsible for managing funds from third parties such as donors. PPT operates according to a strict set of written financial controls that govern all financial activities including those relating to projects. PPT is audited annually in terms of applicable South African legislation. All audits have indicated that PPT's finances are in order and in line with generally accepted accounting practice. PPT was also subject to audits under United States law from 1995 to 2001 in terms of PPT's first agreement with USAID. These audits indicated that PPT's management of funds was according to its agreement with USAID and that all expenditure was legitimate.

PPT's model of sustainability is replicable

The use of its capital base as a key part of its sustainability is a model that PPT has successfully applied to some of the development projects it has prepared. A good example is the use of donor or private sector funding to bridge finance the construction or acquisition of housing stock for HIV/AIDS relief projects. When housing subsidies are approved, the repaid funding is then used to establish an endowment with the interest yield contributing to operating costs. See Special Needs Housing and HIV/AIDS Relief.

Contact Us
PPT
269 Smith Street, Durban, 4001, South Africa
P.O Box 5609, Durban, 4000, South Africa
Email: pptrust@worldonline.co.za
Telephone: + 27 31 305 1288
Fax: +27 31 305 1227

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