Minister of Transport Budget Speech
Briefing
15 Jul 2024
Watch: Debate on Vote No 40 – Transport
SPEECH BY THE MINISTER OF TRANSPORT MS. BARBARA CREECY
Honourable House Chair
Our Deputy Minister Mr. Mkhuleko Hlengwa
Chairperson of the Portfolio Committee Hon Donald Selamolela
Members of the Committees
Chairpersons and CEOs of the Entities reporting to the DOT
Director-General, Adv. James Mlawu and Senior Managers of the DOT
Honourable Members,
The mission of the Department of Transport is to:
“Lead the development of efficient and integrated transport systems by creating a framework of sustainable policies and regulations; and implementable models to support government strategies for socio-economic development.”
Indeed, today we would all agree that an efficient and functioning transport sector that moves people and goods safely, speedily and affordably across the length and breadth of our country is the key to a successful economy.
In recent times there has been a disconnect between this vision and the realities of our transport system and our national Transport Department. Our sector is not operating as either an effective economic facilitator or as a much-needed social service.
The 2020 National Household Travel Survey found that declining availability of rail services and damage to infrastructure means many households rely on alternative and more expensive methods of transport.
In the aftermath of the Covid 19 Pandemic the freight system was characterised by long delays in the movement of key bulk minerals, containers and vehicles.
Dysfunctional port terminals resulted in long waiting times for ships wishing to berth, as well as congestion at strategic border crossings and key national highway corridors. Our freight rail system was characterised by maintenance backlogs, cable theft, and skills shortages.
Our road systems deteriorated throughout the country and many provinces failed to execute maintenance and new build programmes, resulting in unspent funds being returned to National Treasury.
Every year our country sees in excess of 10 000 fatal crashes, which the Road Traffic Management Corporation (RTMC) estimates amount to almost 3% of our annual Gross Domestic Product.
This is totally unacceptable from both an economic and a humanitarian perspective.
Given the current status of the transport sector, my first task in this 7th Administration is to stabilise the transport system in our country and make our Department fit to fulfil its policy-making and regulatory role.
Against the background of multiple challenges in the freight logistics system and the ports and rail network, bold and decisive action was taken to address the problem and prevent further damage to the economy.
Government in collaboration with business and unions formed the National Logistics Crisis Committee (NLCC) as a co-ordinated integrated response to meet the scale of the crisis.
The NLCC has three distinct objectives: improving operational performance of industry supply chains including freight rail and ports; implementing reforms to modernise the freight transport system for efficiency and competitiveness, and necessary regulatory change or exemptions to enable efficient procurement and adequate funding for network maintenance.
The NLCC oversees the implementation of the Freight Logistics Roadmap.
I would like to extend my gratitude to my predecessor, Minister Sindisiwe Chikunga, as well as Minister Pravin Gordhan, for their instrumental role in the establishment of the NLCC and in encouraging further engagement between the private and public sectors.
I also want to take this opportunity, as incoming Minister, to pledge my strong and unequivocal support for all the important work which lies ahead.
Honourable Members,
PRASA is continuing to reopen passenger rail lines severely affected by infrastructure damage and cable theft, with 28 of 40 priority lines being fully operational. As of March this year, 256 stations are fully functional in cities across the country.
Continuous work is being done to rehabilitate and open up more strategic commuter corridors. This will ensure that the public can rely on safe, secure, punctual, and affordable public rail services that will not hinder their participation in the economy.
A key priority for the next financial year will be the stabilisation and improved governance of the Department and its entities.
With regards to the Department, critical vacancies will be assessed, and appointments made to fill important posts.
The efficacy of the Department’s entities in fulfilling their stated mandates will also be assessed, and reforms such as addressing adverse audit findings and the timeous payment of outstanding invoices will be implemented.
Immediate attention will be given to the critical issue of underspending by both Departmental entities and Provincial Departments on finances allocated for road maintenance and road construction.
In a country where citizens must daily navigate the hazards of potholes it is unconscionable that we are returning money to National Treasury!
I want to take this opportunity to congratulate Airports Company South Africa (ACSA) for Cape Town International Airport and OR Tambo International Airport being rated second and sixth respectively in the recent 2024 Airhelp Global Airports Ranking.
In 2023, our Cabinet approved the Rail Policy, which has various far-reaching recommendations on the future of freight rail and urban commuter rail.
This Policy must be implemented with speed so that the country’s railway sector can be revitalised. Commuter rail must become the backbone of the transport system. We must harness the potential of our freight rail infrastructure to foster long term, sustainable economic growth.
A planning component will be established to consider the strategic value of branch lines and unlock both state and private investment in lines which have economic potential and logistics capacity.
The planning component will assist in furthering the expansion and regional integration of our rail network, and ensure gradual compliance with standards such as the African Union resolution on standard gauge.
In December 2023 under the auspices of the Freight Logistics Roadmap we approved the development of a framework for private sector participation (PSP). This framework will identify suitable areas for private sector participation in rail and ports, and outlines structural and contractual requirements to enable such participation.
The future PSP unit will be established with the necessary skills and expertise in the design, negotiation and contracting of projects so that innovative practices can assist us to solve current and future logistics challenges.
The Freight Road to Rail Migration Plan (FRRMP) has been developed in cooperation with the Freight Logistics Roadmap, the Transnet Recovery Plan, and the NLCC process. Its key purpose is to migrate rail-friendly cargo back to rail and alleviate the pressure on our roads.
A key piece of legislation that will be implemented during this administration is the Economic Regulation of Transport Act 2024 (Act No.6 of 2024).
Recently signed into law by President Ramaphosa, the Act will establish a single transport economic regulator to help ensure an efficient and cost-effective transport system, by increasing competitiveness and access to transport networks through effective regulation.
As part of ensuring optimisation of our transport system, the Department will prioritise road safety during this term of office, so that our roads are safe for those who use them and foster economic activity.
Our Deputy Minister will address this matter more fully in his speech today.
Honourable Members
Taxis are part of community life, and as per the National Household Travel Survey, now carry eighty three percent of those who use public transport.
During this term I pledge to work with the industry to ensure it takes its place in a safer, greener transport ecosystem. We will work together to decrease levels of conflict and violence which pose a significant risk to the sector and to commuters.
The Taxi Relief Fund, created by the Department to mitigate the negative financial effects of the Covid pandemic on the taxi industry, has been extended in the past year to provide further support to the industry.
The Taxi Recapitalisation strategy continues to deal with the scrapping of unroadworthy vehicles, but also aims to regularise and professionalise the industry by improving safety and incorporating the industry in transport planning processes.
Honourable members as we stabilise and optimise our existing transport sector, we also look forward to new risks and opportunities.
Climate change, as we have seen over the last couple of years, poses a significant risk to our built infrastructure in general and our transport infrastructure in particular.
Building the climate resilience of our ports, road and rail networks is both a necessity and a new opportunity for investment, growth, economic inclusion and job creation.
Contributing to reducing greenhouse gas emissions in all modes of transport will become a necessity once the new Climate Bill is signed into law. Our transport sector is responsible for approximately one tenth of our country’s CO2 emissions, and we will have to do our bit to achieve the NDP target of net-zero by 2050.
Transport is in the midst of one of the greatest changes since the introduction of the automobile. The transition to new energy vehicles is also accelerating rapidly, with electric vehicles set to be the cars of our now and immediate future.
Sale of new petrol and diesel cars will be banned by 2035 in Europe. New York has also announced that sales of nearly all petrol and diesel-powered cars and trucks in the state will be banned by 2035.
The Department’s Green Transport Strategy includes investing in green energy infrastructure; promoting the uptake of alternative fuels such as biogas and green hydrogen, extending the rail network to provide alternative public transport, and developing “green procurement guidelines” which will promote low-carbon technologies.
Implementation of the Green Transport Strategy will be a priority for our Department in this term of government.
In this next decade transport will also be revolutionised by an acceleration of digital technology. New technologies, and new global imperatives will fundamentally alter the skills requirements of those employed in the transport sector as well as open up new value chains for new forms of economic access, ownership and employment.
Such innovations include operational automation and real-time tracking of shipments to assist in port management, digital signalling to modernise the management of our railway systems, the use of artificial intelligence in traffic management, and the introduction of self-driven vehicles and drones for delivery.
I am proud to share with you today that over the last year our entities, as well as our provincial departments and the national department, provided young people with 221,610 training and development opportunities across the country. We have every intention of continuing these important programmes in the current administration.
Honourable Members as I conclude, I want to thank our Portfolio Committee under the able leadership of Honourable Selamolela for the speedy processing of this budget vote.
I want to thank the Director General and all the officials of the Department of Transport for all the hard work they will be doing over the next five years. To the Chairpersons and CEOs of our entities: we look forward to your contribution to stabilising, optimising and growing an integrated and efficient transport sector. We have no time to lose!
I thank you.
_________________________________________________________________________________________________________________________
SPEECH BY THE DEPUTY MINISTER OF TRANSPORT MR. MKHULEKO HLENGWA
Honourable House Chairperson Our Minister Ms. Barbara Creecy Honourable Members
Director-General, Adv. James Mlawu
Deputy Directors-General of the Department of Transport Chairpersons and CEOs of the Entities reporting to the DOT
Ladies and gentlemen,
As the Department of Transport, our budget for this financial year, or at least what’s left of the financial year will certainly go a long way towards contributing to the resolution of some of the persistent challenges facing the transport sector.
Given the role of the transport sector as an enabler of economic growth and indeed the development of people, it thus remains imperative for us as the GNU to continue to commit ourselves to its continuous improvement.
We thus have our task well cut out as we come into this GNU Administration with these lingering challenges facing many South Africans. In tandem with this commitment, we will equally strengthen commitment to safety across the transport sector and thus across all modes of transport and our budget will continue to give road safety added attention given the dire state of road safety, the recent death of eleven children a serious indictment on us. On behalf of Minister Creecy and I, I convey our sincerest condolences to the bereaved families.
Road safety remains particularly important given the statistics of crashes and fatalities still defining our road transport network with the daily average of 34 people killed and 157 seriously maimed and also given our commitment to the United Nations Decade of Action Road Safety target to reduce fatalities by 50% in 2030 from the 2010 baseline.
Some progress has however been made in the past ten (10) years, because from around 2014, the daily average was approximately 40 deaths and 184 serious injuries. In the past three (3) years road fatalities have come down from 12 554 to 11 883 in 2023. This is attributed to increasing visibility of traffic officers.
Irresponsible driver behaviour has been noted as the major contributor to road crashes, with distracted driving, drunken driving; over speeding; and non-compliance with the rules of the road playing a major role.
Research has proven that changing road user behaviour is central to making our roads safer. In fact, statistics have indicated that up to 87 percent of all road fatalities in the country can be attributed to road user behaviour compelling us towards a programme of behaviour change across the road sector.
Given our populous and expanding urban settlements, we will commit ourselves to fight pedestrian deaths which are the highest segment of victims in the country.
State of vehicles
Approximately 10% of vehicles registered in South Africa are not road worthy and the average age of these vehicles is 11 years which also contributes to the increased potential for crashes and fatalities. Furthermore, it has been estimated that around 40% of vehicles on our roads are not insured.
State of our roads
South Africa generally has a good road infrastructure and the country continues to invest and identify key road infrastructure maintenance and improvements required. The increase in population figures and economic movements have however resulted in depleted capacity and inadequately maintained road infrastructure.
Fraud and Corruption
Driver License Testing Centres (DLTCs), Vehicle Testing Centres (VTCs), Registration Authorities (RA), and Law Enforcement Authorities (LEAs) are vulnerable to fraud and corruption by both officials and members of the public. A “cool drink” honourable members, is corruption; we are urging members of the public to acknowledge this as such.
These factors, amongst others contribute significantly to the saddening numbers of deaths.
As the department curbs corruption and fraud, it is commendable that testing centres have introduced digital tests for Learner Licencing. More importantly is the continued search for corrupt officials and the arrest of 97 suspects this financial year by the National Traffic Anti-Corruption Unit attest to the efforts.
These include driving license examiners who allegedly issue learner and driving licenses fraudulently, examiners of vehicle in privately owned vehicle testing centres who issue roadworthy certificates fraudulently, traffic officers who take bribes on the side of the road, administration clerks, runners (middlemen who facilitated fraudulent transactions) driving school instructors, driving license applicants and businesses owners who collude with official to have their licenses issued through corrupt.
The arrests were made in places such as Fochville and Orlando, Booysens, Meyerton, Roodepoort, Fairlands, Ivory Park, Briton, Pretoria Central Lenasia in Gauteng, King Williams Town in Eastern Cape. Newcastle, Glencoe in KwaZulu Natal. Westerburg and Mankwen in Limpopo. Vrede in the Free State. The cases are in court at various stages of prosecution.
In addition to the RTMC’s stated actions taken against fraud and corruption, the solutions have also included the following changes and milestones amongst others that have been achieved just in the last 5 years:
In its quest to professionalise traffic law enforcement, the RTMC, has been able to revise the current qualification equivalent to a Matric, bringing it to a Diploma level to create a high calibre of officers and recruits trained for effective professional policing (enforcement) – a 21st century cadre as demanded by the National Development Plan.
Overall action towards the reduction in road deaths has been guided by the National Road Safety Strategy (NRSS) 2016 -2030 to implement a coherent and integrated programme of action.
The RTMC’s development of a new centre of excellence in traffic officer training at the Boekenhoutkloof College to improve the quality of training provided to the traffic officers will be supported in this financial year.
The RTMC embarked on a project to upgrade the Boekenhoutkloof College to the Centre of Excellence and followed an incremental process by splitting the process into phases based on resource availability whilst responding to the mandate of establishing a Centre of Excellence.
Online services.
The Driver Licence Testing Centres, Vehicle Testing Stations and Registering Authority provide services for the licencing of drivers, registration of vehicles and roadworthiness testing. The RTMC has now successfully introduced online and digital platforms to improve convenience and efficiency in customer service. We are however aware that some of the processes within centres remained manual and labour- intensive.
For ease of doing business with motor dealerships and financial institutions the online vehicle registration has also been introduced.
Introducing 24/7 shift system
Honourable Members, this Administration will speed up the resolution of all issues that have delayed the implementation of a 24-hour, seven-day a week and 365 days a year campaign visible traffic law enforcement across the country especially in highly accident-prone zones on our road network.
The Western Cape and the National Traffic Police remains the only authorities that implement 24/7 shift system. It is crucial that all province fast track their processes to obtain approval for the implementation of the shift system to ensure visibility of officers on the road daily and at all hours. The DoT will monitor and ensure the introduction of the new shift system by the 31 March 2025 and continue to recruit and train personnel.
Towards effective implementation of our road safety strategy and towards strengthening overall capacities of the RTMC we allocated R196, 991 million in 2024/25 and R204,264 million in 2025/26.
The Arrive Alive Campaign must step up its efforts throughout the year, not just during seasonal campaigns.
Road Accident Fund
Honourable Members, while we commit to prevent crashes and losses of life or limb, we also commit to ensuring effective and responsive post- crash assistance to those affected and these services are carried out by the Road Accident Fund.
The Road Accident Fund, RAF, has been implementing the turnaround 2020–25 RAF strategy for the last four years as developed to address the RAF’s major challenges which included amongst others:
- Increasing liability
- Long settlement turnaround times for claims
- Unsustainable Funding Model
- Governance and Leadership Instability
- Manual and Litigious Operating Model
- Non-Compliant Claims Lodged
- Fraud and Corruption Culture
The strategy has focused on reducing administrative costs, introducing efficiencies addressing the manual and litigious model, management and reduction of the Fund’s liability, digital transformation, prioritising claimants’ compensation, managing claims’ risk, reducing claims backlog, and expediting claims settlements.
The strategy’s interventions have resulted in the cumulative reduction of legal costs by 75%, and a cumulative legal cost savings of just over R23 billion in the three years of implementing the strategy.
The introduction and implementation of RAF Medical Tariffs and treatment protocols has resulted in the reduction of medical costs from R3.6 billion in the 2019/20 financial year to R2.1 billion in the 2023/24 financial year.
Honorable Members, as you are aware, in both my past and recent experiences within this house, we have grappled with addressing accounting standards related to the Road Accident Fund (RAF). There has been ongoing dialogue between the agency, the Auditor General, Parliament and even the courts. At the Department of Transport, we firmly believe that the RAF Board must promptly find a resolution to this matter and not let it be an instruction by other government institutions to it.
The necessary changes required at the RAF must be achieved through legislative reforms and not through arbitrary changes in accounting standards.
House Chair, the RAF has now gone for three consecutive financial years without any fuel levy increases. We also emphasise that this is unprecedented, as the Fund was always granted fuel levy increases over the years
In this regard, the long-term viability and sustainability of the RAF is dependent amongst others the reduction of road accidents. The pressures
on the RAF will be relieved by, also, a concerted effort to deal with the high levels drinking and driving, drinking and jay-walking, road block corruption, driver licence corruption, vehicle roadworthiness corruption, and due compliance with road and traffic regulations.
The impact of alcohol abuse of the transport eco-system is of an adverse and detrimental to the economy.
The strain and opportunity cost of the road carnage is of serious negative consequence on the economy through the loss of time and productivity for commuters, goods, logistics and services.
In fact, the RAF has remained a key contributor to the implementation of the National Road Safety Strategy (NRSS) with its goal to reduce road crash fatalities and injuries by 50% in 2030.
The RAF has also ensured growth of social responsibility projects meant for inclusion of road accident victims and persons with disabilities.
My mother who was a nurse often reminded us that prevention is better that cure; and therefore, the action steps presented today seek achieve this reality insofar road accidents are concerned.
In summary we are saying the road to rail, road to train commuting where possible and viable will assist reduce road accidents.
In the long-term transport coherent and integrated transport-centric spatial planning must take centre stage.
I join the Minister in her commitment to harnessing a healthy working relationship with the taxi industry.
The GNU and the Ministry will ensure transport sector cooperation to ensure we can realize the mission and vision of ensuring that our transport sector continues to serve as a cornerstone of development, growth,
progress and prosperity for generations to come and that the transport environment builds lives and does not take lives.
Thank you.
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