The Department of Transport briefed the Committee on its Annual Report and Financial Statements for 2009/11 and on its overall performance with a specific focus on challenges and achievements. Performance highlights, highlights of the 2009/10 financial statements and human resource management and development were indicated. The various programmes of the Department were discussed and the challenges faced by the Department in each programme were explained.
Unauthorised expenditure of R362.4 million was incurred as over expenditure of the budget on Programme Six. Parliament was to decide whether it should be approved with or without funding or whether it should not be approved. There was over-expenditure on bus subsidies in 2009/10 to the amount of R 844.98 million. An equitable formula for future allocation of subsidies had been developed and implemented. There were no fourth quarter reports on performance information. For the 2010 World Cup Co-ordination Sub–Programme there was no quarterly reporting for the entire period under review. Quarterly reports were checked against the strategic plan to ensure that all the sub-programmes provided reports.
An important programme was Programme Three which dealt with transport regulation and accident and incident investigation. This was a shared responsibility among the three spheres of Government and the Road Traffic Management Corporation. There was institutional chaos as a result of inadequate systems. Revenue flows remained a pervasive challenge and revenue-sharing arrangements were not working as they should. Municipalities were not passing on what was due to provinces and provinces were not passing on what was due to national Government.
The National Traffic Information System (e-NaTIS) contract was for the development and deployment of the system and at no stage was there ever a plan to issue another tender for the National Traffic Information System. Based on the contractual arrangements, once the system was operating optimally at the end of the contract period, Tasima was required to transfer the National Traffic Information System to Government. The agreement was that the system should be transferred to the Road Traffic Management Corporation (RTMC), which would then assume custody of the National Traffic Information System on behalf of the state.
Given the magnitude of its challenges, the Road Traffic Management Corporation was not in a position to take over the system and did not have the management infrastructure in place to support a mission-critical system like the National Traffic Information System. The system had been classified as a national key point, which demanded compliance with onerous security requirements.
The Department had since extended the Tasima contract based on these considerations and to enable it to build the requisite capacity to take over the system.
In terms of aviation, a number of security related issues were dealt with during the reporting period, which included aircraft accidents in
Challenges were experienced with the approval of Airports Company of
The issue of vacancies and capacity building was emphasised. Measures were introduced to reduce the vacancy rate which included: 1) concurrent headhunting with the normal recruitment process had been introduced and implemented; 2) a retention strategy was approved and implemented; 3) appointment of ‘second appointable’ candidates who were women or people with disabilities; 4) the pro forma submission of posts had been improved to include branch Employment Equity status updates; and 5) contract employees had been temporarily placed against vacant posts as per Executive Committee directive.
Members asked about the high vacancy rate; the National Traffic Information System; the taxi recapitalisation programme; the Shova Kalula project; under-expenditure of R100 million; over- expenditure on bus subsidies; why the Department was so silent about the taxi industry; whether the building of bridges over rivers in the rural areas was considered in regard to non-motorised transport to assist learners and other members of the community; if the theft of computers and software was reported to the National Treasury; why the Department failed to meet its targets for the Shova Kalula project; whether the Shova Kalula bicycle programme was linked to poverty reduction and who would repair bicycles; what the focus of the rural grant of R 12.8 million was; how the Department would re-align some of its programmes; for clarification on the transfer management plan; and commented that virements needed approval from the National Treasury.
Department of Transport presentation of its Annual Report 2009/10
Mr George Mahlalela, Director General, Department of Transport (DOT) gave the entire presentation. He started his presentation by giving the key highlights of Programme Two which dealt with transport policy, research and economic analysis. Significant strides were made in terms of refining policy and closing critical gaps identified in the process in the following areas namely: scholar transport; rail economic regulation; road safety; and passenger transport. These gaps necessitated a review of the approach to law enforcement and resulted in proposed amendments to the National Road Traffic Act 1996, Passage of Maritime Transport Security Act 2009 and the Merchant Shipping (Civil Liability Convention) Act 2009.
Programme Three dealt with transport regulation and accident and incident investigation. This was a shared responsibility among the three spheres of Government and the Road Traffic Management Corporation (RTMC). There was institutional chaos as a result of inadequate systems. Revenue flows remained a pervasive challenge and revenue-sharing arrangements were not working as they should. Municipalities were not passing on what was due to provinces and provinces were not passing on what was due to national Government.
The National Traffic Information System (e-NaTIS) contract was for the development and deployment of the system and at no stage was there ever a plan to issue another tender for e-Natis. Based on the contractual arrangements, once the system was operating optimally at the end of the contract period, Tasima was required to transfer e-Natis to Government. The Agreement was that the system should be transferred to the RTMC, which would then assume custody of the e-Natis on behalf of the state.
Given the magnitude of its challenges, the RTMC was not in a position to take over the system and did not have the management infrastructure in place to support a mission critical system like e-Natis. The system had been classified as a national key point, which demanded compliance with onerous security requirements. The DOT had since extended the Tasima contract based on these considerations and to enable the Department to build the requisite capacity to take over the system.
In terms of aviation, a number of security related issues were dealt with during the reporting period, which included aircraft accidents in
Programme Four dealt with integrated planning and inter-sphere co-ordination. Considerable time was spent shaping debates around infrastructure funding and engaging on issues around a dedicated maintenance fund for the secondary road network. Post year-end significant progress had been made in these engagements with the National Treasury (NT) which might result in a more sustainable approach to the maintenance of the secondary network.
To date the Shova Kalula project had distributed over 21 000 bicycles to deserving learners. Government had invested R15 million in the project over a period of four years. A revised non-motorised transport implementation plan had as its target to roll out the distribution of one million bicycles by 2015.
Programme Six dealt with public transport. Through the Passenger Rail Agency of South Africa (PRASA) the Department had extended the rail network in Khayelitsha. The Railway Safety Regulator (RSR) approved all relevant safety standards and evaluated the level of compliance with safety prescripts and the technology, resulting in the issuing of a safety permit authorising the operation of the OR Tambo Airport – Sandton Link of the Gautrain post year-end.
As part of preparations for the World Cup 2010, significant investments were made on infrastructure both in rail and road transport. Bus Rapid Transit (BRT) projects were rolled out in
The Department had established the National Joint Working Group to address challenges facing the taxi industry and continued to engage with the small bus operators.
Programme Seven dealt with the public entity oversight and border operations and control. Pervasive challenges remained in the corporate governance of public entities. The Department continued to address the challenges experienced by the RTMC and formulated the draft no-fault policy for Road Accident Benefits, consulted the policy and tabled the policy to Cabinet.
Programme One dealt with administration. The current establishment of the DOT was 677 posts, but only 627 posts had been filled. This was primarily due to budget constraints. The Department started an exercise in the last year to review the effectiveness of the structure. The Department had realised that the way the Department was currently structured posed a challenge and the fragmentation of functions compromised accountability and proper strategic focus. The Department intended to shift from policy focus to implementation co-ordination. It also wanted to place an emphasis on skills development, support for the disabled, women and the youth.
Mr Mahlalela then presented the annual financial statements for 2009/10. He referred to slides 13-23), and informed Members on expenditure trends for 2009/10 – adjusted budget; expenditure trends for 2009/10 – reprioritisation; under- and over-expenditure; audit outcomes – which included emphasis of matter with regard to unauthorised, fruitless, wasteful and irregular expenditure, and other legal and regulatory matters with regard to no quarterly reporting on performance information and concern as to internal control.
With regard to Human Resource Management, Mr Mahlalela illustrated the personnel establishment by way of the pie chart on slide 25. He reported that measures were introduced to reduce the vacancy rate which included: 1) concurrent headhunting with the normal recruitment process had been introduced and implemented; 2) retention strategy was approved and implemented; 3) appointment of ‘second appointable’ candidates who were women or people with disabilities; 4) the pro forma submission of posts had been improved to include branch Employment Equity (EE) status updates; and 5) contract employees had been temporarily placed against vacant posts as per Executive Committee (Exco) directive.
Race representation could be seen as per the pie chart on slide 28. Gender representation could be seen as per the pie chart on slide 29. Gender representivity and turnover at all levels could be seen on the table on slide 30. Staff mobility between 1 April 2009 to 31 March 2010 was illustrated on slide 31. The employment equity status as at 31 March 2010 was indicated on slide 32.
Certain challenges existed within the Department. These included: 1) paying more attention to under-represented groups (Coloured people with disabilities); and 2) ensuring that more women were appointed at senior levels within the Department. Certain interventions were also made which included: 1) Senior Management Staff (SMS) members were held responsible for ensuring and achieving EE in their relevant components; and 2) Job Access had been appointed to assist the Department to recruit people with disabilities.
Job evaluations between 1 April 2009 and 31 March 2010 could be seen as per the table on slide 35 and the profile of employees absorbed in an upgraded post between 1 April 2009 and 31 March 2010 as per the table on slide 36.
The Department addressed issues of scarce and critical skills as follows: 1) the Department achieved partially the Integration of Transport studies within the Further Education and Training (FET) curriculum for levels 2-4; 2) 17 students were sent to Prague to pursue transport-related careers; 3) the Department sourced R 1.84 million from the United Nations Development Programme (UNDP) for placement of scarce and critical skills; 4) 45 transversal interns were placed within the Department; 5) outreach programmes had been conducted to address transport-related scarce and critical careers; 6) a human resource development strategy for 2009 – 2013 was developed that addressed the capacity development initiatives for the Department; 7) 2010 World Cup Skills Development project was conducted with the assistance of R1.8 million from UNDP; and 8) the completed gender audit was presented to the Exco for adoption and approval.
Areas of intervention for 2010/11 included: 1) policy for public transport access in South Africa; 2) Modal split analysis; 3) Development of the Rail policy; 4) Framework for a single transport regulator; 5) consolidation of aviation economic regulator; 6) implementation of best practice model (re: licence management); 7) facilitating job creation and employment in maritime sector; 8) development of rural public transport network plan; 9) non-motorised transport policy completed; 10) transport disaster response strategy; 11) high speed rail plan for priority areas finalised; 12) regional master plan for the Southern African Development Community (SADC) drafted; 13) taxi subsidy framework reviewed; and 14) provision of a better working environment through a new office campus.
The Chairperson wanted to know whether the Department spent accordingly and commented that the Department should also look at its medium-term framework when looking at the annual report. Also, the Department should look at its programmes for the next financial year and get an understanding of how the programmes implemented would reflect its new budget.
Mr M de Freitas (DA) wanted clarification on what is happening with the e-NaTIS system; and clarification on the high vacancy rate. Also, why was there over-spending on bus subsidies, and under-spending of R100 million?
Mr Dan Pretorius, Chief Financial Officer, DOT explained that before the introduction of the e-NaTIS system the national Department paid for the funds in full. Since the introduction of e-NaTIS the provincial departments now pay. e-NaTIS cost the Government R350 million. Mr Pretorius said that some projects had to be postponed, hence the under-spending of R100 million, and with regards to bus subsidies, the funds were exhausted.
The Chairperson wanted to know whether a national pool account could be set up that would collect all the funds.
Mr Pretorius responded by saying that each Government department had its own account where the funds were deposited.
The Chairperson commented that in the long-term, e-NaTIS must be transferred to the state.
With regards to the high vacancy rate, Mr Mahlalela said that National Treasury (NT) could give approval for only 500 vacancies at a time and that it was a gradual process over the next few years. Also, the Department had finalised positions up to the level of Chief Director.
Mr E Lucas (IFP) wanted to know why the Department was so silent about the taxi industry given that it was an important industry, and asked for clarification on the bus subsidy.
With regards to the taxi-recap, Mr Mahlalela stated that the R7.7 billion required was not available and the scrapping process was inevitably slower. Also, the cost of a new taxi was R250 000 and most operators could not afford to purchase a new taxi.
Mr Mahlalela said that the bus subsidy issue remains a challenge and that R9 billion was set aside per year. However, R20 billion to R30 billion was actually needed to address the problem.
Ms D Dlakude (ANC) wanted to know whether the building of bridges over rivers in the rural areas were included when looking at non-motorised transport.
Mr Themba Tenza, Acting Deputy Director General, DOT, noted this question and accepted that lives could be saved by building these bridges.
Ms P Ngwenya-Mabila (ANC) wanted to know what was happening with the taxi recap; was the theft of computers and software reported to NT and why did the Department not meet its targets for the Shova Kalula bicycle project?
Ms A Nchabeleng, Acting Deputy Director General, Integrated Planning and Inter-sphere Co-ordination, DOT, said that the Shova Kalula project had never met its target because of a lack of technical capacity and that a fresh look at the market was needed. Also, deployment of individuals with the right technical skills would be implemented to achieve targets.
Mr Mahlalela said that the theft of the computers and software was reported to NT and an investigation was underway.
The Chairperson wanted to know whether the beneficiaries of the bicycles were the schools and what criteria was used when donating the bicycles.
Ms Nchabeleng said that schools were targeted where the learners walked more than six kilometres to school.
The Chairperson wanted to know why the report did not make mention of the six kilometres and whether the Shova Kalula Programme was linked to poverty reduction and who would repair bicycles that broke down. Also, where would the recipients get the spares for the broken bicycles?
Mr Mahlalela said that, historically, transport development had been urban-focused and only in
Mr J Maake (ANC) wanted to know what the Department was going to do to re-align some of its programmes and asked also for clarification on the issue of the transfer management plan. Also, what was the focus of the rural grant of R 12.8 million?
On the question of re-alignment of programmes, Mr Mahlalela said that each branch of the Department would be responsible for a different mode of transport. This would ensure that there would be greater efficiency. With regards to the transfer management plan, Mr Mahlalela said that the plan was not yet finalised as a result of certain delays.
With regards to the rural grant, Ms Nchabeleng said that it was underfunded and that the grant was spread over only five municipalities currently.
Ms P Ngwenya-Mabila (ANC) commented that virements needed approval from NT
The Chairperson thanked the Department for its presentation and Members for their questions and input.
The meeting was adjourned.
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