Transport 2012 Budget Review & Recommendation Report: Preliminary deliberations

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16 October 2012
Chairperson: Ms N Bhengu (ANC)
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Meeting Summary

The Committee Researcher presented a draft Budget Review and Recommendation Report (BRRR). There was a focus more on the Department of Transport’s failure to meet targets that its achievements. Members suggested some recommendations to be inserted into the BRRR. A second draft would be debated on 23 October.

Several substantive comments were raised by Members. All expressed their frustration with the poor performance of the Department of Transport (DOT), although the point was also made, towards the end of the meeting, that part of the problem was that Cabinet had approved policies and strategies (such as rural road strategies) that were then not funded by National Treasury. They believed that DOT had paid insufficient attention to job creation or skills development, especially the potential in the marine environment, and had failed to cooperate with other institutions of learning. This had led to tension as the South African Maritime Safety Authority had itself started to deal with matters that were outside its mandate, in order to avoid the DOT’s resulting in missed opportunities. Members agreed that Civil Aviation issues were also not properly addressed, and expressed concern also that SAA continued to receive bail-outs while other small low-cost airlines collapsed. A substantial debate was held on the position of the Road Traffic Management Corporation (RTMC) and Administration Adjudication of Road Traffic Offences. The DA suggested they be disbanded, but ANC members did not agree, believing that proper funding might resolve the issues. The Chairperson appealed for a non-partisan approach and pointed out that the DOT and Committee had agreed that even funding, and new staff and board appointments could not alter the non-conducive environment in which RTMC operated, and it was agreed to include a comment and recommendation about the DOT’s failure, so far, to present policy or legislative changes to the Committee that could be debated to address the problems. Members also expressed their concern that the DOT was yet to revise its suggestions to incorporate under-developed areas to pursue the goal of manufacturing bicycles, particularly since only 900 of the intended 5 000 had been delivered. Members criticised the DOT’s failure to manage and monitor entities and provinces, and commented that it had not achieved targets in regard to non-motorised transport in six municipalities, nor responded positively to a prior insistence by this Committee that rural provinces – in particular river overflow – had to be addressed, nor had finalised the policy on transport of learners. In general, Members said that policies were never given sufficient attention and their budgets were shifted elsewhere. They felt that DOT had to re-look at its subsidy policy and perhaps consider giving to subsidies to individuals, to be used as they chose, rather than to different entities. In general DOT should be ensuring that the costs of travel were reduced, but nothing was mentioned on this in the Annual Report. More focus was needed on aviation and sea transport. Members also noted the problems of grant funding being withheld for under-performance which ended up in a vicious cycle of services not being provided to benefit those most in need. It was noted that meetings with the Minister and SANRAL would be needed after this process.

Meeting report

First Draft: Transport Budget Review and Recommendation Report 2011/2012
Mr S Mgesi, Committee Researcher for the Transport Portfolio Committee, noted that the Budget Review and Recommendation Report (BRRR) draft drew on the Annual Report that had been presented by the Department of Transport (DOT or the Department) for 2011/12, as well as the findings of the Auditor-General (AG). There was a focus on the inability of the Department to meet the targets set, rather than on the achievements.

Mr L Suka (ANC) said that he was disappointed by the Department’s performance, and there were many gaps that were not filled. Although the Department had identified five priorities of government, in terms of delivery and performance, there was insufficient attention given to job creation or skills development. He believed that the Millennium Development Goals (MDGs) as set out on page 5 of the BRRR could not be achieved by government by 2020, because there were so many policy gaps. He also mentioned that there was serious under spending on the budget of this Department, and this was particularly worrying because it indicated that no delivery was taking place. In particular, he noted the adjustment of the budget to R41.5 billion, but still did not feel that the Committee had been given a true analysis of the expenditure and projects taken on. He noted the gap of R321 million in spending.

Mr Suka also stressed that there was a serious and fundamental challenge with the vacancy rate. Now that an Acting Chief Executive Officer was in place, he thought that this would have been addressed.

Mr Suka then touched on the issue of Civil Aviation, and said that he felt more information was needed around compatibility between the Departments of Transport and Public Enterprises. He also stressed that there was not enough information in the BRRR, and reminded the Committee that it would be published for the public.

Mr I Ollis (DA) agreed with Mr Suka’s concerns around Civil Aviation challenges and safety. He referred to page 10, noting that the Department had not spent money budgeted for the Aviation Safety Board, which was also still not established. He mentioned that the Civil Aviation strategy had also not been reviewed. He said that there is evidence that in Civil Aviation, the Department was failing. This, he believed, should be highlighted, and the Committee needed to include a specific recommendation that urgent action must be taken.

Mr Ollis then spoke on skills development, noting that provinces were outsourcing jobs. Skilled people were leaving, and the skills were being lost over time. Parliament needed to be more responsive and do something about skills development, instead of leaving this to the provinces. He urged that the Department must develop and retain skills in provinces, to deliver roads.

Mr Ollis’s next point related to the Administrative Adjudication of Road Traffic Offences (AARTO) and Road Traffic Management Corporation (RTMC), both of which were problematic. The enabling legislation for AARTO was not done, targets were not met and insufficient money was provided. He urged that legislative changes be made. Even the Unions were of the view that the AARTO needed to be repealed.

Mr Ollis feared that RTMC would not be able to improve, even if a permanent Chief Executive Officer was appointed. The DA believed that cities, provinces and the DOT itself should revert to the former system of collecting their own fines. He therefore suggested that the RTMC be shut down and its powers be transferred back to these bodies, and highway police should be set up. He reiterated that he was firmly of the view that no amount of money being put in, nor appointment of staff, would help the RTMC.

Ms D Dlakude (ANC) initially spoke about the 5 000 bicycles that were meant to be issued for the Conference of Parties (COP17) but noted that these were never issued.

Ms Dlakude also spoke about the RTMC, pointing out that the DA had been involved in the establishment of this entity through an Act of Parliament. After its establishment, however, noting was done to ensure that it functioned as it was expected. The Committee had tried its best to ensure that RTMC would fulfil its constitutional obligation. She suggested that the RTMC constitutional arrangements be reviewed, but did not agree with Mr Ollis, as she would not like to see a return to old-order systems. The ANC was of the view that all law enforcement officers in the country should be properly trained and answerable to one commander. She strongly disagreed with suggestions that RTMC be closed down, or its Act repealed. She did, however, believed that the relevant legislation should be reviewed so that RTMC could do what was expected of it. Despite its difficulties, it had achieved quite well. She also agreed that the AARTO system should be properly rolled out.

Ms N Ngele (ANC) agreed with Ms Dlakude that RTMC should not be closed down. It could not be expected to function without proper funding, and she urged that it be properly funded, and given another chance.

Mr Suka believed that the main problem with RTMC was that it had not been given a specific time frame, so it was impossible to measure its performance. He too cited the example that 5 000 bicycles were meant to be delivered, but only 900 were actually delivered.

The Chairperson thanked Mr Mgesi for the draft BRRR. She noted that, in regard to Civil Aviation, the ANC, at the relevant meetings had brought up issues of inaccessibility of air travel and the closing of the low-fare airline. The DA had been concerned with Civil Aviation safety and the continuous funding and bailing out of South African Airways (SAA) by government. The root causes of these problems had to be found and addressed. She felt that the Committee’s Recommendations must include the concern that the Department had been silent on these issues, and should have commented on the fact that on the one hand, other airlines were being shut down whilst on the other SAA was receiving continuous bail-outs. SAA faced the same problems as other private airlines, and it was of concern that it was receiving priority treatment.

The Chairperson noted the differences of opinion in relation to the AARTO and RTMC and commented that it was not always helpful to approach issues from a party-political standpoint, as this limited a realistic consideration of the issues. Since the establishment of AARTO and RTMC in 2009, the problems of both had come under debate. The first concern related to the operations, which included issues around funding and staffing, the role of the government, the existence of a board and Chief Executive Officer, and whether specialists and systems were in place. The second concern was the environment in which these institutions had to operate; RTMC must not be looked at in a limited way, but as a part of the whole South African transport sector.

The Chairperson said that the question was whether RTMC would have been able to function as required, if it had been given what it needed by way of human resources, financial resources and an operative board. Everyone, including the DOT itself, had concluded that this would not have been possible, because the environmental and institutional arrangements in South Africa hindered it from operating. At one stage, a solution was proposed to use the   Land Transport Act to create a more conducive environment for RTMC. No draft bill or regulation had yet been produced to deal with that. She believed that if this was done, this would present an ideal opportunity for the views of all political parties to be debated with a view to creating a conducive environment for RTMC to operate. Depending on how the draft was worded, it might be possible to consider going back to the original systems, or facilitating the setting up of line systems between cites, provinces and the national structure.

The Chairperson also stressed that the situation would not be corrected by merely addressing funding or employment alone. Instead, she urged everyone to “move from their political corners” to try to find direction and solutions to the problem. This problem was first identified during a strategic workshop in 2010, but was again raised in 2011 and 2012, but there were attempts to fix the RTMC internally without also fixing the environment in which it operated.

Mr Ollis agreed with the Chairperson. He suggested that it should be noted that AARTO and RTMC were currently unable to function well, but it should also be noted that the Committee had not received any proposals from the DOT.

The Chairperson thought it should be specifically stated that DOT and the Committee had also agreed that in order for RTMC to function well, an amendment was needed to the National Land Transport Act. The Committee should not dictate what action should be taken, as that was not in the purview of the Committee, but would leave it to the Department. It should, however, be stressed that AARTO and RTMC could never function in the current conditions, and that the matter must receive priority from the DOT.

The Chairperson then also touched on the bicycle issues. She said that the DOT was still confining itself to buying and distributing bicycles. The issue of local manufacturing had been raised, or even merely wheel alignment at local level, but nothing was said on this. In the previous year, it had been said that South Africa could manufacture bicycles itself, and the Department was to have developed and brought a strategy to the Committee. Four cities had been proposed for manufacture. However, there were concerns that these bicycles, instead of being manufacture in the cities and brought into the rural areas as completed items, should rather be manufactured in underdeveloped areas, to address issues of job creation and rural poverty. Nothing further had been done to identify four under developed areas.

Ms Dlakude added that the Committee had even identified the rural provinces’ possibilities for the Department, but the latter had ignored the issue.

Ms Dlakude was also concerned about skills development, saying that nothing was said by the DOT about the potential in the maritime field. She expressed her frustration that whatever was suggested by the Committee did not appear to be taken seriously by the Department.

Mr Suka commented that the Public Administration and Leadership Management Academy (PALAMA) was set up to train civil servants to understand how government operated. Although the DOT was supposed to work with higher learning institutions on skills development, he was not sure what it had done in this regard. Nothing was said, either, about people being sent overseas for skills development. It was also not clear to what extent the DOT had been paying levies for skills development for its employees.

Mr Suka commented that the impression was created that the Annual Report had “cut and pasted” sections from previous reports, as similar issues were simply repeated from the previous year.

Mr P Mbhele (COPE) asked why South African Roads Agency Limited (SANRAL) was not invited to the meeting.

The Chairperson responded that she had deliberately not invited SANRAL, because she had felt that a separate session focusing on its issues alone was needed, apart from the performance of other entities. The debate on e-tolling and funding model for the levies would be resolved only if SANRAL’s mandate was extended to also developing rural roads. She believed that more people would be happy to pay if they knew that the levy was going towards improving infrastructure in the rural areas.

Mr Mbhele shared concerns of other Members about the RTMC. He also pointed out that the DOT was failing to meet its targets in almost every respect, even when money was not an issue. He cited the instance of taxi recapitalisation, noting that there had been under-expenditure for several consecutive years. He found the DOT to lag behind also in the monitoring and management of entities and provinces.

Ms Dlakude said the Committee needed to reflect on the issues of under spending coupled with a failure to meet targets.

Ms Dlakude said that the DOT had said that it would be dealing with non-motorised transport infrastructure in six municipalities, but the Annual Report indicated that nothing had been done in this regard. There were still many areas where children were unable to get to their schools in the rainy season. In the previous year, the DOT had announced that it would have a focus on the big cities. However, the Committee had specifically told the DOT then that it needed to focus on the rural areas, and in particular those with large rivers that would overflow and pose a danger to the learners. As Mr Mbhele correctly pointed out, spending had not taken place and targets had not been met.

The Chairperson commented on the uneven levels of performance between the entities and Department. The Skills Development Expo on Maritime had resulted in some tensions. The training of seafarers was not necessarily driven by the DOT, because South African Maritime Safety Association (SAMSA), realising that the DOT was not doing so, had started itself to build relationships with training institutions. The DOT employee responsible for training felt that this was encroaching on his mandate. However, if the DOT was not achieving anything, she said that the country would suffer unless the function was pursued elsewhere. The first problem was that SAMSA had indeed over-stepped on its mandate, but this was done precisely because the DOT that is meant to be handling this mandate was not doing so. SAMSA was faced with either sitting back and watch the opportunities pass by, or using a proactive approach as a strategy to pressurise the DOT into doing its work. She wondered if the Deputy Directors General of the various programmes were specialists in their field.

Mr Ollis agreed with the Chairperson.

The Chairperson noted that the Maritime Policy was unable to be given to the Committee, apparently due to budgetary constraints. She was also concerned that anything to do with policies simply was not attended to by the DOT, and the money allocated for such policies, including the Scholar Transport Policy, would simply be shifted.

The Chairperson also referred to the draft maritime policy which could not be produced owing to budgetary constraints. She said that anything to do with policies in the department does not happen and the money allocated for policy always gets shifted, including the Scholar Transport Policy. In September 2011, it was discovered that it took the Department took four years to complete this work, and only three provinces had agreed to run their Scholar Transport under the Department of Transport. A policy was desperately needed that would cover issues of safety, how many people would drive a vehicle, distances and vehicles used, and considerations of road infrastructure. The DOT report, however, only touched on funding and displayed lack of skill.

Mr Suka said that the Committee’s oversight role was intended to keep the DOT accountable and make it explain the non-performance. Everybody in the DOT had a mandate to perform and funding should have been allocated in line with the mandates. He would like to see Directors and Managers called to a meeting to respond specifically on the funding entrusted to them. He would also ideally like to have interaction with the provincial Departments of Transport on the roads, particularly road maintenance, to follow up on billions given for road maintenance. Finally he mentioned the Re Ya Vaya programme, asking why buses were still parked without being used, in Nelson Mandela Bay Metropolitan Municipality.

Mr Mbhele said that the fact that specific figures were quoted for the numbers to be carried should be listed as a serious problem, in light of the fact that they were unused, and not as an achievement.

The Chairperson pointed out that public transport could be provided by government and the private sector, and the latter was not equally assisted by government. Bus companies falling under the South African Bus Owners Association (SABOA) were subsidised, but small buses and taxis were not. This raised the question of why DOT was responding differently on subsidies. She suggested that it would make more sense to subsidise passengers, who could then choose their preferred mode of transport. This would cancel the current discrepancies between different modes.

She also stressed that the DOT should be putting in place systems that would reduce the cost of travelling and transportation of goods, to allow more people to move around, trade and meet their social needs. Government should be seeing this as an area of investment, not of profit. The impact of transport would be measured by the ease with which people could commute, and the prevention of accidents. The DOT should regard itself as one that must provide a conducive environment for social and economic development to take place. The Annual Report did not, when setting out targets, actually address the challenges of the country. Nothing was said about reducing the time and cost of travelling.

The Chairperson said that she did not understand why the country was not placing more focus on aviation, which was the fastest mode of transport, followed by rail, which was the mass mover. The sea should be seen as an ideal opportunity also to transport people as well as goods, as was done in other parts of the world, and that was an ideal link into tourism.

The Chairperson reminded Members that the DOT had been asked, on 22 May, to brief the Committee on the strategy for upgrading rural roads. It was also asked to address the Portfolio Committee on Women, Children and People with Disabilities on its specific initiatives for vulnerable groups. Both presentations indicated that in 2008, a plan was apparently approved for upgrading rural roads, but only limited funding of 30% was made available. She said that there was a mismatch between Cabinet approving projects, but National Treasury (NT) being unable to provide the funding, and suggested that if no funding was available, the project should not actually be approved. This led to the situation where the DOT was accused of under-performing although there was no reflection of the NT role.

Mr Ollis added that a further problem related to grant funding. If grant funding was not used, NT could take it away, but the end result was that the road were not being improved. Many of the problems in using the money lay with lack of skills in the small towns, but a vicious cycle was created by grants being withheld and people on the ground continuing to suffer.

Mr Ollis asked for an indication of how the Committee would proceed, asking if the Committee Researcher would now prepare a new draft, incorporating more recommendations. He suggested that the Minister be invited to share the Ministerial vision with the Committee, since nobody else seemed to have the answers to the points raised.

The Chairperson said that there had been three meetings with the Minister, who was currently busy with the consultations with the entities and boards reporting to the DOT. When that process was finalised, it was possible to arrange a meeting.

The Chairperson said that the second draft of the BRRR would be presented for deliberation on Tuesday 23 October. She thanked the Researcher and Members for their contribution.

The meeting was adjourned.


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