Department of Transport on its 2014 Strategic Plan, with Deputy Minister in attendance

NCOP Economic and Business Development

08 July 2014
Chairperson: Mr L Suka (ANC, Eastern Cape)
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Meeting Summary

The Deputy Minister of Transport said the Road Infrastructure Network had the potential to unlock the economic potential in South Africa, particularly in the rural areas. The National Transport Master Plan (NATMAP) had been presented to the Presidential Infrastructure Coordinating Commission (PICC) and aimed to integrate transport systems. The taxi industry contributed R40 billion to GDP per annum and about 300 000 jobs and it was an industry that needed to be developed and formalised. Land availability for infrastructure development was an issue for the Department of Transport and it was committed to addressing the challenge of illegal land invasions.

Presenting this year’s strategy, the Acting Director-General acknowledged the National Development Plan that cited the need for provision of more affordable and efficient infrastructure linked to higher levels of public investment, responsive and efficient regulations, and also appropriate sector strategies.

Budget estimates for 2014/15 showed a total allocation of R48.7 billion to the Department and this was expected to increase to R53.9 billion in 2015/16. The transfers to entities constituted 96% of the allocation which were allocations to provinces, municipalities, state owned companies and agencies. The single biggest challenge for the country was municipal road infrastructure and how resources were managed was important. Budget breakdowns were provided for the DOT programmes: Administration, Integrated Transport Planning, Rail, Road, Maritime, Public Transport and Civil Aviation. The road transport sector took a big chunk (44.4%) of the budget, followed by rail transport (38.9%) and public transport (23.4%). Administration accounted for 0.8%, Civil Aviation 0.4% and Maritime Transport 0.4%. The single biggest challenge for the country was municipal road infrastructure and how resources were managed was important.

The Transport Information System programme existed to provide an effective communication technology environment. This would be accomplished through the eNaTIS service which should be completely transferred to the Department by the end of 2014. The Integrated Transport Planning programme managed and facilitated national transport planning, related policies and strategies and coordinated regional and inter-sphere relations. Performance indicators included NATMAP which would be submitted to Cabinet and the development of the Consolidated Transport Databank. Another indicator was the proposed development of the Energy Consumption Reduction Strategy in 2015/16 to address the environmental challenges.

A breakdown was provided of the current condition of roads and it showed 20% of South African roads were in poor to very poor condition and required substantial renewing or upgrading. Strengthening and gravelling backlog roads in poor to very poor condition would require about R149 billion.

The objectives for each of the programmes were noted. The Maritime programme included oversight of the public entities, the Ports Regulator and South African Maritime Safety Authority. Public transport was critical and the Department was mandated to promote the provision of sustainable public transport through the use of safe and compliant vehicles and to develop empowerment systems within the public transport sector. The Department was in the process of finalising the National Scholar Transport Policy and the Taxi Recapitalisation Programme was being reviewed. The Department had managed to develop the Draft White Paper on the National Rail Transport Policy, which planned to address the major challenges faced by rail transport in South Africa.

The DOT vacancy rate of 25% was expected to decline as the Department was expecting the introduction of progressive internships that would attract the required skills. The Department was still largely represented by males (61.7%) with females only representing 38.3% and the goal was an even 50/50 split.

The Committee discussed the Scholar Transport System and the Shova Kalula (bicycle distribution) Programme and the safety issues it would have for learners. The Scholar Transport System had been moved from the Department of Basic Education to the Department of Transport and the Committee discussed the reasons behind the move and the management of these programmes. Member commented on the importance of the maritime programme and that majority of trade used maritime transport, yet South Africa did not own any ship to move freight. The Department was asked what it planned to do to address this.

The expense of tolled roads was discussed, and members asked what the strategy of DOT was to reduce the expense of travelling. The discussion focused on what percentage of the road network was tolled and how it factored into the user-pay principle and the total cost to government.

Meeting report

Deputy Minister of Transport, Ms Sindiswa Chikunga, said the Road Infrastructure Network had the potential to unlock the economic potential in South Africa, particularly in the rural areas. The National Transport Master Plan (NATMAP) had been presented to the Presidential Infrastructure Coordinating Commission (PICC) and aimed to integrate transport systems. The taxi industry contributed R40 billion to GDP per annum and about 300 000 jobs and it was an industry that needed to be developed and formalised. Land availability for infrastructure development was an issue for the Department of Transport and it was committed to addressing the challenge of illegal land invasions.

Presenting this year’s strategy, the Acting Director-General acknowledged the National Development Plan that cited the need for provision of more affordable and efficient infrastructure linked to higher levels of public investment, responsive and efficient regulations, and also appropriate sector strategies.

Budget estimates for 2014/15 showed a total allocation of R48.7 billion to the Department and this was expected to increase to R53.9 billion in 2015/16. The transfers to entities constituted 96% of the allocation which were allocations to provinces, municipalities, state owned companies and agencies. The single biggest challenge for the country was municipal road infrastructure and how resources were managed was important. Budget breakdowns were provided for the DOT programmes: Administration, Integrated Transport Planning, Rail, Road, Maritime, Public Transport and Civil Aviation. The road transport sector took a big chunk (44.4%) of the budget, followed by rail transport (38.9%) and public transport (23.4%). Administration accounted for 0.8%, Civil Aviation 0.4% and Maritime Transport 0.4%. The single biggest challenge for the country was municipal road infrastructure and how resources were managed was important.

The Transport Information System programme existed to provide an effective communication technology environment. This would be accomplished through the eNaTIS service which should be completely transferred to the Department by the end of 2014. The Integrated Transport Planning programme managed and facilitated national transport planning, related policies and strategies and coordinated regional and inter-sphere relations. Performance indicators included NATMAP which would be submitted to Cabinet and the development of the Consolidated Transport Databank. Another indicator was the proposed development of the Energy Consumption Reduction Strategy in 2015/16 to address the environmental challenges.

A breakdown was provided of the current condition of roads and it showed 20% of South African roads were in poor to very poor condition and required substantial renewing or upgrading. Strengthening and gravelling backlog roads in poor to very poor condition would require about R149 billion.

The objectives for each of the programmes were noted. The Maritime programme included oversight of the public entities, the Ports Regulator and South African Maritime Safety Authority. Public transport was critical and the Department was mandated to promote the provision of sustainable public transport through the use of safe and compliant vehicles and to develop empowerment systems within the public transport sector. The Department was in the process of finalising the National Scholar Transport Policy and the Taxi Recapitalisation Programme was being reviewed. The Department had managed to develop the Draft White Paper on the National Rail Transport Policy, which planned to address the major challenges faced by rail transport in South Africa.

The DOT vacancy rate of 25% was expected to decline as the Department was expecting the introduction of progressive internships that would attract the required skills. The Department was still largely represented by males (61.7%) with females only representing 38.3% and the goal was an even 50/50 split.

The Committee discussed the Scholar Transport System and the Shova Kalula (bicycle distribution) Programme and the safety issues it would have for learners. The Scholar Transport System had been moved from the Department of Basic Education to the Department of Transport and the Committee discussed the reasons behind the move and the management of these programmes. Member commented on the importance of the maritime programme and that majority of trade used maritime transport, yet South Africa did not own any ship to move freight. The Department was asked what it planned to do to address this.

The expense of tolled roads was discussed, and members asked what the strategy of DOT was to reduce the expense of travelling. The discussion focused on what percentage of the road network was tolled and how it factored into the user-pay principle and the total cost to government.

Minutes
A minute of silence was observed to acknowledge the passing of Member of Parliament, Ms Nosipho Ntwanambi.

The Chairperson said that transport was the backbone of the economy and he asked Committee members to ask questions that would be of value to their constituencies.

Foreword by the Deputy Minister of Transport
Deputy Minister of Transport, Ms Sindiswe Chikunga, offered an apology on behalf of the Minister of Transport, Ms Ms Dipou Peters. The Department of Transport (DoT) had identified pieces of legislation that would be tabled in Parliament, as well as policies that would enable the Department to deliver on its mandate. The Road Infrastructure Network had the potential to unlock the economic potential in South Africa, in particular the rural areas. The Department had been given the opportunity by the President to be part of the blue economy strategy and part of Operation Phakisa which was a managing model to come up with implementable programmes after a planning process. The National Transport Master Plan (NATMAP) had been presented to the Presidential Infrastructure Coordinating Commission (PICC) and aimed to integrate transport systems. The taxi industry contributed R40 billion to the GDP per annum and about 300 000 jobs and it was an industry that needed to be developed and formalised. Space needed to be created for private sector participation as instructed by the President in the State of the Nation Address (SONA). Land availability for infrastructure development was an issue within the DOT and it was committed to address the challenge of illegal land invasions. The discussion around road infrastructure development and its proposed budget should be held collectively.

Department of Transport: 2014/15 Annual Performance Plan, 2014-2019 Strategic Plan and Budget
DOT Acting Director-General, Mr Mawethu Vilane, gave an overview of the Department of Transport (DoT) Strategic Plan for the next five years, the Annual Performance Plan (APP) and also the 2014/15 budget allocation. Overarching policies and legislation for public transport, rail transportation, civil aviation, shipping, freight and motor vehicles were illustrated, as well as the public entities and enforcement agencies associated with DoT. The Medium Term Strategic Framework (MTSF) focused on the National Development Plan (NDP) 2030 vision and trajectory. South Africa needed to invest in a strong network of economic infrastructure designed to support economic and social objectives. Economic infrastructure was a pre-condition for basic services, specifically electricity, sanitation, telecommunication and public transport.

Mr Vilane said the first five years (2014-2019) of the National Development Plan (NDP) suggested focus on the movement towards an inclusive and dynamic and economy, and the second five years to 2024 would have greater emphasis on the diversification of the economy, building capacity required to produce capital and intermediary goods for the infrastructure programme. From 2024-2030 there were plans to focus on increasing the labour force, and reducing inequality and poverty, as these challenges were also identified in the SONA. The NDP clearly stated that the economy needed to be inclusive, equitable and fast growing and this could be achieved by growing employment, supporting productivity, improving efficiency and moving towards greater equality. In order to achieve this, the NDP cited the need for provision of more affordable and efficient infrastructure linked to higher levels of public investment, responsive and efficient regulations, and also appropriate sector strategies.

Mr Vilane showed budget estimates for 2014/15 with a total allocation of R48.7 billion and this was expected to increase to R53.9 billion in 2015/16. The transfers to entities constituted 96% of the allocation which were allocations to provinces, municipalities, state owned companies and agencies and the budget allocations for specific programmes were illustrated. These programmes showed breakdowns for Administration, Integrated Transport Planning, Rail, Road, Maritime, Public Transport and Civil Aviation. The road transport sector took a big chunk (44.4%) of the budget, followed by rail transport (38.9%) and then public transport (23.4%). Administration accounted for 0.8%, civil aviation 0.4% and maritime transport 0.4%. The single biggest challenge for the country was municipal road infrastructure and how resources were managed was important.

Mr Vilane focused on the different programmes and a breakdown of each programme’s budget allocation was illustrated. In Administration 80 posts were filled in the 2014/15 financial year and this was planned to increase to 100 by 2015/16 and 120 by 2016/17. The Department was still largely represented by males (61.7%) with females only representing 38.3% and the goal was an even 50/50 split. The vacancy rate of 25% was expected to decline as the Department was expecting the introduction of progressive internships that would attract the required skills. The Department also focused on attracting groups that were underrepresented, like coloureds and women and DOT’s employment equity status was profiled. The Transport Information System programme provided a flexible, efficient and secure communication technology environment. This would be accomplished through the eNaTIS service which should be completely transferred to the Department by the end of 2014. The Integrated Transport Planning programme managed and facilitated national transport planning, related policies and strategies and coordinated regional and inter-sphere relations. The performance indicators were NATMAP which would be submitted to Cabinet and the development of the Consolidated Transport Databank. Another indicator was the proposed development of the Energy Consumption Reduction Strategy in 2015/16 to address the environmental challenges. The Rail Transport System facilitated and coordinated the development of sustainable rail transport policies, rail economic and safety regulation, infrastructure development strategies and systems that reduced system costs and improved customer service. A map showed the rail infrastructure of the country and a breakdown of the policies and strategies and projects that would be developed to address some of the challenges in the rail industry. A project that addressed specific challenges in the rural areas was the Moloto Rail Development Project which was projected to be concluded in March 2018. The Department was focused on reducing the cost of public transport and improving the service of Metrorail. It would also monitor and oversee the Railway Safety Regulator (RSR) and Passenger Rail Agency of South Africa (PRASA). The Department had managed to develop the Draft White Paper on the National Rail Transport Policy, which planned to address the major challenges faced by rail transport in South Africa.

Mr Vilane said the Road Transport programme developed and managed an integrated road infrastructure network, and also regulated road transport, to ensure safer roads and to oversee road agencies. A breakdown showed the current roads conditions where 20% of South African roads were in poor to very poor conditions and required substantial renewing or upgrading. Strengthening and gravelling backlog roads in poor to very poor conditions would require about R149 billion. To improve road conditions in South Africa, and in the spirit of cooperative governance, the South African National Road Agency Limited (SANRAL) would provide a critical supporting role in the implementation of the Maintenance Programme. The most import performance indicators for this programme were the Road Safety Policy which would be implemented during 2016/17 and the annual implementation of the 365-Day Road Safety Programme. The Civil Aviation programme was to facilitate the development of an economically viable air transport industry that was safe, secure, efficient and environmentally friendly. The Department had already updated the Draft White Paper on the National Civil Aviation Policy and there were on-going consultations with provinces and broader stakeholders to introduce a National Airports Development Plan (NADP).

Mr Vilane mentioned that the primary objective of the Maritime programme was to ensure the development of a safe, reliable and economically viable maritime transport sector, through the development of policies, strategies, monitoring of the implementation plan and oversight of maritime related public entities. He added that the Department was responsible for a number of maritime-related public entities, namely the Ports Regulator (PR) and South African Maritime Safety Authority (SAMSA). There were still six major harbours in South Africa at Saldanha, Cape Town, Port Elizabeth, East London, Durban and Richards Bay. The Department was planning to improve legislation and policies that would prioritise the safety and environmental sustainability of these harbours. The Department was in the process of developing the Green Paper on the Maritime Transport Policy, and had also worked on the development of the Salvage Strategy that would reduce pollution levels at sea. Public transport was critical, and there was a need to transform land transport systems by legislation, institutional building, planning and capacitation in the medium term. The Department was mandated to promote the provision of sustainable public transport through the use of safe and compliant vehicles and to develop empowerment systems within the public transport sector. He also added that it was important to improve public transport access and reliability, by facilitating the development of Integrated Public Transport Networks. The Department was also in the process of finalising the National Scholar Transport Policy and the Taxi Recapitalisation Programme was being reviewed.

Discussion
Mr O Sefako (ANC, North West) thanked the Department for the presentation. South Africa was part of the global economy and he asked how competition was regulated and licences issued to not stifle the South African Aviation industry. He referred to the recurring issue raised students not attending schools during examinations due to transport challenges and he asked how this interrelationship with the Department of Education and provinces would be managed.

Mr Vilane said South African Airways (SAA) was consulted in the agreements, but foreign companies or foreign airlines were not allowed to operate in the country, other than carrying passengers into the country. Domestic movement had been regulated to be carried out by SAA or any other South African airline only. Aviation matters boiled down to the frequency of flights and the bilateral agreements entered into with other cooperatives.

Mr M Khawula (IFP, KZN) referred to the challenge of municipal road infrastructure and said government allocated money to municipalities which was spent on road infrastructure, but the DoT was not being consulted and he asked why coordination and monitoring initiated by the DoT did not take place. He agreed with the plans to revitalise rail transport and he asked why the map of the Road Infrastructure Network in the presentation was labelled ‘top secret’. He referred to the Taxi Recapitalisation Programme and asked what the Department was doing to minimise the conflict between taxi drivers during the process.

Mr Vilane said since the Department had been giving support in the form of the grants to the provinces, allocations toward municipal road infrastructure had steadily dropped and the Department wanted to change that. Concurrent functioning, memoranda of understanding (MoUs) and the development of norms and standards were some of the strategies DOT was looking to apply to coordinate and monitor these projects. The Department was committed to the revitalisation of rail transport and certain lines were targeted, especially the scenic lines from Durban to Port Shepstone which could also be a tourism initiative. Goods that were too dangerous or hazardous for road transport could then be moved to rail.

DOT Deputy Director-General: Public Transport, Mr Mathabatha Mokonyama, said the Department developed, finalised and made available the Taxi Conflict Resolution Strategy and it spoke to how matters of conflict should be prevented and resolved. Stakeholder management units had been appointed to ensure that tensions were resolved before it became a conflict or violent.

Mr F Mokoena (EFF, Free State) said he was happy with the Maritime transport strategies and the National Scholar Transport Policy because it spoke to the importance of education, especially in rural areas. The road networks especially between Lesotho and the Free State which moved a lot of business and labour, was below standard and in very poor condition. There should be more of an oversight role played by DOT to make sure these roads were taken care of, because Lesotho was an important partner in terms of tourism and other business. The costs of travelling on national roads were becoming increasingly expensive and the asked if there was a national strategy in place that could curb these expenses and to make it more affordable. He referred to the identity card and the new driver’s licence card and he asked if the two could not be combined as one card.

The Deputy Minister said South Africa had freight but the country did not have ships and the transportation of goods cost in excess of R48 billion annually. The Department wanted to change this status quo and the country was not benefiting much from ships travelling through South African waters.

The Chairperson asked what had happened to South Africa’s ships.

The Deputy Minister said South Africa’s ships were sold on the eve of democracy to make sure that the current Government did not participate in the international shipping industry. If the budget was analysed, it was clear that the Government was trying to correct those issues.

The Chairperson said close to 100 ships were sold in 1993 by the then Nationalist Party to ensure that there was nothing for the current Government.

Mr Vilane said 90% of trade happened through maritime and over half a billion tons of freight was moved through the ports yet South Africa did not own one single ship. DOT would with the support of the Committee and other cooperatives address the situation. The road referred to by Mr Mokoena was the R26 and it was in a bad condition as it carried a lot of freight. The road belonged to the province, but through the MoUs signed with the provinces the road could be part of DOT’s upgrade plans as proposed in the Strategic Plan.

The Chairperson asked if skills transfers were being done by SANRAL, specifically related to the upgrade of roads.

Mr Vilane said SANRAL worked with DOT and the Department of Public Works and would work with the entire roads portfolio on the upgrading of roads. SANRAL increased its ownership of the national road network from just over 500 km in 1998 to over 22 000 km currently. Only 14% of the network was tolled and the 86% was funded by government which amounted to roughly R30 billion. It was impossible for government to fund the entire road network.

Mr Vilane commented that there was a duplicate system when it came to the new identity card and the new driver’s licence and the integration of the databases had been discussed with Home Affairs, but the security of citizen information was a key challenge.

Mr Mokoena said the tolled roads were the roads that mattered, because alternative roads were not properly developed and the national roads became the extra expense for people travelling from one place to the other.

Mr Vilane said the question then became how infrastructure would be funded. He asked for guidance from the Committee because Members were representatives of the public.

Department of Transport Chief Financial Officer, Mr Collins Letsoalo, said the roads that gave the public access to services were the roads that mattered. In South Africa as it was, most of the freight was not paying for the cost it took to move the freight, and the user-pay principle was applied because a small percentage of South Africans owned cars and those who did not, should not be held liable to pay for roads they never used.

Mr S Mthimunye (ANC, Mpumalanga) asked if there was any way the Scholar Transport system could be transferred back to the Department of Education and if there could not be an element of security attached to the Shova Kalula Bicycle Programme, especially in vulnerable rural areas. The Department of Trade and Industry had secured R18 billion and the infrastructural development responsibility was predominantly the responsibility of the DoT. He asked what the responsibility of DOT was related to agricultural logistics and to industrialisation, especially around mining areas.

Mr Mathabatha Mokonyama said the Scholar Transport System had been delayed by the decision of where this function should be located. The initial decision was that the Department of Education should focus on education and the DoT would focus on matters of transport. The two Ministers of these Departments met three weeks ago and a decision was made to respect the Constitution that gave each premier the power to allocate functions. DOT was filling in the policy gaps on what the Authority responsible for scholar transport does as it related to standards and minimum requirements, safety issues and roadworthiness of vehicles. There was still a duty for provincial education to make sure the contracts were adhered to and often operators behaved inhumanely during examination times when their payment targets were not being met due to the exams. The crux of the matter was in the terms and conditions of the contracts and those responsible should be held accountable for non-adherence. The Scholar Transport System was initially with the Department of Education and currently the function was still allocated to the Department of Education in about four provinces. Shova Kalula was much more than just the distribution of bicycles and post-distribution management was an important function. There were maintenance managers and safety issues often depended on areas. DOT insisted that children travelled in groups, but Shova Kalula aimed to fill the ‘walking to the bus stop’ gap.

The Deputy Minister said the former Minister of Police repeatedly said the responsibility of learner safety and security was the responsibility of everyone in a community. Constitutionally, the Department of Police should protect citizens against crime and it was responsible for crime prevention, but they could not be everywhere and the responsibility should be shared by the communities. If any element of criminal activities was associated with the Department’s initiatives, the DoT would collaborate with the relevant departments, as well as with the communities to ensure that children were not exposed to crime.

Mr Vilane said industrialisation needed to be engaged, because it in addressed unemployment. DOT had set a target to procure at least 70% of rail roll-out stock locally or it should at least be manufactured here. Government was the biggest procurer of services and it was an opportunity for job creation opportunities.

Mr Collins Letsoalo said currently DOT spent R17 billion on subsidies and a recent fiscal study showed DOT needed about R50 billion, because R690 per person per month was spent for every person using public transport in South Africa. Only 20% of South Africans owned cars and 80% relied on public transport and the subsidy scheme needed to be stratified. The review of the National Household Travel Survey guided DOT on the strategies developed on how better to assist the poor.

Mr Sefako asked why most of the delegation from DOT was in ‘acting’ positions.

The Deputy Minister said the Director-General position would be filled very soon and it was a very strategic position. All other positions were prioritised and most had been advertised. In some instances, DOT specifically wanted a woman in a senior management position, but could not find one that met the requirements and those positions had been re-advertised.

Mr J Londt (DA, Western Cape) said the presentation should be numbered, because it was difficult to refer to it if the slides were not numbered.

The Chairperson thanked everyone for their input and he said it was a very fruitful first meeting with the Department, because critical issues were raised. The budget would be more closely scrutinised at the second meeting.

The meeting was adjourned.

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