Strategic Plan for 2003: briefing by Department

Meeting report

TRANSPORT PORTFOLIO COMMITTEE
21 February 2003
STRATEGIC PLAN FOR 2003: BRIEFING BY DEPARTMENT

Chairperson: Mr J P Cronin (ANC)

Documents handed out:
Presentation by Department on Strategic Plan for 2003
Road Accident Fund Commission Recommendations (link to Commission Report on Transport website)

SUMMARY
The Department informed the Committee that the taxi recapitalisation process has accelerated in the last two months. Discussions between the South African National Taxi Council, the Department of Trade and Industry and the Department of Transport have resulted in an agreement to reduce the profit sharing agreement on the electronic management system. The Road Accident Fund Commission Report was only briefly discussed. On 11 March 2003 an inter-ministerial committee will discuss and decide on a substantive government response to the Satchwell report. The Committee would have discussions with Judge Satchwell in the near future.

MINUTES
Professor M Rwelamira: Acting Director General, Department of Transport, explained the new realigned Department of Transport organisational structure (please refer to attached presentation). He also briefed the Committee on the status of the taxi recapitalisation programme. Prof M R Rwelamira said that 15% of the new taxi fleet would be on the road by the end of 2003 though it is expected that the first of the taxis will have to be imported until the company sets up its South African operation. He referred to the need for economic integration and harmonisation.

Taxi Recapitalisation
The taxi recapitalisation process has accelerated in the last two months. Discussions between the South African National Taxi Council, the Department of Trade and Industry and the Department of Transport have resulted in an agreement to reduce the profit sharing agreement on the electronic management system (EMS) to 25,1% from the 50 % SANTACO previously wanted.

The planned size of the new fleet was reduced to 76 000 from 120 000 taxis; this reflects the current number of licensed taxis on the road. The scrapping value of taxis remains constant at 20 % of the value of the vehicle.

Economic integration and harmonisation
More countries need to be encouraged to adopt the Yammassoukro Declaration. However, since the Abuja treaty some countries have become fearful that South African Airways or British Airways may come to dominate African aviation if the treaty is fully implemented. SADC is currently in the process of drafting legal protection for local aviation industries.

Discussion
Mr R Ainslie (ANC) asked if members of the South African National Defence Force would be re-deployed to the Department of Transport to assist in providing security on public transport.
He also asked if arrangements were made for South Africans living abroad to have their driver's licenses renewed.

Prof Rwelamira said security is obviously a high priority for the Department especially since the recent spate of bombings in South Africa and international threats against all airports. Cabinet recently held a meeting with all relevant agencies and parastatals to discuss national key points and other security concerns. The Department of Defence is demobilising three companies. Currently the cost of maintaining one company is R 10, 2 million per year. The Department of Transport does not have sufficient funds to accommodate such a heavy burden at this stage. However, alternative funding arrangements are being discussed.
The Department had a rude awakening recently when a prisoner took them to court because he was not able to renew his driver's license. The Department is now working on regulations to cater for prisoners, South Africans living abroad and other similar cases.

Mr R Ainslie (ANC) asked how the Department of Transport ensures that parastatals are held accountable for their activities.

Prof Rwelamira said ensuring accountability of agencies and parastatals is a major concern in all government Departments. Most agencies and parastatals operate on a corporate style of governance; the Department usually interacts with their boards and performance contracts and other reports also assist in keeping these organisations accountable. The corporate governing mechanism does not work too well in these cases as the relationship between the Department and the agency is only as good as the relationship between the Minister and the Board.

Mr S Farrow (DP) asked for clarity on the role of the Road Traffic Management Corporation.

Prof Rwelamira said the Road Traffic Management Corporation was created to provide a framework for the current fragmented decision making process. There are, however, constitutional constraints as the RTMC is given power but the exercise of these powers are not clear and need to be tightened up. There are also financial implications to this, as some municipalities derive up to 50 % of their revenue stream from traffic management activities.

Mr Farrow asked what the cost of the new taxis will be and how government will subsidise them.

Mr Jerry Makokoane: Senior General Manager, Policy Strategy and Implementation, said that the estimated cost of the new taxis is R4 billion. However, since there are still six companies involved in the bidding process the final cost cannot be accurately predicted without compromising the bidding process. The Department is looking at a fleet of 76 000 vehicles as opposed to the previously stated 120 000 vehicles. The new figure corresponds more accurately to the number of registered taxis in South Africa. The 20 % scrapping allowance is a once off subsidy and not an ongoing subsidy.

Prof Rwelamira said that 15 % of the new taxi fleet would be on the road by the end of 2003 though it is expected that the first of the taxis will have to be imported until the company sets up its South African operation.

Ms Coetzee-Kasper (ANC) asked when the Department would install security cameras on trains as she has raised this question since 2000. She also asked whether any training or subsidy would be forthcoming to the National Sea Rescue Institute.

Prof Rwelamira said surveillance cameras on trains may not be feasible on all trains but the Department would consider the suggestion.

There are insufficient funds in the budget to allow the subsidising of the NSRI however they do have an excellent relationship with the South African Maritime Safety Agency.

Mr C Redcliff (NNP) asked for a status report on road projects planned for completion in 2002. He also asked for more detail on R 30 billion earmarked for road infrastructure development.

Prof Rwelamira said a review of the projects not yet completed has been done. The Department was too ambitious in its planning especially considering the high staff turnover and limited budget they have to contend with. The new business plan will reflect this new realism.

The R30 billion is money already allocated for development over five years. The issue now was to prioritise needs and co-ordinate the spending of this money as it is currently used for all kinds of things.

Road Accident Fund
The Road Accident Fund was briefly discussed. Prof Rwelamira said on 11 March 2003 an inter-Ministerial committee would discuss the Road Accident Fund and decide on a government response to the Satchwell report, the report of the Commission established to look into the current system of road accident compensation. The Chairman said that the Committee has planned discussions with Judge Satchwell, Chair of the Commission, for the near future.

The meeting was adjourned.