Airports Company South Africa and Cross-Border Road and Transport Agency: briefing

Meeting report

TRANSPORT PORTFOLIO COMMITTEE
9 April 2003
AIRPORTS COMPANY SOUTH AFRICA AND CROSS-BORDER ROAD AND TRANSPORT AGENCY: BRIEFING

Chairperson: Mr J P Cronin

Documents handed out:
Airports Company of South Africa
Cross-Border Road Transport Agency

SUMMARY
Airports Company South Africa outlined a number of plans for improving the airport infrastructure and customer service. Concerns were raised regarding facilities for the disabled, security and the construction of a new domestic terminal. The Cross-Border Road Transport Agency explained their functions to the Committee. A number of issues regarding illegal trafficking of people into other countries, security at border posts and the relevance of some programmes were raised.

MINUTES
Airports Company South Africa
Ms M Hlahla, the Chief Executive Officer of Airports Company South Africa (ACSA), described the company as maturing and meeting challenges concerning operations to improve efficiency and infrastructure. The company was in its tenth year and was always committed to world-class standards and excellence. The streamlining of airports and customer care were high on the list of priorities. She then referred to the budget.

Ms M North, the Group Manager of Finance explained that airports were driven by traffic and how this would affect growth in the new financial year. An overall increase of 5.3% was expected in total passengers. An amount larger than expected was allocated to security at airports since this had become a major concern. A new domestic terminal was planned and this would result in that more funds being allocated to cover additional costs.

Financial charges had increased sharply because one-year projects were no longer being conducted. Commercial revenue had increased because of the retail activity at airports as well as a sixteen percent increase in total revenue. Personnel costs had also increased in light of customer care, training and development. Repairs and maintenance costs ensured that airports met a particular standard, and security costs included the contracting staff and the various costs associated with it. Ms North referred to the consolidated balance sheet and pointed out an extra investment in trade debtors. The cash inflow of R463 million was to be allocated to improving infrastructure while further funds would be borrowed to cover expenses.

Discussion
Mr A Ainslie (ANC) referred to the 2001 annual report presented by ACSA and asked about a board level sub-committee in place at the time and why there was no such committee mentioned in the 2002/2003 report. He inquired about updates to the permit system. Why were private security companies contracted?

Mr G Schneemann (ANC) commented on the visibility of the South African Police Services (SAPS) at airports. Why had this had decreased.

Mr Gore (DA), representing the disabled faction, spoke of the discrimination against disabled clients at the new terminal at Johannesburg International Airport. Nothing had come from personal contact with staff. He described the ramps as being sub-standard in terms of the requirements of the South African Bureau of Standards.

Ms Hlahla stated that in terms of co-ordinating security, she referred to last year's National Security Committee, under which there functioned a Local Airport Security Committee, the key co-ordinator of security measures. Improvements could be made and the biggest risk came with uncoordinated security. Regarding the sub-committee as mentioned by Mr Ainslie, the committee was now known as the Risk Committee and was charged with dealing with more issues than the former structure. Regarding the permit system, she said that the entire system of access control had been reorganised with a new strategy to reduce access into airports. In keeping with security, private security companies performed specialist roles, and other entities were being evaluated as to which skills are deemed useful by ACSA. Concerning the visibility of the police at airports there had been no final output between ACSA and the state, but that discussion around closer co-operation was under way.

Mr Moseki, ACSA General Manager for Johannesburg International, reiterated the importance of access control and that more funds for technological improvement was required. He said that centralised control rooms were planned for airports in Johannesburg, Durban and Cape Town. Approximately 20 000 permits were issued daily in Johannesburg, but the permit verification system created difficulties when people failed to return permits. An upgrade including more adequate measures was imminent as a new domestic terminal would require more personnel to cover additional areas of control, as well as more parking areas. Plain clothes men were stationed in sensitive areas, and that resources would be further employed in such a way.

Ms Hlahla referred to Mr Gore's concerns about disabled passengers and said that disability was not to be ignored. Planning for airports had been done years ago and needs and requirements and changed over time. Meetings had been convened with inter alia the Human Rights Commission as well as other bodies representing the interests of the disabled.

Mr Gore thanked ACSA saying that it was reassuring to hear the plans outlined. However, he mentioned that research had indicated no meetings with the organisations mentioned by Ms Hlahla during the phases of design, construction and operation.

Mr Moseki explained that the magnitude of the domestic terminal would result in further consultation with airlines and passengers on ways to improve infrastructure. The ramps had been audited and now met the necessary standards. Misunderstandings ensued because people needed to know that measures are in place.

Mr Schneemann requested a report on consultation made throughout the different phases, namely design, construction and operation.

Mr Ainslie asked whether technology could allow for permits to be cancelled automatically. Which security company was now employed by ACSA.

Ms H Matlanyane (ANC) commented on slow service and exposed parking bays at Polokwane Airport and asked that this be addressed.

Mr Schneemann asked about ACSA's role concerning the construction of the King Shaka airport.

Mr Ainslie mentioned the severe acute respiratory syndrome (SARS) and asked about precautions had been taken regarding the disease.

The Chair asked about the loans made and what they were for. A further concern was raised about the language problem, particularly in pamphlets only in English and Afrikaans.

Mr Moseki explained that a new system would force that permits be renewed. Regarding security companies, the contract was split between Enlightened and Khulani security companies. Aviation security equated national security, and therefore the SAPS was being evaluated in terms of rendering the necessary services. Concerning parking, that special provision had been made for Parliamentarians in the form of a specially issued pay-as-you-go card. Multi-story parking facilities were also planned as there was already covered parking at Cape Town International Airport. He referred to SARS and said that because it was prevalent in Asia, two routes were affected: namely those between Johannesburg and Hong Kong and Johannesburg and Sydney. Airline staff would monitor flights while port health officials would isolate any suspicious individuals.

Ms Hlahla said that personnel concerns were managed by the relevant provinces. Even though ACSA owned the property on which the King Shaka airport was to be built, there had not been any correspondence between themselves and the authorities of La Merci. Communication was a challenge, especially as far as various languages were concerned, but that she would look at core markets for a resolution.

Ms North answered the question on loans and explained that the Board and shareholders decided financial policy. Loans were made for a number of different reasons . Decisions as to which instituted to engage could now be taken in the new financial year.

The Chair repeated the request for a progress report on consultation with organisations for the disabled. He encouraged further interaction as the Committee felt somewhat uninformed as far as projects and proposals were concerned.

Cross-Border Road Transport Agency
Mr J Chiumya, the Chief Executive Officer of Cross-Border Road Transport Agency (CBRTA) described the company as one which issued permits to those providing freight and passenger services. CBRTA was reliant on the industry for income generation. The vision was explained as ensuring the smooth flow of people and goods as well as economic development in the SADC region. He cited better accessibility and mobility as the mission. Furthermore, the objectives included maintaining effective law enforcement regarding the issuing of permits and enforcing the Road Traffic Act. There were plans to transform the agency, address gender inequality, implement Skills Development Plans and promote Black Economic Empowerment through a number of workshops and campaigns already conducted in the Limpopo, Mpumalanga, Guateng and North West provinces.

Mr Monakisi, the Chief Financial Officer, CBRTA, stated that the company had been funded by a R7 million grant in 1998 and was still using those funds at present. Money generated monthly came from issuing permits and the company was a non-profit organisation. Mr Monakisi explained that the company was not doing well as it recorded a R3 million loss in 2002. This was as a result of training programmes conducted for specialised inspectors as well as additional benefits granted to them. He cited incentives and increases in permit fees as mechanisms to avoid a repeat of such a financial loss.

Discussion
Mr Ainslie mentioned queues at inland border posts and how this could be regarded as free-flowing traffic. There were no amenities at posts for those who spent days there. Mr Ainslie also referred to the illegal trafficking of women and children from neighbouring countries. Was there was any interaction between CBRTA, SAPS or the Department of Home Affairs.

Ms Matlanyane asked as to the inspectors receiving training and then leaving to employ their skills elsewhere.

The Chair said that he failed to understand the actual purpose of CBRTA and noted a contradiction between being a regulatory body wanting to encourage free-flow of passengers and goods. He asked about the relevance of BEE programmes as being part of CBRTA's function.

Ms F Oaten, the Director and Deputy Chairperson of the Board, explained the function as issuing permits at border posts in association with SAPS and immigration customs. The company was responsible for alerting the necessary authorities of any irregularities encountered. Their mandate was to facilitate joint-route management and take issues to an executive level. Concerning BEE programmes, she said that it was a mandate of most agencies to give black people the opportunity to enter an industry dominated by large white-owned companies.

Mr Chiumya referred to the question on queues and explained that Customs officials spent time inspecting the goods on vehicles passing through. Queues on the South African side were held up by cumbersome manual administration on the other side. Efforts to rectify this would be made in conjunction with other Departments.

The Chair asked whether CBRTA had counterparts in other countries or whether the work was undertaken by government departments. Why was there a need for an independent company?

Ms Oaten answered that the aim was to commercialise that particular aspect of the industry. She said that 70% of expenditure was dedicated to manpower, and any grants not used were left with the Department of Transport.

The meeting was adjourned due to time constraints.