National Land Transport Amendment Bill: Department response to negotiating mandates (continued)

Meeting report

The Chairperson stated that at the last meeting the Committee had decided that the Parliamentary Legal Advice Office, the Office of the Chief State Law Adviser, the Department of Transport and the South African Local Government Association (SALGA) should meet to deal with the constitutional issues raised by SALGA. The Committee was keen to hear whether a compromise could be reached.

Ms Noluthando Mpikashe, Parliamentary Legal Adviser, replied that the meeting had taken place but that no consensus could be reached on the matter. SALGA firmly believed Clause 7 amending section 11 was unconstitutional. She on the other hand believed it to be constitutional. No middle ground could be reached.

The Chairperson said that SALGA should feel free to challenge the Bill at any stage.
 
Department response to Negotiating Mandates on the National Land Transport Amendment Bill
Mr Hament Patel Chief Director: Regulation, Department of Transport presented the responses.

KwaZulu – Natal Province
The Province supported the Bill with proposed amendments.

Clauses 1(c) and 40
The Province proposed that the definition of e-hailing services should be enhanced and reinforced to avoid unintended consequences at the point of granting licences by regulatory entities. E-hailing services should also not be restricted to areas of operation and dedicated routes as they were roaming services.

Mr Patel stated that the Department having considered the concerns raised by members in the previous meeting felt that the concerns of members were fair. Consequently, the Department proposed the deletion in Clause 40 of 66A(2)(a) and 66A(2)(b). He said that this would allow the operator to go from place A to place B to place C.

The Chairperson asked whether it meant that the Department was in agreement with what the KwaZulu-Natal Province was proposing.

Mr Patel confirmed that the Department was in agreement with what the Province had proposed.

Mr E Makue (ANC, Gauteng) said that the way technology was changing one had to keep up with the times. There was a need to be pragmatic and to accommodate new things.

Mr O Terblanche (DA, Western Cape) asked what decision was taken over the matter of 60 days or 90 days for consideration of applications.

Mr Patel responded that the Committee had agreed on 90 days.

The KwaZulu-Natal Province also proposed that it was necessary to specifically define the appropriate  
and applicable application process and a timeframe for the consideration and granting of operating licences for e-hailing service operators by regulatory authorities.

Mr Patel responded that there were different types of applications. Application processes were already covered in regulations and would be expanded in terms of the new section 8(1)(bbA). Existing regulations would be beefed up.

The Chairperson asked whether the regulations spoke about timeframes.

Mr Patel responded that the regulations provided a timeframe of 60 days for applications to be processed.

Mr Neville Dingle, Legal Adviser: Department of Transport, said that currently there were huge backlogs in the processing of applications within 60 days. The new section 8(1)(bbA) provided for the Minister to make regulations to speed up processes. The Minister would try to streamline processes in consultation with Provincial Regulatory Entities (PREs).
 
Mr Terblanche was not convinced about how it could be practically done.

Mr Dingle said that the Department was setting up structured processes. The idea was for applicants to all not wait until the last day to lodge applications. Huge publicity campaigns were envisaged to encourage applicants to apply well before the closing date.

The Committee was satisfied with the explanations given by the Department.

Clause 1(c)
The Province proposed a definition for “e-hailing app”. The Department felt that there was no need to define “e-hailing app”. It was covered within the scope of the definition of e-hailing services.

The Committee agreed with the explanation given.

The Department noted the comment made by the Province over the term “ride-sharing”.

The Chairperson said that “car pool” was covered in the Principal Act. The Bill did not define e-hailing as ride-sharing.

Clause 1(e)
The Province proposed an amendment to the Clause. The Department responded that the matter was already covered in the Bill.

Mr Dingle stated that the Province felt that there was duplication taking place. He disagreed and felt that clarity was being provided. Even if there was a bit of duplication no harm was being done.

The Committee agreed with the explanation given by the Department.   

Clause 39(c)
The Province felt that a review and amendment of section 66(5) was required due to backlogs at various municipalities in the issuance of operating licences. The Department did not see the connection between section 66(5) and backlogs. It must have been an oversight on the part of the Province. As earlier stated the new section 8(1)(bbA) would address the backlog issue by way of regulations to be made by the Minister.

Mr Makue said that backlogs in the processing of applications of taxi operators were a real problem. The Committee could not legislate to accommodate poor performance. Backlogs had to be addressed.

The Province also on Clause 66(5) made a distinction between analogue and digital meters. The response from the Department was that there was no need to make a distinction between the two meters as they were the same and served the same purpose.

The Committee accepted the explanation given.

Clause 40
The Province proposed an amendment to section 66A(1)(b). Mr Patel on what the Province was proposing said that it was within the discretion of the Provincial Regulatory Entity (PRE) under Clause 40.

The Committee agreed that the provision should remain as it were in the Bill.

The Department did however agree with the Province on the deletion of Clause 66A(2).

The Committee agreed with the deletion.

The Chairperson referring to the earlier decision to remove from the Bill the restriction of areas for e-hailing to operate from said that the amendment would have to go back to the National Assembly.
   
Mr Patel pointed out that the Province had made an input on “limitation of areas or ranks specifications” which related to Clauses 66A(1)(b) and 66(2). He said that these Clauses would be deleted based on the earlier decision by the Committee and the Department to remove restrictions on areas of operation for e-hailing services.

The Committee agreed.

The Province on section 66(5)(b) had raised concerns around the branding/marking of e-hailing vehicles and had made comments in this regard. The Department disagreed with the Province. It was government policy that all public transport vehicles should be identifiable for law enforcement purposes.
Mr Patel said that the matter of markings/branding would be covered in regulations. On regulations, deep consultation over the matter was envisaged. Engagement had already taken place between the Minister of Transport and stakeholders. He noted that the branding of vehicles was already in the public space.

The Chairperson was concerned about engagement taking long to reach agreement. He asked whether engagement over the marking/ branding regulations was ongoing would other controversial regulations be implemented.

Ms Mpikashe responded that other regulations could be implemented whilst the issue of markings/branding was sorted.

Mr Terblanche said that e-hailing vehicles already had a sticker to identify the type of service that they were rendering.

The Chairperson asked the Department whether Mr Terblanche was correct.  

Mr Dingle confirmed that e-hailing vehicles did have a sticker the size of a licence disc. He said that the sticker was different to what the Department was speaking about. The Department was speaking about markings/branding. The Minister would in regulations state that e-hailing vehicles should have some sort of markings in addition to the disc spoken about.

Mr Terblanche felt the disc to be good enough. Metered taxis only had markings for the sake of advertising their services. E-hailing was a different type of service. There were independent operators.

The Chairperson felt the provision in the Bill was flexible enough on markings/branding and suggested that it be left as it was. 

The Committee agreed.

The Province had also proposed an amendment to section 66A(5)(a) and (b). The response from the Department was that section 8(2) of the Principal Act adequately covered things.

The Chairperson noted that the Department was busy with regulations. He asked the Department what the norm was.

Mr Patel said that there was a whole process. He said that there were draft regulations on which consultation would take place with internal stakeholders. After input had been received it would be published for comment by external stakeholders. He added that there would be a whole process of redrafting. Section 8(2)(i) did provide for regulations.

Ms Mpikashe said that the Committee needed to make a policy decision.

The Chairperson said that it seemed that the Province in its amendment to section 66A(5)(a) and (b) was proposing a process because they did not trust the Department.

Mr Patel stated that the Department already had a comprehensive process and section 8(2) set it out.

Mr Terblanche said that the Department in its draft regulations would consider inputs made. It seemed as though section 8(2) covered things.

The Chairperson noted that perhaps the Province was being far too prescriptive. The Province even set timeframes. This was even before consultation took place.

Mr Dingle pointed out that the constitutional court had held that making regulations was an administrative process. The Promotion of Administrative Justice Act (PAJA) would also apply. He added that consultation processes did have time limits.

The Committee agreed with the Department that section 8(2) adequately covered things and that there was no need to amend section 66A(5)(a) and (b).

Interim operating licences
The Province proposed that provision be made for interim operating licences. The Department felt it to be in conflict with the PAJA. Mr Patel noted that experience had shown that the issuing of interim licences often lead to abuses. Operators had the tendency to use them as if they were permanent licences.

Mr Dingle stated that the problem with interim licences was that the operator was not screened. It was also only valid for fourteen days. After interim licences expired operators continued to use them. Interim licences also affected the rights of other operators on routes.

Mr Makue agreed that there was no need for interim operating licences. He said that backlogs simply had to be dealt with.

Mr Terblanche agreed that if the Department already could not deal with normal operating licence applications volumes how could it deal with interim licence applications. He was not in support of interim operating licences being issued. Normal operating licence application’s processes should be speeded up and waiting periods shortened.

Ms M Dikgale (ANC, Limpopo) pointed out that the KwaZulu-Natal Province was making the point that backlogs were a problem. It was the very reason that the Province was asking for interim operating licences to be issued. She felt that the Department ought to be pressurised into dealing with backlogs.

The Chairperson said that many of the issues were of an operational nature and would be dealt with.

Mr Makue asked that the Committee in its legacy report recommend that the Department deal with the issue of backlogs on the processing of operating licence applications.

Section 5 of the Principal Act
The Province proposed that the Member of Executive Committees (MEC) and the Minister exercise their functions for fare collection and ticketing systems by also including players in the industry, that is, operators and service providers. The Department noted the comment and said that all relevant stakeholders would be involved. 

Mpumalanga Province
The Province voted in favour of the Bill without proposed amendments.

Northern Cape Province
The Province supported the Bill with comment.

Clause 48
The Province felt that the Clause was not clear in terms of whether accredited tourist transport operators could use more than one vehicle at the same time. The Department disagreed and felt that the Clause was clear enough. Tourist operators may use any number of compliant vehicles.

The Committee accepted the Department’s explanation.

General comments
The Province was concerned that the safety of passengers including learners was not fully addressed by the Bill. The Department disagreed. Clause 2 of the Bill amended section 5 of the Principal Act to promote safety. Alternatively, safety was covered in the National Road Traffic Act 93 of 1996.
The Province also felt that the Minister had to expedite the issue of regulations to address the safety of passengers and pedestrians, especially in built up residential areas.

North West Province
The Province voted in favour of the Bill with proposed amendments.

Clause 40
The Department agreed with the Province’s proposal that section 66A(5)(b) which provides that the Minister must make regulations prescribing special markings or other requirements for vehicles used for e-hailing services be amended to make a discretion and not compulsory. The wording should be amended to provide that the Minister may make regulations.

The Committee too agreed with the proposal.

The Province made a proposal that there should not be area restrictions for e-hailing services to operate. The Department had already earlier in the meeting decided to delete area restrictions from the Bill, to which the Committee agreed.

Clause 1(a)
The Province proposed that the definition of “association” in the Bill be amended to define the composition of an association and the number of people required to form an association. The Department felt that the current definition of association was adequate.

The Committee agreed with the explanation given.

General comment
The Province stated that on job creation, employment personnel in Municipal Regulatory Entities (MRE) that were to be established should be biased to give reference to suitably qualified persons residing in those municipalities. The Department felt it to be an implementation matter.

The Committee was satisfied with the Department’s explanation.

Western Cape Province
The Province supported the Bill.

Limpopo Province
The Province voted in favour of the Bill with amendments.

Clause 1
The Province proposed that the definition of “subsidise” be amended to specifically include passengers for the taxi industry. The Department disagreed with the proposal. There was no need to differentiate between passengers of types of services.

The Committee accepted the explanation given by the Department.

Section 87 of the Principal Act
The Province proposed that the Minister be the one to determine impoundment fees to provide standardisation of fees across provinces. The Department felt that provinces, that is, the MECs should continue to determine their impoundment fees as it was a provincial function.

The Committee agreed with the Department.

Gauteng Province
The Province voted in favour of the Bill with proposed amendments.

Clause 22
The Province proposed an amendment that reduced the duration of stopgap contracts from three years as it was in the Clause to six months. The Department disagreed.
Mr Patel said that it took time to negotiate and conclude stopgap contracts. It did not mean that it would necessarily take three years. The Bill stated that it could take up to three years. He said that a fair amount of time was needed and six months was not sufficient.

Mr Makue pointed out that in the mid Vaal area there were no public transport contracts in place. He felt that three years was too long as people needed contracts to be in place.

Mr Patel addressing Mr Makue said that the situation being referred to was different, there were no contracts in place to start with. He explained that what the Province was referring to was where contracts had to be renewed. Long-term contracts of twelve years in duration had to be renewed. He said that where there was no contract the Department could introduce a new contract.  

Mr Terblanche asked why negotiations could not be started when contracts were concluded. Why did they have to wait for contracts to expire?

Mr Dingle added that at municipal level it was not easy to negotiate with taxi operators. Six months was far too short. He agreed that the contracting authority should start negotiations before contracts ended but it was not always possible.

Mr Terblanche stated that twelve-year contracts were far too long. It was often the case that contracts went to the same people. The practise could prevent others from participating. Twelve years plus three years was fifteen years. It was a long time for a contract to be with one person. He recommended that the process of renewing contracts should be done timeously.

Mr B Nthebe (ANC, North West) pointed out that it had to be remembered that there were already contracts in existence. Other players could also bid. The duration of the stopgap contracts could be reduced to one or two years. The provision could provide that contracts run for either not more than one year or not more than two years.  

Mr Patel understood the concern and said that the stopgap contracts could be reduced to one year or two years. He also understood the fear of creating a monopoly. He reiterated that the provision did state “not more than three years”.

Mr Makue said that the Bill could only be amended based on what provinces suggested as proposed amendments. The Committee could not change the duration of the stopgap contracts to two years when the Province had suggested six months. So it would have to remain “not more than three years” as was reflected in the Bill.

The Committee agreed that the duration remain as “not more than three years”.

Clause 40
The Province proposed the deletion of Clause 66A(2).The Committee had already with the Department earlier in the meeting agreed that provisions in the Clause limiting area of operating for e-hailing services be deleted. The Committee had also already dealt with Clause 66(5)(b) which the Province had also made input on.

Clause 13(a)
The Province proposed that the term, “non-executive members” should be defined as there seemed to be a contradiction in the Clause. The Department felt it not necessary to define the term as a non-executive member was a member who was not involved in the management and administration of the entity.

The Committee agreed with the explanation given by the Department.

Clause 15(a)
The Province felt that there was a need to clarify who a non-executive member was. The Department pointed out that there was no contradiction.

Clause 21
The Province felt that the provisions of the Clause were inconsistent with the constitution and with the Public Finance Management Act (PFMA). The Department disagreed.

Mr Patel explained that one was dealing with negotiated contracts. The only new addition was the introduction of integrated networks. The matter of constitutionality had been discussed with the State law Advisers Office and everything was considered to be fine.

Ms Mpikashe confirmed that the matter had been discussed and that there was no issue of constitutionality and no issues around the PFMA.

The Chairperson noted that the provisions seemed to be in line with the constitution and the PFMA.

The Committee agreed with the explanations given.

Clause 32(a)
The Province wished to have clarity where there was no Municipal Regulatory Entity (MRE). The Department’s response was that the provision presupposes that an MRE must exist for it to apply. He added that operators could apply to Provincial Regulatory Authorities.

The Committee agreed with the explanation given.

Clause 35(b)
The Province stated that it was an expensive exercise to publish an application for an operating licence. It suggested that it was not necessary to publish applications for renewals. The Department responded that the Bill already provided that renewal applications need not be published. Applications for renewals was also exempted in terms of Regulation 17.

Clause 36(c)
The Province felt that the power to delegate should not be overbroad but should rather be clearly circumscribed. The Department was of the view that the provision was adequate as it was.

The Committee agreed with the Department.

Clause 54
When the Act comes into force new applications would be received for e-hailing operating licences. The Province asked what about existing operating licences that were issued under categories (meter taxi or charter service) under the existing Principal Act. It would be unfair for either category to be required to submit new applications. The Department’s response was that the earlier mentioned new section 8(1)(bbA) would empower the Minister to make regulations to cater for these types of administrative arrangements.

The Chairperson said that the Department urged the Province to raise the matter during consultations on regulations.

Mr Nthebe said that the Department needed to be proactive. The matter should be dealt with during the process of regulations.  

The Committee agreed with the explanation given by the Department.

General Comments
The Province stated that that in the Bill there should be a requirement that Regulatory Entities must within 60 days of receipt of a fully compliant and complete application, finalise its decision on the application and communicate its decision to the applicant. The Department responded that it was provided for in the regulations. It was more appropriate for it to be included in regulations.

Mr Makue pointed out that a great deal of things seemed to be covered in regulations. He suggested that the existing regulations should be forwarded to the Committee Secretary so that it could be sent to provinces. He wished to have a commitment from the Department that when the Bill was promulgated that they would share the new regulations with MECs in provinces.

The Committee agreed with the explanation given by the Department.

The Chairperson stated that the Committee had hoped to deal with the Final Mandates on the Bill on the 26 February 2019 but it would be unfair on provinces to rush things. Committee Minutes on proceedings would be sent to the provinces. There would be a C-list of proposed amendments which when incorporated into the present Bill would bring about a D-version of the Bill. The Committee would deal with the Final Mandates on the Bill on 19 March 2019. The last day for the National Council of Provinces (NCOP) was 28 March 2019. Members would have a constituency period until the 2019 general elections. The last day for the National Assembly (NA) was 20 March 2019. He pointed out that if the plenary of the NCOP passed the Bill on 28 March 2018 then it would be sent to the NA. At that time the NA would not be around. Would the Bill collapse and start afresh in the sixth parliament.

Ms Mpikashe said that in all likelihood the Bill would collapse. However the Bill could be revived in the sixth parliament. The process would not start afresh.  

The Chairperson asked whether the NA would only deal with the amendments.

Ms Mpikashe stated that in order for the Bill to lapse it must be on the order paper of the NA. The Bill would not make it to the NA Programme. The Bill would still be with the NCOP. She asked to check on whether what she was saying was correct and get back to the Committee.

The Chairperson said that the report back from the Parliamentary Law Advisers Office would take place on 19 March 2019 as well.

Committee Minutes
Minutes dated 21 November 2018, 29 January 2019 and 12 February 2019 were adopted unamended.

Committee Programme February – March 2019
The Chairperson reiterated that the Committee would only have its next meeting on 19 March 2019 to deal with the Final Mandates on the Bill. All other available Tuesday meeting days could be utilised by its sister committee, the Select Committee on Trade and International Relations, if need be.

The Committee adopted its Programme unamended.

Mr Makue as Chairperson of the Select Committee on Trade and International Relations said that the Committee would utilise the meeting days of 6 and 13 March 2019 given that they were not being used by the Economic and Business Development Select Committee. His Committee would also be meeting the following day 20 February 2019 to get a briefing from the Department of International Relations and Cooperation (DIRCO) on the Foreign Service Bill.
 
The meeting was adjourned.