Department of Transport 2019/20 Annual Performance Plan

Meeting report

The Chairperson welcomed everyone to the briefing by the Department on its 2019/20 Budget and Annual Performance Plan (APP). The Committee would first receive a preliminary overview from Committee staff before the presentation from the Department.

Presentation by Committee Staff

Dr Sifiso Ngesi, Committee Researcher, highlighted areas and key issues for consideration by the Committee in relation to the Department’s performance. On the 2019/20 Budget analysis, the Department was expected to provide reasons for the increase in its allocation to payments for business and advisory services. An explanation should be given for the exponential increase in the budget particular towards payment for consultancy services in the Integrated Transport Planning programme. Further, the budget for the use of consultants in the Public Transport programme had consistently been higher than that of other programs. The Department should also give reasons for the exponential increase in the budget allocation for the Modelling and Economic Analysis sub-programme, especially in light of the fact that it was likely to decline in the two outer years of the medium-term expenditure framework (MTEF) period.

On the Passenger Rail Agency of South Africa (PRASA) operations, the Committee would need to be provided with regular updates on the agency’s rolling stock fleet renewal programme, the refurbishment of coaches as well as the upgrading of signalling systems. These briefings should encompass the budget spends per programme, the time frames thereof, as well as the progress recorded thus far. The Committee should monitor the expenditure on the provincial road maintenance grant (PRMG) and the Department would be expected to brief the Committee on the breakdown of the budget allocation for 2019/20 per province. Moreover, Parliament should conduct oversight visits to some of the areas where the PRMG was being implemented with a view to ascertain whether the grant was used for its intended purpose, and whether the Department gets value for money. Given the persistent carnage on the country’s roads, Parliament should also continually monitor whether the road safety programmes or strategies implemented by the Road Traffic Management Corporation (RTMC) and Road Traffic Infringement Agency (RTIA) are yielding positive results.

Dr Ngesi further highlighted that the Committee should monitor the use of consultants by the Department and whether the services rendered provide good value for money. The Department should indicate whether the consultants transfer relevant skills to departmental employees. As part of the Committee’s oversight duties, the expenditure of the Public Transport Network Grant (PTNG) should be closely monitored. In line with the aforesaid, the Department should brief the Committee on progress made on the implementation of Bus Rapid Transit (BRT) systems in the 13 earmarked cities and Parliament should conduct oversight in these cities with a view to ascertaining whether there was alignment between budgets spent on the one hand, the progress made as well as the quality of the work done, on the other.

Briefing by the Department of Transport (DoT)

Mr Chris Hlabisa, Acting Director-General, DoT, took the Committee through a presentation on the Department’s 2019/20 Budget and APPs. He pointed out that the 2019/20 financial year, per definition, was the fifth and final year of the Department’s Strategic Plan (2015 -2020) and was aligned to the medium term strategic framework (MTSF) of 2014-2019. He outlined the key MTSF initiatives as per the Minister’s Delivery Agreement as follows:

An efficient, competitive and responsive economic infrastructure (Outcome 6)

The Department had set a target to establish a Single Transport Economic Regulator (STER), and as at end of March 2019, STER Bill had been approved for submission to Cabinet. However, finalisation of the legislative process had been delayed by prolonged consultations with the Department of Public Enterprises (DPE).

On the target to ensure the maintenance, strategic expansion, operational efficiency, capacity utilisation and competitiveness of sector logistics and transport infrastructure, the Department aimed at improving national transport planning to: develop long-term plans for transport; synchronise spatial planning; and align infrastructure investment for all sphere of government. To date, the National Transport Master Plan (NATMAP 2050) was approved by Cabinet in 2016, and implementation of the Plan was being monitored. Currently, ten priority pilot projects were being monitored to ensure they advance vision of the NATMAP.

On efforts to improve public transport systems, an Integrated Public Transport Networks (IPTNs) was at different stages of construction and operation across 13 cities. To date, the bulk of old taxi vehicles had been scrapped in line with the Taxi Recapitalisation Program (TRP). The TRP had also been revised and new design of the program was currently being implemented.

Comprehensive Rural Development and Land Reform (Outcome 7)

On efforts to increase access to quality infrastructure and functional services, particularly in education, healthcare and public transport in rural areas, the Department sought to implement the Access Road Development Plan (ARDP) to improve rural road infrastructure which, to date, had been finalised and approved for submission to Cabinet.

Revisions to the Department’s APP impacting on medium-term targets

The Department, in its MTSF, had set the development of a status report on the transport sector socio-economic empowerment programs. The target had been revised such that development of the status report on the transport sector economic empowerment programs will be monitored through internal business processes and the Sector Transformation Forum.

On the Green Transport Strategy, the policy initiative was approved by Cabinet and public awareness campaigns were successfully conducted in nine provinces. Going forward, implementation of the strategy would be monitored through internal business processes.

On the National Rail Bill, the Department aimed to submit it to Parliament by March 2020. However, its finalisation was dependent on the approval of the National Rail Policy. Due to uncertainties resulting from the approval of the National Rail Policy by Cabinet, the development and finalisation of the National Rail Bill will be monitored through internal business processes.

Key Interventions: Administration

Mr Collins Letsoalo, Chief Financial Officer, DoT, outlined key departmental interventions as relating to administration. To coordinate the function of human resource management and development in support of departmental programs, the Department set out to compile a monitoring report on the implementation of the 2018/19 Human Resource Development Framework. To render financial administration, supply chain management, risk management, internal audit, budgeting and management accounting services, the Department set out to: develop and monitor implementation of action plans to address audit findings raised by Internal Audit and Auditor-General; monitor implementation of the Departmental Risk Strategy; and carry out quarterly assessments of strategic and operational risks.

Key Interventions: Integrated Transport Planning

To formulate and implement national transport macro-planning legislation, policies and strategies, the Department planned to develop and implement strategies to enhance seamless movement of freight and passengers across all modes of transport. To standardise economic regulations and enhance participation and inclusion of key stakeholders in mainstream sector interventions, the Department planned to conduct literature review on the Pathway for Autonomous Vehicle Technology implementation in South Africa as well as process the draft STER Bill through Cabinet.  

Key Interventions: Rail Transport

To develop and implement interventions aimed at improving rail transport operations, the Department sought to develop draft Guidelines on Rail Access Regime as well as monitor implementation of the Private Sector Participation (PSP) Framework. To develop and implement interventions aimed at enhancing safety and security of rail transport, the Department would first have to secure approval for submission of the Railway Safety Bill to Cabinet.

Key interventions: Road Transport

To develop and monitor implementation of policies aimed at ensuring construction and maintenance of road transport infrastructure, the Department set out to monitor implementation of the S’hamba Sonke Programme (inspections and bilateral consultations). In efforts towards development and implementation of interventions aimed at enhancing safety and security of road transport, the Department set its targets as follows: develop final due diligence report on the Review of Founding Legislations of Road Entities; monitor implementation of the National Road Safety Strategy; develop final draft of the National Anti-Fraud and Corruption Strategy; and secure ministerial approval to submit the draft National Road Traffic Amendment Bill to Cabinet.

Key Interventions: Public Transport

To develop and implement policies and strategies aimed at improving provision of quality public transport infrastructure and services in rural areas, the Department set out to develop detailed Integrated Public Transport Network (IPTN) Plans in two district municipalities, Amathole and Capricorn.

Mr Letsoalo highlighted key challenges that could militate against effective implementation of deliverables and the proposed interventions to mitigate same. On funding constraints, the Department was set to: approach and appeal to National Treasury for more funding; consolidate fragmented funding streams; and identify alternative funding sources. Further, inherent dependencies on other spheres of government, departments and agencies called for more coordinated intergovernmental relations, building capacity at implementing spheres and agencies, and more focused oversight capabilities. In efforts to monitor implementation of risk mitigation strategies, the Department was taking steps to measure the value of risk management in its performance through identification and robust reporting at all levels of the department during branch and EXCO meetings. The process to monitor implementation of risk mitigation plans on the strategic risks has been on-going throughout the year to ensure that visible and quantifiable improvements on the Department’s performance is realised.

Discussion

The Chairperson welcomed the presentations and said the Committee would exercise robust oversight on the Department and see to it that its performance plans were fully implemented. The Committee would monitor implementation to ensure all policies on the pipeline see the light of day. The Department should get its house in order so that there are no hiccups going forward. He asked for an indication of the number of vacant posts at senior managerial level within the Department.

Mr L Mangcu (ANC) appreciated the presentation from the Department. He expressed concern about the increase in the proposed Integrated Transport Planning budget, largely because of the engagement of consultants. Unless compelling reasons were given, he would recommend that the Committee not endorse this, particularly given the prevailing economic conditions. On transfers to provincial roads, as the Department was increasing its conditional grants, the provinces appeared to be actually decreasing their equitable share budgets. The Committee should look into this. It was also concerning that the Department was creating more agencies and duplicating provincial functions. He wondered why things were being conducted in this manner. On the intention to decrease the Public Transport Operations Grant (PTOG) to certain municipalities, how was the Department planning to deal with the budgets and manage the actual delivery of hardcore programmes? Lastly, on proposed allocations to PRASA, signalling did not appear to be having an adequate budget considering that past rail fatalities had been attributed to faulty signalling. If reports were anything to go by, there was need to give consideration to this and see to it that budgets are rationalised. 

Mr L MacDonald (ANC) referred to the watch keeping services line item on the Goods and Services proposed allocation. He asked what these services were, noting they would cost millions of rand. Referring to Mangaung, Free State, where an allocation was made but only a small piece of road was constructed, he asked for a breakdown of the money sent to municipalities and how that money had been spent previously.

Ms M Ramadwa (ANC) pointed out that the Department had no clear implementation timeframes for its APPs. The presentation was silent about when those programs not fully implemented the previous financial year would be finalised. On the Department’s plan to conduct ten community outreach campaigns on gender, persons with disability, youth and children, what would this entail? There was no clear indication from the presentation.

Ms N Tolashe (ANC) commented on vacant posts within senior management. There should be clear timelines as to when the positions would be filled as this spoke to spending patterns and poor accountability mechanisms. The Committee would want to know how soon this was going to be implemented so that Members are in a position to discharge their oversight duties effectively. She asked if the Committee could get a strategy document speaking to intergovernmental relations from the Department. It would never be accepted that fundamental developmental projects come to a standstill owing to the lack of coordinated efforts amongst departments. She expressed concern about the proposed allocation to PRASA given the entity’s challenges at PRASA. She implored the Committee to interrogate this further when PRASA appears before Parliament.

Mr C Hunsinger (DA) asked about the balance between budget allocations and targets. There should have been an analysis of indicators in percentage terms for each of the quarters in the presentation. He asked if there was still any real commitment to pull through the Single Transport Economic Regulator, five years later. There was need for a focused workshop on the rationale of having a single regulator. He referred to the indirect operating costs of the Bus Rapid Transit (BRT) system and asked if it was sustainable going forward.  The need for full engagements on the sustainability of the BRT system in the 13 cities should be flagged as a priority item on the agenda list. 

Mr T Mabhena (DA) noted the Department seemed to have abandoned the Moloto Rail Corridor project. If the project had indeed been abandoned, what was the rationale for such a decision? He noted virements from PRASA to SANRAL to finance non-toll networks and said the railway network currently needs a lot of overhaul and it was thus unclear if this was the best decision to take. He asked for an explanation for the proposed budget towards payment of consultation services.

Mr I Seitlholo (DA) said the less said about PRASA the better, as money had continually been poured into the agency to no avail. He emphasised the need for the Department to fill its vacant posts expeditiously. He added the Committee needed to strengthen oversight as most of the agencies under the Department were clearly failing to deliver on their mandate.

Mr M Chabangu (EFF) asked why the Department felt the need to engage consultants if it believed departmental staff and officials were well-qualified and up to task. This was a case of wasteful expenditure. He reiterated the majority Members’ view that PRASA is one of the worst performing entities. Also, when was the regulation of driving schools going to happen given the massive scams and corruption on that front?

Ms N Nolutshungu (EFF) found it unfathomable that consultants were being engaged to the extent outlined in the presentation. Consultancy services had to be gotten rid of. As per one of EFF’s cardinal pillars, the state should build enough capacity so that there would be no need for the engagement of consultants within government departments. She lamented the absence of a budget for road signals when there were clear reports that faulty signals were to blame for a number of road and rail fatalities. Universal access had seemingly been abandoned and rural people forgotten as the initiative had not even been mentioned in the presentation. She added BRT systems ought to be revisited to understand if there was any need for them.

Mr Hlabisa replied that the Department would do its best to ensure all flagged issues are dealt with. He appreciated the input from the Committee. The filling of vacancies has been on the cards for some time now. Interviews were held during the previous Minister’s tenure and five critical vacancies were filled at that time. The process was still underway and the Department would be guided by the current Minister as his commitment to dealing with this matter was encouraging. The President was seized with the Gauteng e-toll matter, and the expectation was that a determination would be made sooner than later. There were material efforts to process the Road Accident Benefit Scheme Bill on the part of the Department but there was a lot of fight-back from stakeholders benefiting from the status quo. He therefore hoped the Committee would assist the Department in reviving the discussions and wading off push-backs from some stakeholders. 

The Chairperson said the need for the expeditious filling of vacancies within the Department was also raised by the Auditor-General (AG). This must be corrected and there must not be any dilly-dallying on the part of the Department. How could the Department be expected to be taken seriously if it was failing to address such a simple query from the Office of the AG? Further, there was a Cabinet decision to the effect that government should be working towards the elimination of consultants and therefore, in all fairness, the Department should not be appearing before the Committee calling for an increase in its budget for consultant services. The Committee should not be compelled to arrive to the conclusion that the Department was being run outside the prescripts of the law. There were a lot of gray areas in the presentation in terms of timeframes and these needed to be addressed. He invited responses from the Department.

Mr Hlabisa said the analysis of previous quarters’ performance could be furnished to the Committee as it was readily available. On the equitable share schemes, provinces needed to be encouraged to budget from these rather than banking on conditional grants to fulfil their deliverables. The Department would relay the Committee’s concerns about SANRAL and PRASA so that the entities get to address them when they appear before Committee. The decision to revisit the BRT system was fully supported. On the funding of public transport in South Africa, the consolidation of the program and way forward should be looked into. The Department was fully aware of the concerns relating to the desired public transport funding model for the country. The process of rethinking the desired funding models was underway and the Committee would be given an update as soon as something concrete was agreed upon. This was also on the agenda for discussion when the Department meets with provincial MECs for a workshop slated for the following week. He reiterated that the filling of vacancies was currently underway but as positions of DDG and upwards require the approval of the Department of Public Service and Administration as well as Cabinet, it could not be done overnight. The administration within the Department would do its part and leave the rest to its political principals.

Mr Mathabatha Mokonyama, DDG: Public Transport, DoT, explained that the reason why there had been a jump in the proposed allocation to consultancy services was that the Department would carry out a household survey, conducted once in five years, and StatsSA would play a major role in this. He clarified that watch keeping services involved aviation and coastal guard checks- to which Telkom was partly involved. On proposed allocations towards Signalling, PRASA had been allocated funds in the past and there was need for speedy implementation on their part. The BRT system was of concern to the Department as well. The system was just but a component of the Integrated Public Transport Network implementation plan. Monitoring and support was being ramped up and this would require additional resources on the part of the Department. The whole system was being transformed, and the Minister had set up a war room to deal with most of the identified challenges. On the Moloto Rail Corridor, a lot of work had been done but the reality was, during negotiations with the Chinese contractors, the costing came out on the higher side. However, discussions were still underway. The Department would certainly need the Committee’s support on the project as they had exhausted most avenues in government in efforts to secure funding owing to affordability concerns. It was also recommended that the Ministers of Finance and Transport meet for discussions on the project, and the Department was hoping to secure the meeting in earnest. The Committee would receive continual updates in this regard. 

The Chairperson, in closing, appreciated the responses and indicated the Committee has its ducks in a row and would not hesitate to reign in on the Department and get to the highest levels if need be. The Department needed to correct its mistakes. He thanked everyone for the engagements.

The meeting was adjourned.