Annual Reports 2018/2019
The Committee was briefed by the Department of Transport. The Committee was pleased that the Department had achieved an unqualified audit opinion. The Minister announced that a Merchant Shipping Bill was passed which would aid the efficiency of ports. The Department of Transport achieved 26 out of 29 targets. The Departments achievements included the finalisation of a draft Roads Policy, an Access Road Development Plan, the implementation of the National Road Safety Strategy; the finalisation of the Merchant Shipping Bill; the monitoring of the integrated public transport networks across 13 cities, the development of a Draft National Rail Bill, and the training of 479 staff members.
Members heard that according to the DoT finances, there was a possibility of PRASA continuing as a going concern. Other areas of concern were the freight shift from road to rail; the carbon emission plan; the upgrading of rail stations; train commuter safety; the sustainability of electric cars; the Shova Kalula bicycle project, and under expenditure. Members asked how many women, youth and disabled persons were received training; how many of the criminal charges laid with the SAPS had led to arrests; and if there was a plan to work with municipalities to engage with the challenges in rural areas around roads.
Members appealed to the Department to do something about its finances as “its finances were not impressive” The Committee referred to what the AG had termed “the extent of the rot in PRASA” and asked ‘could PRASA continue as a going concern’? They were confused as to why even though government had increased subsidies, the DoT revenue had decreased. Members commented that the way in which some of those heavy vehicles were driven was scary. Members felt that if the burden could be shifted to rail, road maintenance costs would be lowered. Members requested that the Carbon Emission plan be brought to the Committee when completed. Members asked what the action plan for ensuring commuter safety was; how would rural areas be served; if the DG had considered the Kouga Municipality’s plastic rollout; why was a total of R13.3 million shifted to the Ministry to cover expenditure on travelling, venues and facilities; clarity on unauthorised expenditure related to eNaTIS and what was budgeted to maintain the Shova Kalula bicycle project. Members were mildly surprised to hear that Irregular expenditure was to a degree ‘unavoidable’, but each case was investigated and action was taken were possible.
Minutes of 30 October 2019 were adopted without amendments.
Introductory Remarks by the Chairperson
The Chairperson welcomed the Minister and the Director-General and said that Transport was a strategic portfolio. The Minister apologised for the Deputy Minister, who was in China on a visit that dealt with bilateral relations.
Ms H Boshoff (DA, Mpumalanga) submitted that there were too few Members present for a quorum, and hence the meeting should not continue. Members had to show respect to the Minister by being on time.
The Chairperson replied to Ms Boshoff that Rule 96(1) stated that a meeting could proceed without a quorum until such time as decisions had to be made for which a quorum was needed.
The Committee Secretary agreed that the Chairperson had given the right explanation. The meeting could proceed but if decisions had to be made, five provinces had to be present.
Briefing by the Minister
The Minister of Transport, Mr Fikile Mbalula, noted that the Annual Report was based on baseline performance. It had to indicate how the mandate was implemented. 90 percent of the budgets went to the various entities, and there were a total of 90 performance targets. A tighter alignment was sought between the departmental strategy and the implementation plans of entities. The Department had received an unqualified audit, which was clean on predetermined objectives. Focus areas over the MTSF included strengthening of oversight and governance for the entities. The Auditor-General (AG) issues for each entity were attended to. There had to be audit intervention plans, and repeat findings had to be eliminated. New boards had to be appointed when the terms of serving boards had ended. The DoT had filled the vacancy of the Director-General (DG) position, and other critical posts would be filled by the end of the year. Acting arrangements had to be eliminated. Sector skills training was being implemented with staff bursaries and internships. A feasibility study was undertaken towards developing an integrated transport plan. Regulations had to be developed to implement the plan. The shift from road to rail was a priority. Pressure had to be taken off the road infrastructure. The Transport Economic Regulation Bill prescribed a single transport regulator. A regional integrated strategy was to be developed to promote regional and Continental trade. A programme was introduced to reduce gas emission. A national rail policy was geared towards the transformation of rail to be more responsive to economic needs. PRASA had embarked on a station upgrade programme and was acquiring new trains. Improvement in the performance of rail would be linked to job creation with women, youth and the disabled targeted. Train safety would be improved, and rail accidents eliminated. A PRASA war-room was created, for interventions towards making the passenger rail service more responsive. Carnage on the roads had to be arrested. A 20 percent reduction in accidents was aimed at. The Road Traffic Management Corporation launched a ‘365 days of action’ programme. Road traffic law enforcement would be re-imagined. There was a strong Metro Police presence on the highways, and more traffic officials were being trained. There was movement towards automatic permit and licence application. Road networks were continually assessed, with the aim to increase urban and rural road connectivity. A business case was made for an aviation academy, and a drone regulation review was being conducted. A Merchant Shipping Bill was passed, which would aid the efficiency of ports. Public transport infrastructure would be enhanced, with positive implications for job creation. The bus subsidy system was to be reviewed. Scrapping of old taxi vehicles would contribute to the safety of public transport.
Briefing by the Department of Transport on its Annual Report
The Committee was briefed by the Department of Transport on its Annual Report. The DoT achieved 26 out of 29 targets. Achievements included finalisation of the Draft Roads Policy, the Access Road Development Plan; the implementation of the National Road Safety Strategy; finalisation of the Merchant Shipping Bill; monitoring of Integrated Public Transport Networks across 13 cities; development of a draft National Rail Bill; 479 staff members were trained, and the induction of 100 percent of new appointees into the Code of Conduct. The effectiveness of internal control systems and the internal audit function was reviewed. The Department received an unqualified audit opinion. Compensation of employees was underspent on in all programmes due to unfilled posts. There was unauthorised expenditure related to the Electronic National Traffic Information System (eNaTIS), because expenditure was not in accordance with the Road Transport programme vote. Criminal charges were laid with the SAPS related to irregular expenditure. The Department had a bank overdraft mainly due to a transfer payment of R4.8 billion to PRASA that was withheld in 2018 due to consistent low expenditure on capital programmes.
Ms B Mathevula (EFF, Limpopo) referred to slide 19 and asked how many women, youth and disabled persons received training. She referred to slide 51 and asked how many of the criminal charges laid with SAPS had led to arrests. Access to public transport in rural areas was a challenge, especially in wet weather. ‘Was there a plan to work with municipalities to engage with the problem’?
Mr M Dangor (ANC, Gauteng) commented that his constituents were complaining that they had lost a road, due to the SANRAL upgrade.
Ms M Moshodi (ANC, Free State) remarked that she had worked with both the Minister and the DG, and knew them to be hard-working and competent; the Department however had to do something about its finances. Its finances were not impressive.
Ms H Boshoff (DA, Mpumalanga) noted her concern about PRASA. The AG had commented on what was termed the extent of the rot in PRASA. Irregular expenditure amounted to R26 billion. Minutes were not recorded of meetings, which was contrary to the Companies Act. Because of PRASA inefficiency, people could not get to their work places, and employers could not excuse that. ‘Could PRASA continue as a going concern’? Government had increased subsidies, and yet the DoT revenue had decreased. She asked about progress with a freight transport development plan. There were too many heavy vehicles on the road. Chrome and platinum was transported to Mozambique via the Long Tom pass in Mpumalanga, and the congestion was incredible, also the way in which some of those heavy vehicles were driven was scary. If the burden could be shifted to rail, road maintenance costs would be lowered. She requested that the carbon emission plan be brought to the Committee, when completed. The rollout of new trains and the upgrading of stations had to be approached within a context of budget cuts. ‘What was the action plan for ensuring commuter safety’? There were not enough charging stations to sustain significant use of electric cars. ‘How would rural areas be served’? Eskom could be engaged with for stations that were on big highways. She asked the DG if he had considered the Kouga Municipality’s plastic rollout. Plastic roads could possibly last longer than asphalt. It was mentioned on slide 37 that a total of R13.3 million was shifted to the Ministry to cover expenditure on travelling, venues and facilities. ‘Why was that done’? There was no expenditure on the Shova Kalula bicycle project in 2018/19. ‘What was budgeted to maintain the project’?
The Chairperson asked about unauthorised expenditure related to eNaTIS. Slide 42 referred to underspending on public transport and goods and services. The Shova Kalula bicycle project had to be brought closer to constituencies. ‘How would under expenditure on goods and services be reduced’? ‘What was the position with regard to small bus operators’? He asked for comments on recruitment and selection, and capacity.
Mr Moemi responded and said that it should be understood that Cape Town was the most congested city, and there were negotiations around that, but the question was where the money was to come from. Cape Town was headed for disaster. The rest of the country worked according to user payment, but a road funding solution had to be found for the Western Cape. Access to transport in rural areas remained a challenge. The Rural Development Grant did not provide enough money for all rural roads. Provinces could not be dictated to. Road links to arterial roads was a priority. Emerging roads were assessed, and when such roads gained strategic importance, it became eligible for upgrading. With local and farm roads, a distinction had to be made between declared and undeclared roads. For something to be done, a road had to be declared. Transport was a concurrent function, roads under the national portfolio were well-kept, whether tolled or not. Roads maintained by municipalities were in the worst condition, and in the cities there was a mixed bag. Municipalities did not have the capacity to deal with roads.
Mr Moemi said that the Department of Public Works formerly could assist with the yellow fleet, but it was no longer the case. Provinces could not be compelled to maintain yellow fleets. The Moloto Road spanned Mpumalanga, Limpopo and Gauteng. There were portions of the road in Gauteng that still had to be handed over to the National Department. Gauteng was handing over without an accompanying budget. The road was being straightened, and notices for expropriation of land with compensation were given where the road ran through farms. Dedicated bus lanes would be included. There would have to be more expropriation for that purpose. eNaTIS could not be done without. There were questions around who properly had to house it, but it was currently the responsibility of the DoT who had to pay for it.
On electric cars, he said that the range and availability of charging stations were challenges. 43 percent of national roads were covered. Universal coverage would eventually be reached. The SABS had agreed on a standard charger socket which could be applied to all car makes. The Kouga plastic road rollout was not according to the nationally agreed upon standards. The freight transport development plan was budgeted for, but there were delays with the finalisation of the plan. The Cross Border Road Transport Agency was overseeing the plan, which could be finalised in the current financial year. Increased subsidies did not necessarily lead to increased revenue. The Ministers of Finance and Transport were working concurrently on increased aviation tariffs, but revenue was not guaranteed to pick up. The DoT could present to the Committee about tariff setting.
On the question about whether the PRASA could be saved, the answer was that it was simply too big to fail. The current leadership was currently in a position to work on a turnaround for the first time since the establishment of the PRASA war-room. In the past, those who wanted to implement turnaround plans were simply removed. The PRASA had nearly collapsed and were struggling to raise revenue as the volume of passengers declined. Still, the situation had improved over that of the four months before. Three corridors were fully proclaimed. The security of passengers had improved, and actions were taken against cable theft. 671 people were arrested and there were high levels of conviction. Drones were used to improve security, and concrete walls were being built around identified critical areas with cameras installed. Trains and revenue collection were being improved. Rail corridor by rail corridor was being reclaimed. People guilty of cable theft could be charged with sabotage which could lead to a longer prison term without the option of a fine.
The Money needed for rail station upgrading was R11 billion. He answered Ms Moshodi about the DoT finances and said that it was not in tatters, the DoT was doing well relative to its size. The DoT wanted to eliminate the audit matters of emphasis. Unauthorised expenditure on eNaTIS was unavoidable. If the system collapsed, it would be impossible to sell cars. It was classed as unauthorised expenditure because the budget used was not intended for eNaTIS. It was a policy matter with the preferred solution being funds ring-fenced for eNaTIS. Contracts awarded without obtaining enough quotes would not be tolerated and action was taken against it. Irregular expenditure was to a degree unavoidable, but each case was investigated and action was taken if it turned out that it was not unavoidable.
Mr Letsoalo added that there had been no expenditure on eNaTIS for 2018/19, but the Treasury had not removed the amount as it awaited condonement. The matter of buses standing idle was being attended to, and there was a commitment to filling vacancies at DDG level.
Mr Dangor said that people had to appreciate road improvement as it reduced congestion. It had social value, as acute congestion could cause parents to only arrive home when children were already sleeping. Produce which had been on the road for too long, causing a rise in temperature, would be rejected by supermarkets like Woolworths. It was imperative that phases 3 and 4 of Gauteng road improvement be proceeded with. There had been an initial outcry that the project was expensive, but it had since become political. Debt incurred by the development of roads had to be paid.
Adoption of minutes
Minutes of 30 October 2019 were adopted without amendments.
The Chairperson adjourned the meeting.
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