Transport: Budget: Committee Report

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Transport

14 July 2020
Chairperson: Mr M Zwane (ANC)
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Meeting Summary

Video: Portfolio Committee on Transport, 14 July 2020

Tabled Committee Reports

The Portfolio Committee met to consider and adopt its Report on the adjustment budget allocation of the Department of Transport: Budget Vote 40. It noted a number of issues that were not correctly expressed in the writing of the Report, and suggested changes be made to the draft before it could be adopted. Among the issues that had been left out were the recommendations that had been made to previous meetings with regard to the allocation of funds for road infrastructure in rural areas, as well as the reallocation of funds being explained by the Department of Transport on a quarterly and annual basis, to prevent confusion among entities that expected the funds to be allocated to them.

There were also changes that were made on the observations within the Report in terms of the specificity of their content and emphasis on unclarified points, as well as changes to the recommendations, as requested by the Portfolio Committee.

There was a general consensus among the Members on the updated observations and recommendations on the adjustment budget allocation Report. It was adopted unanimously, with all the amendments that had been made.

Meeting report

Report of the Portfolio Committee on Transport on the Adjusted Allocations of Budget Vote 40: Transport

Mr C Hunsinger (DA) said that the Report was very important because it allowed the Portfolio Committee the opportunity to engage on the key performing areas, and indicators and strategic plans. This was an opportunity to make particular recommendations and also to give direction and guidance with regard to experiences so that the meeting was not just seen as a finalisation of the approval of the Report. This would allow the Portfolio Committee to move into the next phase of the budget cycle, and would be a document that addressed the next operational performance settings and targets.

Mr L McDonald (ANC) expressed concern that there were only three recommendations in the Committee Report, as there were more recommendations that had been raised at previous Committee meetings. The three recommendations did not cover everything that had been said in the previous meetings, and the problem with the Report was that it had a lot of Committee observations. For example, the recommendation that was made in previous meetings that there should be more money allocated to the building of roads in rural areas, was not included in the three recommendations. He suggested that the Portfolio Committee be afforded some more time to add those recommendations to the Report before it was adopted.

The Chairperson said the recommendations should be added in during the meeting, as there was enough time to do so.


Mr K Sithole (IFP) said that he shared the same concerns with Mr McDonald, as the shifting and adjustment of funds to other areas that had been affected by COVID-19 had not been included in the recommendations.

Ms N Tolashe (ANC) also shared the same concerns as Mr McDonald, and added that in the recommendations there should be a clarification of the process of taking away money by Treasury to different departments and entities so that it did not look like an event, but an emphasised process that happened in the financial year. This was because sometimes, when it was not clarified, it gave the impression that it was something that just happened, which was not received well by the people who were expecting to receive certain service deliveries from the specific budget allocation. Therefore, the recommendation should be that the reallocation of funds should be explained by the Department on an annual and quarterly basis so that it did not cause confusion and conflict.

The Chairperson afforded the Members an opportunity to raise their inputs that needed to be added on to the Report in each section.

Mr McDonald recommended that there should be a reduction of job losses within the entities in the Department, and also suggested the fast-tracking of the taxi recapitalisation programme.

Ms Tolashe agreed with McDonald’s recommendations.

Mr L Mangcu (ANC) suggested that the Committee should first focus on each of the Committee observations in the Report so that Members could share their thoughts, and then at a later stage in the meeting, move on to the recommendations, as the meeting was booked for three hours.

Mr Hunsinger suggested that the Committee should make general remarks on either the entities, or on each of the other seven programmes of the Department of Transport (DoT) so that the focus could be on specific service delivery areas.

The Chairperson agreed with the suggestions of both Mr Mangcu and Mr Hunsinger, and asked Members to contribute their inputs on each Committee observation in the Report, starting with the first observation.

Observations

Mr Mangcu proposed that in terms of the first observation, the Department should consider in its upcoming adjustment budget making resources available for the Airports Company of South Africa (ACSA) and the South African Civil Aviation Register (SACAR).

Mr Hunsinger asked whether the Committee agreed with the statement that the aviation industry had been hit the hardest by COVID-19 and if so, on what basis. There needed to be clarity on how the Committee was justifying additional budget for the aviation industry, because all the other state-owned entities were affected by COVID-19.

The Chairperson responded that it was from the observation that the two aviation entities (ACSA and SACAR) had not been given anything.

Mr Mangcu added that the observation was based on what had been discussed at previous meetings, and there had been consensus.

Mr McDonald added that it had also been suggested at the previous meetings that there must be a way to capitalise on the entities within this period so that there could be a continuation of the development of buildings and the runways.

Mr Hunsinger said the specifics mentioned by Mr McDonald and Mr Mangcu regarding the development of infrastructure in the entities needed to be added to the observations, instead of generalising the information. He asked for a reformulation of the sentence to provide those specifics in the Report.

Mr I Seitlholo (DA) asked whether it would be plausible to recommend that the entities report on their objectives and submit those to the Committee so that when talking about the provision of resources, there was understanding from a scientific point of view on what the resources were needed for.

The Chairperson said that the issue raised by Mr Seitlholo was an issue that would come after the Report currently being discussed.

Mr Mangcu suggested that the observation should be amended to note that the two entities had not received any allocation, so that it could also be linked to what the recommendation stipulated.

The Members agreed to Mr Mangcu’s suggestion.

Mr Hunsinger added that the calibration of aircraft was something of urgent importance to SACAR, and that it should be added to the section specifically referring to SACAR.

The Chairperson agreed and moved on to the second observation.

Mr T Mabhena (DA) suggested that the second observation be amended in terms of writing, so that it could reflect the quality of the Portfolio Committee. There should be an emphasis that the funds must be used effectively.

Mr Seitlholo agreed with Mr Mabhena, and added that the Committee needed some form of reports from SACAR and ACSA on what it was that they would require as assistance in terms of infrastructure and development so that it could show on the report that the funds allocated were indeed used effectively, as requested by the Committee.

Ms M Ramadwa (ANC) also agreed with Mr Mabhena, and added that there must be value for the money that would be allocated to the entities so that they would be able to account for it.

Mr Mangcu suggested that the Portfolio Committee should try to remember what the discussion regarding the second observation at the previous meeting had been. The discussion had been in the context of what the Department had anticipated -- that the budget would be cut by a more significant amount of money. The R4.6 billion had come as a way of saying that only R4.6 billion was cut. The observation needed to be removed, as it did not add value to the point that was being made.

Ms Ramadwa said that even if the entities did receive the money, the emphasis should be that they use it effectively, and that there must be value for the money allocated to them.

Mr Mabhena agreed with Mr Mangcu, and added that perhaps it should be stated in the Report that the budget had declined by R4.6 billion (7.5%), and that the Committee had stated that the remaining reallocated funds of R56 billion after the adjustment must be utilised effectively.

The Chairperson said the consensus was that the second observation was noting the budget cut of R4.6 billion, and the hope that the remaining amount would be utilised effectively where it was going to be allocated. It was correct that the statement could be left as it was, or ignored. He then moved on to the next observation on the Report.

Mr P Mey (FF+) said his biggest worry was infrastructure. The Committee needed to keep an eye on infrastructure, especially in the Eastern Cape, because it was in a terrible state.

The Chairperson said the Committee had adopted an approach that in the meeting they would first focus on the observations as outlined in the Report. He appreciated Mr Meyer’s contribution, and would do a follow up on it. He also understood that some Members were struggling with connections to the meeting because of load shedding.

Mr Mangcu said that the third observation was related to the Passenger Rail Agency of South Africa’s (PRASA’s) infrastructure, and not transport infrastructure in the general sense. Therefore, it was too broad and needed to be narrowed to be specific to the vandalisation of PRASA infrastructure and assets. As a recommendation, there should be a suggestion that the Department start a process of application to declare this infrastructure as a national key-point within 60 days of the approval of the report.

Mr Mabhena said that during an oversight with PRASA, which happened about three weeks ago, a gentleman who was in charge of security at PRASA had given assurance that he needed about six months to turn around the situation and secure the rail infrastructure at PRASA. This had led to a belief that PRASA did have a budget and a plan of action. He then asked what would happen to the security companies that had recently signed contracts with PRASA if its infrastructure and assets were declared a national key-point.

Ms Ramadwa said she supported Mr Mangcu’s suggestion that PRASA’s infrastructure and assets should be declared as national key points. This was because there was security at PRASA, but the vandalisation and theft was still happening, and as much as what Mr Mabhena had said was true, the Director-General (DG) had not appointed any security yet, so the national key point proposal was a sensible solution.

The Chairperson said that the consensus among the Members was that something needed to be done with regard to the securing of PRASA infrastructure and assets. Perhaps the police should be allowed to step in at PRASA so that there were no more asset losses.

Mr Hunsinger said that this particular observation needed to be outlined as firmly as possible. It should be stated that it was with huge concern that the Committee observed the absolute destruction of PRASA assets in general. The places where oversight had been done should also be mentioned, as well as that it was with disappointment that the Committee had to hear that there were places that did not have security at all, which had been caused through negligence in not paying the security guards. Therefore, a permanent solution had to be taken with firm direction in either pursuing the route of declaring PRASA infrastructure and assets as national key-points, or by a delegation which allowed regional managers to handle the tender process of hiring a security company. This was because in most cases, documents were ready to be signed, but the centralised structure simply ignored the pleas from the regional managers.

Mr McDonald suggested that in the wait for proper security to be appointed by PRASA, the Committee should get the army to be deployed to PRASA assets so that they could be secured while running through the undemocratic court system of the country, which allowed people to destroy assets. It was time for the Committee to put its foot down and say that the army must assist, so that there was no longer a loss of assets at PRASA.

Mr Mangcu agreed with Mr Hunsinger that the terminology used in the observation must be firm, except for that part that said a tender process should be undertaken. This was being discussed in the context of the importance of transport as a backbone of any economy, as well as in the context of the safety of the people that should be moved by mass rail movements, which were not currently happening. The issue of a national key point was not something that could be achieved within six months, but it was what had been suggested needed to happen in the long term. It did not prevent PRASA from doing whatever they were supposed to do in the meantime, and should the declaration of PRASA infrastructure and assets as a national key-point succeed, all processes to unwind and wrap up whatever issues were there, would happen. There could not be a halt in processes while PRASA continued to lose billions of Rands. That was the context of the observation in the report.

Mr Mey said that seeing that PRASA had lost billions of Rands, what was needed was policemen, and not security guards.

The Chairperson said that the Committee was converging on the point of the importance of securing the PRASA infrastructure and assets, and the Members agreed. He then moved on to the next observation in the Report.

Mr Mangcu said what the fourth budget Report observation should be saying was that the Department needed to undertake a process of revision on all its entities, and rationalise them into one.

Mr Hunsinger agreed with Mr Mangcu, and added that it should not carry an underlying notion that consolidation was around saving on expenditure, but was about efficiency and effectiveness. For example the two entities mentioned – the Road Traffic Infringement Agency (RTIA) and the Road Traffic Management Corporation (RTMC) -- were really about who had the franchise on road safety, and if it was diversified into so many entities, nobody did it properly. That should also carry the notion of efficiency and effectiveness rather than the message of consolidating for the sake of saving on expenditure.

The Chairperson moved on to the next observation on the Report.

Mr Seitlholo advised that in terms of the fifth observation on the report, there should be serious oversight in cities such as Rustenburg in terms of the bus rapid transport (BRT) systems. The date of completion of the Rustenburg BRT project had already been changed up to five times, and as a result this had wasted up to R3 billion, and the Department seemingly found it appropriate to feed into this particular programme. Perhaps it needed to oversee the execution and the completion of this project and should be responsible, because it could not be correct that a municipality released a statement in July that said it was dependent on the Public Transport Network Grant (PTNG) to complete the project, and then a few billions of Rands later the project was not complete. It was important that the Committee spoke to the Department of Transport and made it clear that these particular cities that were still going to run the BRT system should in no way get a single cent if there was not a complete framework of how they intended to complete their BRT systems. The Minister had said the BRT would be functional by January 2020, and it was sad to say that it was July now, and on 29 June they had had a test run of a single bus, yet there were 18 stations that were not complete. If the Committee wanted to be taken seriously, it needed to summon all these cities to the Committee, where the Department could be reasonable and be responsible for the oversight of the completion of the BRT systems.

Mr Hunsinger said that for the construct of the document, it would be important to categorise what was mentioned by Mr Seitlholo, and also to extract that under the heading of “suggestions”. There could be an acknowledgement in the budget that the three cities had been deprived of any further funding, and it should not only be that particular matter of no funding, but also an acknowledgement of the expenditure inability that had led to this decision. The Committee recognised the importance of the two things that had caused this expenditure inability. The Department should assist in a bigger way, and it could not be that every year 100% of targets were achieved when in actuality that was because the funds had been transferred to these cities. This inability to execute and implement the BRT system should be part of the suggestions that the DoT should engage on, with methods to make sure that the systems were maintained so that everybody in each of those cities benefited from the BRT system.

Mr McDonald added that the cities must report to the Committee on how the money they had spent so far had helped, and what they had used it on. For example, Mangaung had received more than R450 million which it had spent, but there was nothing to show for it.

The Members agreed to make these suggestions the resolution.

The Chairperson moved on to the next observation in the budget Report.

Mr Hunsinger said that in terms of the sixth observation, the entities should be encouraged to generate their own income.

The Members agreed, and the Chairperson moved to the seventh observation in the budget Report.

Mr McDonald said that the names of the provinces should be removed in the observations, and the Report should say all the provinces instead, as they all had rural areas which needed road infrastructure services. The money needed to be spent in rural areas where people needed roads, and it should be across the whole country.

Ms Ramadwa agreed with Mr McDonald that all provinces were affected, and therefore all should be included in the budget.

Mr Mangcu said that the context of the discussion on this matter at the previous meeting was that the budget had been reduced because there was not enough planning from the provinces. What was important was to come out strongly in the recommendations, emphasising that the Department must ensure that before money was allocated, there was proper planning. He further proposed that the Provincial Roads Maintenance Grant (PRMG) stand alone and not be combined with the PTNG. In terms of the PTNG, its recommendation should be linked with the recommendation on the BRT system.

The Members agreed, and the Chairperson moved to observation number eight on the budget Report.

The Members all agreed on observation number eight, and the Chairperson moved to observation number nine on the budget Report.

Mr Hunsinger suggested that the whole of observation number nine be removed, since it expressed particular sentiments for or against the relief fund, and recognising the fact that the taxi industry did not belong to the Department of Transport at all. It was in no way integrated in any formal way into any portion or section of the Department of Transport. Furthermore, the Committee should express its concern about the passenger capacity with no adequate precautions, and should not go further than that.

Mr Mangcu said that observation number nine in the budget Report was a discussion in the context of the adjustment budget, which was indicating some allocation of money for particular relief. Therefore the Committee should note, but also restrict itself from making a view on the loading capacity, because the money was in the context of money that was being reallocated. The observation should therefore be maintained, but should be limited to the observation of the Committee of the once-off taxi relief as presented in the budget.

Mr Sithole said that as far as he understood from the previous meeting, the relief fund had already been allocated to the taxi Industry, but they did not want to accept it because they said it was too small. He asked what would happen if the situation between the industry and the DoT was not resolved, and what the position of the Portfolio Committee would be in that situation.

Mr Mangcu clarified that observation number nine in the budget Report was a discussion in the context of the adjustment budget, and there were talks of a taxi relief fund. The Committee noted the allocation of the money, but did not comment on issues pertaining to the loading capacity in the taxis.

The Members agreed to Mr Mangcu’s suggestion, and the Chairperson moved on to the tenth observation on the budget Report.

Mr Hunsinger said that the discussion on observation number 10 was about the announcement that the services of PRASA and Metrorail would commence with the announcement of Lockdown Level 4 on 1 June. The Committee had noted with disappointment that the services were not at a capacity to resume, and that would happen only from 1 July. Further disappointment was the fact that only four railway lines would be able to operate -- in Pretoria, East London, the Southern line in the Western Cape and Port Elizabeth and East London, where a lot more of these services were required. The observation should include the expected expansion of the COVID-19 mitigation processes and procedures, to extend to the full service as to what was expected to happen on 1 June as soon as possible.

The Members agreed to Mr Hunsinger’s suggestion. The Chairperson moved to the last observation on the budget Report.

Mr Hunsinger suggested that an observation should be made noting the reply from the Cabinet on the e-Toll funding policy matter, and request with urgency that the matter be resolved with Cabinet if it was true that the submission had indeed been made to Cabinet.

Mr McDonald suggested that a time frame be put in place for the resolution of the matter, to avoid the process taking longer.

The Chairperson said that the Committee was responsible only for the Department of Transport, and not for Cabinet, and suggested that in putting time frames they had to make sure that they were within their scope.

Mr Mangcu agreed with Mr Hunsinger. The Committee was hamstrung in that matter, and could not put in time frames. The only thing the Committee could do was to express displeasure on the non-conclusion of the matter.

The Members agreed on the 11th observation on the budget Report.

Mr Hunsinger said that there was also a mention of particular infrastructure projects under the South African National Roads Agency Limited (SANRAL) that needed to be prioritised, and that there should be a focus on completing the projects that were already under way instead of focusing on new projects all round. Perhaps this needed to be added to the list of observations in the budget report.

The Members agreed with Mr Hunsinger’s suggestion.

The Committee Content Advisor said that in terms of the recommendations that the Members of the Committee had put in place, they had to make sure that these recommendations were specific to the Department and within their jurisdiction to perform. Some of the recommendations that had been made regarding the additional meetings that the Committee would require with the cities on the BRT systems were more of the recommendations that the Committee should keep and plan on their own, and were not recommendations that they could put to the Minister. The Committee could make a recommendation that the Department needed to increase its oversight and possibly increase its assistance to the cities in the implementation and the spending.

The Chairperson agreed, and suggested that the Portfolio Committee allow her to redraft the observations.

The Content Advisor read through the revised observations for all Members to comment if they were happy with them, and made the necessary changes requested by the Portfolio Committee.

There was a general consensus among the Committee on the changes made to the observations on the adjustment budget allocation Report, as corrected by the Members.

Recommendations

The Content Advisor read through the revised recommendations, as requested by the Committee, and the Committee commented on whether they were satisfied with the additions and added their advice on where they felt the recommendations needed adjustments.

They made some suggestions regarding to the phrasing and wording of the recommendations on the adjustment budget allocation Report, and the changes were made as requested.

Consideration and adoption of Report

Mr McDonald moved the adoption of the Report, and Mr Hunsinger seconded.

The meeting was adjourned.

Documents

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