SANRAL on Horizon 2030 strategy, completion of major construction projects & impact of COVID-19

NCOP Transport, Public Service and Administration, Public Works and Infrastructure

07 October 2020
Chairperson: Mr M Mmoiemang (ANC, Northern Cape)
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Meeting Summary

The Select Committee met on a virtual platform to be briefed by Sanral on its horizon 2030 strategy. This strategy is a long-term plan for Sanral which articulates its vision, strategic and tactical interventions needed to deliver on its mandate. Sanral manages more than 22 000 km of roads that are estimated at a net asset value of R251.6 billion. The Committee heard that funding has been negatively impacted due to the e-tolls issue which is still not being resolved, which resulted in low payment compliance. The impact of Covid-19 and lockdown regulations impacted on the non-toll allocation which was reduced by R1.1billion. However, Sanral has assured the Committee that it is financially stable until October 2021.

Committee Members wanted to know how Sanral had ensured the inclusion of the community, especially rural and underdeveloped communities and how it contributed to the community through its programmes and projects; whether any of its projects were affected by Covid-19 and how it managed around Covid-19. The Committee wanted an update on some of the roads that were already under construction and projects that were already underway in some of the roads; if there was any corruption in the issuing of contracts and whether the tendering system affected the progress of some projects.

The Committee agreed to give Sanral a period of two weeks to prepare detailed responses to some of the unanswered questions of Members.

Meeting report

The Chairperson opened the meeting and welcomed Members. The Committee would receive a briefing from Sanral. The Minister had apologised.

Sanral Update

Ms Inge Mulder, Acting CEO, presented the horizon 2030 strategy update. The strategy was launched in November 2017. In 2019, Sanral presented the strategy before the NCOP and she therefore would not go into too much detail regarding the background to the strategy. The strategy had four pillars:

-  Roads pillar: Sanral is mandated to look after the national roads of South Africa. The roads pillar focuses on delivering public transport enabling infrastructure, rolling out infrastructure to improve road safety for road users, deliver high socio-economic projects e.g. N2 Wild Coasts, N1/N2/R300 Cape Town, Moloto R573, GFIP Phase 2 and 3, N3 Van Reenen, N2/N3 Durban, and to evaluate internal toll division and possibly establish a separate toll subsidiary

- Stakeholder pillar: to ensure all stakeholders received the benefit they required from the work Sanral does. This pillar focused on implementing the stakeholder engagement strategy and plan, strengthen media relations, ensure effective marketing and advertising, and extend research to understand and respond better to customer needs

- Mobility pillar: seeks to develop public transport-enabled road infrastructure, extend integrated ticketing and public transport user information, implement congestion management programmes, optimise mobility and accessibility needs of strategic roads, promote efficient and integrated urban mobility planning, and ensure route optimisation of capacity through cost-effective measures.

-  Road Safety Pillar:  focus on implementing programmes to improve attitudes and behavior, extend education and awareness campaigns, strengthen partnerships for law enforcement and regulation, implement technology and innovation solutions that influence road user attitudes and behavior, expand road management systems, and implement and continue road safety research and development programmes

The statement of financial position indicated the entity was healthy and its assets were more than its liabilities.

Sanral achieved an unqualified audit opinion in 2019/20


Mr E Landsman (ANC, North West) asked what happened to the projects that Sanral was currently dealing with and were in progress.

Ms S Boshoff (DA, Mpumalanga) asked what the update with regards to the Moloto project was.

Mr T Brauteseth (DA, KZN) asked what the internal audit of Sanral looked like.

Ms M Moshodi (ANC, Free State) asked whether the position of the CEO was vacant and for how long it has been.

Mr M Rayi (ANC, Eastern Cape) asked what was happening with the issue of the road pillar. He also enquired on the 2030 roads plan. What happened to the previous process of the Wild Coast road? What happened to the Cape Town N1, N2 and R300? What were the effects of covid19 on the loan that was guaranteed?

Ms B Mathevula (EFF, Limpopo) wrote on the Zoom chat function that she could not speak due to bad network coverage and wrote her questions on the chat.

The Committee Secretary read the questions asked by Ms Mathevula. She asked whether there was corruption involved in the termination of the contract and whether the tendering system had a negative role on building roads.

The Chairperson commented on the part of the presentation which spoke to a “healthy budget” – he asked the team to share what areas it could look at to ensure the entity was sustainable. What role was it playing in terms of the infrastructure development unity together with the Department of Public Works? What was the team doing with regards to road construction and infrastructure development? 

Ms Mulder said Sanral would submit a document that broke down the projects it was busy with.

The Chairperson asked to what extent the community was involved in the construction development.

Ms Mulder said Sanral would also submit answers to other questions later. She replied to Mr Landsman that Sanral had to close some of projects due to Covid-19 cases. The CEO position was not vacant - she was the Acting CEO as the CEO was on leave for three days.

On how Sanral managed irregular expenditure, there was an identified project where there was a miscalculation as the remainder of the work to be done by the constructors was not included. The integrated report that would be tabled in Parliament in November would detail the irregular expenditure.

Regarding the internal audit of Sanral, years ago, Scopa identified that an internal or in-house auditor would be more efficient for Sanral as opposed to outsourcing this function. The loans were not assisting - there was currently no loan to be repaid and the bonds had not yet matured.

On the questions from Ms Mathevula, she said the contract was terminated as the constructor went into business rescue and never returned. There was no corruption. Regarding the tendering system, tendering was not really a hindrance but it was found the process was long and a specialist had to be brought in who could interpret the design and this takes a long period of time.

Mr Louw Kannemeyer, Sanral engineering executive, said that Sanral had no in-house team, it was all external. All Sanral procurement followed all the regulations provided. Most of the road safety workshops in schools identified that the need was in the rural areas more than in the urban areas. The bulk was concentrated in rural areas and not only in metropolitan areas.

With regards to R37, the road was under Sanral - it was a small portion that was not under Sanral. The road in Mbombela was now under Sanral and the entity is looking at six projects to develop the roads. There was currently 106 project plans in Mpumalanga and 26 construction processes would be issued in five years. Regarding local labour employment, each project would have a target area, project liaising committees, and a project liaising officer.

Mr Brauteseth asked how Sanral dealt with the contract on the issue of the Mtentu road maintenance contract.

Mr Kannemeyer said that those contracts all went through an open tender process.

The Chairperson opened the floor for follow up questions

Ms Boshoff asked when Sanral was going to send construction to Lainsburg and when this would commence.

Ms Moshodi asked that the Chairperson impose a timeframe by when Sanral should provide responses to the Committee.

Mr Rayi questioned the coordination on the N3 project along with the Western Cape N2.

Mr Kannemeyer responded that with the format of the wire construction, Sanral would have to see how it would be conducted given COVID19 regulations. There was currently a legal case before the Supreme Court of Appeal. On the N1 and N2, Sanral was in the process of appointing a design consultancy to get the design before construction commenced. Sanral submitted 30 projects - 16 were Sanral roads and they were all approved.

The Chairperson said Sanral had two weeks to prepare and send responses to questions not answered. He thanked Sanral for its presentation – this Committee was now in a better position to appreciate its efforts and on behalf of the Committee, he appreciated the work it was doing as Sanral. He excused the management of Sanral.

Committee Minutes

The Chairperson requested Members have a look at the minutes of the previous meetings and Indicate if they wanted to suggest any amendments.

He referred Members to the minutes of 18 August 2020, 26 August 2020 and 2 September 2020.

Mr Rayi suggested that the researcher look at the projects in the minutes of 2 September and do some research on them so that the Committee could be better informed.

The minutes were adopted.

Meeting adjourned.




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