SAMSA on Maritime Sector Transformation

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Meeting Summary

The South African Maritime Safety Authority‚Äč (SAMSA) in a virtual briefing presented the current status and plans for promotion of maritime activities in South Africa. This included an update on Operation Phakisa which focuses on infrastructure and operations, skills and capacity development, and market growth in the maritime industry.

Members asked about the economic impact of Covid-19 on maritime activities, SAMSA’s responsibility about pollution, care for the environment and sustainability of fishing stock, coastline patrol capacity, non-operation of the Durban dry dock, the idea of Transnet not being part of Department of Transport, SAMSA’s role in coordinating the African Region, promoting women in the maritime sector, lack of competitiveness and monopolies in the maritime industry, tensions about interpretation of SA tax policy to support the growth of the ship register, and development of the Boegoebaai port.

Meeting report

The Chairperson noted this was the first time SAMSA was meeting the Sixth Parliament Committee.

Maritime Sector Transformation: SAMSA briefing
Mr Zakele Twala, SAMSA board member, communicated that he was representing the rest of the board members who could not make it to the meeting, but promised to attend next time. The team would present to the Committee an overview of maritime activities and introduction to SAMSA, what has been done so far, and the transformation. He introduced the SAMSA team:
Mr Sabontu Tilayi - Acting CEO SAMSA
Mr Vusi September - Head: Corporate Affairs & Government Relations, SAMSA
Mr Walter Simakani - Senior Manager Cooperate Strategy, SAMSA
Mr Moyahabo Raphadu - Company Secretary SAMSA
Ms Zama Chonco - Chief Financial Officer, SAMSA.

The briefing covered a background to the foundation of SAMSA, its role in the promotion of maritime activities, including in Operation Phakisa, SAMSA structure, its work and responsibilities – including search and rescue, flag state responsibility, fishing safety, coastal state responsibility, boating safety. It explained SAMSA's daily work in vessel registration and licencing; statutory surveys, ship security and pollution prevention; seafarer competence; cargo surveys; casualty investigation; casualty rescue; intervention enforcement, as well as safety programmes. In its overview of the transformation journey of the maritime sector, plans for developing the sector in the next five years included creating 1000 jobs, 10 new SMMEs into the sector, 10 merchant vessels on the register and 3% increase of maritime contributions to the GDP.

The role of SAMSA in Operation Phakisa was established, as well as the partnership with Department of Transport (DoT). The challenges that SAMSA has faced have been;
• SAMSA funding inadequacies as per the requirements of the mandate –
• Limited infrastructure capacity such as tugs, communication equipment, aids to navigation and manpower.
• Contestation on activities to be performed under mandate objective: promotion of maritime interests. Both “promote” and “interests” are not defined in the Act. Therefore SAMSA undertook to “support or actively encourage” the maritime interests, but more pertinently to “further the progress" of the maritime interests.
• Outdated and slow domestication of legislation with very little progress in processing conventions, protocols, bills and subsidiary instruments
• Funding of the SAMSA SA Agulhas as an enabler of maritime skills development.
• Scarcity and loss of maritime technical skills
• Availability of cargo for SA registered ships and incentives such as preferential conditions in the port system
• Finalisation of Government Fleet Centralisation as per Operation Phakisa Initiative 15.2
• Alignment in the interpretation of SA tax policy to support the growth of the Register

The following requests were made to the Committee:
• Fast-tracking outstanding maritime legislation into the Parliament Programme
• Support by creating awareness to domestic and international business about the Implementation of the South Africa Ship Registration Strategic Initiative
• Finalisation of Government Fleet Centralisation as per Operation Phakisa Initiative 15.2
• Alignment in the interpretation of SA tax policy to support the growth of the Register
• Funding for Maritime Risk Capacity
• Partnership with Provincial and Local Government on:
- SA Maritime Agenda in the promotion and growth of the Maritime sector
- Provision of capacity such as maritime technical skills and partnership funding.

Discussion
Mr E Landsman (ANC, North West) asked about the economic impact of COVID 19 on the maritime sector especially on number of jobs lost, and how many jobs have been saved. Is there a plan to mitigate against future shedding of jobs in the sector?

There is a lack of accurate statistics to measure the economic contribution of cargo and maritime related services, due to the lack of maritime culture in business and government of South Africa. What is being done to ensure that such statistics are available?

There is a monopoly by a few large business concerns in the maritime sector. To what extent is the small business development sector represented demographically in the industry?

Mr T Brauteseth (DA, KZN) said he was very concerned about fish stocks. Has SAMSA has engaged with the Department of Fisheries to consider the development of fishing reserves along the coastline, where fish can be allowed to grow, in terms of Operation Phakisa? Studies around the world show that creating large fishing reserves where no fishing is allowed at all, allows over time for a spill over from those fishing reserves into the wider waters. This is sustainable from the point of view of small-scale fishing. Fishing reserves are a foundation block to support the life of the ocean and those people who are dependent on the ocean. What work has SAMSA done through Operation Phakisa and the Department of Fisheries to actively work on fishing reserves, which will have a massive impact on the ocean economy and will be sustainable?

Secondly, he pointed out about instances of Chinese trawlers that move along the South African coastline who are reported to turn off their radar and then turn it on again when they leave SA territory. Those are the kind of trawlers that indiscriminately drag stock out of South African waters, which directly affects the small-scale fishermen and cooperatives to sustain themselves. In addition, they also wipe out the natural environment, which is vital for the sustainability of food security in the sector. South Africa does not have a coastguard service as in other countries, but rather relies on the NSRI emergency patrol that helps maritimers in distress, and the Navy – which is severely limited. How many patrol vehicles, do we have patrolling the maritime borders of South Africa, which are massive? If there is an incident, for instance, of a trawler operating in SA waters in an unauthorised manner, how long would it take any one vessel enforcing South African water rules, to intervene in an effective manner? If we do not have that capacity, what is SAMSA doing to build that capacity? This is vitally important as the coastline has no protection against people damaging the ocean economy. The ocean is the country’s heritage, just like minerals in the ground and land, and many South Africans are dependent on that heritage.

He pointed out the Durban harbour dry docks have not been operating for six to eight years. There is both a long-term and a short-term dry dock there for repairs. However, the dock gates have not been working for eight years. As a result, a lot of repair and maintenance business that should be going to SA companies is lost. Dormac had built their own floating dry dock in the Durban Harbour, as Operation Phakisa drew back from the marine maintenance and refurbishment projects. While this may be a Transnet National Ports Authority (TNPA) issue, what is SAMSA doing in conjunction with DoT, to get Transnet to fix this so as to get this vital business for South Africa? The country is losing business of approximately 35 oil rigs every year that go past the South African shoreline since they do not stop for maintenance. There is also a 50-tonne crane that has not been operating for six years and ships just pass without stopping for maintenance.

Finally, are there any moves or recommendations from SAMSA to stop the lunacy of Transnet moved out of the DoT? Currently, when one is in the water in the Durban harbour, it is under DoT, but once a person steps onto the dock it is Transnet. There are two completely different rules that govern the two. Transnet should be under the DoT, to have a uniform approach.

Ms S Boshoff (DA, Mpumalanga) agreed about the need for sustainability of fish stocks. There is also a need to ensure that pollution of oceans is addressed. How is pollution being looked at? What other steps will be taken to ensure that the oceans are clean? How will SAMSA ensure the promotion of inland dams? Not much was said about woman in the maritime industry, how are women encouraged to join the maritime industry? How many women are part of this? On the concern about scarcity and loss of maritime skills, how will SAMSA broach the subject to ensure that we do not lose skills and scarce resources?

Ms M Mamaregane (ANC, Limpopo) said her questions had already been raised by Mr Landsman.

Ms B Mathevula (EFF, Limpopo) asked what role SAMSA plays in connecting the African region. Does SAMSA have programmes to support women in the maritime industry? How many cooperatives owned by women have been offered licences? What method is SAMSA using to ensure the inland dams are not polluted?

The Chairperson asked about the requested Committee interventions highlighted by the Acting CEO. He asked for more detail on the fast tracking of maritime legislation into the parliament programme – especially the untransformed nature of the industry and lack of competitiveness.

He stressed that support in creating both domestic and international business awareness of the South Africa Ship Registration Strategic Initiative will the raised with DOT by the Committee. The Committee will be meeting with DoT on the finalisation of the government fleet centralization as per Operation Phakisa.

The Committee will take heed of the tension in the interpretation of the Tax Policy which is a stumbling block towards opening the industry.

On the lack of competitiveness in the industry, most ships that enter SA waters are not on the South African Ship Register. Most of the services and operations of ships trading in South Africa were formerly provided in this country. The ships that were lost during the sanction period pre-1994 could not be recouped. What can be done to ensure that the country can grow its ship register? He noted the case of the Green Road Ltd, a South African company that through offshore subsidiaries owns and operates a large fleet of ships sailing internationally. Annually they carry approximately 16 million tonnes of cargo. Although most of their substantial shipping business is conducted offshore, how do we ensure that the monopoly is indeed disrupted?

What can be done to develop Boegoebaai? While SAMSA is the facilitator, the provincial and local authorities are responsible. What is the plan?

SAMSA response
Mr Tilayi, Acting SAMSA CEO, indicated that if required, SAMSA was willing to give further responses in writing as is normally done.

On the economic impact of COVID-19, in terms of job losses, he replied the maritime sector was fortunate. At the beginning of the pandemic, government determined that the maritime economy should not be shut down, since the virus is not spread by goods but by people. While people’s movement was limited, maritime activities kept the economy going. However, Transnet went down to 25% at some point. There has been much pressure as SAMSA lost about 70% of revenue. Although SAMSA has since recovered, it is still nowhere near what was budgeted for. No jobs were lost, because operators in the sector largely managed to keep the jobs, although they are bleeding economically. The country is still in the middle of the pandemic and the sector is reacting as things happen. SAMSA has not yet done a compelling study. As such there are no accurate statistics yet of the impact. However, those that SAMSA has spoken to still seem to be in business, although they have lost some money, but generally jobs have been retained. When the State of the Maritime Sector Report is done at the start of the new year, SAMSA will report comprehensively on what was lost.

On lack of accurate statistics on the maritime sector, he agreed that it is a challenge. He pointed out the prior suggestion of undertaking and developing the State of the Maritime Sector Report. By nature, the maritime sector is attached to other sectors such as mining, car manufacturing, law, economics and insurance. As such, it has taken SAMSA a long time to determine how to account for this sector.

What SAMSA has now started to do is to go to Statistics South Africa to request information on sub sectors. As it would provide more accurate information representing the maritime sector. This work requires the country to work together, and it will take some time to have that response. This may not be completed until the end of the financial year because of the amount of work required. However, SAMSA has asked Stats SA to give information on glaring areas that can be accounted for. For instance, in looking at money spent on freight internationally, the freight account showed that almost 90% of that was by sea, with a small percentage by aeroplane and even less by rail. As such, based on that assumption, the R46 billion is accurate. However, it will take time to get a full picture since SAMSA is working together with other partners – Stats SA and Transportation Institute (TTI).

On addressing monopolies, the current difficulty is that cargo owners have a preference on who must carry their cargo. There are some areas in which SAMSA can intervene to ensure cargo owners comply with the laws especially the BBBEE Act and other legislation. This is with the hope that such laws can begin to be passed.

On who ensures laws are complied with, SAMSA does “police” the cargo that must go. SAMSA reacts where the cargo does not go in the manner suggested which is through mainly a South African ship. However, assuming there is no mechanism to force the cargo to be on a South African ship, SAMSA lobbies. There is a need to determine how to ensure people that need to benefit do in fact benefit, while setting out to deal with monopolies.

SAMSA learnt what Kenya has done about the scenario where if an individual sends a container through an operator like Maersk, once the ship clears, the cargo gets put onto a track owned by Maersk, and gets put in a warehouse also owned by Maersk. The Kenyan government set parameters to deter this, so that the cycle is broken apart. This was also done for security reasons, because if that container contains arms – given the area Kenya is located – how do they ensure that the container contents are checked before it has gone inland which becomes problematic. SAMSA saw that this is something that can be explored. While the problem is not as big South Africa, including the all-the-way integration, determining how to break those monopolies will take much campaigning. The main task is to South Africanise the sector, even before dealing with the monopolies. If the monopolies are South African, it would at least create some benefits for the country.

He confirmed that Green Road is listed on the Johannesburg Stock Exchange, and they are South African. However, Green Road allowed its ships to be out-flagged and operate out of Singapore which is outside the South African net and employment. It is just in name they are South African, but the South African benefit has been diminishing over the years, which is a problem. SAMSA has been having discussion with it on whether it is South African or not, arguing that it cannot be South Africa when it picks up South African cargo without complying with the procedures to employ South Africans and provide South African benefits. This shows the dynamics that SAMSA must navigate in dealing with monopolies.

On whether the small business sector is catered for, he replied this is the reason for the current programme and possibly why the Committee has called SAMSA for a discussion. This is work in progress and the work is still at the beginning. He acknowledged that the response would sound vague. However, looking within the value chain, there are small legal firms which have a maritime desk, but they are not getting work. The odd insurance company probably does not have a maritime wing but insurance is generally bought from London. For instance, Petro SA generally ships all their products locally. They refine and supply all other oil majors. However, the products, ships and operations are insured from a London market. These are the dynamics that must be dealt with. While it may not be a small business providing that insurance, yet it must still be South African.

To deal with this, SAMSA spoke to a group of small operators such as those who own small boats, guesthouses, or those taking crew change. There is visible transformation, such as the South Africanisation of Port Elizabeth, although it is not good enough because it is white businesses that got a head start. There is a big campaign in Port Elizabeth through the Eastern Cape Maritime Business Chamber, a representative body of black SMEs with a national footprint. This can be replicated once refined. SAMSA has formed a stakeholder engagement with all stakeholders including SMEs that are untransformed, the black SME operators that introduced this opportunity, and Department of Environmental Affairs. Through this, they have discussed the necessity of the offshore bunkering ensuring there is enough economic activity, while accruing its benefits to those people designated. This is still work in progress.

On the question of care for the environment and work on fishing reserves, he clarified that SAMSA is the maritime authority, addressing activities to do with maritime and ships. Fish resources are regulated by Fisheries under the Department of Environment, Forestry and Fisheries (DEFF). Diamonds and gas under the seabed are regulated by the Department of Mineral Resources and Energy. Operation Phakisa has now given a governance lab for all interests, which are sometimes competing. While seeking to leverage on the economic opportunity, there is always a risk of an oil spill when ship-to-ship transfers and offshore bunkering are allowed. Thus, DEFF can deal with this.

The reserves would be created through the allocation of fishing licences and designation of waters. The National Ocean Spatial Planning Bill is out, and it creates some marine protected areas, like Port Elizabeth, and a few other areas that have been extended. DEFF who are the experts can best regulate fish stock activities, and are best positioned to respond on fishing reserves. However, SAMSA operates some of the fisheries fleet which has a two-part role. First, they conduct research on the fish stock, by taking samples to determine how much of one stock is available. Through this they can determine what quota of a particular fishery to issue. On the fisheries side, that work of research and publishing results is required to fulfil international obligations, since it is the only way a country gets permission to export fishing products. Secondly, patrol of the waters is needed to ensure that the stock available is protected and does not get stolen.

The Department of Fisheries has both offshore and inshore patrol vessels. The inshore patrol vessels operate up to 200 nautical miles, while offshore patrols operate on the high seas. SAMSA has been involved in hot pursuit of ships, especially Japanese involved in tuna fishing. SAMSA's Centre for Sea Watch and Response (CSWR) was necessitated after it was determined that the country did not know enough about what is happening on our coast. Satellite technologies allow SAMSA to monitor sea activities. Notorious fishing ships switch off their Automatic Identification Systems (AIS), thus they cannot be detected. However, SAMSA has another system laid over the satellite based AIS which does not show the name of the ship, but it can be noticed.

At this stage its movement is monitored to determine what activities it could be doing, since it is suspicious for it not to identify itself. There is then the need to send a patrol. The Navy and Air Force are called via helicopters or aircraft although this capacity is not at a satisfactory level. While there is some capacity is to monitor 2000 kilometres of coastline and 250 miles out to sea, it is inadequate. As mentioned in the presentation, there is a need to build up that capacity for risk management. There are five bigger patrol vessels and two of them carry smaller ships, since those are much faster than an ordinary fishing vessel and can get to the patrol area quicker. Department of Fisheries has armed guards on the ship. As earlier mentioned, this is an area that we do work in that is still being worked on. SAMSA is a service provider, but Department of Fisheries is accountable, therefore other details can be responded to by Fisheries.

Transnet operates those dry docks at Durban Harbour. He had sent the question on the dry docks to the Principal Officer in Durban who responded that all dry docks are fully operational. There was a time that they went out for repairs. As the DoT Deputy Director who also chairs the Port Consultative Committee was in this meeting, he would give more details to confirm all the dry docks are fully operational.

On the oil rigs bypassing South Africa, he replied it was not necessarily because of the challenges with the dry docks. Durban does not have a dry dock big enough to take an oil rig in any event and they always wait in the Port of Ngqura and Saldahna Bay. It is a space constraint since there needs to be a berth and a capacitor. He admitted that oil rigs do leave a lot of money because of the maintenance. It was last estimated that an oil rig in port when work is happening is equal to approximately R10 million a day for the duration of the work, and a few jobs can be paid for with that amount. Within Operation Phakisa is a new initiative to promote South Africa as a destination for rig repair as many oil rigs work on the west and east coast of Africa, thus it is better to have them repaired in South Africa than hauling them to Singapore.

On pollution, including in the inland dams, SAMSA regulates the activities on the water. However, the quality of the water and the inflows into those water bodies in the oceans is the function of DEFF, while Department of Water Affairs is responsible in the case of inland waters so the question would best be answered by them. What SAMSA does is to ensure that those who visit water bodies use them responsibly, that the boats used do not cause pollution. However, in system borne pollution where there is overflowing sewage that ends up in the water body, that would be the role of the Department of Water Affairs.

The presentation noted how SAMSA has undertaken an initiative in which women development and empowerment is part of the agenda. SAMSA supports initiatives by several associations such as Women in Maritime, and Women in Ports and Port Administration.

SAMSA places emphasis on training to stop the loss of skills. As pointed out in the presentation, the 2012-2013 period was used to have the correct basis by conducting research to ensure adequate capacity is built for the required work. However, this is not adequate since both SAMSA and Transnet are at critical resourcing levels. Skills development programmes are there to help mitigate the situation.

On SAMSA's role in connecting the African region, it participates in maritime discussions, such as the role it played in coming up with the Integrated Maritime Strategy 2050. The Acting CEO was based at the AU Headquarters in Addis Ababa for two months working on that project. Ministers of Transport on the continent formed the African Maritime Transport Charter which creates a coordinating body called the Association for African Maritime Administration (AAMA). South Africa is the Secretary of this association, this gives access to other SAMSAs on the continent, who each have a duty to lobby within their governments and elsewhere. There is hope that the architecture put in place for maritime development is adequate. There is need to get traction in the work. SAMSA has requested the African Union form a maritime desk so that while AAMA operates locally in the countries, a desk is functional at the central level at AU, just like the Ghana-based African Free Trade Area Secretariat. This is work in progress, but it has a direction as SAMSA does the work, led by Department of Transport.

On cooperative licences, he replied the cooperatives were invited to apply by Department of Fisheries, when it issued all those licences for the OR Tambo region in the Eastern Cape. There were more than 28 cooperatives with many of them being women-led and having women participating. Such cooperatives exist throughout the country. A comprehensive response on this can be given after consulting them.

On outstanding legislation, he replied that SAMSA is the administrator. Therefore, once Parliament passes the legislation, it will be SAMSA’s duty to implement. There is an inter-ministerial committee on tax at the Deputy Ministers’ level. This committee called for discussion between DoT and SAMSA with Treasury and SARS. The talks stopped at one stage, but they are now back on track. He gave a plea to the Committee and Parliament to assist where SAMSA feels it has exhausted its abilities. This is both in the case of outstanding legislation, which is a partnership between SAMSA and DoT, while Tax Policy is a matter between DoT and Treasury.

On the Ship Register, SAMSA still controls over 150 million tonnes of cargo – which results from somebody being issued a mining licence. The starting point is to talk to people who own that cargo, on how the cargo gets landed to market, while insisting that the preference is for it to be shipped using South African flagged ships. There is need for the country to have a ship ownership regime that does not make it more expensive than other ships it may be competing against. SAMSA needs to resolve with Treasury since it was established that the country can have a ship that costs as much as the Singaporean ship. SAMSA will expect to be monitored by the Committee on the progress of this discussion between DOT and Treasury, or non-cooperation between industry and government. When the need arises, SAMSA will approach Parliament on the need for legislative instruments to resolve issues within the government, while continuing with partners in the industry. Flag ships that were registered were based on cargo that was released by industry and this has been held back ten years for the taxation concerns to be resolved. Hopefully this will reverse the historical damage that happened.

Green Road was already mentioned, the idea is that if Green Road calls itself fully South African, the South African value must be seen. This is subject to discussion so the cost does not become too expensive for it. The only worry is that it did not appear that Green Road wanted to make a compromise.

The development of Boegoebaai is a joint agreement with province and local people available. The plan is to develop Boegoebaai to a deep-water port, although there is no structure yet. He said the DoT Deputy Director would further respond to this. The DDG would also respond on why Transnet is not under DoT.

Department of Transport response
DoT Deputy Director General for Maritime, Mr Mthunzi Madiya, said the Department of Transport is in the process of developing the Maritime Development Fund Bill which aims to create the country’s capability for search and rescue, and the activities that SAMSA Acting CEO earlier mentioned. Secondly, it will assist SAMSA to have the capacity to discharge its mandate. There are two maritime entities within the department, with the second one being the Coast Regulator of South Africa which regulates the National Ports Authority economically, while also working on tribunal dispute issues. The hope is that once this bill is finalised, some of the currents acts like the National Ports Authority can be reviewed. This will be in keeping with world trends where the sector is able to fund institutions that are doing oversight and economic regulations. Therefore, the country needs its own Maritime Development Fund.

There are currently nine commercial ports from Richards Bay to Port Nolloth. There are structural challenges and limitations with Port Nolloth as it is not deep enough to bring in commercial vessels. There was discussion with the Northern Cape Provincial Government to move the port to Boegoebaai, to be able to develop it into a commercial and viable port. It is 57 kilometres from the current port on the Orange River mouth. Together with the Provincial Government and Transnet a steering committee was formed to investigate pre-feasibility studies, whether operating such a port would not take cargo away from the Port of Saldanha. The idea is the develop a port that will have an organic growth. There were positive results from the studies conducted. A commercial port requires a minimum of 11 million tonnes for it to be viable, these are available. Thus it was confirmed that the port can be developed. The task now is to determine when this development activity can begin. The Port of Boegoebaai is one of the Presidential Strategic Integrated Projects (SIPs) to be developed post-COVID. DoT has a governance structure with the Provincial Government and Transnet, with periodical engagements on the development of Boegoebaai.

He acknowledged that competitiveness of the port system is challenged. This is partly because of non-implementation of the National Ports Act, which states that Transnet National Ports Authority should be a standalone entity. This is because revenue generated must be invested back into the port system, to reduce the cost of doing business, thus allowing South Africa to become a competitive country for export purposes, as well as boosting infrastructure in terms of the dry docks. The current challenge is that the Act was signed in 2005 but corporatisation of the authority has not yet been done. The implementation of the Act would assist the country to build the dugout port in Durban where there was the old airport and build the Boegoebaai Port. The National Ports Authority generates enough revenue to invest in these two critical projects. The expectation is that the Committee can assist Government, to ensure the National Ports Authority is corporatised, this will ensure that revenue generated there is ring fenced. It should not cross subsidise other divisions of Transnet as is currently the case. There is a huge backlog in infrastructure that should be built in the port system. Part of the Operation Phakisa programme was forecast to be financed by the National Ports Authority; this has not yet been achieved.

On transformation, the Comprehensive Maritime Transport Policy states that the country needs to develop its own national carrier, with the capacity to carry more than 200 million tonnes for export. It is in the Department’s plans this financial year to determine how to incentivize mining houses, where if the seller of the cargo should be the one nominating the vessel, this will lead to an increase in the ship register. For international commercial terms, there is the Cost, Insurance and Freight (CIF), or Free On Board (FOB). CIF is where if a mining house is exporting minerals, they are the ones who nominate the vessel that will carry that cargo, rather than a buyer who is abroad nominating a vessel to come into South African ports to take the cargo. The cargo owner is the key in maritime camps. The country can leverage on this, as they are “low hanging fruits”. There is no need for investment, but rather ensuring that the policy is implemented, and incentivizing mining houses to take up CIF as opposed to FOB, where the buyer nominates the vessel to come to South Africa to pick up cargo.

On Transnet not being part of the Department of Transport, it is a policy issue, which need policy alignment. This was recommendation in the Presidential Review Commission on State Owned Enterprises Report. If those recommendations were adopted, Transnet would come to the Department of Transport, so that there is an alignment of policy and implementation.

Follow-up Questions
Mr Brauteseth said he was concerned Mr Tilayi said the dry docks are working. He had spoken to three industry stakeholders in the harbour that morning, who said Transnet’s statement that the dry dock is functional is incorrect. A former MP once said, “If you are not sure go and see for yourself”. He is based in Durban and will do an oversight visit to the dry dock next week, and report to the Committee if the Transnet statement is true or not.

Secondly, Mr Tilayi indicated there are five ships meant to patrol the borders and two of them can deploy smaller ships. Does this mean there are seven ships in total?

South Africa’s coastline is 2850 kilometres. Are seven craft adequate to patrol the borders and ensure that craft in South Africa’s coastal waters are following the rules? Are seven craft enough to patrol a 2850km coastline?

Finally, the Deputy Director referred to an Act that has not been implemented. He asked for the name of the Act so he could follow up on it. Rightly, Transnet is not ring fencing that money and is using it to cross subsidise, but the money should be spent on port infrastructure. This has a knock-on effect of losing industry in those ports. He appreciated the willingness to consider having Transnet under DOT so that there can be cohesion in operations.

Closing remarks
The Chairperson requested that SAMSA and DOT be allowed to give their responses in writing within two weeks due to time constraints. He thanked SAMSA for the presentation, and the DDG for the responses on maritime activities. More discussion will be done in the next meeting. He thanked all for attending the meeting.

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