Sub-Committee: Public Protector Report on Toyota Quantum Panel Vans: follow-up engagement with NRCS, SABS & DTIC

Meeting report

The Chairperson welcomed Members and the guests to the meeting. He invited the Department of Trade, Industry and Competition (DTIC) to make their input.

Ms Thandi Phele, Deputy General-Director: Industrial Development, DTIC, said they had made their presentation at a previous appearance before the Committee. The purpose of this meeting was to give Members the opportunity to ask questions and they would respond.

Dr Tshenge Demana, Chief Director: Technical Infrastructure Institutions, DTIC, said that Members could ask questions on the presentation that had been made the previous time. He said the DTIC supported the findings of the Public Protector about areas that needed improvement. Those areas included better coordination and communication between the different role players. As such, the DTIC had already been engaging with the Department of Transport (DoT) to ensure that their policies were aligned. The National Regulator for Compulsory Specifications (NRCS) and the South African Bureau of Standards (SABS) had reviewed the memorandum of understanding between themselves and the Department of Transport. At the technical level, there was a new project called Safer Vehicles 2025 which involved all the stakeholders, including the DoT, the DTIC and other role players. The DTIC was cognisant of the issues that had been raised and they were doing something about them. It was government policy to allow manufacturers and builders of imported motor vehicles to build, manufacture or import vehicles for private use and for selling. Manufacturers, Importers and Builders (MIBs) that were involved in converting panel vans to minibuses and that were legally doing so had been registered with the Department of Transport (DoT) through the system that the DoT managed.

The National Land Transport Act did exempt MIBs that produced such vehicles for private use. The role of the NRCS was to inspect and approve vehicles from registered MIBs. That distinction was important because, where MIBs were not registered, vehicles could and did leak from their workshops to be sold as passenger-carrying minibus taxis. At the moment, there was no mechanism to close that gap to prevent that leakage from those MIBs that were not registered or not required to be registered.  The two-pronged approach that the policy allowed was an area that the Government, the DTIC, DoT and the Committee should look at again and do something about it. The two-pronged approach seemed to be where problems were arising.

When the responsibility for inspecting vehicles was given to the NRCS no additional resources were given to it to make sure that work was carried out as well as it could be. The CEO of the NRCS had raised that as a complaint in 2009. The technical expertise and the engineers at the NRCS and the SABS  needed to be at the same level as the engineers at places like a Toyota for them to do the work as well as they could. The DTIC had not made allowance for that as the policy owners and that meant that they were not regulating that area as well as they could. The DTIC agreed that there were areas that they could improve on.

The Chairperson thanked Dr Demana and invited members to raise questions. He said the challenge for the Committee was a situation where people had died and continued to die. There were also people who had lost money because they had been misled. It had been alleged that some of the entities that reported to the DTIC did not do their job properly. It was disheartening when DTIC came and made excuses that there were no resources. He said he would give Dr Demana an opportunity to respond at the end of the discussion.

Discussion

Ms N Nolutshungu (EFF) thanked the Chairperson. She asked DTIC if they were aware of what they were supposed to present when they were invited. In the DTIC’s presentation there was no mention of the Public Protector’s report. She wanted to know if they had ever heard of it. If they had, what had they done about the findings and recommendations in the report? When did the DTIC start engaging the Department of Transport regarding this matter?

She said that the NRCS presentation had claimed they were established in 2008. Why did the Public Protector find that the NRCS failed to ensure that all MIBs complied with compulsory specifications in order to restrict the illegal conversions and yet NRCS was not in existence? Toyota claimed that they had notified the NRCS of the practice of the conversions and of their disapproval of the practice. What had the NRCS done when they heard this from Toyota? The NRCS had powers to inspect, search and seize. Having come into effect in 2008 and having been informed of the practice, what did the NRCS do with the powers that they had?

She asked whether the SABS did its own tests or whether it relied on documentation received from other bodies like the NRCS. Did the SABS do regular product testing throughout the year to ensure compliance of converted panel vans? If not, why was it not done on this product? She said assessments of quality systems were made twice a year and full reports were issued. What were the SABS’s findings when they did those quality checks and where were those reports?

Mr L McDonald (ANC) asked the SABS how it could do a roll-over test on a car that they knew was going to carry passengers, but not do all the tests that would be expected to ensure that the poor were travelling in safety. He said that there was a difference in the maximum allowed weight that a panel van could carry and the maximum allowed weight that the actual minivan could carry. He did not understand how all the departments together had found that they could issue certificates to vehicles they knew were going to literally kill people on the road. The DTIC had said they did not have funding for engineers so it might have slipped through. Another department said they were heavily reliant on the SABS, while the SABS said it relied heavily on another entity. Toyota had written to all those entities and to the Department in 2005 already and expressed their dissatisfaction with the conversion of their vehicles. Vehicles were still being converted. Be they Toyota, Ford, or Volkswagen, all of them were being illegally converted daily by MIBs registered with the entities before the Committee. He said that he had driven behind a truck from Bloemfontein and the truck had an unlicensed 50-seater bus attached to the back of it. It had no right to be on the road. The Committee needed to find a way to stop the registration of those illegal conversions, because in their endeavour to open the economy to everybody, they were killing people on the roads.

Mr K Sithole (IFP) said the Public Protector’s report said the NRCS failed to take efficient steps to ensure that all MIBs complied with the compulsory specification as envisaged by the National Regulations for Compulsory Specifications Act (NRCS Act). What steps had the NRCS taken after they received the report from the Public Protector? If they had taken steps how far were they with those? What consequences had the NRCS put in place for those who failed to comply with the regulations? Toyota had written to the NRCS advising them of the conversion of the Toyota panel vans and informing the NRCS of Toyota’s disapproval of the practice. If the NRCS received that report in 2009, what had they done up to now? It had been admitted that 436 vehicles were retrofitted to make them safe but the NRCS failed to conduct a survey to ensure the safety of the public. Did the NRCS take the public into their confidence? If they had received such a bad indication in the report and not acted on it, it meant they were not serious about what was happening.

The SABS had received a report from the Department of Trade and Industry in 2009 because they were trying to determine if the illegally converted vehicles could be retrofitted to ensure the safety of the commuters using them. Why had the SABS failed to conduct an adequate quality assurance test? How many of the converted vehicles were involved in car accidents. If they did not have that information, why?

The Chairperson asked if the entities were aware of the Public Protector’s report. What did they do about it?  Were they aware of the main complainant to the Public Protector? Did they have sight of what the complainant said? The Public Protector was limited in where she could go. Did the entities have sight of the issues raised and what did they do about them? Were the three entities aware of the process to amend the National Road Traffic Act? Did they make any recommendations?

Responses

Dr Demana said the DTIC implemented their policies and strategies through the two entities, the NRCS and the SABS. The DTIC’s input would be short to allow the two entities time to give full details of what had happened. He said that the DTIC was aware of the Public Protector’s report. The report did not have any substantial recommendations for the DTIC to implement, except that the DTIC must see to it that the coordination between regulators was better and that there was better communication in terms of policy on public transport. The DTIC was not the responsible department. The DTIC had been engaging in several issues since 2009, including the conversion of panel vans into minibus taxis. They had a two-pronged approach which allowed some MIBs to be registered, monitored and inspected and others not.

The Chairperson asked Dr Demana to pause since he had said he did not have much to say. He asked if what he meant was that they had seen the report and done nothing about it because they had not been mentioned as the DTIC.

Dr Demana said that was not what he meant.

The Chairperson said he would give Dr Demana a chance at the end of the meeting to clarify what he meant.

Mr Edward Mamadise, Chief Executive Officer, NRCS, said the NRCS was established on 1 September 2008. Before then, it was a regulatory division within the SABS. They were separated when the NRCS Act was passed. Anything that had been done by the regulatory body was carried forward as work of the NRCS. It was not correct that the NRCS had failed to stop the practice of illegal conversions. The issue had arisen before the NRCS was established. By the time of the complaint to the Public Protector, the vehicles were already on the road. The distinction between the role of the regulator and other regulators such as the SABS was important in apportioning blame. The information that the vehicles were being illegally converted had come from the DoT and the Road Traffic Management Corporation (RTMC) because they had access to the Inathi system. The work of the NRCS ended when they issued a model number.

The Chairperson asked Mr Mamadise to confine himself to the questions, and only elaborate where it was necessary.

Mr Mamadise said the process to legalise the conversions was approved by the DoT. They laid down the requirements on how to legalise the illegally converted vehicles. The duty of the NRCS was to ensure that those vehicles were inspected and issued a letter of authority if they were satisfied that the vehicle had been converted to the requirements of the specification and the requirements of the Taxi Recapitalisation Programme (TRP). The approval was made irrespective of the objection from Toyota South Africa. The NRCS’s role was confined to the legislative provision even though they were aware of the objection by Toyota. Even without Toyota’s approval, the role of the NRCS was to ensure that the vehicle complied with safety requirements. The submitter of the vehicle had to submit the test report that proved compliance with the compulsory specifications and TRP regulations.

He said that the issue that was being avoided was that the vehicles that were converted were illegally registered as such by someone else who contributed to those vehicles being able to operate on the road. The NRCS would not be accountable for that because they did not deal with individual registration of vehicles. Other entities had to ensure that every vehicle being registered had all the required documents. There was a huge failure that led to the vehicles being allowed to operate on the road.

Mr Mamadise outlined the steps NRCS took after they received the report: They engaged the DTIC. They wrote to the Director-General and the Minister informing them of the report and its implications. Since there were no remedial actions in the report, they informed the DTIC that they had taken a proactive step to review the process of the approval of the converted vehicles. The NRCS also engaged the DoT. They needed to conclude a new memorandum of understanding so that they could redefine the roles and close all the gaps. There were processes and improvement issues that the NRCS had implemented, which included establishing a task team of inspectors. It was not true that they were incompetent. They had qualified inspectors within the NRCS. The issue was capacity in terms of the number of inspectors that they had. That team had been tasked with the investigation of all the allegations of non-compliance and illegal conversions. Currently they were investigating two MIBs. They had initiated a process for the revision of the standard administered by the SABS, SA National Standard (SANS) 10319, which dealt with the registration of MIBs. Conversions in general were not illegal. What was not permitted were illegal conversions by other unregistered MIBs.

Ms Jodi Scholtz, Group Chief Operating Officer, DTIC, said that in terms of their standard practice, the SABS did their own tests and where they did not have the capacity, they outsourced the tests to other laboratories which were accredited by the South African National Accreditation System (SANAS). Her understanding was that the SABS did three tests:  the rollover protection test, SANS 1563; the SANS 1430 test for anchorage points for restraining devices; and the 28-degree tilt test. Their standard test would list the testing methodology and they would follow it. If the vehicle met that standard, then the SABS would grant the certificate or the permit. Standards were set in terms of a consensus development process which comprised industry, academia, government and regulators. They all came together to determine what should be in the standard. The SABS only developed and promoted these standards by consensus, and they were not allowed to amend or change any standard unless it went to the Technical Committee. The tests that were requested by South African Taxi Finance were also the same three tests. 

Ms Nolutshungu said the Committee was not looking for a general answer on what the SABS did. The Committee wanted to know specifically what the SABS did with the vehicles that were submitted to their test. The SABS should tell the Committee what they did specifically with those vehicles.

Mr Lungelo Ntobongwana, Acting Executive: Laboratory Services, SABS, said the SABS tested according to the requirements of the standard and the request of the client. In that case, the request was the three tests mentioned by Ms Scholtz. The SABS tested those vehicles according to the requirements of the standard and the vehicles complied with the requirements. 

The Chairperson asked Ms Scholtz if Mr Ntobongwana’s response was the correct one. What did they do about the report that identified specific issues related to those vehicles? The SABS had not been clear about whether the request they received from SA Taxi Finance was on the alleged illegal conversions, or on the ones that were properly tested.

Mr Joseph Leotlela, Deputy Information Officer, SABS , said the SABS  was aware of the Public Protector’s report. The SABS was one of the entities that had been engaged by the Public Protector during her investigations. The SABS had made submissions to the Public Protector to assist her to understand the role of the SABS in the matter within the context of the mandate of the SABS. He said it was important for Committee Members to understand that the SABS was invited to the process to fix an illegality after the fact. Vehicles were already on the road, so the process was to fix them. The SABS could not do all the tests because it did not have the capacity to test a product as complex as a vehicle in its entirety. The SABS, within its mandate, conducted tests according to approved South African National Standards. The tests were conducted based on requests. The SABS did not call for a vehicle to be tested. The SABS could not do more. When the SABS tested, it tested against a certain standard which contained the minimum requirements for quality, which were agreed upon in advance by consensus. The SABS had conducted the tests as reflected in the Public Protector’s report. The tests the SABS could conduct could be identified and they did conduct those tests.

The Chairperson asked Mr Leotlela if he had seen the publication of amendments to the National Road Traffic Act. If so, had the SABS contributed to them? Did he intend to do anything to close the gap that was affecting his work at the SABS?

Mr Leotlela said that he was not aware of the process, but now that he was aware, he was sure that it was something that the SABS would want to contribute to.

Follow up Questions.

Mr McDonald said the Committee was getting to the bottom of the issue. The whole system was broken. Toyota had indicated in 2005 that the conversion of those vehicles was unsafe but they, as a collective, had still found a way to bypass that with tests that were done specifically to alter the outcome. When Toyota said the conversion was unsafe, they should have immediately stopped any conversions. Toyota manufactured millions of those vehicles. They were in a better position to tell if they were unsafe. He said he would love to be given the documents with the results of the tests that were done so that he could read through them before he could make a final assessment. He wanted to check what other tests should have been done to make those vehicles safe.

Mr Sithole said he was not happy with the answers from the NRCS. They had diverted from the questions asked. The NRCS had been aware of the illegal conversions. What did they do to protect the public? The NRCS failed to comply with their Act. They needed to answer what they had done when they received the reports from the Public Protector and Toyota.

The Chairperson said the responses from the NRCS were the best they could provide. Asking the same questions again was not going to produce any different answers. It was a reflection on the NRCS and an indication for the Committee as they wrapped up their report on the NRCS.

Ms Nolutshungu said she wished everyone could take note of the last speaker from SABS, who had been straightforward and honest. Dr Demana had said that the NRCS complained in 2009 that they had been given the task but they did not have funding. On the other hand, the NRCS said they knew nothing about it because at the time it did not reside with them, it resided with the SABS. It would be better if the entities came together and shared the work and responsibilities that were required of them.

The Chairperson said what was very clear was that the NRCS and the SABS did not know what their mandates were as they related to the mandate given by the DoT. There was no existing memorandum of understanding. The DTIC had failed in their oversight role to make sure that the gap was closed. It was no surprise that the answers the Committee was getting from the NRCS were the way they were. Most questions were specific to the NRCS, but it was clear that the Committee was not going to get answers. He said he agreed with Mr McDonald that the whole process was broken. If they had to rely on the NRCS and the SABS, nothing was going to happen. He invited the DTIC to make final comments.

Responses

Dr Demana said that it was clear to DTIC that there was a lot that needed to be done in the policy space. The DTIC had pushed the entities to report back to the DoT on where the gaps were and it only happened in 2009. The policy issues needed to be fixed before they could worry about implementation.

Ms Phele said the points that had been made were valid. As Dr Demana had indicated, the two-pronged approach created the loopholes where any person could convert their private van, but it would be found on the road transporting people. The process of registration of vehicles and the linkages of what DTIC and the SABS were doing, and the DoT and its entities ought to be doing, needed to be streamlined. Once the vehicle was registered and was on the road, it was deemed to be fit to be on the road. That was why it was necessary to redefine roles. The policy space was mainly driven by the DoT and it was supposed to be supported by the NRCS, the SABS and the DTIC. It was important that they did everything right to protect the lives of people.

The Chairperson thanked Committee Members and the entities. He said that it was shocking that the NRCS and the SABS were not aware of a legislation that was being amended while they derived some of their functions from that legislation. There were places where a person could get a roadworthy certificate without going to a test place. It was discouraging that the SABS and the NRCS seemed to have taken an approach which said as long as the Public Protector had not said anything directly to them, they would not do anything. It was regrettable that the NRCS and the SABS were not doing anything, because people were dying. There were MIBs that continued to illegally convert the vehicles and there were records of those up to 2019. The Sub-committee would be making its recommendations to the mother Committee. The Department was represented, they were fully aware of what was happening.

The Chairperson said that when they met the National Association of Automobile Manufacturers of South Africa (NAAMSA) the following week, it should be their last meeting, as they had agreed. They needed to start shaping their recommendations. The Committee Members should also look at the National Road Traffic Act Amendment Bill and see what amendments they could influence.

The meeting was adjourned.