Marine Pollution (Prevention of Pollution from Ships) A/B: consideration of written submissions; RAF cost saving proposals; Meeting with SABRATA

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25 October 2022
Chairperson: Mr L Mangcu (ANC) (acting)
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Meeting Summary

Video (Part 1)

Video (Part 2)

In a virtual meeting, the Portfolio Committee on Transport received a briefing from the Association for the Protection of Road Accident Victims on cost-saving proposals for the Road Accident Fund. The Association identified five actions it claimed could save the Fund R500m per month. It also suggested establishing a road accident tribunal similar to the Commission for Conciliation, Mediation and Arbitration.

Members of the Committee welcomed the substantial and detailed suggestions. They asked the Association for more specific suggestions about what legislation could be amended to improve the functioning of the Fund, and whether it had interacted with the board or management of the Fund or participated in public hearings on the Road Accident Fund Act.

The Committee also received a briefing from the South African Bus Rapid Transport Association on section 41 of the National Land Transport Act. The Association argued that government had used this legislation to dismantle the taxi industry. More specifically, it objected to 12-year contracts for bus rapid transit (BRT) operators. It recommended repealing section 41 as it did not promote the envisioned transformation and empowerment.

Members of the Committee sympathised with the plight of some taxi operators who had lost out. They also discussed the details of the contracting arrangements between local governments and bus operators, pointing out that the contracts were negotiated between these two parties. They also noted that it would likely be impossible to make any changes to section 41 through the National Land Transport Amendment Bill because it was at such an advanced stage of parliamentary processing.


Meeting report

Committee programme planning
Ms Valerie Carelse, Committee Secretary, went through the organisations and people who had made written submissions on the Marine Pollution (Prevention of Pollution from Ships) Amendment Bill [B 5-2022]. She said that the public hearings on the Bill were scheduled for 15 November, but suggested bringing them forward to 8 November 2022.

Ms M Ramadwa (ANC) asked which provinces the written submissions had come from.

Ms Carelse replied that she would check this. She added that because it was a Section 76 Bill, there would be provincial public hearings when it was considered by the National Council of Provinces (NCOP).

Mr F Khumalo (ANC) asked whether changing the date of public hearings would affect the rest of the Committee’s programme.

The Chairperson said that the programme would not be affected.

The Committee agreed to hold the public hearings on 8 November 2022.

Briefing by the Association for the Protection of Road Accident Victims on cost-saving proposals for the Road Accident Fund
Mr Pieter de Bruyn, Chairperson, Association for the Protection of Road Accident Victims (APRAV), took the Committee through a brief history of the organisation, its analysis of the problems at the Road Accident Fund (RAF), and its cost-saving proposals. Five actions and the expected cost saving for each one were discussed:

- In-house lawyers who properly evaluate claims as soon as they are received: R220m per month;
- Improvements in Loss of Support guidelines and more realistic settlements: R100m per month;
- Experts’ fees better regulated by professional medical bodies: R50m per month;
- Timeous and effective settlement of claims: R150m per month; and
- Timeous payment of accounts: R20m per month.

Among other suggestions, APRAV proposed the creation of an RAF Tribunal similar in structure to the Commission for Conciliation, Mediation and Arbitration (CCMA).

(Please see presentation for further details)

Mr C Hunsinger (DA) thanked APRAV for its well-researched presentation. He noted APRAV’s suggestion to form a Tribunal and asked it to discuss the powers, roles and functions of the RAF board, Minister of Transport and claimants in the current framework. Were there any other Acts, such as the National Road Traffic Act, that APRAV felt could be amended to improve the functioning of the RAF? Were there any traffic regulations that should be moved into legislation?

Mr P Mey (FF+) also thanked APRAV for its presentation. He felt positive after hearing it.

Mr L McDonald (ANC) also thanked APRAV for its presentation. He asked whether APRAV had engaged with the RAF board and the management to discuss some of the issues. If so, what had the outcome been, and if not, why? He said that legal fees should be considered carefully because lawyers took most of the money to which claimants were entitled. This showed that the system was broken. Did APRAV have any ideas about the best way to deal with lump sum payments? There were instances where a beneficiary spent the entire sum very quickly and then became reliant on social benefits.

Ms Ramadwa also appreciated the presentation. She asked APRAV to explain what it meant when it described the move to the Road Accident Benefit Scheme (RABS) as ‘unlawful’. She noted the APRAV’s observation that most accidents happened in rural areas and asked what, if anything, APRAV had done to protect road accident victims in rural areas, given that one of its stated aims was to protect victims. Had APRAV had any interactions with the Department of Transport (DoT)?

Ms N Nolutshungu (EFF) asked if APRAV had participated in the public hearings on the RAF Bill and if not, why?

Mr de Bruyn said that the RAF was a very special agency. It facilitated the protection of rights for millions of people. There were elements in the RAF regulations that should be in the main RAF Act, such as the definition of an ‘accident without any other vehicle’, which had been formulated after the promulgation of the Act. There were also a number of matters in the regulations that dealt with the execution of the law, and these needed to be in the Act. He said there should be stronger parliamentary oversight of all agencies, particularly on the RAF. APRAV had made submissions on the RABS Bill and it had attended public hearings in all provinces. APRAV hoped to support the Committee to balance the different spheres of government, because insight and effective oversight were needed to ensure that the RAF dealt with large sums of money very cautiously. A presentation on this has been done and could be provided to the Committee. He noted that making regulations were the domain of the Minister and the Department, while Parliament’s role was to make laws that the Department executed. Unfortunately, there were currently rules and regulations that were not fully aligned with the law. The RAF Act was connected to many other laws, such as the Fuel Levy Act and the Public Finance Management Act (PFMA). It was linked not only with regulating the RAF itself but also with regulating public hospitals and medical aid. It seemed complicated, but in fact, there were only five or six things that would have to change. Whatever solution was found for the RAF should be applied to all agencies where billions of rands of taxpayer money were involved. The last amendment in 2008, in terms of general damages, had not had the expected cost-saving effect.

Mr de Bruyn said that APRAV had interacted with the RAF in a qualified sense. Some individuals had interacted informally and personally with senior members of the RAF, but it did seem as if the RAF had never fully engaged with its views, opinions and resources. APRAV had been knocking on the door but had not been invited in. It had reached out to multiple ministers, chief executive officers and portfolio committee members. APRAV had been saying that it would help to fix RAF. He noted that there were lots of regulations around legal fees but also a lot of misinformation. There was a need to reconsider the cost of different services such as legal advisors and medical experts, but it would not help to limit attorneys’ fees, for example, because attorneys were only involved in 5% of RAF claim cases. The approach to legal fees should concentrate not only on these big-money cases but also on the other 95% in which legal fees were relatively low.

Mr de Bruyn noted that according to the RAF Act, a road accident victim should be put in a position as if the accident never happened. It took 55 months or longer on average to settle a claim. During this time, the person might lose his house, his spouse and so forth. Lump sums were given to allow a person to catch up with his or her life. It was a technical question of whether a person should receive a lump sum or not in a particular case. There should be careful consideration of how benefits are allocated and whether it is in the interest of the public.

Mr de Bruyn explained that APRAV was not arguing that the RABS Bill was unlawful. It meant that the DoT and the RAF had started preparing for the RABS Bill before Parliament had approved the Act. Jobs had been created and people appointed. There had been multimillion rand advertisement campaigns and internal memos. But it was for Parliament, not the RAF, to pass or not pass the Bill. APRAV was interacting with other non-profit organisations such as Arrive Alive and the Human Rights Watch in Parliament to try and protect road accident victims. Unfortunately, APRAV did not have the billions available to the national government to run campaigns or put up billboards. APRAV’s Professor Hennie Klopper had developed a draft national framework for road safety that could be shared with the Committee and the Department. APRAV had a wealth of insight, knowledge and energy to share with the Committee, the Ministry and RAF. He did not know who to give this information to because people did not seem interested.

Further discussion
The Chairperson assured Mr de Bruyn that the Committee was interested in what APRAV had to say. He noted that APRAV had made mention of the frivolous litigation concerning the Auditor-General of South Africa (AGSA) and the RAF that had been in the newspapers. Could APRAV comment on this?

Mr de Bruyn replied the most important APRAV had been trying to make was that it was not in the public interest to try and exclude medical aids completely from reclaiming legitimate costs incurred after treating a road accident victim in a hospital. The size of the claim could be debated, however. The frivolous litigation referred to was the RAF’s tendency to fight even small claims in court. This resulted in R50 000 claims, for example, becoming R100 000 claims when judges awarded costs against the RAF.

The Chairperson thanked Mr de Bruyn for the succinct response. He said that the Committee would apply its mind to what had been presented to try and find practical solutions. He appreciated the fact that APRAV had offered solutions as well as identified problems.

Briefing by the South African Bus Rapid Transit Association on section 41 of the National Land Transport Act (2009)
Mr Andile Peter, Chairperson, South African Bus Rapid Transport Association (SABRATA), explained that SABRATA was a voluntary association formed in 2020 to protect the interests of bus rapid transit (BRT) operators, allied organisations and commuters. Among its members were eight BRT companies. The Association was of the view that section 41 of the National Land Transport Act (NLTA) was an instrument to disempower and ultimately dispossess black people in the transport industry. 

Mr Sam Matebane, SABRATA, outlined the history of BRT in South Africa, which began with preparations for the 2010 Soccer World Cup. The past few years have seen a push-back against BRT, with increased subsidies for other public transport sectors and no clear plan for supporting the taxi industry. He said that section 41 of the NLTA was at odds with the objectives of the BRT system. This section required bus operating companies (BOCs) that opted into the BRT system to sign 12-year contracts. SABRATA and representatives of the taxi industry believed that government had used this legislation to dismantle the taxi industry. The Association supported the proposed addition of section 41A, which would provide for stopgap contracts of up to three years to be signed while negotiations were underway, and noted the Competition Commission’s recommendation that the 12-year contracts be renewed without tender. SABRATA recommended repealing section 41 as it did not promote the envisioned transformation and empowerment.

(Please see the presentation for more details)

Ms Nolutshungu welcomed the presentation and sympathised with SABRATA. She said that without the taxi industry, many people would never have been able to travel over the past two years, during which the rail industry had been dysfunctional. The EFF would look at how the interests of operators could be accommodated in the amendments to section 41. SABRATA raised an important point about the inability of small, new companies to compete with large, well-established companies.

Mr T Mabhena (DA) said that according to his understanding of the BRT model, BOCs would be formed by amalgamating the taxi operators in a certain area and then the BOC would be given a 12-year contract. During this contract period, the BOC would be actively supported by government, which therefore took on a considerable portion of the risk involved. SABRATA, as he understood its argument, wanted government support to continue beyond the 12-year period. How many of SABRATA’s member companies have managed to become self-sustaining commercial operations? Would they be able to continue operating and expanding without government support? He observed that the memorandums of understanding (MOUs) between taxi and BRT operators were sometimes ignored. It was often the case that taxis continued to operate in areas set aside for buses in terms of the MOU. Notwithstanding these circumstances, he said that the Committee was sympathetic to operators, and admitted that government had not done much to support the taxi industry over the last few years.

Mr K Sithole (IFP) asked for clarity about an agreement between the taxi industry and the government, according to which government was going to train taxi drivers to drive the buses. How far was this agreement? SABRATA had raised important issues. Had it met with the Minister or other representatives of the DoT? He sympathised with SABRATA because the taxi industry was in a crisis.

Mr Hunsinger said that when the 12-year contracts were reviewed, the constitutional principle of the separation of powers and the delegated authority to provide a public BRT transport service must be kept in mind. He pointed out that the 12-year contracts were negotiated contracts, implying that the content was agreed to by the parties of the contract. He understood the frustrations of SABRATA and had his own issues with the National Land Transport Amendment Bill. He asked SABRATA to clarify what it meant by saying that ‘BRT has failed to deliver a subsidy-free public transport system in record time’. Had SABRATA made any submissions on the National Land Transport Amendment Bill during the six years it had been under consideration by Parliament? What was its expectation of the Committee at this late stage?

Ms Ramadwa asked whether SABRATA had achieved success in terms of transformation among its members. The Committee could not take decisions without knowing what had actually been achieved.

Mr Peter recalled that when the BRT concept had been introduced to the taxi industry, there had been a promise that it would not disempower taxi operators. However, when it had been implemented, it became clear that it was not going in the intended direction. Taxi operators had taken legal action against municipalities in this regard and had won arbitration awards. There was indeed a challenge when municipalities did not assist with the transformational agenda. SABRATA was frustrated because it had tried its level best to set up meetings, but there had still been no meeting with the Minister yet. A promised meeting with Pioneer Transport (PioTrans) and the City of Johannesburg (CoJ) was still not held. There was also no national framework in terms of the BRT. Instead, each city used its own format of negotiation. In Johannesburg, for example, the CoJ had only bought buses in the eleventh year of the 12-year contract. The benefits of BRT were not going to those for whom they were intended. Instead, they had gone to consultants and infrastructure providers. He argued that, in Cape Town, some taxi operators had been against the BRT system and had not signed agreements. They continued to operate on bus routes because the bus capacity was insufficient during peak hours. He said that there was room for both buses and taxis. There were also double standards being maintained in Cape Town in the relative treatment of taxi operators and Golden Arrow Bus Services (GABS). GABS owned 25% of the BRT company but did not have to give up any permits or vehicles, like the taxi operators, and still received subsidies. SABRATA wanted government to put a moratorium on the tender process for renewing the 12-year contracts. Although the contracts had been negotiated, it had not been thoroughly explained that the contracts would be put out to tender after 12 years. No other companies had a lifespan of 12 years. In other countries, it would be 25-30 years. Transformation in this country could not happen if people were not put in charge of navigating the transformation agenda.

Ms Noma Memani, Chairperson of the board, PioTrans, said that negotiations between PioTrans and the CoJ had started in 2007, long before the introduction of the National Land Transport Amendment Bill. More recently, PioTrans had been robbed of its aspirations. It had been formed in 2009 in preparation for the 2010 World Cup, and it had bought its own buses. Parts of the BOC agreement with CoJ had not been fulfilled, and PioTrans was calling on CoJ to meet with it to resolve the issues.

Mr Matebane said that a subsidy-free transport system was the intended purpose of the BRT when it was first implemented. The delays in the implementation and the changes to the value chain had made this impossible. He hoped that the government would still want to see a subsidy-free transport system, given concerns about the price of government. He said that SABRATA had not made any earlier submissions on the National Land Transport Amendment Act because it had only been formed in 2020, but individual bus operators had done so. 

A SABRATA representative said there had been interactions with the CoJ, such as written letters. People who had surrendered permits and vehicles as part of BRT agreements were unquestionably worse off now. He reiterated that SABRATA was calling for the tender process to be put on hold.

Further discussion
Ms Ramadwa understood that the National Land Transport Amendment Bill had been sent back to Parliament for the reconsideration of clause 7 only, as this was the clause that the President had expressed reservations about in terms of its constitutionality. No other amendments, for example, to section 41 of the Act, could be considered.

The Chairperson said that the passion of SABRATA was obvious and assured it that the Committee sympathised with it. There was indeed a lack of a national framework, but the separation of powers of national and provincial government was something that had to be protected. The Committee had listened and would decide how best to respond. He also suggested that SABRATA engage with the Department of Transport. The Committee, meanwhile, had to apply its mind and see where it would be able to intervene. He stressed that Members should try to engage with matters before them as a Committee and not as a political parties. Section 41 could be interpreted differently, and the Committee would like to look at the issues raised in a broader scheme of things. The Department of Transport might not have engaged with SABRATA but reasons for such might be provided.

Mr Peter asked the Committee to consider the NLTA in light of section 36 of the Constitution and the Bill of Rights.

Further Committee business
The Chairperson said that once the Committee had reached consensus on the matters raised by APRAV and SABRATA, such as whether section 41 actually did protect the industry as intended, its decision would be communicated. This would take some time. A chance for the entities that had not yet presented their annual reports to the Committee (the RAF, Driving License Card Account (DLCA) and the Road Traffic Infringement Agency (RTIA)) should be put into the programme.

Mr Hunsinger said that the substantive and well-researched suggestions by APRAV on how the RAF could save R500m per month, and on regulations that should be moved into legislation had stood out. The Committee should obtain the background research that had informed APRAV’s suggestions and it should be studied by the Committee researchers. SABRATA provided valuable insight that was rather embarrassing and frustrating for the Committee because it pointed to yet more aspects of the National Land Transport Amendment Bill that it had not properly considered. He suggested that the Committee provide SABRATA with an update on the processing of the Bill.

Mr Sithole said that the submission by SABRATA was an eye-opener. It has raised issues that were not considered before.

The Chairperson agreed that both APRAV and SABRATA had provided valuable information to the Committee. He asked the Committee researchers to provide a report on the matters raised within two weeks.

The meeting was adjourned.


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