National Land Transport Transition Draft Bill: briefing

Meeting report

TRANSPORT PORTFOLIO COMMITTEE
14 September 1999
NATIONAL LAND TRANSPORT TRANSITIONAL DRAFT BILL; TAXI RECAPTILISATION: BRIEFING

Documents handed out:
Overview of National Land Transport Transitional Draft Bill (attached to end of minutes)

SUMMARY
The National Land and Transport Transitional Draft Bill was presented. Time did not allow the committee to be briefed on the issue of Taxi Recapitalisation. However, the Chair did clarify the issue further by informing committee members that this initiative has not been consolidated as yet. He understands the urgency of this issue and it will be discussed within a fortnight. Mr J Cronin was elected as parliamentary representative on the Road Accident Fund Board.

MINUTES
Road Accident Fund Board nomination
The Chair, Mr J Cronin (ANC), circulated a letter received from the Minister of Transport, Dr Dullah Omar, urgently requesting the Transport Portfolio Committee elect a member onto the Road Accident Fund Board. The current board has run its course which was a three year period. Thus with no delay the chair moved into the nomination and selection procedures. Mr A Ainslie (ANC) nominated Mr J Cronin (the chair), seconded by Ms N Hlangwana (ANC) with no objections.

National Land and Transport Transitional Draft Bill
Mr Harold Harvey (Senior General Manager: Policy, Strategy & Implementation) and Ms Antoinette Nothnagel (Manager: Public Transport Implementation) from the Department briefed the committee on the draft National Land Transport Transitional Bill.

Mr Harvey noted that name of the Bill has changed as the term "Transitional" has been included. He sketched the background to the Bill. In 1994 the Department was confronted with the public transport sector in great disarray. Metrorail was operating at a deficit and Government had to cover the losses plus there was rampant violence in the taxi industry. This violence had its roots in the deregulation of the industry in the early 1980s and the absence of a strategic approach to the granting of permits.

Faced with such problems, the previous Minister of Transport had motivated in 1995 that key principles be established in the White Paper on National Transport Policy (August 1996) to bring the various restructuring processes together into an integrated and truly public transport system. The needs of the community would be taken as the platform for planning.

Questions
1. Mr Rockman (ANC) asked how the Department of Transport will ensure that all role-players in the process are reasonably satisfied. Will a process of self-policing be operating since these role-players will have to go out and support this initiative. Secondly, he also questioned the effectiveness of the permission system which is to replace the permit system. He raised the point that due to the five-year period of this permission system, banks refuse to grant the large volumes of finance needed to sustain the taxi business. Mr Rockman felt that such a limited period hindered the success of loan applicants and defeats the whole purpose of empowerment.
2. Ms N Hlangwana (ANC) was concerned that in rural areas the emerging black bus owners, who have to rise early in the morning to take commuters to their individual destinations, then return with empty buses. She questioned their survival after five years if they have to compete with big business when tendering.
3. Rev Meshoe ( ADDP) asked with regard to the principle of national policy and the fact that members of the board have to be impartial, whether this included immediate family. Secondly, with regards to policy responses, if MEC and Minister disagree, whose decision will take precedence.
4. The last question raised was on the issue of planning a separate bill for rail transport. Does this mean that there will be separate bills?

Answers
1. The period of permission had been discussed and proposals were made that with the conversion the period remain the same, but this was opposed by provinces who supported the move to a five-year period. Consensus was obtained therefore the department has deferred to that. As far as the development track is concerned, Mr Harvey believes that a regulatory environment would enable a developmental agenda. As far as taxi recapitalisation is concerned it will be based on negotiated contracts but he acknowledged that not much has been done in this area. "It might difficult ", he conceded.
2. As far as the full and empty issue is concerned, it is a South African story. However by promoting integrating planning, increased density in certain routes and mixed land use, this problem should be dealt with effectively. For it has occurred to the department that a transport issue that has been omitted is the issue of commuters being geographically specific- moving between certain points only. In Gauteng, a specific structured approach is taken which promotes appropriate commuter assistance whereby clear efforts is made to seek those views that may not be viewed as important by the department through public comments. Antoinette pointed out that a process of public hearing is currently being facilitated for a month through a process of informal hearings, road shows and 9 provincial workshops.

3. The issue of impartiality of the members of the Board has been raised with the drafting committee. Through a process of discussion, no relatives were permitted. With regard to policy responses, it must be in the provincial sphere in conjunction with National.

4. The Bill fundamentally affects rail, however the department is currently focussing on the taxi industry. As for the omission of rail or the drafting of a separate bill is concerned, this sector of the transport department is still in transition and national rail issues still need to be restructured. Due to limited capacity, the department does not want to exhaust its resources. Therefore the department postponed any further intervention in this area.

Further questions
1. Mr Ainslie ask for a definition of vested interest.
2. The Chair commented that local government is the weakest link with regard to resources and he does understand that this proposed Bill will be a phasing-in process. However he cannot help wonder how it will be implemented with effective resourcing without it quickly crumbling at local government level.
3. Mr J Slabbert (IFP) asked if there is a possibility that all road freight might go back to rail for the big lorries are ruining South Africa's roads.

Answers
1. Mr Harvey pointed out that a heated debate has taken place around this issue of a definition for "vested interest" but ultimately consensus was obtained from both national and provincial government. However he did not provide the Portfolio Committee with a definition.
2. Due to time constraints Mr Harvey failed to respond to this question. However the Chair agreed that a second briefing session needs to be scheduled.
3. Mr Harvey claimed that currently road freight is competing with rail. But heavy regulation will permit such a change. As for managing rail and road separately, such a decision will not be good for transport. There is no easy answer.

Chair interupted at this point to propose that a second session should be scheduled to debate the rail vs road issue.

Further questions
1. Rural areas: The public transport sector is run by individual operators, their buses are old. Will the Department finance new vehicles to help those in rural areas.
2. Registration and Associations: When registering will associations register together with its members or as an organisation. And will all vehicles that are owned by the association be accounted for?

Answers
1. Mr Harvey acknowledged that the public transport sector is faced with a crisis. Since vehicles are rapidly deteriorating. Taking into consideration that the average age for rail carriages are 25 years, buses 13 years and taxis 9 years. He claims that the financing of vehicles is currently being discussed.
2. Associations have to declare all members and all vehicles to register finally. Physical checks and legal checks are also conducted to reduce the chances of stolen vehicles being registered.

The chair adjourned the meeting.

Appendix 1:
NATIONAL LAND TRANSPORT TRANSITION BILL, 1999
National Department of Transport
July 1999

Process leading up to the NLTTB
- White Paper principles were translated since 1997 into a draft NLTB.
- During 1998 the DCD initiated a series of local government legislation. This required that the NLTB and local government legislation would have to be moved simultaneously.
- In late 1998 it became clear that local government legislation timetables were behind.
- The demarcation process and the looming LG elections required urgent LT legislation so as not to lose 3 years in laying the key institutional platforms.

Process leading up to the NLTTB
- January 1999 a draft NLTTB published
- February 1999 Mincom blocks the legislation for current term, but mandates process for first session of next parliament.
- This NLTTB is the product of an Inter-governmental drafting team made up of NDoT, Gauteng, W. Cape, KZN, Northern Province, and Cape Town, Pretoria, PE, East London and Durban local authorities.
- COLTO has approved the current draft and recommends approval by Mincom.

REASONS FOR THE NLTTB
To enable:
Proper structuring of land transport planning
Establishment of appropriate institutional structures
Formalization and restructuring of the public transport industry and services
- prioritize public transport
- permissions based on transport plans
- regulated competition
- formalized environment for minibus-taxi operations
basis for long term system

STRUCTURE OF THE NLTTB
CHAPTER 1: Introductory matters
CHAPTER 2: Matters of National concern
CHAPTER 3: Matters of Provincial concern
CHAPTER 4: General matters

Scope of the Bill
No current legislation will be repealed

Chapter 2 prescribes policies, principles, requirements, guidelines, frameworks, norms & standards that must be the same for all provinces and will take precedence in case of conflict

Chapter 3 provisions assist Provinces without adequate legislation & may be repealed by provincial legislation. Provincial laws will take precedence on issues dealt with in Chapter 3

SCOPE OF THE BILL
- Institutional structures
- Planning
- Public transport
- Regulation & enforcement
- Impacts on:
Tourism
Freight

Pillars of the Bill
[Graphs not included]

PRINCIPLES OF NATIONAL POLICY
Co-ordination of institutional structures
Integrated planning
Priority to public transport & customer needs
Promote modal integration
User-charges & cost recovery
Optimal use of resources
Sustainable investment
Address needs of special categories of passengers
Effective transport law enforcement
Training and development
Public participation
Integrated information systems

PRINCIPLES OF NATIONAL POLICY (cont)
Impartiality :
Members of Permissions Boards
Staff of Boards directly involved
Members of Appeal Boards
Officials of PA’s - developing permissions strategy
Officials - transport law enforcement
Registrar

FUNCTIONS OF THE MINISTER
Making of policy
Monitoring implementation of policy
Preparing a NLT Strategic Framework
Making regulations on Chapter 2-issues
Monitoring the utilization of funds
Establishing an information system
Introducing a research program
Guiding education and training

FUNCTIONS OF THE MEC’s
Functions assigned by Constitution to Provinces, plus
Making of policy
Monitoring implementation of policy
Monitoring the utilization of funds
Assisting planning authorities
Preparing a Provincial LT-framework
Ensuring co-ordination between PA’s
Making regulations on Chapter 3-issues

INSTITUTIONAL STRUCTURES
[Diagram not included]

TRANSPORT AREAS
[Diagram not included]

ESTABLISHMENT OF TRANSPORT AUTHORITIES
Juristic person not subject to liquidation
Written agreement between MEC and municipality
Consent not to withhold unreasonably
MEC to publish founding agreement
Disestablish MTA’s if applicable

COMPULSORY FUNCTIONS OF TA’S
Must:
- Prepare transport plans
- Develop transport policy
- Perform financial planning
- Manage movement of persons & goods
- Promote public participation
Must by a date determined by the Minister in consultation with the MEC:
- perform transport contracting function

FUNCTIONS OF TA’S (cont)
- Wide rage of optional functions in Provincial Chapter
- Optional functions can be added to by Provincial legislation

TRANSPORT EXECUTIVES
Technical and administrative personnel
- Municipal administration
- One or more municipal departments
- Separate body
- Province

BOUNDARIES OF TA’S
Determined by:
- dominant passenger movements
- economic inter-dependency between inhabitants
- integrated land use and transport development potential
- extent of public transport services
- physical characteristics
- other criteria - provincial legislation
MEC to consult MECs for Local Gov’t & Finance
Provision is made for cross-provincial TA’s and agreements between the relevant MEC’s

FINANCES OF TA’S
Management of finances of TA’s prescribed - similar to the Local Government Transitional Act

PROVINCIAL PERMISSIONS BOARDS
An Independent body
A single Board to be establish + administrative offices in regions if required
TA can establish a Board for T/Area only if all compulsory functions are taken-over & capabilities are demonstrated
To receive, consider and decide upon
- new applications
- renewals, amendments or transfers
- conversions
Procedures to be prescribed by MEC

PROVINCIAL REGISTRARS
One Registrar per Province
Provincial Transport Registrar - interim only taxi functions
Panel of Assessors
Not part of impartiality provision in National Principles
Provided for disclosure of interest

FUNCTIONS OF PROVINCIAL REGISTRARS
Disposing of applications
Monitoring compliance
Promote professional practices
Suspension & cancellation
Establish & maintain Provincial Register
Report annually to MEC

APPEAL BODIES
National Transport Appeal Tribunal (TAT-Act)
- handles inter provincial and cross border appeals and intra provincial in absence of Provincial Appeal Body
Provincial Appeal Body

PLANNING
[Diagram not included]

REGULATED COMPETITION
SERVICES TO BE PROVIDED ITO:
- subsidised service contracts
- negotiated service contracts
- commercial service contracts
- permissions only

REGULATED COMPETITION
All subsidized services » subsidized service contracts or
Negotiated contracts only when:
- parastatal or municipal service busy with restructuring and
- once off between interim (current) & tendered contracts and
- SMME-development

REGULATED COMPETITION
CONTRACTING AUTHORITIES
- Provinces
- TA’s

REGULATED COMPETITION (cont)
Qualifying as a tenderer:
- operate on business principles with financial ringfencing
- business conducted separately with separate accounting records
- financially sustainable and no unfair financial advantage
- registered as a tax payer
- Minibus-taxis - registered

RAIL SAFETY REGULATOR
Deleted from NLTTB
Will be published with other rail related legislation

LAW ENFORCEMENT
Success of implementation of NLTTB depends on effective law enforcement
To link transport law enforcement with other law enforcement agencies, such as Cross Border, traffic and municipal police
To link with AARTO (Def of operator)

LAW ENFORCEMENT
Offences & penalties
- The Bill provides a list of offences & penalties
MEC may appoint inspectors
- The Bill provides a list of powers

INSTITUTIONAL STRUCTURES
Transport Authorities (Planning Authorities)
Provincial Permissions Board
Provincial Taxi Registrars
Provincial Transport Appeal body
Transport Appeal Tribunal *

FOUNDING AGREEMENT FOR TA’S
Participants
Governing body, consisting of councillors only
Operational and procedural arrangements
Cadastral description
Additional issues prescribed in Chapter 3
Minister to publish a pro-forma agreement

OPTIONAL FUNCTIONS OF TA’S
Promote security on public transport
Develop & maintain information system in collaboration with MEC
Make recommendations to the P/Permissions Board
Promote public transport
Introduce integrated ticketing systems
Control service delivery

OPTIONAL FUNCTIONS OF TA’S (cont)
Provide information to users
Determine fare levels for subsidised & unsubsidised services
Conduct investigations
Marketing
Make payments to operators for subsidised service contracts
Municipal roads (in agreement with LA’s)

SEQUENCE OF PLANNING
[Diagram not included]

NATIONAL LAND TRANSPORT STRATEGIC FRAMEWORK
To be done annually by Minister
Content:
- Policy
- Strategies re co-ordination of three spheres, freight, rail, national roads, tourism, environment, land-use restructuring, inter-provincial transport
- conflict resolution mechanisms
- KPI’s

PROVINCIAL LAND TRANSPORT FRAMEWORK
To be done annually by MEC (initially and subsequent)
Initial Framework
- Overall framework for local planning
Subsequent Framework
Submitted to Minister for noting

PROVINCIAL LAND TRANSPORT FRAMEWORK
Subsequent Frameworks
- Summary of local plans
- Co-ordination of local planning
- Budget
- Conflict resolution
- Strategy re special passengers & learners
- Strategy re movement of dangerous goods
- Detail re inter- and intra-provincial long distance passenger services
- KPI’s

CURRENT PUBLIC TRANSPORT RECORD
To be done annually by all Planning Authorities (METS update & other PA’s new)
Done either on its own or part of its PTP
Content:
- Status quo of public transport services, facilities and usage
To be submitted to MEC for noting

PERMISSION STRATEGIES
To be done annually by every Planning Authority
Done either on its own or part of its PTP
Content:
- Information re road based modes and services to provide guidance to Permissions Boards in disposing of applications for permissions
To be submitted to MEC for noting and approval of policies, procedures, financial issues impacting on Province and cross PA boundary & provincial cross border transport

RATIONALISATION PLAN
To be done annually by every Planning Authority that has subsidised service contracts or concessions
Done either on its own or part of its PTP
Content:
- Information re subsidised modes and services to rationalise and optimise service and minimise subsidy prior to going out to tender
To be submitted to MEC for approval

PUBLIC TRANSPORT PLAN
To be done annually by every Planning Authority that has public transport (subsidised & non-subsidised) services
Content:
- CPTR, Permission Strategy, Rationalisation Plan
- Needs of learners and special passengers
- Vision, goals and objectives
- Modal integration proposals

To be submitted to MEC for approval

INTEGRATED TRANSPORT PLAN
To be done annually by TA’s, core cities and specific municipalities required by MEC
Content:
- PTP but linked to IDP (land-use)
- Policy & strategies
- Budget and funding sources
- TDM-strategies
- Plan re movement of dangerous goods
- Proposed projects (all modes and infrastructure)
To be submitted to MEC approval

PUBLICATION OF PLANS
Notices of prescribed particulars to be published for:
- Public Transport Plan
- Integrated Transport Plan
- Provincial Land Transport Framework
- National Land Transport Strategic Framework

CHANGES IN LAND-USE AND PUBLIC TRANSPORT SERVICES
All persons and institutions are bound by the plans (excl CPTR and permission strategy)

Not only intensification of land use also disinvestment decisions

APPLICATION OF PERMISSIONS
Permission pre-requisite to operate
Permission not a right
Permit to be converted to permission
New permissions - 5 year validity
Disposals ito transport plans
Requirements and disqualifications
Notice of applications

APPLICATION OF PERMISSIONS (cont)
Permissions for contracted services
Duties of the holder of a permission
Permissions Board to which applications must be made
- Province in which operate
- >2 Provinces - origin
- renewal, amendment or transfer
- original Province

PERMISSIONS: Definitions of vehicles
Motor car 1 - 8
Mini-bus 9 - 18
Midi-bus 19 - 35
Bus >35

CONVERSION OF PERMISSIONS
Same authority as for old permit
Done before a date prescribed by Minister
Manner to be prescribed by MEC
To larger vehicles - published in Provincial Gazette

CONVERSION OF PERMITS
Type of permit Converted to:
Radius or area Route or network based
Metered taxi Particular area
Long Distance Specify routes and ranks
Minibus-taxi Vehicle up to 35 seats
"4 + 1" Vehicle 9 – 18
Vehicle up to 35
Indefinite period Indefinite period except where converted to
A larger vehicle
Definite period Same period

PERMISSIONS
Normal disposal procedures
Cancellation of permission - not in use
Uniform information on permission
Contents of permission
Duties of the permission holder
Registration - prerequisite for permission
Restriction of the use of same vehicle for long distance & commuter services:
- not allowed where it will be detrimental to the provision of commuter services
- only allowed with consent of P/A
Rationalization: withdrawal of permissions
- Non-contracted services: offer permit holder alternative service
- If not, apply to Board for withdrawal
- To pay compensation based on guidelines issued by MEC

PROCESS OF DISPOSAL OF APPLICATIONS FOR PERMISSIONS
[Diagram not included]

REGISTRATION
Establishment of National Transport Register
Info re associations, members & vehicles
Database - monitoring implementation
Sensitivity of information
In one Province only - where association is based
Registration ito Provincial legislation = provisionally registered
Full registration only when all members have permissions
Uniform info on certificates & marks
Constitution & Code of Conduct - prescribed by Minister in consultation with MECs

BENEFITS OF REGISTRATION
Economic assistance
Tender for contracts

REGISTRATION PROCESS
[Diagram not included]

REGULATED COMPETITION
TA not to operate a transport service
No contract between a municipality and any TA to operate a service unless ring-fenced

LAW ENFORCEMENT
Impoundment of vehicles
- Bill provides for circumstances of impoundment pending an investigation
- Such vehicles to be taken to a depot as established by the MEC

GENERAL
Transitional provisions
- conviction under previous law = conviction in terms of this Act be regarded as conviction committed i.t.o this Act
- distinguishing mark = valid i.t.o this Act until permit is converted, withdrawn or cancelled