National Land Transition Bill: discussion

Meeting report

TRANSPORT PORTFOLIO COMMITTEE; PUBLIC SERVICES SELECT COMMITTEE: JOINT MEETING
5 April 2000
PROVINCIAL RESPONSE TO NATIONAL LAND TRANSPORT TRANSITION BILL

Documents handed out:
Amendments proposed by the National Department of Transport

SUMMARY
Co-Chairpersons: Mr Marais (ANC Free State), Select Committee Chairperson; Mr J Cronin (ANC), Portfolio Committee Chairperson

After consulting with the provinces the Department has drafted a number of proposed amendments which were outlined to the committee. The negotiating mandates from the nine provinces indicate overall support for the Bill.

Kwa-Zulu Natal raised the following concerns:
- That government would have too much control over the taxi industry.
- The powers of the MEC would be reduced.
- The transport authorities were wrongly being turned into political structures. - The use of diesel instead of petrol.
- There would be job losses.
- Rail transport should be expanded on in the Bill.
- The training of taxi drivers.

Mpumalanga raised the following concerns:
- An all-inclusive solution should be found for the problems of cross-border permits and after hours permit issuing.
- What are the criteria for deciding the amount of the scrapping allowance?
- What incentives could be introduced to develop transport routes in rural areas?
- Civil servants should be excluded from participation in the taxi industry.

The North-West Province raised the following concerns:
- The financial implications of the recapitalisation process for provinces.
- The participation of permit-issuing staff in the taxi industry.
- The registration of taxi drivers in order to pay tax was raised
- The lift club phenomenon should be distinguished from the taxi industry.

The Northern Cape had a number of technical problems with the wording of the Bill. SALGA supports the Bill in general but the SALGA representative outlined a number of amendment proposals to the Bill.

MINUTES
Proposed amendments to the Bill by Department
Mr Harold Harvey, Deputy Director General: Department of Transport, outlined the proposed amendments to the Bill (see document ). The bulk of these proposals emerged from consultation with the provinces. The most critical amendments are as follows:
- The policy principles have been reinserted into the legislation.
- The Bill now enables the Minister to give funds to provinces and municipalities.
- There are motivations for the insertion of a new Clause 40A that will allow for a transition period before the legalisation process has to be completed.
- The new Clause 40A will relieve many of the administrative problems of the process.
- The concerns over funding for local government are dealt with in the Bill.

Provincial mandates
Eastern Cape
Mr Mahlalo, Chair of the Standing Committee of Transport, presented the mandate. The Eastern Cape has formulated an interim Bill on the basis of the national bill. After a briefing by the permanent delegates from the NCOP and the Department, the province had consulted with local authorities on the Bill. At this meeting a number of concerns were raised. However the province has decided to support the Bill.

Free State
Dr Nel (NNP) conveyed his province’s unreserved support for the Bill.

Gauteng
Ms Ndzanga (ANC) said that her province fully supports the Bill and did not recommend any amendments.

Kwazulu-Natal
Ms Thompson (ANC) said that no public hearings had been held in the province due to time constraints. Although the province supported the overall intent there were some minor concerns. One was that the Bill was allowing government to take over control of the taxi industry and this would result in over-regulation. In reply, Mr Harvey felt that an acceptable compromise had been made between over-regulation and adequate control by the government but accepted that whether or not the industry would be over-regulated should still be debated.

A second concern was that the Bill would reduce the regulating powers of the MEC. Mr Harvey’s response was that the powers of the MEC are framed in the Bill as adding texture and specific responsibilities to those vested in the MEC by the Constitution.

The province believes that the transport authorities are being turned into political structures in the Bill. The province was not in favour of political participation in the transport authority. Mr Harvey said that his reading of the Constitution was that the transport authority must be a political body since it has a political function. He cited the spending of public funds and policy making as two of these political functions.

The province was unhappy over the use of diesel and asked why petrol could not be used instead. Mr Sulliman (Northern Cape ANC) asked that it be noted that the Bill does not deal with the issue of diesel versus petrol and only in a minor way with recapitalisation.

The province feared that the implementation of the Bill would be accompanied by job losses. In addition, the province felt that rail, as part of transport, should be expanded on in the Bill. Mr Harvey had difficulty with this. He pointed out that the Department had an agreement not to have a detailed policy on rail. However, he pointed out that for the first time rail is subject to planning by local authorities and rail authorities are bound by this.

Their last point of concern was whether the training of taxi drivers was adequately covered in the Bill. Mr Harvey said that the Road Traffic Act provided for training and standards for drivers while the Bill also provided for capacity building.

Mpumalanga
Mr Mkhaliphi (ANC) said that public hearings had been held after the briefing by the Department. The relevant stakeholders in the province supported the broad aims of the Bill. However the province did have certain concerns. Cross border routes and permit issuing were regarded as being potentially problematic. The province wanted to know if Department officials would be available to issue permits at short notice or after hours and on weekends if the situation necessitated it.

According to Mr Harvey the problem of regulating cross border routes was an implementation question and options would have to be looked at by provincial registrars. Regarding special permissions, for instance where there has been a death in the family and a permit for transporting large numbers of people is needed on short notice, the Department could make some accommodation. Mr Harvey thought that in such a case the trip could be undertaken and the permission could be obtained afterwards.

The province was concerned about drivers who had no vehicle to exchange after five years - would they lose out on the scrapping allowance and any consequent earnings thereafter? Recapitalising the old taxis may not be possible. What are the criteria for deciding the amount of the scrapping allowance seeing there were so many models of taxis?

The province recommended that a 19-seater vehicles be used on short distance routes. In response, Mr Harvey referred to Part 9, Section 31(1) which states that the Minster may on notice restrict all new applications to only 18 seater, 35 seater and so forth. There is an industrial policy reason for this: to maintain economies of scale in the new purpose built market. The Department of Trade and Industry were of the view that the 2004 date from which permissions would be issued only for vehicles complying with S31 (1)(a)-(d) of the Bill should be brought forward although the Department of Transport would be suggesting an amendment allowing the Minister to exclude public transport from this provision. It is also a sustainability issue. Also, particular revenue is required to sustain the industry and the 18 seater is needed to raise that revenue.

Mpumalanga said that they want to see more incentives for transport to rural areas. Mr Harvey said that there was no planning for rural services given the limited resources of local authorities. However, the Bill would introduce certain infrastructures.

This province said that they strongly oppose civil servants and politicians having a stake in the transport industry. In response, Mr Harvey said that the Bill does exclude certain categories of civil servants from participation in the public transport service. But after consultations with the Department’s legal advisors it seems that it would be unconstitutional to have a general exclusion clause.

The province expressed the view that the Bill would lay the basis for the recapitalisation process. Mr Cronin, the Chairperson, said that recapitalisation and the Bill were to be seen more as parallel processes. However, members had to be wary that provisions in the Bill did not predetermine certain outcomes for the recapitalisation process. He was of the view that Sections 46 and 47, for instance, impeded subsidisation.

Mr Harvey disagreed, saying that there was nothing in the Bill preventing the subsidisation of rural services per se. Subsidisation of poorer areas is in line with government’s overall intentions. It would also lay a basis for the shifting of spending patterns.

Western Cape
Ms Ntwanambi (ANC) said her province had agreed to accept the Bill without amendments.

North-West
Mr Maloyi (ANC) said that public hearings had not been held due to the recess but that they would be held shortly. Their main concern was regarding recapitalisation and what would be the financial implications of vehicle replacements for the province? Would the government make money available for the process? Mr Harvey’s response was that financial implications had not been built into the Bill.

The province asserted that the Bill should specify that all persons dealing with permissions as well as their families should be excluded from the industry.
Mr Harvey said that staff dealing with permissions would not be permitted to own a taxi but it would be unconstitutional to exclude a mother or a spouse from owning one.

The province said that taxi drivers should be registered for tax purposes as a matter of urgency. Mr Harvey asked if this was not a task for the South African Revenue Services (SARS). Because the bulk of the industry is informal the SARS and SATACO (South African Taxi Council) are currently negotiating the issue of registering taxi drivers to pay tax. Mr Harvey preferred to leave the issue silent for now since he thought it would cause antagonism to the process if pushed.

The North-West province wanted to know if taxi drivers who opt to leave the industry would be paid the value of their vehicles or only the scrapping allowance? Mr Harvey said a market-related value would be paid out. However, he pointed out that in the context of the Bill the value evaporates after six months. Because you can no longer trade in permits, the Bill also destroys the value of the permit.

Another concern was how would lift clubs be protected from the regulation of the taxi industry? Mr Harvey said that if a lift club were required to register under the Bill it would definitely be overregulation. An important difference was that public transport is for gain while a lift club is merely aimed at sharing fuels expenses.

The province asked what the criteria are for declaring a vehicle old or new?
Further the province felt that the penalties in Clause 126(2) should complement each other. Mr Neville Dingell, legal adviser to the Department, said that there were two categories of offences in the Bill: those falling under Clause 126(2)(a), a more serious offence with a maximum penalty of R100 000, and those falling under Clause 126(2)(b), with a maximum penalty of R5000. The first category of offences could include operating without a permit although it was debatable which offences fell into which category. If no jail sentence was applied, then fines kicked in. The Bill did not specify which offences could necessitate a fine of R100 000 as opposed to R5000 and the difference was unclear. But Courts did not like the fines to be too specific.
The question regarding criteria for determining a new or old vehicle was not answered.

Northern Cape
Mr Sulliman (ANC) said that all relevant stakeholders in the province were present at the briefing by the Department. At a subsequent meeting it was decided to support the Bill. The proposed amendments would be taken back to the province and the final mandate would then follow.

Northern Province
Mr Mokoena (ANC) said his province had no fundamental changes to suggest except for a few technical details:
- Clause 12(3) in Part 5 referred to a ‘competent MEC’. The province suggested that the word ‘competent’ be replaced because it casts negativity on the MEC. Mr Harvey accepted the suggestion.
- Clause 13(2) gives the CEO of the transport authority powers to open a banking account in the name of the authority. They thought this should be reconsidered.
- Regarding provincial permission boards why was Clause 9 in Part 4 differentiated from Clause 62?

Mr Harvey said that Clause 9 was in the National Chapter of the Bill and Clause 62 in the Provincial Chapter. Clause 9 set out a minimum set of functions while Clause 62 was merely a stopgap measure. The province could change the functions set out in Clause 62 if necessary because all these functions were matters of provincial concern.

South African Local Government Association (SALGA)
In general SALGA accepts the Bill. Ms Surty elaborated on SALGA's concerns and suggestions for amendments.

Clause 15(1)(b) reads ‘the Minister may", and SALGA suggested that ‘must’ be substituted for ‘may’? The use of ‘may’ could lead to unfunded mandates. Mr Harvey said that funding allocations for the national government sphere of government was Parliament’s prerogative.

Regarding the planning issue, SALGA believed that transport planning had to be integrated with the integrated development plans of the municipalities. The Bill should be more specific about the link between the two. In response Mr Harvey referred the committee to Clause 18(1) in Part 7 that refers specifically to the integrated land process and municipal planning. He said that the economic efficiency of transport depends on the close management of service and planning therefore transport planning had to be part of the transport authority’s work.

SALGA wished to clarify how ‘municipal public transportation’ would be interpreted. Could it be defined as public transport owned or operated on behalf of the municipality? Mr Harvey agreed with this interpretation. He referred to the Labour Relation’s Act which has the same definition and is therefore a precedent.

SALGA suggested that in Clause 10(1) ‘must’ be substituted for ‘may’ as there could be problems if one sphere of government encroached on another. Mr Harvey said that he understood the suggestion to imply that the Bill should mandate the establishment of a transport authority. But this could only be voluntary. If it were to be mandated either revenue from national government would have to be mandated or local government would have to be allowed to raise their own revenue for transport. The Committee would have to deliberate on this matter. The constitutional principle that had to be upheld was that, to the extent that a function gets handed from a national to a local authority, funding must follow. Then the problem of unfunded mandates will be avoided.

Other suggestions made by SALGA were:
- Clause 10(3): could the language of the Bill not be made simpler? Here it could simply read ‘in order to improve service delivery’.
- Clause 10(6)(d): what does ‘cadastral’ mean and is there no simpler word that could be used in its place? Mr Harvey said that it is a legal term specifying the ways in which things are described in geographic terms. He was uncertain whether it could be substituted.
- Clause 10(6)(c): should ‘financial arrangements’ not also be inserted in this clause? According to Mr Harvey, financial arrangements are dealt with in another clause.
- Clause 10(8): this clause should be deleted because the municipality itself is already a juristic person. Mr Harvey had a different opinion on this matter. He said that if the clause was deleted many sections in the Bill would have to be rewritten.
- Clause 10(14)(c): what happens to the transport authority in the event of a Section 139 intervention because many municipalities are already in a state of collapse? Mr Harvey left this question open. He said that the transport authority is a separate legal entity from the local council but did this mean that the transport authority would be exempt from intervention?
- Clause 31(1)(d): why is there no upper limit on what is a bus? Mr Harvey’s response was that there are many different types of busses with different capacities. When analysed it becomes clear that the bulk of large capacity services is subsidised and would be no competition for busses with smaller capacities.

Other comments
Mr Sulliman (Northern Cape ANC) asked whether the words ‘to carry fewer than nine persons, excluding the driver’ in Clause 31(a) set out the criteria for motor vehicles seeing as the cars on the road these days are much smaller. Mr Harvey’s response was that certain rural areas might require this service and he cited the Venture van as this type of vehicle. Mr Sulliman added that the sentence should be reworded to make its meaning clearer.

Mr Suka (Eastern Cape ANC) added that it must not be read into the clause that if you use such a vehicle for the purpose ‘to carry fewer than nine persons’ that you can fill it to the maximum with people. The Road Traffic Act sets a certain standard.

The meeting was adjourned. Within the next few days the Department will be producing a document giving their written response to the concerns raised by the provinces. Members will now go back to their provinces to obtain their final mandates.