National Land Transport Transition Bill: discussion

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17 May 2000
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Meeting Summary

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Meeting report

17 May 2000

Documents handed out:
National Land Transport Transition Bill [B5B-2000]

The National Land Transport Transition Bill was formally voted on and there was no opposition to the Bill nor to the amendments made by the National Council of Provinces. The Democratic Party was concerned about the lack of representivity in the Transport Authority as it is constituted as a political body with no stakeholder representation. The department believes that this allows its functions and the use of public funds to be carefully monitored. There were various arguments opposing the inclusion of specific vehicle sizes, namely 18 to 35 seaters, in Clause 31 but all parties agreed to accept the clause without amendments.

The Chair, Mr Cronin, read the motion of desirability and it was seconded by Mr Louw (ANC). The Chair then read through the Bill clause by clause. No amendments were proposed although members did elicit explanations from the Department over certain clauses in the Bill. That discussion follows here.

Questions and Discussion
Clause 10(10):
Mr Farrow (DP) referred to Clause 10(10) and asked for a debate on the representation and structure of a Transport Authority. [In terms of Clause 10(10) the governing body of the Transport Authority, which governs and controls the authority, is made up of councillors of the constituent municipality or municipalities]. He is of the view that the industry must be run by the operators themselves. In terms of the Bill however, representivity is controlled by the municipality. Mr Farrow wants the Bill to be specific about representivity.

Mr Harald Harvey, Deputy Director General: Transport, said this issue has been the subject of lengthy debate. There were two models of representation: a model used in the United Kingdom in terms of which there is stakeholder representation on the body and the alternative model where the body is made up of political figures only. A previous version of the Bill adopted the UK model but the Bill has subsequently adopted the latter model, which excludes outside representation on the Transport Authority. The aim of this move has been to ensure consistency with municipal legislation and funding procedures. The Transport Authority will be a creature of local government and it is necessary for it to be a political body so that there can be oversight over the use of funds and other functions. Furthermore, having operators on this body would go against the White Paper principle of separating executive and regulatory functions. The Department of Finance had also expressed their opposition to the Transport Authority being a non-political body.

Mr Farrow (DP) responded to Mr Harvey's explanation by asking whether the reasons for not allowing more representivity was purely financial? Mr Harvey said there had been discussions with the Treasury on this matter but it was more a matter of preventing transport authorities from performing functions outside the scope of their budget and a means of regulating the use of public funds. He reasoned that there are other mechanisms to get expertise onto the Transport Authority.

Mr Farrow (DP) pressed the point that he was unhappy with sole representivity. Why could another body such as organised business not be represented? If the Transport Authority was going to be involved in planning and tendering processes all bias would be removed if there was broader representivity.

Mr Harvey cautioned that there should not be confusion over decisions regarding permits and procurement. The operating licence board makes decisions on permits and procurement is done through the creation of tender boards and so forth. Mr Harvey added that the South African Commuter Organisation had made strong representations to have a representative on the Transport Authority. The problem was that this is the only commuter organisation and it is not recognised all over the country.

Mr Slabbert (IFP) commented that all councillors are subjected to a code of conduct, which will regulate their actions.

The Chair, Mr Cronin, thought that Mr Farrow's concerns were fair. Mr Harvey addressed these concerns by outlining the entire institutional structure created by the Bill. There are three bodies who perform executive functions. Thee Transport Authority, will have five mandatory functions [in terms of Clause 10(13)], which includes transport planning and financial planning functions. These are all functions of government. In respect of the taxi industry, the Transport Authority will map out the routes and the capacity on each route. Businesses will then bid for the right to operate on that route. The decision whether or not to issue a permit will be made by the Public Transport Licensing Board [formerly the Permissions Board]. Although the Licensing Board is advised by the Transport Authority on the capacity on routes, the Transport Authority has no role in issuing permits. There are also appeal mechanisms, the Transport Appeal Tribunal and the Provincial Transport Appeal Body.

The Transport Authority's role is that of government, it integrates transport management in total. The execution of its acts is done through the Transport Executive while the Board makes the decisions. Mr Harvey likened this institutional arrangement to that of a corporation, which clearly separates the executive from the board.

Addressing Mr Farrow's concerns over lack of representivity, Mr Harvey said that Clause 10(13)(e) requires the Transport Authority to encourage public participation from all sectors. The Minister may prescribe requirements and procedures in this regard. Mr Harvey assured members that these requirements would be published.

Mr Farrow (DP) concluded that although he was still unhappy with the lack of representivity, he would be prepared to settle for Mr Harvey's explanation of the reasons for this choice.

Clause 31(1):
Mr Cronin (ANC) said he had raised the issue of the 18 and 35 seater vehicles in the ANC study group the previous day and he still had some reservations about detailing size specifications in the Bill. On the one hand there was always a possibility that there might be a 19 seater on the market in the future which would be a set back to any recapitalisation program and might hinder manufacturers. At the same time if amendments were made to the Bill, the passing of the Bill would be delayed. Furthermore, Clause 31(1) is a suspensive clause that will fall away some time in October 2006. The Minister may even decide not to go that route. The African National Congress would therefore support Clause 31(1) as it stands.

Mr Slabbert (IFP) said he was still concerned that the Bill was too prescriptive, why not adopt a 'wait and see' position? Mr Cronin (ANC) said that while it is prescriptive, it is only hypothetically prescriptive. It could be prescriptive by 2006.

Mr Niemann (NNP) asked what would happen if Toyota came up with a safe 16-seater, favourable to the market? Mr Farrow (DP) responded that there is a need at this point to administer the process. Two issues could not be deviated from: safety criteria had to be met and investment. He acknowledged that they had some hard selling to do to manufacturers producing vehicles outside the 18-35 range.

The Democratic Party supports Clause 31 as it stands.

Although not satisifed with the specifications, Mr Slabbert said the Inkatha Freedom Party would support Clause 31 as it stands.

General Discussion
Mr Abrahams (UDM) was concerned about lift clubs. He was aware that lift clubs should be encouraged to stem the traffic flow, should the Bill not be used to recognise lift clubs officially? The Chair, Mr Cronin, said that lift clubs were not for commercial purposes and therefore were not regulated by the Bill [in terms of Clause 33 lift clubs are exempt from requiring an operating licence]. Mr Harvey said the Act deliberately does not regulate private lift clubs because it would not be an appropriate step at this time. It is difficult enough to regulate commercial operators. The policy principles encourage the reduction of private vehicle usage in favour of public transport. The adoption of a high-density usage lane, the high density referring to the number of passengers in the vehicle, is envisaged.

Mr Farrow (DP) asked if there was validity in incorporating a certificate of roadworthiness in permit regulations? Mr Harvey said that a certificate of road-worthiness is a prerequisite for getting an operating licence. The renewal of a licence after one year is also conditional on road-worthiness. Talks are on the table to reduce the year to six months.

Mr Farrow (DP) referred to Clause 56 and asked whether the registration of associations included commuter organisations. The Chair said it only applied to operators. Mr Harvey explained that registration applies to taxi operators only in order to regulate the behaviour of the industry. While there is no provision for commuter representation they could be represented in a sub-committee of the Transport Authority.

An ANC member asked whether distinguishing marks are linked to permits and registrations. Mr Harvey said that the period of validity of the distinguishing mark is directly linked to the validity of the registration. If the registration or provisional registration lapses the distinguishing mark will also have no validity. If a member's registration of his association has lapsed but he continues operating the taxi, the association faces the danger of being closed down. Therefore it will be in the the association's interest to discipline that member.

Mr Slabbert (IFP) raised the concern that the Bill does not prescribe how to ensure that the right drivers are made operators. Mr Farrow (DP) added that only commuters can control driver behaviour. Mr Cronin agreed that there are commuter organisations that report driver misbehaviour. Mr Harvey said that the Road Traffic Act specifically governs the behaviour of drivers. The regulations to the Bill will embrace the policy principle of commuter empowerment.

Mr Slabbert (IFP) asked whether the Bill would be enforceable. Mr Cronin (ANC) responded that enforcement would be a challenge.

Ms Da Camara (DP) asked what implications the Bill will have for tax collection. How will the Receiver of Revenue have access to information regarding an operator's income? Mr Harvey referred to Clause 85(1)(b) [in terms of which the applicant for an operating licence must furnish proof to the satisfaction of the Board that he has registered as a taxpayer under the Income Tax Act or is not required to register in terms of the Act]. He said that he was aware of the current perception that the Bill would turn the taxi industry into a cash cow for government. He said that in reality the taxi industry does not generate enough money to bring in that much revenue for government.

The Bill was formally voted on by the Portfolio Committee and accepted unanimously without further amendments. It will be debated in the House as soon as the Minister is available.


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