Department of Transport on Division of Revenue Act: First Quarter Report
NCOP Finance
13 October 2006
Meeting Summary
A summary of this committee meeting is not yet available.
Meeting report
FINANCE SELECT COMMITTEE
13 October 2006
DEPARTMENT OF TRANSPORT ON DIVISION OF REVENUE ACT: FIRST QUARTER REPORT
Chairperson: Mr T Ralane (ANC)
Documents handed out:
Department of
Transport Presentation
SUMMARY
The Department of Transport briefed the Committee on progress made on
transport infrastructure. Its conditional grant - the Public Transport Systems
Fund - was established in March 2005 with its objective to improve public
transport infrastructure and systems in the country. Some of the challenges
faced included lack of technical support. In an attempt to address identified challenges the Department aimed to:
- Ensure everybody sign MOUs and abide thereby.
- Appoint a team of project and programme managers to provide technical support
to municipalities – to ensure adequate planning and proper delivery management.
- Drive implementation of Transport Action Plan that incorporates local
transport plans in preparation for World Cup 2010.
- Develop an Inter-sphere Implementation Framework
- Use a “hands on” intervention approach
- Expand role of provinces in supporting municipalities
The discussion focused on how the Department had spent the R241 million
indicated in its report. Members of the Committee wanted clarity on how the R241 million had performed and asked for a
systematic analysis of the allocation of funds. The Chair ruled that the
Department provide a clear list of the R241 million spend with details of all
the projects undertaken and the sustainability of the projects. Where there was
under expenditure, the Department should give reasons.
MINUTES
Department of Transport Presentation
Mr Skhumbuzo Macozoma (Chief Director: Integrated Infrastructure Network
Development, Branch: Integrated Planning and Intersphere Coordination) begun by
providing apologies on behalf of the Minister and Director General who were
unable to attend the meeting. He stated that in March 2005 the Department
established a public transport conditional grant, known as the Public Transport
Infrastructure Fund (PTIF). The main focus of the grant was to improve public
transport infrastructure and systems in the country. The main beneficiaries of
this grant would be municipalities and service delivery mechanisms.
A monitoring and evaluation team was established in order to assess the
challenges faced. Some of the key findings included serious capacity challenges
faced at local level, need for dedicated technical support and an increase in demand and cost in the civil and
construction industries. Even though there were many challenges it had faced,
the Department said that it had managed to address most of them and the Fund
was well managed. The PTIF had come at the right time as the country prepared
for hosting the 2010 World Cup, however the Department strongly emphasised that
projects must begin and that funds cannot be overspent.
Discussion
Mr B Mkhalipi (ANC)[Mpumalanga]
questioned if the National Roads Agency (NRA) would be one of the beneficiaries
of the fund. According to the table, it seemed that all this year's funds had
already been allocated. Even if part of the allocation was from last year's
fund, a rough estimation for this year's figures was around 536 million. Would
there be sufficient allocation to Fund projects in the next financial year?
Mr Macozoma replied that some organizations such as the NRA had made a request
for funds to be allocated, however they did not receive anything. This is
because their objectives did not suit that of the department, which is to aid
and improve public transport. The total amount in the Fund is around R 3.74
billion, which was set to be allocated for a period of four years.
Mr Z Kolweni (ANC) [North West] asked what was meant by non-motorised transport
and the reason why the Department was not funding normal infrastructure projects.
Since there are varied shortcomings faced by municipalities, how would it
ensure that the people benefit from the infrastructure. The Department should
show how they planned to play a supporting role to the municipalities.
Mr Macozoma stated that before a project is undertaken, there would be
oversight into how the project benefits the citizens. The first stage would be
to check whether a particular project has the capacity to maximise job creation
and skills development. The second stage will assess whether the sustainability
of the project will maximise employment and the use of the facility. Non
motorised transport is any form transport that can be executed without a car,
the Fund will try to make proper structures and facilities which would aid such
facilities.
Mr Kolweni questioned the instruments which would be used to conduct oversight
over the beneficiaries of the Fund, and whether or not municipalities
understand the Memorandum of Understandings (MOUs) given to them
Mr Macozoma replied that no money could be transferred until the MOUs have been
transferred. Before money is
transferred, the Department has to assess the readiness of the municipalities
before projects are initiated.
Mr Sogoni (ANC)[Gauteng] questioned how this Fund differed from all the other
funds that had tried to address this particular issue, and asked the Department
to provide an explanation on how it planned to avoid the duplication of funds.
In terms of the capacity building objectives, it had set itself to intervene
where it can wherever it can. However the Department should elaborate on how it
planned to intervene. It should also provide clarity on the figure of R241
million for 2005/06, since the report stated that R590 million was allocated.
Finally it should provide reasons, if possible, on why funds were not allocated
to certain municipalities.
Mr Macozoma replied that the Fund differed from other funds in that it was
structured in such a way that it primarily focused on public transport
infrastructure, and the Department had measures in place that prevented the
duplicate funding of projects. In terms of capacity building, the Department
usually avoided giving municipalities large projects that will hamper their
ability to deliver service elsewhere. With regards to why funds were not
allocated to various municipalities, the proposals provided by the
municipalities were not refined and did not fit in with the objectives of the
funds.
The Chair questioned how the Fund would aid provincial growth and development.
He asked if the amounts allocated to municipalities were of the first quarter,
if they were, then it was clear that some municipalities had underspent. If the
money allocated was not from the first quarter, then the Department should give
an explanation on the performance of the 2005/06 financial year. Finally the
state of the roads in certain provinces was unacceptable, the Department should
provide reasons on how they plan on seeing to this matter.
Mr Macozoma replied that the Fund will improve the integration of transport
planning which will in turn aid provincial growth. He stated that he understood
the Chair's concern about the challenges faced by municipalities on the issue
of roads. However provincial authorities play a huge role in solving infrastructure
challenges. At the present the Department acknowledged the challenges faced,
but on the other hand, it focused on what lay ahead. Mr Macozama also argued
that the R241 million was funds that were to be allocated to municipalities.
However the funds that were appropriated in the 2005/06 financial year, were
allocated at the end of the financial year. The money was then transferred to
the municipalities at the beginning of the new financial year. However money
had not yet fully been transferred due to the challenges faced by the
municipalities.
The Chair asked from where the R519 million came and how it had performed
Mr Macozoma replied that the Department added to the R241 million, a further
R278 million from their own funds, which makes up the R519 million.
The Chair asked if the R241 million had already been allocated to
municipalities. If it had, then the Department should provide a list of all the
municipalities that had received the funds, and how much they had received.
Mr Mkhalipi commented that it was unacceptable for the Department to sit with
funds, and at the last minute dump them on municipalities.
Mr Macozoma replied that the money was not sitting with the Department, but
with National Treasury. He also restated that before money is transferred, the
Department has to assess the readiness of the municipalities before projects
are initiated.
The Chair said that he was still unclear about how the R241 million had
performed.
Mr Mkhalipi stated that the total allocation for the financial year 2005/06
came to R519 million, which has now gone, the same applied to the R214 million.
The Chair then ruled that Mr Macozoma should submit a
proper list of the R241 million spend. This was since the issue around
money dumped onto municipalities was unclear, and the reporting of how the R241
million was spent was very confusing. The Department should provide a detailed
list of all the projects undertaken and the sustainability of the projects.
Where there was under expenditure, the Department should give reasons why there
was under expenditure. Finally the Department should provide a systematic
breakdown of the R241 million, and not just an overlap of the various funds.
Mr Macozoma replied that he would return to the Department and furnish all the
details and allocations for these figures, as the information was available and
could be easily provided.
The meeting was adjourned.
Audio
No related
Documents
No related documents
Present
- We don't have attendance info for this committee meeting
Download as PDF
You can download this page as a PDF using your browser's print functionality. Click on the "Print" button below and select the "PDF" option under destinations/printers.
See detailed instructions for your browser here.