MEMORANDUM

To:		Portfolio Committee on Transport

From:		Department of Transport (Mr Hament Patel)

Date:		11 August 2008

NATIONAL LAND TRANSPPORT BILL [B51—2008]: CHANGES PROPOSED BY THE DEPARTMENT AND AGREED TO AT THE MEETINGS ON 29 AND 30 JULY, AS WELL AS CHANGES PROPOSED PURSUANT TO THE MEETING BETWEEN TE DEPARTMET AND THE DPLG AND OTHERS ON 6 AUGUST 2008 

A.	CHANGES PROPOSED BY THE DEPARTMENT

Clause	Proposed change	Motivation	
1: Def. of “courtesy service”	Change “contract” in line 36 to “agreement”	Could cause confusion with definition of “contract”	
1: Def. of “desig-nated planning authority”	Delete	Taken up in new concept of transport authorities	
1: Def. of “National Fund”	Delete	Concept opposed by the National Treasury (NT)	
1: Def. of “provin-cial fund”	Delete	Concept opposed by the NT	
1: Defin-itions	Add the following after the definition of “staff service”:
“Structures Act” means the Local Government: Municipal Structures Act, 1998 (Act No. 117 of 1998);	Needed in relation to the new clause 16 on transport authorities (TAs)	
1: Def. of “transport authority”	““transport authority” means a municipality contemplated in section 16;”
	Consequential change in relation to new clause 16	
3	Add a new subsection as follows: “(2) This Act is intended to prescribe policies, principles, requirements, guidelines, frameworks, norms and standards that must be the same for all provinces, and other matters contemplated in section 146(2) of the Constitution.”	The reader of the Bill needs to know that the Bill is intended to provide national provisions that are intended to override conflicting provincial legislation	
11(1)	Make it sub-clause (2) and replace with the following:
“(2)	The functions listed in subsection (1)(c) are seen as inherent municipal functions contemplated in Parts B of Schedules 4 and 5 of the Constitution, and the Minister or MEC may assign additional functions to municipalities under section 156(4) of the Constitution, subject to the Systems Act.”	States intention of Bill more clearly and distinguishes between inherent functions and assigned functions in terms of the Constitution	
11(2)	Change sub-clause (2) to (1) and replace paragraph (b) with the following:
“(b)	The provincial sphere of government is responsible for—
(i)	provincial policy and strategy formulation;
(ii)	planning and co-ordination in the provincial sphere, and preparing the Provincial Land Transport Framework in terms of section 44;
(iii)	co-ordination between municipalities and promoting provincial legislation and municipal by-laws, and promoting or concluding agreements, as appropriate, in the provincial sphere;
(iv)	liaising with other government departments in the provincial sphere with portfolios that impact on transport and land use planning issues, and bringing together key players;
(v)	assisting municipalities that lack capacity or resources and to see that transport-related gaps left by those authorities are filled and, in the urban environment, to reach the status of transport authorities in appropriate areas; 
(vi)	intervening where municipalities fail to perform their functions under this Act, subject to section 139 of the Constitution;
(vii)	ensuring implementation of its integrated development strategy and public transport strategy, with due attention to rural areas, especially in municipalities that lack capacity or are lagging behind in transport service delivery, either by direct implementation or assistance under paragraph (v);
(viii)	regulating and subsidising public transport services in the province outside of the areas of transport authorities and between such areas or between such areas and other areas, but subject to the right and duty of municipalities to liaise and co-ordinate with neighbouring municipalities in exercising their municipal functions;
(ix)	performing the other functions of the MEC in terms of this Act.”	Gives effect to discussions and comments on the role of provinces	
11(2)(c)	Replace paragraph (c) with the following: 
“(c)	The municipal sphere of government is responsible for—
	(i)	municipal policy and strategy formulation;
(ii)	planning and co-ordination in the municipal sphere, and preparing integrated transport plans in terms of section 45;
(iii)	promulgating municipal by-laws and concluding agreements, as appropriate, in the municipal sphere;
(iv)	liaising with other departments in the municipality with portfolios that impact on transport and land use planning issues, and bringing together the relevant officials;
(v)	undertaking municipal public transport functions in respect of services taking place within their areas, including the planning, implementation and management of modally integrated public transport networks and travel corridors and liaison in that regard with neighbouring municipalities; and
(vi)	performing the other functions of municipalities in terms of this Act. 
	Gives effect to discussions and comments on the role of municipalities	
11	Insert a new subsection after (3):
“(4) One or more adjacent municipalities may agree on the joint exercise or performance of their respective powers and functions contemplated in this Act, or may establish municipal entities in terms of the Systems Act for this purpose.” 	Provides for the joint exercise of municipal functions as an alternative to forming a transport authority	
11	Replace sub-clause (4) with the following and renumber:
“(5)	If the spheres of government cannot agree, subject to this Act, on the division of land transport functions between them, they must act in a manner and spirit consistent with the principles of co-operative government prescribed by section 41 of the Constitution and apply the provisions of the Intergovernmental Relations Framework Act, 2005 (Act No. 13 of 2005).” 		
16	Replace clause 16 with the following:

“Establishment of transport authorities and related matters

	16.	(1)	All metropolitan municipalities as defined in section 1 of the Structures Act are transport authorities.
	(2)	A municipality that is not a metropolitan municipality but displays one or more of the characteristics of a category A municipality contemplated in section 2 of the Structures Act, and complies with the prescribed criteria, may apply to the MEC to be declared a transport authority, if—
(a)	its integrated transport plan is adequate;
(b)	it has the necessary capacity; and
(c)	it has arranged or organised its administration as required by section 17(1).
	(3)	On receiving such an application, the MEC must consult the Minister, the Minister responsible for Provincial and Local Government and the Municipal Demarcation Board established by section 2 of the Local Government: Municipal Demarcation Act, 1998 (Act No. 27 of 1998) and, if satisfied that the municipality complies with subsection (2), appoint it as a transport authority.
	(4)	The eThekwini Transport Authority established in terms of the Transition Act will cease to be a juristic person distinct from the eThekwini Metropolitan Municipality on a date to be determined by the Minister, and that Municipality must amend or restructure its administration as soon as possible to bring it into line with the requirements of a transport authority under this Act.”	Changes pursuant to comments from NT and discussions with DPLG and Cities Network	
17	Replace with the following:

“Establishment of special division for and arrangement of administration of transport authority

	17.	(1)	Every transport authority must―
(a)	establish a division within its administration to perform the functions of a transport authority in terms of this Act; and
(b)	arrange or, if necessary, reorganise its administration so that the functions of managing and funding transport matters, and land use planning, as well as the other transport authority functions contemplated by this Act, are integrated.
	(2)	Such division must consist of dedicated officials of the municipality, appointed either on a full-time or part-time basis by virtue of their specialised knowledge, training or experience in public transport or related matters.
	(3)	The Minister may prescribe minimum qualifications or experience for officials of such division or of officials undertaking specific land transport functions.
	(4)	No person contemplated in section 12 may be an official of such division.”
	This is the current clause 30, as amended to take account of the new clause 16	
18 and 19	Delete	TAs will no longer be juristic persons separate from the relevant municipality	
20	Now becomes clause 18. Amend as indicated below		
20(1)	Typing error in line 36 “authrity”		
20(1)(m)	Replace with the following:
“(m)	in the case of gross cost contracts for subsidised services, determine fare structures and fare levels, and concessionary fares for special categories of passengers, and periodically adjust fares after publishing the proposed adjustment for public comment;”	Comments by NT and SABOA	
20(1)(o) and (t)	Delete “as a designated planning authority”	Consequential amendment	
20(1)(v)	Delete	Consequential amendment	
20(2)(b)	Replace with the following: “(b)	apply traffic management techniques aimed at improving road traffic movement; and”	Consequential amendment	
20(2)( c)	Replace with the following: 
“(c)	perform other functions that are directly or indirectly related to land transport.” 	Consequential amendment	
20(3) to (7)	Delete	Consequential amendments	
21	Becomes clause 19. Replace with the following:

“Adjacent transport authorities

	19.	(1)	Where there are significant transport movements between two or more adjacent transport authorities, they must establish an intermunicipality forum in terms of section 28 of the Intergovernmental Relations Framework Act, 2005 (Act No. 13 of 2005) to co-ordinate their functions in terms of this Act and to ensure that their integrated transport plans take account of such movements.
	(2)	As an alternative to such an intermunicipality forum, such transport authorities may establish a multi-jurisdictional service utility for the purpose in terms of Part 4 of Chapter 8A of the Systems Act.”	Necessary to provide for arrangements between adjacent TAs	
22	Replace with the following:

“Regulatory functions of transport authorities

	“20.	(1)	With regard to the function contemplated in section 18(1)(t), a transport authority must receive and decide on applications relating to operating licences for services wholly in their areas of jurisdiction, excluding applications that must be made to the National Public Transport Regulator or a Provincial Regulatory Entity.
	(2)	In considering applications regarding operating licences, transport authorities must, in the case of services provided in terms of their integrated transport plan, apply that plan and give due regard to the relevant Provincial Land Transport Framework.
	(3)	A transport authority may give notice in the prescribed manner that it will no longer receive applications for operating licences for new services except in accordance with invitations given by it for specified services on specified routes or in specified areas in accordance with its integrated transport plan, either for the purpose of concluding a contract or because those routes or areas are already adequately served.
	(4)	A transport authority may, in appropriate cases, make inquiries or hold hearings to enable it to perform its functions contemplated in this section, and also has the prescribed powers.
	(5)	Every transport authority must in the prescribed manner establish a call centre where passengers and other interested persons may lodge complaints or inquiries regarding public transport services in its area, and must follow up such complaints and, where appropriate, take the necessary action to remedy the situation.”	This is the current clause 31, as amended to take account of the new clause 16	
23	Delete	Consequential amendment	
25(1)(b) (i)	Replace with the following: “(i) interprovincial transport, excluding daily commuter transport to and from the area of a designated planning authority, which must be dealt with by that designated planning authority;”	It makes more sense for the designated planning authority to regulate daily commuter transport, e.g. between North West Province and Tshwane	
25	Add the following subsection: “(6) As soon as possible after its appointment, the National Public Transport Regulator must formulate an implementation plan for establishing the entities required by this Act and for capacitating them, and for implementing the other provisions of this Act.”	Such a plan is considered necessary	
28(1)(b)	Replace with the following:
“(b)	receive and decide on applications relating to operating licences for intraprovincial transport outside of the areas of transport authorities, or between the areas of transport authorities, excluding applications that must be made to the National Public Transport Regulator in terms of section 25.”	PREs will be responsible for all services outside of TA areas or between such areas	
30	Replace with the following”

“Agreements on regulatory matters

	29.	(1)	The National Public Transport Regulator, a Provincial Regulatory Entity or a transport authority may agree that that one of them will undertake the functions of another relating to receiving and considering applications concerning operating licences, either temporarily or permanently, where―
(a)	there is significant travelling of commuters on a daily basis between the areas for which they are responsible;
(b)	the nature of transport movements between them would make such an agreement advisable from a transport or land use planning viewpoint; or
(c)	for other prescribed reasons.	
	(2)	The Minister may prescribe regulations on the circumstances in which and the conditions on which such an agreement may be concluded, and procedures or requirements for its implementation.”
	Suggested change after discussions with DPLG etc. 	
31 and 32	Delete	Consequential amendments relating to TAs	
33 and 34	Delete	The NT does not support these funds	
35	Replace with the following:

“Municipal land transport funds

	35.	(1)	Subject to subsection (2), every transport authority must establish a fund for its area known as a Municipal Land Transport Fund, into which shall be paid—
(a)	money appropriated by the Minister for that Fund;
(b)	money appropriated by the MEC for that Fund;
(c)	user charges levies collected in terms of section 36;
(d)	interest on invested cash balances belonging to that Fund; and
(e)	donations and contributions to the municipal fund from any other source, including foreign aid agencies.
	(2)	The transport authority must administer the municipal fund and use it to defray the cost of the functions of that authority in terms of this Act or its integrated transport plan, and to cover any other expenditure that will promote the objects of this Act in its area.
	(3)	The transport authority may also use the money in the municipal fund for the purposes prescribed by the Minister, and subject to such regulations.
	(4)	The transport authority may invest money in the municipal fund that is not immediately required by it subject to the Municipal Finance Management Act and any other applicable legislation.
	(5)	The transport authority must keep proper accounts of all money accruing to or paid out of the municipal fund, which must be audited by the Auditor-General.
	(6)	The municipal manager or chief executive officer of a transport authority must submit, annually to its council, for approval estimates of expenditure to be defrayed from its municipal fund, and may make no payment from that fund except in accordance with such estimates or with the prior approval of that council.
	(7)	The provisions of the Municipal Finance Management Act apply to municipal funds, and the Minister of Finance may make regulations clarifying the application of that Act to those funds.”	Changes suggested in discussions with DPLG and Cities Network, and pursuant to comments by NT and necessitated by changing from DPAs to TAs	
36	In lines 25 and 38, change “designated planning authority” to “transport authority”	Consequential amendments	
40	Delete the number “(1)” in line 28	There are no other subsections	
42	Add the following sub-clause: “(6) Planning authorities must make their integrated transport plans available to the National Public Transport Regulator and relevant Provincial Regulatory Entities and designated planning authorities to assist them in making decisions relating to applications for operating licences, despite the fact that the planning authority must be asked for its recommendations under section 64.”	This provision may be implied, but is considered necessary in the light of past experience	
43(3)	Change “two years” in line 33 to “five years”	It is not realistic to update the NLTSF every two years	
51(2)	In line 34 change “must” to “may” and delete “and” before “with”	Typing errors and comment by NT	
54(2)	Add “or” at the end of paragraph (a) and replace “unless it complies with requirements prescribed by the Minister” in line 28 with “unless it is financially ringfenced in the prescribed manner and complies with the other requirements prescribed by the Minister”	This will make the intention of the Bill clearer	
58(2)(a)	Delete the words: “pay to that holder the scrapping allowance determined by the Department”	National Treasury feel that the scrapping allowance should not be statutory	
58(2)(b) (ii)	Delete	National Treasury feel that the scrapping allowance should not be statutory	
58(2)(b) (iii)	Add the following: “and such operating licence must specify in detail the route or routes to be operated, which must be those operated by the operator for the period of 180 days prior to the date of application.”	Omission from the Bill	
59(1)	Add the following after “operating licence” in line 26: “or a permit, subject to sections 56, 57 and 58,"	Omission	
62(1)(a)	Delete the words “set out in the regulations promulgated in terms of this Act”	Words are superfluous	

B.	CHANGES PROPOSED BY SABOA AND AGREED TO BY THE DEPARTMENT

Clause	Proposed change	Motivation	
1: Def. of “negotiat-ed contract”	Delete the words “for the first phase of an integrated public transport network”	Definition is too limiting as it is. Negotiated contracts can be concluded for other reasons - see clause 50(1)	
1: Def. of “subsidis-ed”	Add the words: “or where services are subsidised for other reasons, for example to encourage transport usage, relieve traffic congestion, to support land use and transport integration or for other reasons”	Current definition is too limited	
8	Insert a new subsection (2) as follows and renumber:
“(2) Before making any regulation contemplated in subsection (1), the Minister must publish a draft of such regulation for public comment in the Gazette, and must consider any comments received in response to such publication.”	There have been problems in the past with regulations being made without proper consultation.	
8(1)(l)	Delete	Control of operator associations in this manner should not be made statutory	
24(2)	Replace “not more than five dedicated officials of the Department” with “the number of dedicated officials of the Department determined by the Minister”	Five officials may not be sufficient, and the clause should not be prescriptive	
24	Add the following sub-clause: “(5) The prescribed quorum of members of the National Public Transport Regulator contemplated in subsection (2) must take the decisions of that Regulator, and the Department must allocate members of its staff as a dedicated unit to assist that Regulator in the performance of its functions.”	This is implied in the Bill, but should be made clearer	
48(1)	Replace “ the planning authority must, where possible” with “the planning authority must apply law enforcement measures to eliminate unauthorised operators from the route, or request the appropriate authorities to do so, and must, where possible—“	Will be necessary if sub-clause (2) is deleted - see below	
48(2)	Delete sub-clause (2) and renumber sub-clause (3) and amend to refer only to subsection (1)	It will not be equitable to cancel some operating licences and not others. How will the authority decide which one(s) to cancel?	
50(2)	Change “should” to “must” in line 12	Existing operators subject to contract arrangements must be included	
55	Amend the heading to read “Existing contracting arrangements” and replace sub-clause (1) with the following and renumber sub-clause (2) as (5):
“(1) Where there is an existing interim contract, current tendered contract or negotiated contract as defined in the Transition Act in the area of a contracting authority, that authority may—
(a) allow the contract to run its course; or
(b) negotiate with the operator to amend the contract to provide for inclusion of the operator in an integrated public transport network; or
(c) make a reasonable offer to the operator of alternative services, or of a monetary settlement, which offer must bear relation to the value of the unexpired portion of the contract, if any.
(2) If the parties cannot agree on amendment of the contract or on inclusion of the operator in such a network, or the operator fails or refuses to accept such an offer, the matter must be referred to mediation or arbitration in the prescribed manner to resolve the issue.
(3) In the case of services taking place entirely within the area of a transport authority, or daily commuter services serving such an area, the planning authority must be substituted as contracting party in any such existing interim contract, current tendered contract or negotiated contract on the date of commencement of this section, in place of the relevant provincial government.
(4) The Minister may make regulations providing for the transition of existing contracting arrangements and the transfer of the contracting function in terms of this section, including the transfer or amendment of existing permits or operating licences to give effect to its provisions.”	Merely to allow contracts to lapse will be inequitable to the operators. See clause 37(2) on the transfer of funds to designated planning authorities	

C.	CHANGES PROPOSED BY SATTSA AND AGREED TO BY THE DEPARTMENT

Clause	Proposed change	Motivation	
24(2)	Insert a paragraph (c) and renumber the existing (c) and (d): “(c) tourism transport;”	Because one of the NPTR’s main functions is to deal with tourism transport, the tourist transport industry should be represented 	
66(1)	Add the words “other than a tourist transport service” after “non contracted service” in line 9	Needed for clarity	
91(3)	Delete “or provincial” in line 33 - 34	This provision should only apply to a national tourism body	
92(3)	Add the following: “and such an operator must submit to the National Public Transport Regulator for cancellation his or her certificate of accreditation and all operating licences, tokens, tags or other equipment issued by that Regulator to that operator within seven days of cancellation of that operator’s  accreditation”	Necessary provision for law enforcement