Hansard: NCOP: Unrevised hansard
House: National Council of Provinces
Date of Meeting: 24 May 2023
Summary
No summary available.
Minutes
UNREVISED HANSARD
NATIONAL COUNCIL OF PROVINCES
WEDNESDAY, 24 MAY 2023
PROCEEDINGS OF HYBRID NATIONAL COUNCIL OF PROVINCES
Watch: Plenary
The Council met at 14:02.
The Deputy Chairperson took the Chair and requested members to observe a moment of silence for prayers or meditation.
The DEPUTY CHARPERSON OF THE NCOP: Hon delegates, before we proceed, I would like to remind delegates of the Rules relating to virtual and hybrid meetings and sittings, in particular subrule 21, 22 and 23 of Rule 103. Can we have order in this House. No, I can’t feel like a principal. No, I can’t feel like a principal, I want order in the House. [Interjections.] [Inaudible.] Suka! [Go away.]
The hybrid sitting constitute a sitting of the National Council of Provinces. Delegates ... Can we have order, please. I can’t believe that it’s this young man who is going on like this. [Interjections.] People, do you allow Mokause to go on like this. Can’t we throw her out. [Interjections.] Thank you, now there will be order.
The hybrid sitting constitute a sitting of the National Council of Provinces. Delegates in the hybrid sitting enjoy the same powers and privileges that apply in a sitting of the National Council of Provinces. For purposes of the quorum, all delegates who are logged on to the virtual platform shall be considered present. Delegates must switch on their videos if they want to speak and they should ensure that their microphones on their electronic devices are muted and must always remain muted unless they are permitted to speak.
All delegates in the Chamber must connect to the virtual platform as well as insert their cards to register on the Chamber system. Delegates who are physical in the Chamber must use the floor microphones. All delegates may participate in the discussion through the chatroom.
In addition, I would like to remind delegates that the interpretation facility should be active. Permanent delegates, special delegates, SA Local Government Association, Salga, representatives and members of the executive on the virtual
platform are requested to ensure that the interpretation facility on their electronic devices are properly activated to facilitate access to the interpretation services. Permanent delegates, special delegates, Salga representatives and members of the executive in the Chamber should use the interpretation instruments on their desks to access the interpretation facilities.
Hon delegates, before we proceed, let me take this opportunity to welcome the Minister and the Deputy Minister of Public Enterprises, the Minister and the Deputy Minister of Transport
– is the Deputy Minister here, or will be coming – permanent delegates, MECs, special delegates and Salga representatives to the House, good afternoon ... [Inaudible.]. You have been my friend for a long time. I also wish to inform delegates that I have been informed that that there will be no notices of motion or motions without notice. Hon delegates, that one will go and ask the Whips. We will now proceed with the First Order and Second Order.
CONSIDERATION OF REPORT OF SELECT COMMITTEE ON SECURITY AND JUSTICE AND SELECT COMMITTEE ON COOPERATIVE GOVERNANCE AND TRADITIONAL AFFAIRS, WATER, SANITATION AND HUMAN SETTLEMENTS JOINT PROACTIVE OVERSIGHT VISITS TO FREE STATE PROVINCE.
CONSIDERATION OF REPORT OF SELECT COMMITTEE ON SECURITY AND JUSTICE OVERSIGHT VISIT TO THE FREE STATE PROVINCE TO OVERSEE THE CONDITIONS AT PARK ROAD POLICE STATION ON 18 AUGUST 2022
Ms S SHAIKH: Deputy Chairperson, greetings to the Ministers and the Deputy Minister in the House, and greetings to all hon members. Hon Chair ...
The DEPUTY CHARPERSON OF THE NCOP: Sorry, hon member. It’s really disturbing. It’s not only because it’s you hon member, yesterday it has been very bad. The way people from the platform and so on ... It’s disturbing the proceedings.
Really, we must respect the proceedings – I am just requesting. Thank you. You may continue.
Ms S SHAIKH: Thank you very much, hon Chairperson. The Select Committee on Security and Justice conducted an oversight visit to the Free State province from 16 to 19 August 2022. On 17 August 2022, the Select Committee on Security and Justice, together with the Select Committee on Co-operative Governance
and Traditional Affairs, Human Settlements, Water and Sanitation conducted a joint oversight on the distribution of housing benefits to the military veterans in the Free State province. This follows an engagement with the Department of Military Veterans to gain a better understanding of the progress that they have made in the roll-out of benefits to military veterans, which included housing from military veterans.
The joint committees were interested in engaging the Department of Human Settlements who are responsible for the delivery houses. The primary aim of the oversight visit was therefore to understand the challenges encountered in the Free State province in the distribution of housing benefits to military veterans, with the view to collectively address these challenges and to propose a way forward.
The joint delegation met with the Free State department of human settlements. The Department of Defence and Military Veterans and visited housing projects for military veterans in Hillside View, Riebeeckstad and Rheederspark as part of the oversight inspection. In the briefing by the province, a major challenge raised by the Free State MEC for human settlements
was with regards to the province not being provided with the proper data base for military veterans and that some who are illegally occupying these houses. At the Hillside View site, the joint delegation was very concerned about the state and conditions the military veterans were living under as opposed to what was presented by the two departments. The houses were not properly built, and many structural defects, not fenced appropriately, no compliance to the standards that were set by the Department of Military Veterans. There were four units which were not connected to the main sewer pipe. The beneficiaries were not happy with their houses, even though they were in the process of being provided with their title deeds.
Furthermore, the joint delegation was very disappointed that it took the department seven years to build 50 units. However, on a more positive note, members were very pleased with the quality of work that was done by the contractor in Riebeeckstad, and hope that the 21 units will be finished within the stipulated timeframe. At Rheederspark a total of 20 units were completed and occupied, however, only four of the
20 military veterans were approved on the list of the Department of Military Veterans.
The second phase has been implemented in Rheederspark and 22 military veterans were approved on the department’s list.
While some military veterans were generally happy with the size of the house, they were not happy with the conditions of the houses. Once again the joint committee noticed the structural defects, leakages and flawed finishes in the houses. There was a blockage of the sewer line which was only attended to on the Friday before the oversight visit by the joint delegation. There were seven houses without electricity for three years. There was a challenge with the provision of bulk services to these houses which still remains a concern.
A visit to a military veteran living with disabilities, the committee found that in addition to the structural defects due to leakages, the colour of the walls indicated that there may be fungi. The house had no ventilation which presents a major danger to the lives of the beneficiaries. Sewer was running all over his yard, and while it was reported to the local municipality, no assistance was received. The joint delegation also found a house where the occupants signed a happy letter. Despite their substandard building and defects in the house, as he was told that if he did not sign, the house will be reallocated by the contractor. It would appear that the local
municipality was not involved in the planning phase of the military veterans house.
The joint delegation was very concerned about the contract of the local municipality to only attend to the service delivery challenges prior to the oversight visit. The joint committee recommends that the Free State portfolio committee on human settlements should conduct a follow-up visit to these military veteran houses. The Free State department of human settlements, with the Department of Military Veterans should do an inspection of all the houses and engage the construction company and the National Home Builders Registration Council, NHBRC, in order to rectify all the structural defects. The Free State department of human settlements should provide the joint delegation with the breakdown of funds that have been utilised for the seven years of building the 50 units that are at Hillside View.
The department of human settlements in the province should speedily resolve the issue of the four units that are not connected to the main sewer pipe as it is a health hazard to these beneficiaries, once again at Hillside View. The construction company, together with the Free State department
of human settlements should, as a matter of urgency, attend to the house of the military veteran who lives with a disability who is Rheederspark.
The Department of Co-operative Governance and Traditional Affairs and the municipality must ensure electrical provision to the site at Rheederspark. On 18 August 2022, the Select Committee on Security and Justice visited the Park Road Police Station in Mangaung. The Park Road Police Station was identified as number six in the country, out of the 30 police stations with the highest crime rate. The select committee met with the provincial SA Police Service, SAPS, the Park Road Police Station management and the community policing forum.
The Department of Public Works and Infrastructure was also invited to that meeting so that the committee will be able to determine the impact of the ongoing construction delays and service delivery in the area. This was a major challenge with respect to this police station.
The select committee further inspected the precinct to determine the facilities available to service the community. The committee interacted with the SAPS, and amongst the issues raised were gender-based violence crimes, given that domestic
violence and abuse noncompliance was the highest reported in the country. It was indicated that measures were being put in place to address this. Regarding corruption interventions, especially in relation to Independent Police Investigative Directorate, Ipid, recommendations, it was reported that two Ipid cases were ready for trial.
Regarding the slow progress of medical investigations, it was reported that this was due to waiting for DNA results and reliance on the national forensic laboratory as there is no forensic laboratory in the province. With regard to the high attrition rate of police members resigning because of personal morale, the department indicated it was addressing and working on incentive bonuses. Regarding vehicle maintenance and management, it was reported that vehicles would perform on a 24-hour basis and the repair and maintenance programme ensures that vehicles are properly serviced and faults rectified. In terms of police detentions cells in that there are no detention cells in the police station resulting in officers driving 400 km to other police stations for purposes of detaining suspects.
In our engagement with the community police forum, CPF, challenges were raised with regard to resourcing and funding for the CPF and the need for training. The community police forum also alerted the committee to the fact that communities are free to join the CPF because of the high crime rates and that the police needed to be trained on how to assist persons with disabilities. The committee engaged with the Department of Public Works and Infrastructure, the department reported that it encountered capacity constraints within the Bloemfontein regional office and commissioned the Department of Public Service and Administration to assist in the implementation of the Park Road SAPS repair and maintenance projects. Some of the delays and challenges encountered include the late payment of contractor by Department of Public Service and Administration throughout the construction period. Poor contract management by Department of Public Service and Administration, outdated programme of works and poor performance by the contractor without applying the contractual corrective measures.
Furthermore, the Auditor-General noted that the lack of monitoring of sites, where defective work is signed off at the site, that the project costs increase, it initially costed
R82 million but the Department of Public Works and Infrastructure are now projecting R105 million cost to complete the project. This escalation was attributed to the cost of material, prolonged construction and mitigation to recover costs. A forensic report has been commissioned, which will identify what money needs to be recovered.
The Department of Public Works and Infrastructure will look into the issue of the generated strategy and the prioritising of the detention cells at the police station. The SAPS has provided the Department of Public Works and Infrastructure with the list of priority police stations that require generators. Further, the Department of Public Works and Infrastructure indicated that they have implemented oversight committees to monitor the projects. A new memorandum of understanding will be drawn up with implementing agents and if they do not perform within 21 days, they will then terminate the contract.
Amongst the concerns of members were that the renovations had been taking place for the past four years and the costs has escalated from R82 million to R105 million and the Department of Public Works had paid the two previous contractor companies
without having done any work. Further, the delays in the construction work prolongs the long distances that are being travelled by members of the SAPS in order to transport detainees to various detention facilities as this also results in budget and personnel constraints.
The committee recommends that the Department of Public Works should engage the contractor in terms of prioritising the building of detention facilities cells as this issue was depleting the fuel budget of the station. The generator capacity at the station should be dealt with as a matter of urgency before the end of the calendar year. The Department of Public Service and Administration and the Department of Public Works should acknowledge when payment delays have delayed the construction work and contributed towards escalating costs to the detriment of the contractor. Where the Department of Public Service and Administration or the department has been responsible for these delays, they should in reasonable terms adhere to their contractual and payment obligations. The management of the Park Road Police Station should provide members of the CPF with training to be able to service community members and assist the SAPS in fighting crime.
The Department of Public Works should provide the committee with forensic report when the previous two contractors that were paid for not having done work at the Park Road Police Station. The provincial commissioner and her management team should come up with mechanisms on how to deal with the issue of the station having to transport detainees to and from correctional facilities located as far Kroonstad and Kimberley.
This situation is hampering services to the community as those members who are responsible for transportation are thus unable to do work within the community. I thank you, Chair
Debate concluded.
Question put: That the Reports be adopted.
IN FAVOUR: Eastern Cape, Free State, Gauteng, KwaZulu-Natal, Limpopo, Mpumalanga, Northern Cape, North West, Western Cape.
Report of Select Committee on Security and Justice and Select Committee on Co-operative Governance and Traditional Affairs, Water, Sanitation and Human Settlements Joint Proactive
Oversight visits to Free State Province accordingly adopted in accordance with section 65 of the Constitution.
Report of Select Committee on Security and Justice Oversight visit to the Free State Province to oversee the conditions at Park Road Police Station on 18 August 2022 accordingly adopted in accordance with section 65 of the Constitution.
APPROPRIATION BILL
(Policy debate)
Budget Vote 10 — Public Enterprises:
The MINISTER OF PUBLIC ENTERPRISES: Deputy Chair, hon members of the NCOP and representatives from our provinces, it is a great pleasure to present the Budget Vote for our department to you. Yesterday, we presented this to the National Assembly. Deputy Chair, around this time next year, South Africans will once again show the world our intent as a nation to unite and to choose a path that will set this country on yet another course to realise its true potential. Next year’s general elections mark a critical milestone in our ongoing quest to
create a just and an equitable society, where no one is left behind.
State-owned enterprises play a vital role in creating and enhancing the economic and social wellbeing of all South Africans. This reality underpins our work to revitalise our state-owned enterprises, SOEs, and reclaim them from criminals and the beneficiaries of state capture, whose treasonous acts mean that Eskom cannot deliver safe and reliable electricity, for example.
The network industries, energy, electricity and the logistics sector are key to South Africa’s ability for faster and a more inclusive way to generate economic growth. Our people need a reliable supply of electricity to run their small businesses, light up their streets and for their children to learn.
Equally, our miners, farmers and other economic role-player require reliable logistic system in order to both import and export with the rest of the world. This is why we need to reform the way in which each SOE operates, but also reform the way in which the collective SOEs realise the strategic ones, operate as well.
The National Development Plan suggests that the significant SOEs need a clear public-interest mandate and straightforward governance structures, enabling them to balance and reconcile their economic and social objectives. For the large SOEs involved in economic infrastructure provision, their mandate should include the imperative of financial viability and sustaining their asset base and balance sheet to maintain and expand services. Much of this have, of course and regrettably, been dented and set back by state capture and corruption.
So, what is our strategy to reform SOEs? Our strategy is in the first instant to learn from the rest of the world and ensure that we can try with the necessary adaptations to apply those lessons to the South African situation. The SOE reform process therefore that we are attempting here is not unique in the world. Many countries are undertaking similar processes.
For example, in Malaysia, reforms to make SOEs more efficient, fit-for-purpose, and to develop new systems of accountability has resulted in the creation of the holding company called Khazana with some 10 to 12 years ago started with five SOEs and today as a huge number of SOEs in its charge.
Our President announced on the basis of this evidence - the Malaysian, European countries, Singapore, Tamisac and many other examples - the creation of the Presidential State-Owned Enterprises Council, in June 2020. Recognising the fact that the dependence of SOEs on the fiscus was no longer sustainable. In other words, SOEs should not be approaching government all the time for what we have got used to call bailouts in South Africa. The SOEs are key implementing agents of the developmental state and thus must be operationally competent and have the financial resources to do so.
International best practices he also indicates that SOE an state-owned companies, SOCs, must in the future scenarios a separation in the functions which the President talked about of the policy-making separate from the regulatory functions and the operational function of the SOEs themselves.
Accordingly, the following measures were proposed by the Presidential State-Owned Enterprises Council which are now going to be considered by Cabinet itself.
An appropriate centralised shareholder ownership model, meaning that bring those most important SOEs together as we continue to upgrade and repair them. The introduction of an overarching Act or legislation governing SOEs. Improve
governance, financial control, risk management and the infusion of the requisite skills in the boards. Some of these has happened already This is a work in progress. Some of these have happened already. Having undertaken a financial analysis, that is the Presidential State-Owned Enterprises Council of over 30 other SOEs, it has made proposals which of these SOEs need further business analysis through experts, which to merge and which to consider closing down because we cannot sustain all of them. A deep financial analysis of Eskom was also undertaken by the council.
On the basis of the recommendations of the council where do we stand today? A policy statement which gives the rationale for the creation of the shareholder model, or a holding company, has been developed. A business case for the state-owned holding company has also been developed. Similarly, a shareholder Bill, which has been on the government agenda for some 10 years, has also been prepared and will shortly be presented to Cabinet itself.
Of course, we need to recognise in this process that the legacy of the state capture is not going to be dealt with easily. Many things that with a click of a finger or merely
changing a board, putting a new management team in place means that we will rid ourselves of the impact of state capture. As much has to be done to restore and it has been done co- operations of the major SOEs, bring many corrupt companies and individuals to book. Nonetheless, we have to recognise that it will take some time for the deleterious effects of patronage, middlemen and middle women and thieves to be taken out of the system. Monumental effort is still required to repair the SOEs. Similarly, in the post-Zondo commission period, we have engaged with many original equipment manufacturers, and particularly those implicated in Transnet procurement system.
Let me explain and describe some of the work that is going on in Eskom, Transnet and SAA, and the Deputy Minister will cover some of the others. This initiatives and work can be divided into two categories, namely, operationally what is it that they are doing at the moment, and secondly, what is it that they are doing that will impact over the next five years or more in some cases. As far as Eskom is concerned, we know that the Minister of Electricity is dealing with the current performance of the generation plant. We also know that there are shortages in terms of the number of megawatts that are currently available in that plant. But we also have to concede
that more megawatts could have been added if there was a greater sense of urgency about acquiring these megawatts over the past few years.
Secondly, the current transmission network is expensive, and it doesn’t cover the important parts of the country, like parts of the Northern Cape. There are measure that are being put in place to upgrade the current transmission grid whilst at the same time looking at the investment that is required in expanding the transmission grid.
Efforts have been made over the past 18 months or so to operationalise the national transmission company which is the first of the product of unbundling or restructuring of Eskom. Eventually, there will be e generation component, transmission component and distribution component and a new holding structure within Eskom itself. Of course, over the past 18 months, a fair amount of work has been done particularly in terms of researching the impact of climate change and the shift that will be required in terms of the just energy transition. The first of those measures will be put in place at the Komati Power Station.
One of the issues that we all have to deal with it, both in the NCOP and in the National Assembly, is the culture of nonpayment in South Africa. Municipal debt to Eskom now stands at about R58 billion. The National Treasury including ourselves and others, are looking at the support package that will ensure that municipalities ... [Interjections.] ... to see how municipalities can be assisted. But all of that will fail unless the culture of nonpayment is dealt with in South Africa.
Eskom’s distribution arm also offers a lot of assistance to municipalities. In this regard, there are active partnership programmes which are entirely or partially implemented. What this means is that municipalities are offered the opportunity to allow Eskom to upgrade its reticulation network to manage its electricity system, to collect its revenue and also give that portion of the revenue that the municipality is entitled to. Of course, not many have signed up for this but those that have signed up are benefiting from this particular active partnership. This is a way of addressing the question of municipal debt as well.
There are incentives that are going to be offered to municipalities to curb further growth in debt. As I said the Treasury is looking at the municipal support package. Working with stakeholders such as the National Electricity Crisis Committee over a willing framework which is a kind of fees which will be charged for municipalities that have investments in renewables taking place within their particular area to connect with the grid itself.
In terms of the various provinces in the Western Cape, of course, Koeberg is undergoing at the moment a 20-year life extension on one of the units, and that will be followed by the second unit that will take us into the next year. In Mpumalanga there is practical demonstration of Eskom’s climate change commitment in terms of the just energy transition, and the repowering of Komati using renewable energy to the extent that 150 megawatts of solar, 70 megawatts of wind and 150 megawatts of battery storage will be utilised. Mpumalanga will also see under the guidance of the Minister of Electricity the recovery of the three units of Kusile that have been impacted and very soon the outstanding units to be built at Kusile and Medupi will also be coming to live within the next year or so.
As far as the Northern Cape is concerned, that’s where the best sunshine, probably in the world at this point in time. There are a lot of investments that are due to take place there. That is where the extension of the transmission grid is required. Similarly, the Eastern Cape in endowed with lots of wind. So, the wind farms generally turn to move towards the Eastern Cape.
Let us quickly move to Transnet. Here we are in efforts to deploy more locomotives and repair the current infrastructure and remove the speed this section that have to be imposed. To give you some kind of provincial perspective, for coal there would be a term to increase the Richards Bay coal channels volume from 49 million tons million tons per year to
63 million tons per year. That will improve even further once we get the locomotives repaired and delivered by the Chinese – those outstanding.
Similarly, for North West, Limpopo and Mpumalanga and magnetite exports the term clear is to increase from
9,9 million tons per year to 15,6 million tons per year. That is going to be achieved through running longer trains such as
150 wagon trains for chrome and 160 wagon train for magnetite.
In the Northern Cape, an increase from 51 million tons to
60 million tons. Manganese is going to have a huge abandons of investment to ensure that even East London is prepared for manganese exports with an increase of one million tons overall in the next year.
I addition to this, Transnet is also undertaking some structural changes. Firstly, the cusion of the Transnet National Ports Authority is well on its way and its board will be anointed shortly as a subsidiary of Transnet with separate accounting systems. Secondly, an infrastructure unit has been created within Transnet freight rail so that the maintenance and looking after of the infrastructure is separated from the operations of the trains. Thirdly, a leasing company is being checked out at the moment in terms of Transnet engineering acquiring and providing all sorts of equipments to both itself, but also to other entities in South and southern Africa. All of these is based on keen partnership between Transnet itself and government on the one hand and business on the other hand.
Again, if you take provincial perspective, in the Northern Cape the Boegoebaai port development area, project has a
speedy advance in terms of its conceptual development and some of it is costing. That will open up even more mining areas and export zone possibilities for various types of commodities from the Northern Cape directly via Boegoebaai. Of course, that’s a 10-year or so project and it is not going to happen tomorrow morning.
As far as the Western Cape is concerned, there is an increase in the capacity of the Saldanha line. There is an enhancement of port capacity for iron ore which is positive both for the Western Cape and the Northern Cape. This increase is the capacity of the Saldanha and the other ports to export more. Balcon Terminal in Belville is secured as an investment and they are now 96 reefers at the terminal. Reefer plagues is what keep the fruit fresh the right temperature before the fruit is onloaded in to ships and exported to the different parts of the world.
There are similar projects in the Eastern Cape and KwaZulu- Natal where the Durban Harbour Port will grow from two million containers to eventually 10 million containers over the period of time. That port has to be deepened; it has to have the capacity to take on the new types of vessels that come with
large numbers of containers than what is currently possible. But those are all projects that are on the way. The Transnet board has approved a partner for what is called the Pier 2 project which creates an extension and also deepening that part if the harbour.
Let me end by talking about the SA Airways, SAA, which has been saved from liquidation and a total disaster. Today, I hope many of you are using SAA. Currently, it has 12 destinations - 10 regionals and to domestic. There are a number of aircrafts, and they are 12 at the moment and systematically will grow. This key initiative that will be concluded in the next few months is to bring on the strategic equity partner once the Competition Commission and the Competition Tribunal processes have been concluded. We envisage that by March 2024, if all things go well, there will be one intracontinental route, 16 regional routes and a number of local routes as well. That will enable all of you to travel to South America and other parts of the world once SAA gets going. There is a shortage of seats as we see it at the moment.
All in all, Chairperson, there is a clear plan for SOES in South Africa. It’s going to require political will; it’s going to require determination and it is going to require the ability to hold off those who are benefitting from the current arrangements because their pockets are filing up. We need to ensure that SOEs are prepared for future generations. Thank you very much.
The MINISTER OF TRANSPORT: Hon Chairperson, as I deliver my maiden and Budget Vote speech as the Minister of Transport to this National Council of Provinces, I firmly believe that the road to social economic development begins with the development of a road. The rail tracks of time and experience tend to test the tenacity and commitment to meaningful developments.
Hon Chairperson, I say this because a nation’s development is largely measured amongst others by the civilization of its transport infrastructure and systems. Through an integrated transport system, we are able to link producers to markets, workers to employment, students to schools and universities and the sick to hospitals.
Our rail and roads are critical drivers and enablers to our country's economic reconstruction and recovery plan.
Therefore, as the Department of Transport and our 12 state owned entities, our unwavering commitment to the heartbeat of South Africa, social development and economic growth stand firms stand firm and solid on a developmental route to deliver tangible outcomes that our people can see and experience.
Hon members, our 2023/24 financial year budget allocation is R79,5 billion, which will be channelled towards delivering a better transport system, infrastructure, and services for all South Africans. It is important to note that of the
R79,5 billion, total transfers and subsidies account for approximately 98% of the department’s expenditure to the tune of R77,9 billion in the 2023 financial year. Of this,
R47,2 billion are transfers to our public entities and agencies, and R30,2 billion is transfers to other spheres of government.
Hon members, our work towards delivering a public transport system that meets the needs of our people continues to gain traction. The department plans to achieve seamless integration of all model public transport operations that provide the
public transport system for the delivery of efficient affordable, safe and reliable transport.
We will achieve this by directing the Public Transport Network Grant, PTNG, towards critical interventions that will deliver tangible outcomes. The grant is intended to provide funding for accelerated construction and improvement of public and non-motorized transport infrastructure that forms part of a municipal integrated public transport network to support the planning, regulation, control management and operations of fiscally and financially sustainable municipal public transport network services.
The PTNG allocation for the 2023/24 financial year stands at R6,8 billion. The cities of Msunduzi, Mbomela and Buffalo City remain suspended from the grant. We have committed to work closely with them to meet the National Treasury conditions for readmission to the grant.
The breakdown of the allocation of the PTNG for the 2023/24 financial year per city is as follows, Nelson Mandela Bay is R346 million, Mangaung R270 million, Ekurhuleni R773 million, Johannesburg R1,2 billion, Tshwane R830 million, eThekwini
R952 million, Polokwane R214 million, Rustenburg R258 million, Cape Town R1,8 billion and George R145 million.
We are processing the National Public Transport Subsidy Policy, which will be published for comment soon after approval by Cabinet. The public transport funding model will also be approved this financial year.
The Public Transport Operations Grant, which provides supplementary funding towards public transport services provided by the provincial departments of transport in the form of bus subsidies has been allocated R7,4 billion in the 2023/24 financial year.
The allocation is distributed as follows, Gauteng R2,9 billion KwaZulu-Natal R1,4 billion, Western Cape R1,2 billion, Mpumalanga R742 million, Limpopo R441 million, Free State
R324 million, Eastern Cape R294 million, North West R136 million and Northern Cape R66 million.
We continue to strengthen the regulation of the taxi industry through the revamping of the regulatory system to ensure safe and legal operations. These efforts will be bolstered by the
passing of the National Land Transport Amendment Bill, which will enable us to regulate the E-hailing sector and address challenges facing meter taxis.
The taxi recapitalization program remains an important intervention in the transformation of the industry, underpinned by the improvement of passenger safety. The budget for the taxi recapitalization program increases from
R477 million to R479 million in 2023/24 financial year.
Hon Chairperson, investments in road networks are targeted at ensuring that passengers and freight carriers, which hold almost 80% of South Africa's freight load, have adequate access to safe roads. In this regard, we are working towards finalizing South Africa’s Road Funding Policy by the end of this financial year.
For this financially, we have budgeted R42,6 billion to fund efforts to construct, upgrade, and maintain the national and provincial road networks.
Allocation to Sanral is R25,4 billion. Of this budget, R15,8 billion is to strengthen and upgrade the national non-toll
network. Amongst the Sanral mega projects, we are continuing with the construction of the Moloto Road Corridor, the N2, N3 and N7 road network expansion and N2 Wild Coast projects.
The N2 Wild Coast projects include the construction of the two iconic bridges, Msikaba being the highest in Africa and Mtentu being the longest bridge in the continent of Africa.
We are also in the process of undertaking construction work in the northbound section of the 3,9-kilometre-long Huguenot Tunnel, making it the longest road-based tunnel in Africa.
These Sanral mega projects confirm the diverse engineering excellence and profound expertise found right here in South Africa.
Hon members, our work to improve the conditions of our road network which includes refurbishment, rehabilitation, and eradication of potholes particularly in provincial and municipal roads, continues to gain momentum.
For the Provincial Roads Maintenance Grant, PRMG, we have allocated R15,9 billion, of which R4,6 billion rent is
specifically earmarked for road refurbishment, disaster relief and the construction of 96 Welisizwe Bridges in rural areas.
The allocation of the PRMG to various provinces for the 2023/24 financially is broken down as follows, KwaZulu-Nata will get R3,4 billion, Eastern Cape R2,1 billion, Limpopo R1,8 billion, Free State R1,8 billion, Mpumalanga R1,5 billion, Western Cape R1,4 billion, North West R1,4 billion, Northern Cape R1,4 billion and Gauteng R1,1 billion.
Similarly, we have allocated R115 million in the form of the Rural Road Asset Management System Grant intended to assist district municipalities to set up rural roads, asset management systems and collect roads, bridges, and traffic data on municipal road networks, in line with the road infrastructure strategic framework for South Africa.
We also recognize the value of working with research institutions like Centre for Scientific and Industrial Research, CSIR, for innovative solutions. Like the Nanotechnology solution, which will be piloting this year in the gravel road upgrade. It is our intent to employ the
Nanotechnology solution to upgrade our gravel roads to well- engineered and all weather condition network.
We're also committed to working with the private sector in a structured manner to address this challenge and create a multiplier effect in the rehabilitation and maintenance of all provincial and municipal road network.
Hon members, the work continues to restore and rebuild infrastructure that was damaged by floods during April 2022 that affected the provinces of KwaZulu-Natal, Eastern Cape and North West. We are committed to ensuring that we build the capacity of our municipalities through support interventions to achieve efficiencies and road maintenance. In this regard, we are also going to establish a roads war room to address all road-based challenges.
Hon Chairperson, we are purposeful in our efforts to arrest the carnage on our roads. On the 15th of May 2023, we joined hands with nations of the world to echo our support as South Africa for the commemoration of the United Nations, Global Road Safety Week. In this regard, the road traffic management
cooperation has introduced a new era in traffic policing training curriculum.
We now have the first cohort of graduates qualified with the National Qualifications Framework, NQF, level 6 qualification and have joined the ranks of our traffic law enforcement officers.
This new generation brings to the table fresh and innovative solutions to the intractable challenge of the carnage on our roads. They are reinforced by technological innovations to reign in the lawlessness on our roads and provide visibility 24/7 and 365 days.
We have previously committed to maximizing visibility on our traffic law enforcement officers by declaring traffic policing a 24-hour seven-day job. The number of provinces that have completed the necessary processes has increased and our intention is to ensure that the remaining provinces finalize outstanding work in this regard and by the end of this financial year. For this task we have allocated a budget of R220 million this financial year to the Road Traffic Management Corporation, RTMC.
Hon members, we remain resolute as government to deal with challenges confronting the freight industry. In June last year, the Minister of Transport, together with the Ministers of Labour, Police and Home Affairs, signed an 11-point plan with the entire freight industry to find common ground and thus find each other in stabilizing the industry.
Ours is to continue to build the sector, to grow a transformed and inclusive economy served by a modern and resilient transport system. The Cross-Border Road Transport Agency is central in regulating the road freight industry and ensuring its ability to meaningfully contribute to the economy through the implementation of linking Africa plan and through the African Continental Free Trade Agreement.
The CPRTA is a self-funding entity. Its expenditure is expected to increase from R274 million to R286 million rent in 2023/24. The Road Accident Fund, RAF, is mandated to compensate South African road users for losses or damages caused by motor vehicle accidents within the borders of South Africa.
Over the medium term, a change in the settlement policy of loss of income claims from lump sum to annuity sees a moderation in the payment of claims to match the funds pay as you go principle. For this, the budget allocation to the Road Accident Fund for the 2023/24 financial year is R48,6 billion collected through the petrol levy.
Chairperson, regarding the targeted roll out of the Administrative Adjudication of Road Traffic Offences Act, AARTO, we remain confident that the Constitutional Court will find in our favour on the matter of the constitutionality of the AARTO legislation. [Inaudible.] ... is bracing itself for a full speed implementation of this important law once judgement has been handed down.
The agency derives its revenue mainly through administrative fees and transfers from the department. Revenue is set to increase to R555 million in line with the expenditure.
Chairperson, hon members, our work to rebuild commuter rail continues in earnest. In the last financial year, we committed to recover 10 priority corridors. I'm pleased that we not only achieved the target, but we exceeded it by recovering 13.
This financial year we plan to recover 16 strategic rail corridors eight in Gauteng, four in KwaZulu-Natal, and four in the Western Cape. The full recovery of the central line in Cape Town remains our topmost priority. We are working closely with the Department of Human Settlement Settlements and the City of Cape Town to relocate the illegal settlements on the rail reserves, which will enable us to achieve full recovery of the central line.
For the 2023/24 financial year we will transfer R20,5 billion to Prasa. These funds will mainly focus towards implementing Prasa strategic corridor recovery program, signalling, and continuing with its rolling stock renewal.
In his state of the nation address, President Cyril Ramaphosa indicated that the National Rail Policy will guide modernization and reform of the rail sector, providing, among other things, for 3rd party access to our rail network. I must announce that the department has commenced the process to develop the urgently required National Rail Master Plan.
Chairperson, for purposes of effective transformation of the transport sector we have processed through Parliament the
transport Economic Regulation Bill. This bill when past will ensure a level playing field in the sector and ensure regulation of monopolies towards fair pricing and easier access to new entrants, among other aims.
House Chairperson, it gives me pleasure to announce that we appointed and introduced the integrated transport sector Broad-Based Black Economic Empowerment, B-BBEE, council. The urgent task of the council includes ensuring that as a sector
we have integrated transport sector to B-BBEE codes to address acute transformation challenges, experience in the main within the aviation road, freight, and maritime sectors as well as to create a tool to bring awareness and address the skills shortage in ensuring development of black professionals.
Hon members, the Railway Safety Regulator, RSR, continues to elevate the safety of our railways to global standards. To this end, RSR will be hosting international rail experts from all over the world, at the International Rail Safety Council here on South African soil from the 1st to the 6th of October 2023 in Cape Town.
The RSR as with all our entities continues to prioritize the emancipation of women and the 2023/24 financial year will see a 40% growth in this proportion. Railways Safety Regulator will continue with the National Information Monitoring System to ensure seamless online application and issuance of safety. permit. The budget allocation for RSR for 2023/24 financial year is R76 million.
Hon Chairperson, the maritime sector remains strategic in enabling economic growth and increased trade. Our efforts to support the maritime manufacturing capabilities, both building skills development and training will be strengthened and will be led by South African Maritime Safety Authority, SAMSA.
We are testing our different solutions to address the tax regime as an instrument to attract shipping companies to register their vessels in South Africa, leading to growth of our register.
The post regulator of South Africa through the tariff application process has allowed the authority to raise funding of about R14 billion in this 2023/24 financial year. The ports regulator will continue with its responsibilities as the
economic port regulator until the time when we establish the transport economic regulator.
Hon members, our aviation infrastructure program will provide support to the Airport Company South Africa’s, ACSA, recover and sustained strategy. That includes paying an active role to support provincial airports and investing specialized airports such as drone airports, taking advantage of emerging opportunities brought about by technology.
Revenue is expected to increase to R5,7 billion in 2023/24, driven by the expected increase in passenger numbers as the air travel industry continues to recover from the COVID-19 pandemic.
Which we will support ACSA to grow its footprints and play a bigger role in building and managing airports in the country and elsewhere in the continent. We equally intend supporting the growth of the domestic aviation industry.
For the year 2022/2023 OR Tambo International Airport won best cargo airport in Africa, Cape Town International Airport won the best airport and the best airport staff in Africa award,
while King Shaka International Airport won the best regional airport in Africa award and these three airports lead in Africa and they are in the top 100 in the world.
The Air Traffic Navigation Services, ATNS, company maintains its focus on providing safe, efficient, and cost-effective air traffic management solutions and related services with the bulk of budget expected to be used on communication, surveillance, and simulator system. Its total revenue is expected to increase from R1,3 billion to R1,9 billion in 2023/24.
Expenditure for South African Civil Aviation Authorities, SACCA, is expected to increase to R894 million in 2023/24.
SACCA will focus on strengthening their efforts in the implementation of general aviation safety strategy using innovation and technological solutions.
I'm pleased to announce that the SACCA later coordinated process of audits conducted by the following international bodies, the United States Federal Aviation Administration, FAA, following an audit concluded in November 2021. The final
outcome audit assessment confirmed that South Africa has retained its category one status with the United States. The benefit of this outcome is that South African airlines can operate directly into the United States with no hindrances.
In August 2022, South Africa was also subjected to a Universal Security Audit Program by ICAO that is, International Civil Aviation organization. I'm pleased to confirm that South Africa has now received the final report from ICAO and the state received an unqualified audit opinion with no significant security concerns raised by ICAO.
In November 2022, South Africa's aviation security cargo system was assessed by the United States Transport Security Administration, TSA. The outcome of this assessment confirmed yet again that the cargo security system of South Africa is on par with that of the United States.
Yes, as a result, the TSA granted South Africa permanent recognition. This means that South African cargo operators wishing to operate in the Unites States of America can do so unhindered without a need to undergo individual assessment by the United State of America.
In March 2023 this year we were again audited by ICAO under its universal safety oversight audit program. From this audit, South Africa did not attract any significant safety concerns and received an overwhelming effective implementation score of around 92%.
This is a significant improvement from the 87,3% that ICAO gave the country in the 2017 audit. The recognition of South Africa aviation system by leading aviation states and bodies has huge economic benefits for the state and the operators in our in our country and SACCA leads this for South Africa.
The transport sector remains the instrument for the much- needed catalytic economic reconstruction and recovery for South Africa. We pride ourselves at team transport for the progress and achievements recorded, as well as, of course, acknowledge the shortcomings and challenges ahead of us.
Our developmental commitment to address the roads, public transport and rail matters among others are at the apex of our priorities as Ministry. To this end, I would like to appreciate the support of the Deputy Minister, Hon Lisa Mangcu, the director general, the boards, the chief executive
officers, CEO's, the executive management of the Department of Transport and our state-owned entities and public entities, as well as the Ministry led by the chief of staff and the departmental staff complement and the industry stakeholders.
As I conclude, hon members, Chairperson, I present the budget allocation for the Department of Transport Vote 40 for the financial year 2023/ 24. Thank you very much.
Mr K M MMOIEMANG: Deputy Chairperson, greetings to hon members and my colleagues and especially honourable greetings to the Ministers and Deputy Ministers with us this afternoon. Allow me to also extend word of greetings to our people that are watching this debate. Indeed, the Minister has outlined a line of much and I want to rally myself behind her clarion call appreciating the importance of the transport sector. In doing so, allow me to quote the Chinese President Xi Jinping, the President of the second world biggest economy when he said as follows on transport:
Transport is the artery of the economy and a bond between civilization. Transport has facilitated economic integration and people-to-people exchanges and turned the world into a
world close-knit village, only with openness, inclusiveness and connectivity can country reinforce each other’s efforts and achieve win-win results.
That is important because we agree with the Minister that South Africa is one of the most sophisticated transport systems in Africa. Therefore, the country operates all modes of transport road, rail, shipping and civil aviation for the movement of people, goods, freight and providing services and these modes operate in an integrated manner across the provinces. Thus, emphasising and also echoing the same a sentiment as expressed by both the Minister and the Chinese President Xi Jinping.
The transport network developed is due to the relatively vast geography of our economy and it is important that given the fact that we have the largest road and rail network on the African continent ... [Inaudible.] ... to be maintained. I believe that as the ANC we support the budget because it is geared towards supporting that.
The transport sector is a key economic driver of the economy and therefore an efficient transport system is quite critical
in terms of advancing the implementation of the Economic Recovery and Reconstruction Plan. While the country does have a functional transport system the department and its entities have to deal with the number of challenges which were outlined by the Ministers. However, those challenges, indeed, include the restoration of roads and rail transport. It’s quite critical that the further development of the transport infrastructure has to be accelerated because it is quite critical in terms of the recovery of economy.
The Minister has, indeed, outlined the budget to be appropriated which is centred around implementing seven programmes which includes the major modes of transport in the country. It is imperative that the programmes are able to meet their performance targets to ensure the further development of the transport sector. It’s quite critical as the Minister has indicated that the transfers to entities, provinces and municipalities have to be monitored. This is imperative to allow the co-ordination between the national Department of Transport and provincial as well as municipal transport structures, but more than that also the entities because these spheres of government, these entities are quite critical in terms of the policy implementation as charted by the
department. It is imperative that provincial and municipal transport grants are utilised to improve the road infrastructure.
As the Minister has indicated, SA National Roads Agency, Sanral, has certainly been one of the more successful state entities and has a very successful track record of delivering road infrastructure, but we agreed that there’s a room for improvement. We agreed that from the e-toll, there’s debt lots that has to be recovered. As part of its portfolio of development of national roads and provincial roads Sanral is developing road infrastructure in many provinces and will engage also in maintenance of the projects of both national and provincial roads, because of its efficiency and effectiveness there are lots of provinces that are beginning to make a representation to Sanral to come to their assistance.
As the Minister has indicated, there are notable roads, amongst them R63. This important because there are also other critical road development projects in the province of Eastern Cape. Already, we appreciate the investment that is made in spending and as part and parcel of developing R63. This
investment led by Sanral will have a positive economic impact on the province as it will enable access by communities to service and access markets and also serve to improve tourism in the industry through making road transport efficient. The Minister has made reference to Moloto Road. The importance of this road in terms of economic linkages cannot be overemphasised. Sanral is also busy with a number of projects in KwaZulu-Natal, KZN, which require the rebuilding of the road infrastructure post the devastating floods. It is also important as noted by the select committee that this intervention has to be monitored, particularly given the fact that Sanral’s through these number of projects has a target as the Minister has indicated of creating 12 000 jobs.
However, it is quite critical that the provinces and municipalities have along the implementation of this programme develop the skills, capability and capacity for the maintenance and development of provincial and municipal roads. The national Department of Transport and Sanral need to work closely with these entities. Of course, we appreciate the fact that there are number of challenges regarding maintenance of our roads. But what also exacerbate the condition and
situation is the rainy season. Because of this rainy season we see deterioration of some of our roads.
However, it is quite critical also to note the intervention that the department has introduced, amongst them, the Vula Zonke campaign. Indeed, we appreciate this intervention because it gives confidence to our people that, indeed, this is an ANC-led government which, indeed, represents the aspiration of the majority of our people, particularly the working class and the poor. The development of road infrastructure in the rural areas is critical for the further development of the agricultural sector and to ensure food security for the country. The development of the road to the wild coast will ensure greater access to one of the most beautiful parts of the country and encourage tourism which will generate revenue for many communities.
Of course, as the select committee having adopted the report this morning, hon Minister, we appreciate the increase that is expected on Sanral’s budget, but more than that the extent to which the agency will be intervening around the national nontoll road network. As we have also indicated the N2 Road Wild Coast and also the Moloto Road. In relation also to the
provinces as we’ve indicated, Minister, we appreciate the intervention that the department is making in relation to the budget in relation to the Provincial Road Maintenance Grant. Like as we’ve indicated that it was quite critical is close monitoring and evaluation and also ensuring that there’s no disjuncture between the policy as set out by the national department and what is implemented on the ground.
These interventions in terms of the Provincial Road Maintenance Grant indicate that the ANC government is hard at work to ensure the development of transport infrastructure. We also appreciate the resolution of the impasse around Gauteng
e-toll. This clearly indicates the extent to which Sanral will be able to stabilise its books. But also like as the Minister has indicated the provincial road safety is quite important.
And also, as the select committee we noted the report on the reduction of road accidents by 25%. But also to what we are saying is that this reduction mends the savings of lives, but what we are also saying is that enforcing the rules of the road and traffic regulations must be observed through safety campaigns and enforcement, because in most cases accidents are caused by drivers through their negligence.
We also appreciate the work that the department will be doing through the implementation of the District Development Model, which is geared to develop the micro economy, which is dependent for its success on transport as this is about the development of the micro economy in the municipalities and provinces. These are transport infrastructure projects as this will link markets in local areas and people with these markets and therefore drive local economic development. The development and success of Agrozones and industrial parks will depend on both road and rail infrastructure. There are a number of important bridges as the Minister has indicated, which are quite critical in linking the road infrastructure between different areas which also forms a critical part of the transport infrastructure development in the provinces. I will not name them because the Minister has done that.
However, what is quite critical is the fact that emerging from this programme and projects there’s an expectation that 2 500 jobs in those areas around Madikizela-Mandela Municipality will be created. What is also critical is the fact that the Welisizwe building programme is aiming to build 48 bridges, as the Minister has indicated. There’s tremendous progress in relation to that. However, what is also appealing is the fact
that another 96 rural bridges are planned to ensure that the economic development in these areas can become a reality.
There is much work to be done and the budget and the programmes of the department and the transfers to the entities reflect the commitment of an ANC-led government. In this regard implementation is key and as the select committee we will certainly engage the department and its entities on the outcomes and the budget to make sure that, ultimately, the beneficiary becomes our people. The ANC supports this Budget Vote for Transport. Thank You.
Mr Z MKIVA: Thank you very much, Chairperson. Good afternoon to you and good afternoon to the hon members. Allow me also to welcome our esteemed Ministers who are here, Minister Gordhan and Minister Chikunga, as well as the Deputy Ministers who are here. I greet all of you, as well as South Africans who are watching this on the Parliamentary Broadcasting Service.
Chairperson, the Presidential Review Committee on State-Owned Enterprises, SOEs, notes that SOEs are important vehicles and contributors to infrastructure development and gross fixed capital formations in South Africa.
IsiXhosa:
Siyavumelana sonke ngamxhelo mnye kwinto yokuba amaziko oshishino karhulumente ziifolosi ezijongene nokuqinisekisa ukuba uphuhliso luyenzeka kwilizwe lakowethu. Ngaphandle kwala maziko oshishino eli lizwe, asingekhe sikwazi ukufikelela ebantwini ngakumbi kubantu abakwindawo ezihlelelekileyo ukuze siqinisekise ukuba bayalufumana uphuhliso, ngaphandle kokuba sisebenzise la maziko karhulumente.
English:
In contrast, most of SOEs under the portfolio of the Department of Public Enterprises, DPE, we acknowledge that there are some inefficiencies in the task of responding to the infrastructure development and gross fixed capital formation agenda in the country. One of the cited factors contributing to this are the existing governing structures and business models of SOEs, which are inadequate to develop long-term strategies for meeting the infrastructural developmental goals as the Minister has also acknowledged. Thus seen, the DPE is making robust efforts to initiate ground-breaking restructuring and turnaround plans to change the current business as usual practices across SOEs that are unsustainable
and have caused detrimental infrastructure development and gross fixed capital formation consequences in the past.
However, public private partnership as outlined in the presidential review committee on SOEs and the Economic Reconstruction and Recovery Plan, ERRP, can provide an impetus to the efforts geared towards restructuring and turnaround plans of SOEs on the one hand and act as a useful tool for the expansion of infrastructure development and gross fixed capital formation on the other hand.
Chairperson and members of this House, there is now evidence that some of inefficiencies and weaknesses in the electricity market have constrained infrastructure development in the country. In particular, the electricity market is plagued by numerous challenges, including the inability of Eskom to generate enough electricity to offset the growing demand, which has resulted in periodic stages of load shedding. The harmful effects of load shedding on households and businesses make the restructuring of Eskom a priority of DPE.
IsiXhosa:
Siyaqinisekisa kubantu bakowethu ukuba kwiziko lokuphehla umbane kweli lizwe, sizama konke okusemandleni ethu ukuqinisekisa ukuba liyaqhubeka liwenza umsebenzi walo.
Asilali singenacebo sivuke singenaqhinga lokuyisombulula le nyewe. Umhla nezolo eli sebe lizama amacebo namachiza okulungisa lo mcimbi njengoko sisazi ukuba umbane ulilungelo kubantu bakowethu ababekade bengenawo.
Ngoko ke udanya-cimi owenzekayo ubangela ukuba sifinge omfutshane sibhinqele phezulu ukuqinisekisa ukuba siyalilungisa eli khwiniba.
English:
As load shedding continues to result in forgone sales and damaged equipment, literally, the DPE has embarked on a series of sequential steps to unbundle Eskom into three divisions responsible for generation, transmission, and distribution as part of effecting comprehensive restructuring and reforming initiatives in Eskom. The unbundling of Eskom would separate the generation and transmission function of ... [Inaudible.]
...
The DEPUTY CHARPERSON OF THE NCOP: As hon Mkiva is kicked out by the system but he wouldn’t know. As soon as he reconnects he might continue to speak. So we are now sitting with a bit of a problem. I don’t know! Is there anyone that can find out what is a happening?
AN HON MEMBER: Bring him back into the House.
The DEPUTY CHARPERSON OF THE NCOP: We have been trying. Mkiva said you must trench yourself before he come here. Can someone find out before we continue. Because usually it become so confusing when someone comes back and continuing to speak. We will allow hon Nhanha to continue. If someone can just inform hon Mkiva that he will... [Interjections.] ... Is he re- joining? Sorry hon Nhanha. I really didn’t want to call you because of this exact issue.
Mr Z MKIVA: ... I am sorry about that Deputy Chairperson. It’s the loadsheding issue that also affects us where we are located. I don’t think that members should make it a big issue. We are all aware ... [Interjections.] ...
The DEPUTY CHARPERSON OF THE NCOP: Order!
Mr Z MKIVA: ... of the challenges that faces us. Thank you very much.
The DEPUTY CHARPERSON OF THE NCOP: You may continue hon Mkiva. Everyone here is getting on one stage or another of this problem. You may please continue. I am the one presiding here.
Mr Z MKIVA: Moreover, the unbundling of Eskom seeks to fast track the acceleration of the geographic and energy strategic integrated project as outlined in the National Infrastructure Plan looking at approaches that are going to help us address all the matters. The unbundling of Eskom is inextricable linked to this in the sense that it increases the entry of renewable resources through Independent Power Producers, IPPs, in the generation network of the South African electricity market.
In this regard, the unbundling of Eskom not only fast track the geographic and energy Strategic Integrated Projects, SIPs, but also accelerate the ERRP priorities to crowd in additional private investment to increase the much-needed generation capacity. More exactly, the unbundling of Eskom is strengthening the ANC-led government efforts to attract
private sector investment in the delivery of geographic SIPs as part of building broad-based public-private partnership, PPPs, thereby improving infrastructure development and gross fixed capital formations in the country.
It goes without saying that the opposition parties with ... [Inaudible] ... underpinning like the EFF which likes to plagiarize the work of Naomi Chominsky would argue that the unbundling of Eskom is a precursor to privatisation and in turn relinquishes the constitutional role of the government to provide electricity in the country.
Chairperson, we will never outsource the issue of supplying electricity in the country into private hands. We are a responsible government under the ANC. We know why we are doing this unbundling of Eskom. And we are learning as the Minister has outlined in his opening remarks from the best practices in the world The unbundling is not meant to privatize. The unbundling is meant to strengthen and then reach the capacity of as well to do what is expected by our people in the country. To provide reliable and sustainable electricity. Such an argument, however, is underpinned by rigid ideological positions that ignore practical policy and development
lessons. Ours is a developmental agenda in the country, and we learn from the best in the world.
At the same time, this argument rejects international experience, which indicates that generation and distribution networks in the electricity market do not exhibit natural monopoly tendencies, and thus competition must be introduced. We are introducing competition to ensure efficiency, proficiency, and the sustainability that I have spoken to.
Nonetheless, the first step in the unbundling of Eskom has been completed by establishing the National Transmission Company of South Africa, NTCSA, aimed at incentivising competition in the electricity market for more efficiency and reliability supply of electricity. Meanwhile, the second step is currently underway, and it involves getting a license approval from the National Energy Regulator of South Africa, NERSA, obtaining lenders consent on transmission debt and appointing the board of directors for the NTCSA.
In the current situation, the department is proactively engaged in facilitating the finalization of the second step and it is doing all this in consultation with the relevant
stakeholders as part of promoting participatory democracy, which is the character of the ANC and the character of our government.
As the second step is in the unbinding of Eskom unfolds and all the outstanding issues are addressed, the commercialization and operationalization of the ... [Inaudible.] ... which is the priority of the DPE in the current financial year, would contribute to infrastructure development and gross fixed capital formation through the establishment of the independent system operator, which would provide non-discriminatory access to transmission function of Eskom. Thereby incentivising the complementary investment in renewable energies and in the required expansion of transmission grid infrastructure with potential creation of jobs.
Moreover, the commercialization and operationalization of NTCSA and the establishment of the independent system operator promotes the entry of new generation capacity, which is quite needed from the IPPs and the IPPs would trigger competition in the electricity market thereby reversing Eskom’s inefficiency and ultimately reducing monopoly electricity tariffs which
catalyse the culture of non-payment in various municipalities in the Free State and electricity theft in provinces with townships as well as informal settlement such as in Gauteng and the Western Cape.
Hon Chairperson, transforming the railway network is another key for realising infrastructural development in our country as outlined in the Presidential Review Committee on SOEs.
While Transnet Freight Rail, TFR, monopoly in the railway network has resulted in inefficiencies and the cable theft, which has increased rather than decreased the cost of doing business in South Africa as the policy imperatives of the National Development Plan, NDP.
The division nonetheless is embarking on transforming the railway network to attract investment in the railway infrastructure to achieve efficient logistics solutions. In particular, TFR is accelerating the sale of slots in the railway network aimed at crowding the PPP in a structured, yet dynamic way by collaborating in the top eight commodity value chains that TFR presently serves, and which represent 80% of the division’s revenue.
However, in the first phase of the sale of the slots, the TFR has prioritized the container corridor, which goes from Gauteng to Durban, and South Corridor, Gauteng to East London, in the Eastern Cape. Gauteng and the Kwa-Zulu-Natal provinces which formed a critical part of the competitiveness of South Africa’s manufacturing, automotive and agricultural sectors are playing a key role in that space. More importantly, the sale of the slots in the two corridors is not only a means of attracting new investment, estimated around R54 billion in the railway network, rather, it is aimed to improve efficiency in the railway network, particularly because the railway network plays a major role in industrialization, economic growth, social development, as it moves goods, services, as well as people on daily basis. This implies that the sale of slots complements the Department of Transport’s National Rail Policy aimed at achieving the desired results, among other things.
Improved efficiency, service quality, and competition of rail business through the introduction of the third party access across various categories of rail lines in the country is something that we are looking at.
Interestingly, the sale of the slot is inexplicably linked to the Transnet Roadmap, which the DPE plans to finalise and
implement in the current financial year. This roadmap is part of the DPE’s effort aimed at restructuring TFR with the intention of creating, amongst other things, a rail infrastructure manager tasked with the responsibility to oversee the functioning of the railway network in the country. Thanks to the DPE.
Denel SOC Ltd has successfully restructured its business model from six to three core business units, namely engineering, manufacturing, maintenance, and overhaul. The restructuring of Denel SOC Ltd’ s business model is ideally consistent with a visage, gross fixed capital formation agenda as outlined in the Presidential Review Committee on SOE and ERRP.
Hon Chair, the DPE is committed to enforcing ground-breaking restructuring and turnaround plan initiatives for Eskom, Transnet and Denel SOC Ltd, to steer them in a direction that is aligned with the recommendations and the key priority interventions of the Presidential Review Committee. With the support of the DPE and that of the Presidential State-Owned Enterprises Council, those SOEs will become engines geared towards realizing the ANC-led government’s long-term objectives encapsulated in the NDP.
Chairperson, we are optimists, and we have to thrive on courage and giving hope to our people. And we must never allow any situation where we are defocused. These SOEs play a key role in the management of the national ... [Inaudible.] ... because what they do is to ensure that they are torchbearers of infrastructure development which is greatly needed in order to grow our economy to create jobs, to alleviate poverty amongst other things.
I therefore rise on behalf of the African National Congress, the only organisation in the country that has capacity to government this country, which governs right now, and which will govern into the future. I support this Budget Vote on behalf of the ANC. Thank you very much.
The DEPUTY CHARPERSON OF THE NCOP: Thank you very much, hon Mkiva. I am sorry for what happened previously, hon Nhanha. I will now call on you to continue with the debate. Hon members, I also want to apologise on behalf of Sound and Vision, there is a problem with translation but they are attending to it at the moment. Thank you.
Afrikaans:
Askies.
English:
I can see.
Mr M NHANHA: Deputy Chairperson, I will tell that to my wife. Hon Deputy Chairperson and hon members, good afternoon. On Wednesday last week, the Select Committee on Public Enterprises we were asked to avail ourselves for an urgent meeting on Friday, requested by the Department of Public Enterprises to brief the committee on its Strategic Plan and Annual Performance Plans, APPs, for the 2023-24 financial year. We reluctantly acceded to the department’s request, despite the fact that it came at such a short notice.
The Minister sent his Deputy once again, who by the way must be given credit for always availing himself when asked to appear before the select committee. It must be difficult for hon Bapela to always cover up for an absent principal, who is either too busy to attend the select committee meetings or sittings of this House. Back to the Department of Public Enterprises, the vision of the Department of Public Enterprises reads as follows:
It is to drive investment, productivity and transformation in the department’s portfolio of state-owned entities, SOEs, their customers and suppliers to unlock growth, drive industrialisation, create jobs and develop skills.
It is clear, that under Minister Gordhan, the Department of Public Enterprises is failing its vision and mission. It is under Minister Gordhan’s stewardship that SA Express Airways, SAEA, was liquidated, and Mango is unable to emerge out of business rescue and seems like its fate will also be liquidation. The result is that these two airlines are no more, and public value has been destroyed. Sixteen years ago, the South Africans got their first taste of loadshedding and there seems no reprieve in sight.
This biggest crisis our nation has ever faced since the dawn of democracy, has last year alone reached disastrous levels. In 2022, we experienced 157 days of rolling blackouts which cost South Africa R560 billion in lost productivity. Hon members, Denel Dynamics CEO, Sello Ntsihlele, was suspended in November 2022, allegedly, for insubordination and for failing to perform his duties as the CEO. Hon members ...
IsiXhosa:
... vukani magwalandini zemk’iinkomo ...
English:
... plans are afoot to sell Denel Dynamics’s intellectual property and other assets at the fraction of their actual value. It now appears the real reasons for the suspension of the CEO, he dared to stand up for the company and the people of this country. Of course, all these shenanigans at Denel would not go on without the knowledge of the Minister Gordhan.
If the board of Denel is confident of a watertight case against its Chief Executive Officer, CEO, let them refer this matter to an external dispute resolution process, instead of a kangaroo court at Denel, whose outcomes are predetermined. The allegations of theft of intellectual property at Denel, aided by the former Group CEO, Riaz Saloojee, who has mysteriously found himself back at Denel as a Restructuring Officer through dubious appointment processes, and the current acting Group CEO, Micheal Kgobe, needs the authorities to act with haste, to ensure that national security is not compromised, and international trust in South Africa being a responsible owner of armaments manufacturing technologies is not eroded.
The Special Investigations Unit, SIU, should ensure that these allegations are investigated and where evidence of criminality is proven, the criminal justice system must do its work.
Another senior official who has fallen victim of the Minister’s alleged reign of terror, is the Department of Public Enterprises’s Director-General, Kgathatso Tlhakudi. Under his leadership in the last financial year, the Department of Public Enterprises managed to achieve 91% of its strategic outcomes in the 2022 financial year.
I shall be watching their performance in this financial year of 2023 with keen interest, but I am not optimistic. Similar to the situation at Denel Dynamics, the Director-General of the Department of Public Enterprises alleges that he is suspended by Minister Gordhan, because he refused to sign off a corrupt SAA-Takatso deal. The Director-General Tlhakudi, alleges that the Minister of Public Enterprises put together the Takatso consortium by introducing one Mr Novick and Global Aviation to Harith.
Mr Novick confirmed this fact in two articles, on 27 November 2022 and 14 May 2023 in the Sunday Times Business Times. This goes against the requirements of Public Finance Management Act
and the Constitution, which are clear on demanding that the state ensure competitive assets procurement and disposal processes. In this instance, Takatso was handpicked by Minister Gordhan. The same share sale and purchase agreement signed by the department on Valentine’s Day last year, what a gift, which the Minister has kept away from Parliament and other oversight authorities, is alleged to have the following deficiencies:
Firstly, the undervalued assets of SA Airways, SAA, by
R10 billion. This is at least according to Mr Tlhakudi and the National Union of Metalworkers of SA, Numsa, the trade union. Secondly, the compensation of the state for the assets to be acquired by Takatso is unclear with a preferential scheme unlikely to be serviced if we go by the fact that, up to this stage, SAA has never declared dividends. Thirdly, the state was expected to pay R900 million into an escrow account controlled by Takatso by March 2022, money the department actually doesn’t have. Another violation of our statues.
The Special Investigations Unit, SIU, should be drafted in to investigate the Takatso transaction. In the interim, the transaction should be placed on hold, as SAA has proven that
they are capable of operating without Takatso. Hear me right, hon members, I support the private sector playing a role in our SOEs, but it must be corruption free. It is clear, that Minister Gordhan is not as clean as he has alleged, while hurling accusations of corruption and state capture to the former President and his ilk.
Clearly, he learnt a few lessons from them. He has continued to practice ensuring that state assets are disposed to those connected to him. The state capture number two, therefore, continues under this Minister. The Parliament cannot once again be found to be sitting on its hands as it did during the first state capture one. Every effort must be made to stop the systematic looting of state assets in the Department of Public Enterprises portfolio of state-owned entities.
I wish I could stand here, hon members, before you today and state that the Minister deserves some praise, but we all know that cannot happen. I dare any member here to stand up and say that he has done his work. All our state-owned entities have been run into the ground under Minister Gordhan’s watch. The citizens of South Africa are tired of their hard-earned taxpayers’ money going to state entities for bailouts so that
billions can be stolen by cadres and leave the country in darkness.
It is a sad time in our country with the governing party seeing accountability as optional, but the sad reality is that come 2024 you will be accountable to the South African people, and I’m afraid, they are going to leave you and your inept party in the dark. I Thank you very much.
Ms N METH (Eastern Cape): Hon Deputy Chairperson of the National Council of Provinces, NCOP, thank you so very much and good afternoon to you. Hon Ministers and Deputy Ministers, hon members of the NCOP, hon National Chairperson of the Select Committee and other select committees of the NCOP, delegates from provinces, our traditional leadership, SA Local Government Association, Salga, representatives, distinguished guests, government officials ladies and gentlemen, good afternoon. It is a great honour for me to represent the Eastern Cape provincial legislature to this august House, to participate in this 23-24 National Transport budget debate today.
Hon House Chairperson, precisely in 23 days to come South Africa will be celebrating 47 years anniverasy of June 16 Student Uprisings. It is an open secret that the 1976 Students Uprisings shook the entire world and exposed the racist regime for what it was. Hence apartheid was declared internationally as a crime against humanity.
Acknowledging the role of young people, the long-serving ANC President O R Tambo, once said and I quote:
The children of any nation are its future. A country, a movement, a person that does not value its youth does not deserve its future.
It is against this background that the triple challenges facing our country will haunt us as they affect our children immensely.
Hon members, the Eastern Cape Department of Transport is working tirelessly to deliver services to our services across the province. The department is charged with the responsibility to contribute to the alleviation of the
country’s elusive challenges of poverty, inequality and unemployment.
As a Department of Transport, we remain committed on our mandate to enabling a public transport system that supports social emancipation. Our goals to deliver a safe and reliable transport system remains an ideal towards applying state resources for alleviating the triple challenges.
The department is working hard to achieve the following objectives. Sound risk management and ethical leadership intended to legitimise the transition and ensure that we strengthen good governance as the driver of optimal performance.
Improve financial stewardship by strengthening to the control environment of the department and assuring that public power entrusted upon the department through financing is dispensed appropriately.
Optimise investment through integrated planning and co- ordination through effective co-ordination of
intergovernmental relations and leveraging public and private investment to benefit the provincial transport sector.
Embracing the digital transformation agenda by leveraging innovation around information and communications technology systems to enhance service delivery and improved governance.
Human capital management and development to maximise employee retention and driving the agenda of a professional skills- base, while harnessing sector knowledge management.
Regulating the transport system by striving for compliance to the rule of law and driving the capacitation of the traffic safety fraternity.
Mustering mobility and infrastructure development by preserving provincial assets and ensuring their use for the benefit of the broader collective and in order to sustain development gains overtime.
Hon members, as the Eastern Cape Transport Department, we welcome the 2023-24 National Transport Budget delivered by our Transport Minister, the hon Ms Sindisiwe Chikunga. This budget
will go a long way in addressing the ills of the past in relation to the infrastructural challenges especially in rural provinces such as the Eastern Cape.
Climate change is certainly going to be part of our lives for the foreseeable future. Its impact can never be downplayed. We as the province have felt the wrath of it. Many will attest to the damage that has been detrimental to the gains of our infrastructure portfolio of work.
Areas such as Port St Johns in the O R Tambo District and several towns in the Chris Hani and the Amathole Districts have been among the hardest hit in recent times. The comprehensive development strategy to reconstruct our dilapidated bridges and grovel roads has become very difficult to sustain due to abnormal weather conditions caused by climate change.
The development of infrastructure network is intimately connected with the process of economic growth. Transport infrastructure facilitates economic integration and trade and aims to link areas of production to areas of consumption. We cannot deny the impact of transport infrastructure as an
enabler of economic development. It is for that reason that the Eastern Cape Department of Transport working closely with our municipalities and SA National Roads Agency, Sanral, have indeed invested a significant amount of resources on road infrastructure in our province.
In line with our guiding documents such as national and provincial development plans, and the election manifesto of the Ruling Party, this is an investment to the people of the Eastern Cape. This is what gives them access to markets and essential services such as health and education. This is an investment of the future of this beautiful province of ours. Its future economic prospects has the provision of efficient safe and sustainable transport is fundamental for economic growth and the development of well-functioning markets.
The recent heavy rains and hailstorms that have constantly visited our province have gradually depleted our budget. The damage caused by the January and the February 2023 floods is estimated at R3,4 billion. A total of 19 bridges have been washed away by the recent floods in the province. The state of the 42 000km provincial proclaimed roads is a cause for concern. The department faces a predicament of a R3 billion
shortfall per year to address the infrastructure maintenance backlog for annual periodic maintenance through regrovelling receilling and the rehabilitation of targeted 10% of the paid and the unpaid network, respectively.
Hon House Chairperson, Sanral as a national agency holds authority and the custodianship of over 5 200km of the provinces proclaimed national road network. The transport agency has allocated over R55,9 billion infrastructure investment from 2017 to 2023, for the national roads in the Eastern Cape. A network spanning over 637km with an investment value of over R21,7 billion which is 39% will go towards projects in construction allocated to all municipalities across our districts. A budget of R8,1 billion will be allocated by Sanral in the 2023-24 financial year.
The Minister of Transport has launched the National Pothole Campaign branded as Operation Vala Zonke which is supported by Sanral. However, the aging provincial infrastructure is dire and requires far more than this intervention.
As the province, we welcome the announcement of R15,9 billion for provincial road maintenance over the Medium-Term
Expenditure Framework, MTEF. Of which the R4,6 billion is specially earmarked for the road refurbishment, disaster relief and construction of 96 ... [Inaudible.] ... of bridges in rural areas. We hope that we will receive a significant amount of this provincial maintenance grant.
Our province continue to experience road accidents and fatalities, despite our effort to prevent the loss of lives on our roads.
As the Eastern Cape province, mechanism is been explored to prevent further loss of lives through the introduction of technology. Hopefully such efforts will pay good dividence for the province.
Hon members, the Eastern Cape Department of Transport is working hard to improve the governance and management of all its entities in the province. The new strategic intervention to improve service and income generation for the two enterprises Mayibuye and Government Fleet has been presented to relevant stakeholders and is now yet to be presented to the executive council for endorsement.
The refurbishment of government garages and the recruitment of technical expertise is currently underway to ensure that all outsourced services are insourced going forward.
In conclusion, Madam Chairperson, we will ensure that the budget is broken down to transform all our programmes such as the scholar transport, aviation, revival of rail and the improved public transport system to reduce road fatalities. It is our hope that the current Budget Vote, will increase our capacity to continue with our strategic interventions over this period. Thank you very much, House Chairperson.
Ms T C MODISE: Hon House Chairperson, let me greet the Minister of Public Enterprises, Minister Pravin Gordhan, Minister of Transport, Ms Chikunga, Deputy Minister, hon Bapela, members of the House and ladies and gentlemen, good day, the state-owned enterprises serve as a crucial vehicle for the advancement of economic objectives, particularly managing state equity and strategy intervention of the state to ensure industrial development.
Globally, some SOEs demonstrated such outstanding performance between the year 2011 and 2022. The organization of economic
co-operation and development, OECD, estimated that SOEs continue to account for about 6% of the world gross domestic product, GDP.
In recent years, many development countries including South Africa, have recognised that SOEs are key to services that promote economic development, but vitally that they need to provide these services in an efficient and sustainable manner.
The largest four South African SOEs, which is Eskom, Transnet, Denel and Telkom account for 91% of the assets, 86% of the turnover, and 77% of the total employment of SOEs. Denel, Armscor, Transnet, Telkom and Eskom — all of them are considered key entities for economic development under the new strategic growth path.
Despite the crucial role of SOEs, particularly in South Africa, they continue to face the challenges. One of the reasons cited behind SOEs’ poor performance involves the recruitment of incompetent people into SOEs’ boards and executive management. In other words, incompetent people appointed as part of SOEs’ boards and executive management are less capacitated to oversee the responsible, legal, ethical,
transparent, and effective achievement of national or organisational goals as indicated in the Presidential Review Commission on state-owned enterprises.
Thanks to the Department of Public Enterprises, DPE, - Minister, you are doing very well. You are trying your best level - all SOEs that are being restructured and turned around have appointed capable and effective boards and executive management. More importantly, such appointments have yielded major gains and achievements.
To begin with, the DPE has led the selection and appointment of a competent board and executive management at Transnet, which are working collaboratively to ensure the implementation of the Growth and Renewal Strategy, predicated on private sector participation as outlined in the National Development Plan, NDP, and the Economic Reconstruction and Recovery Plan, ERRP.
In the current situation, Transnet has identified 10 preferred bidders, including, but not limited to, Global Ports Services International Container Terminal Services, Red Sea Gateway Terminal and MMC Port Holdings, and Star Classic Investments
Limited and Abu Dhabi Ports as part of the 25-year Special Purpose Vehicles between the private sector players and the Transnet Port Terminals for the Durban and Ngqura container terminals in KwaZulu-Natal and in the Eastern Cape in line with the establishment of Transnet National Ports Authority, TNPA, as a subsidiary of the Transnet Group. And the announcement of the successful bidders would be done during the current financial year, which will make sure that they turn around the SOEs.
The entry of new private sector players would not be limited at both the Durban and Ngqura container terminals, but rather would extend to the City Deep container terminal and the Kaalfontein terminal auto supply chain integration in Gauteng as part of Transnet’s prioritised transactions to enable growth and renewal on the one hand, and the ANC-led government’s Operation Vulindlela initiative for raising port efficiencies at terminals on the other hand.
At the same time, Transnet has achieved significant improvements in the speed of service delivery in the core segments, as well as in the auto and containers through the increase in rail in utilization, for example, the reopening of
the Leeuwfontein link in Gauteng has improved the turnaround time of the automotive industry, reducing the route by 60 kilometres, thus positioning the automotive industry nicely to contribute towards the reindustrialization of the South African economy.
Whilst the introduction of electric vehicles within the European Union and the United States threatens South Africa’s automotive industry as a significant pillar of the country’s economic landscape, there is real potential for export growth in the industry as seven Original Equipment Manufacturers, OEMs, made a commitment of R40 billion investment in the next five years, and this will impact positively on both employment in the industry which stands at around 120 000 employees and whose export share accounts for 14% of South African exports.
Of course, the phasing out of internal combustion engine vehicles in the EU and the US could discourage the earmarked investment in the automotive industry, but the industry could reposition itself to service tow- and middle-income countries, notably in Africa and subsequently take advantage of the African Continental Free Trade Area’s opportunities.
This would enable the industry to retain some of the existing production facilities without drastic changes, particularly for trucks and bakkies. And Transnet has identified key opportunities to expand the Port of Durban, the Port Elizabeth, and the Port of East London in KwaZulu-Natal and in the Eastern Cape respectively to match the potential export growth in the automotive industry in Africa and the developing world.
Furthermore, Transnet’s competent board and executive management is responsible for the completion of the rehabilitation of Thornwood railway station on the container corridor in KwaZulu-Natal, which has resulted in the restoration of 27 trains per day, thereby opening new opportunities for investments to match the demand for rolling stock overhauls and upgrades. The restoration of 27 trains per day, for example, would have a positive spill over effect on Transnet engineering as it would assist in stabilizing Transnet engineering, which is currently facing serious challenges in terms of viability and sustainability due to dwindling demand in rolling stock from Transnet freight rail, which is unpredictable on an annual basis.
Going further, efforts aimed at repositioning the Port of Durban in KwaZulu-Natal as the most efficient port once again through improving operational inefficiencies are underway.
To this end, the TNPA has established both the Integrated Decongestion Team which holds operations meetings daily and implementation reviews bi-weekly at the Port of Durban, as well as the decongesting stream as a subcommittee of the Decongestion Task Team to deal with congestion as soon as the collaboration between the TNPA and eThekwini Municipality to transfer Maydon Wharf Road to the Port of Durban is finalised.
To complete this, the TNPA had an agreement with the South African Navy to relocate its base from Salisbury Island to Richards Bay and forged a partnership with eThekwini Municipality to develop a second access road to link the Port of Durban with N2 to alleviate traffic congestion. While the recent floods in KwaZulu-Natal might have slowed the implementations of these efforts, the evidence shows that Transnet’s competent board and executive management are working tirelessly to ensure that the SOE is financially viable and properly managed.
It shows that the ANC-led government is trying to work for the communities. By so saying, the ANC adopt this Budget Vote.
Thank you.
Ms M O MOKAUSE: House Chairperson, today marks 10 years since the formation of the Economic Freedom Fighters, and 10 years of radical and militant economic emancipation that brings together progressive forces, including workers movements, under one strategic movement of economic freedom in our lifetime.
Ten years ago, you were a part of those who said we will never make it thus far. We are here today in the National Council of Provinces representing all nine provinces of South Africa. I can tell you for free that next year, after the 2024 national elections, the EFF will be in charge of this House. That is a fact! Undermine the EFF at your own peril.
This year also marks 10 years of advocating for functioning and capacitated state-owned transport companies. We reject the budget of the Department of Transport and that of Public Enterprise. We reject the budgets of departments which are plagued with a number of challenges, which include lack of
transport, accessibility for our people, especially those living in rural communities. Transport needs such as safety, shorter travel times, less overcrowding, affordable taxi fares, reduced walking distance and improved access to facilities remain a challenge for the black majority of our people in South Africa. This in a country where 70% of its population depends on public transport for economic accessibility, social grants and all general economic activities.
One would think that reliable, accessible and affordable, overall, efficient public transport system should be a priority, but not with this government. That is not a priority under Mr Cyril Ramaphosa’s-led government. We also reject the budget of the departments whose Minister gave a directive not to transport the general public on 20 March 2023, when the EFF held apeaceful protest in a form of national shutdown in South Africa, as this clearly demonstrated that the interest of this department is interference and control of the public transport for selfish needs of the ruling party, more than ensuring that South Africans have safe and reliable public transport.
This shutdown was meant to make a call for electricity to be accessible by South Africans. It was to make a call to end load shedding in South Africa, but what did you do? You made that call because you are not for the people; you are here for your selfish reasons. It is therefore rather unfortunate that today we gather here to consider the Budget Vote for the Department of Transport while the former Minister who failed this department dismally is busy making noise on Twitter streets, forgetting that he left a misery department that is yet to find a direction in any near future.
Under your leadership, this department is going nowhere. Quite disappointingly, in the taxi industry that for decades self- built its industry without any support from government is of late allowing themselves to be used by the same government and the rich white supremacists to fight against the movement who are professing for the betterment of the conditions of the South Africans.
The majority of South Africans, particularly black communities, continue to be victims of robberies because of the lack of reliable and safe transportation in this country. Bus services also offer no relief as most buses do not cover
certain routes leaving commuters with the option to walk long distances or use other forms of transport to get to their destination.
This department subjects our people to unsafe, unreliable and costly system of transport. Most of the modes of transport available in South Africa are not maintained and they are old, making them hazard for our people. Thousands of motorists, especially young black women who stays in townships and rural areas, fall victims of crimes next to our roads, as they always suffer tire bursts and punctures because of the extreme bad road conditions of South Africa. Yet, the Minister comes to this House and giggles when political parties are making submissions to her department. It is childish of her. It is extremely childish of her to come giggling in this House while we are making submissions.
The ANC-led government boast about having introduced scholar transport but thousands of school children in the rural areas of Kwazulu-Natal and the Eastern Cape are still walking long distances to school, and the taxi owners who had to fare their learners are often not paid on time by this very same
government. There are still areas that are inaccessible due to the roads’ bad conditions. These taxi owners bear the price.
Road infrastructure damaged by floods are still not fixed, especially in the area of Chris Hani in the Eastern Cape and in some parts of Kwazulu-Natal. The failure of the ANC government to provide safe, reliable, accessible and affordable public transport is once again evident that there are areas where the most affordable and mover of millions of commuters is not functioning.
For the past 29 years ANC has been promising to build and revive rail lines, but nothing has happened. Instead, poor South Africans are spending a bigger portion of their hard- earned income on expensive transport. The worst negligence by this department, however, has to be the way they let passenger rail system just go. The same is true for the infrastructure of transporting goods.
Transnet is part of a long list of state owned companies that has been systematically run to the ground by the ruling party through corruption, incompetence and sheer disregard for basic principle and bad financial management. Year in and year out
Transnet has suffered financial losses because of poor management and political interference aimed at rendering all state owned entities inefficient.
We reject the budget of the department which intends to outsource operations of its Johannesburg to Durban line to the private sector. The decision to outsource Transnet’s strategic line is driven by greed and senseless profiteering by the private sector that has nothing to do with improving industrialisation in the South African economy. Transnet has, to date, offered no justification to outsource such a strategic line of business to private sector.
There has never been evidence to justify that outsourcing such a strategic crucial functioning of Transnet will radically improve its operation. Instead, the Minister at the helm of the project has, on several occasions, demonstrated that his aim of destroying SOEs is indeed going to happen. The sabotage of Transnet is driven by greed from the ANC elites. With blame being shifted to looters of rail tracks, yet no mention is made how much PRASA spends on security, and why the looting of rail tracks continues.
Under the watch of Minister Pravin Gordhan Eskom was run to the ground. Denel and South Africa Airways have been dismantled and are a shadow of their former self. We are going to make this submission without fear. We do not come from the benches of the ANC where they are afraid to speak up on you.
We don’t owe you anything. By the way, when we take power, we are going to reverse everything negative hat you have done during your time.
House Chairperson, the destruction is meant to destroy the value of strategic SOEs so that he can sell them to his friends and cronies for a fraction of their true value.
The CHIEF WHIP OF THE NCOP (Mr S Mohai): Point of order, House Chair. Point of order.
The HOUSE CHAIRPERSON (Mr A J Nyambi): Hon Mokause? Hon Mokause? Hon Mokause?
Ms M O MOKAUSE: Yes?
The HOUSE CHAIRPERSON (Mr A J Nyambi): Can I take the point of order. [Interjections.] Order, members. Let me take the point of order from hon Mohai. Hon Mohai?
The CHIEF WHIP OF THE NCOP (Mr S J Mohai): Hon House Chair, the hon member speaking is making a very serious charge against the Minister to the effect that the Minister is deliberately and on a mission to rundown the institution without any little substantiation on the matter that she is raising. I think that is sheer misleading of the House and unparliamentary in which the member approaches the debate.
The HOUSE CHAIRPERSON (Mr A J Nyambi): Hon members, order! Hon members, in terms of the Rules of the NCOP you can’t make a statement in which you know that you are deliberately misleading the House. Those are our Rules. So, hon Mohai is correct in his point of order. Hon member, desist from making statements where you are not going to substantiate but make some allegations. Can you continue?
Ms M O MOKAUSE: House Chairperson, the speaker who just called a point of order is the Chief Whip of the NCOP ... [Interjections.]
The CHIEF WHIP OF THE NCOP (Mr S J Mohai): She must withdraw, House Chair. [Interjections.]
Ms M O MOKAUSE: He is the second Chief Whip that we are going to remove, precisely because he is not objective. He is protecting his own plate, and this is not why we are here.
House Chairperson, we are all under his leadership. As a Chief Whip he needs to protect all of us and not Pravin Gordhan. Had the ruling party listened to the advice of the Economic Freedom Fighters that we need to establish a state owned roads construction company, the transport sector would be acting as a catalyst for economic development.
The department is chronically handicapped and will not be able to turn things around in this tenure. Ts the EFF we will continue to fight on all fronts to demand Ramaphosa’s resignation to bring an end to the destruction of collapse of SOEs because it is too late and South Africa is left without necessary levers of industrialisation.
What will ultimately save our transport and our SOEs is the public and their use of their power to vote the ruling party out, come 2024 and remove yourself, House Chairperson, Mohai
as a Chief Whip and the Chairperson of the NCOP together with his Deputy. House Chairperson, we reject this budget with the contempt it deserves.
The CHIEF WHIP OF THE NCOP (Ms S J MOHAI): You like punching above your weight, hon Mokause.
The HOUSE CHAIRPERSON (Mr A J Nyambi): Order, members! Members, order! Order, members! The next speaker is the hon Badenhorst.
Mr F J BADENHORST: Hon Chairperson, hon members, hon Ministers, fellow South Africans, good day.
Hendrith Vanlon Smith Jr is quoted as saying:
Transportation at its best facilitates the efficient flow of resources, the efficient movement of people and the efficient utilization of time. It’s about efficiency. It’s about the improvement of the human experience.
There is no doubt that transport in all its forms took a massive knock in the 750 days of covid lockdown imposed by the
South African government. And there is no doubt that it will take a lot of time and resources to recover from this.
The primary concept in this recovery is efficiency. The major obstacle in transport in South Africa is a government that is anything but efficient. This budget reveals a mere continuation of lofty and grandiose plans in the cheap ANC promise vernacular.
The Minister promised in her maiden speech to the National Assembly that she would prioritise the work to rebuild the country’s rail service for the benefit of commuters. And so the beloved piggy bank of the ANC, which is Passenger Rail Agency of SA, PRASA, will receive a hefty R20,5 billion to spend on amongst other things, corridor recovery projects.
The Minister failed to reflect why these programmes were necessary in the first place. She failed to own up to the fact that it was her department that left the rail system defenceless during a lengthy shutdown at which time the infrastructure was at its most vulnerable.
In the same way, the Minister’s predecessor and now the leading court gesture at Luthuli House promised that 13,5 ... [Interjections.]
Mr K MOTSAMAI: Chairperson, on a point of order.
Setswana:
Ga go na tolokara ya Setswana mo. Ke tsene mo kanaleng ya Setswana fela ga go na tolokara ya Motswana.
Ke gore eng go se na ditolokara tsa Setswana?
E kete le setse le ja le madi ao a tshwanetseng go duela ditolokara. Ke a leboga.
English:
The HOUSE CHAIRPERSON (Mr A J Nyambi): Hon Motsamai, hon Deputy Chair started by announcing that they are working on it. But I’m informed that if you can check channel 9 you’ll get the interpretation. Channel 9! Setswana!
Setswana:
Rre K MOTSAMAI: Ga se yo Setswana mo, Modulasetilo. O ka nna leka le mo go wena. Ga go na sepe. Ke sone Sekgoa se se buiwang, se se sa tlhapang. Ke a leboga.
English:
The HOUSE CHAIRPERSON (Mr A J Nyambi): Okay. We are working on it.
Can you continue, hon Badenhorst!
Mr F J BADENHORST: I’m sorry you are missing my speech, it’s a good one.
In the same way, the Minister’s predecessor and now the leading court gesture at Luthuli House promised that
R13,5 billion would be spent on much the same thing. And yet, we see no real progress.
The reality is the department has failed to value, protect and maintain the key transport modes entrusted to it. Under their watch this government has ensured, through a lazy disregard for any relevant protocols, a state of poor management
capacity, corruption, inadequate security, which has led to theft, vandalism and the neglect of infrastructure.
Unless these basics of management are addressed, the situation will be much the same at the time of the next budget appropriation.
In fact, the ANC must show their willingness to truly atone for their past before any South African can trust them against.
When the country sees actions being taken to seize the properties and wealth of Makhensa Mabunda and Auswell Mashaba for their part in the corrupt Siyangena and Swifambo deals that drained PRASA and left behind useless locomotives then their might be an equal willingness to listen.
When the erstwhile top six of the ANC, including the current president, admit that they did absolutely nothing to assist Popo Molefe to stop the rot at PRASA, then we might take this new Minister seriously.
When the ANC repays the PRASA loot they picked up via the conduit of Maria Gomes, they may have the credibility to present the budget.
Talking of credibility, what logical person can have faith in the absolutely moronic way in which this department deals with rail and Transnet?
Instead of housing all the assets of this state-owned enterprise under one departmental roof, only the ANC believes it makes sense to continue the current ridiculous habit of cross-invoicing and absurd payments between passenger and freight rail operations.
Indeed, PRASA pays Transnet and vice-versa for using different sections of the same rail track, platforms and locomotives while all assets belong to one state in the end.
In merging PRASA and Transnet, more than R1 billion will be saved every year. This saving can be used to, for instance, re-establish freight terminals along active transportation routes instead of trying to make the current freight route configuration work. A R1 billion saving every year would go a
long way in fixing infrastructure, securing assets and expanding on current networks.
... [Inaudible.] ... quote from a recent news headline: Roads a vanishing as a result of railway failure.
A further reason to dismiss this budget is the apparent lack of cognisance of the mess that transport is in South Africa. There are no bold initiatives presented front and centre to turn around the absolute mess that the ANC’s Stalinist Command Control fantasy caused during the 750-day covid fuelled excuse for government.
There is no realisation of the current challenges faced by commuters in South Africa, and let me give you the example, KwaZulu-Natal. R40 billion will be spent on the roads of South Africa and yet we only see signs of massive projects on the N2 near uMhlanga and at the famous ‘spaghetti’ interchange of the N2 and the N3.
These projects were inexplicably halted by SA National Roads Agency SOC Ltd, SANRAL, and after only massive pressure by my colleague, hon Tim Brauteseth, did the truth emerge. The
contracts were confined and offered only to KwaZulu-Natal contractors in an obvious rent–seeking exercise. When nobody in KwaZulu-Natal, much to the disappointment of the ANC, was found to be up to the job, the tenders were re-advertised nationally and work began in earnest. Months were lost while the Minister’s predecessor played his Machiavellian fundraising games for the ANC.
To make matters worse, there is seemingly no consideration in this budget to, once and for all, get the flood ravaged roads in KwaZulu-Natal fixed.
The reality is that the N2 at Mgababa has remained untouched for over a year. The R102 near Umkomaas has been half a road since last year. Due to the dysfunctional M4 between Westbrook and Ballito, SANRAL has lost R500 million over the last year at the oThongathi Toll booth as a concession and even now the tolls are still only partially collected. The community of Mpumalanga near Hammarsdale is still cut off by the destroyed MR551. Indeed, even MEC Peggy Nkonyeni was a tragic victim of these roads in Ulundi.
Instead of government stepping up, many of these routes have seen local residents pay from their own pockets for repairs. When the Minister was questioned on this on the 9th of May this year, in this very House, she made feeble excuses and actually asked for a list of these roads; remember Minister? And yet, despite this executive undertaking, nothing in the budget indicates that this work will be done.
Despite the protestations of the governing party, this transport budget under ANC control does not reflect the advancement of opportunities for the people of South Africa. Proof of this is abundant.
Rail infrastructure maintenance and investment that will decrease by 55% from R42 million to R19,7 million. The Road program budget will decrease by 32% from R60 billion to R42,6 billion. The aviation budget will decrease by 29% from R424,8 million to R314,5 million.
Is this a government serious about rebuilding or just a tavern full of cheap talk and promises?
The thing about promises is that they are free. But anything free is normally cheap and never materialises. And if it does, it breaks soon thereafter.
In 2024 the electorate will approach the ballot box thirsty for change. The DA is ready for the opportunity to be entrusted with government and the proper management of this department.
Woza [Come] 2024, woza! Thank you.
Ms H S BOSHOFF: Hon House Chair, hon members, hon Ministers and fellow South Africans, good day. It is undeniable that roads not properly and timeously maintained are costing South Africa millions of Rands and negatively affecting our economy and society.
Minister, I know that you are new to this portfolio but this department needs a complete overhaul, starting at the top as corruption, dodgy companies being awarded tenders who more often than not build flimsy infrastructure and cadre deployment has taken its toll. This has now snowballed into
the complete breakdown of the public infrastructure which has led to a system failure.
We are home to the world’s 10th largest road network that spans over 750 000km and we have the 18th longest paved road network.
To maintain this expansive network of national, provincial and municipal roads, your government will have to grow South Africa’s skills development programmes, keep up with road maintenance and technologies and empower workers and businesses to apply these skills to our roadways.
With the current trend of lack of maintenance, ordinary South Africans are suffering and costing them millions in higher insurance premiums to cover costs for repairs to their vehicles due to the state of the roads.
We saw the damage that was caused by the recent floods in KwaZulu-Natal, Gauteng and Mpumalanga. This could have been less if the public infrastructure had been better maintained and better built.
The KwaZulu-Natal floods – as we all know - claimed over 400 lives and around 100 lives cannot be accounted for. The damage to property, infrastructure and movables are estimated at upwards to R50 billion.
The national, provincial and municipal road networks are critical infrastructure to our economic productivity.
Unfortunately, the poor conditions of the majority of the road network continues to slow down economic growth.
Industries and the majority of workforces are dependent on these roads for access to essential services, transportation of goods and the movement of workers. This could be alleviated if your government would attend to the rail network.
Lives and livelihoods are at stake in rural areas as local communities need to access hospitals, schools and other essential services as well as getting to work inside the city and transporting produce from their local farms.
The Free State, North West and Mpumalanga are competing with each other to lay claim to the worst roads in the country. In some instances, one sees on average, one pothole every 30 to
40meters. Every single day you read about accidents that have occurred due to drivers swerving to miss these potholes and landing up in head-on collisions.
Unfortunately, some of these potholes are so bad that you cannot dodge them, leading to excessive damage of vehicles and again, loss of live. The speed limit on the majority of provincial roads are between 100 and 120km per hour, but the road users on these roads are unable to drive 40, 50, 60km an hour. This, hon Minister, is increasing the risk of our road incidents.
To improve on the condition of the road networks, your department will have to start by evaluating and measuring the cost of the road maintenance backlog, invest more in infrastructure maintenance and commit resources and political will to solve the problems facing our roadways.
It becomes apparent that there is a current human resource, national investment and skills deficit that must be addressed and overcome. Without improvements in these areas, road maintenance will be less reliable. Government needs to use all of the data available, resource investment and skills
development to prioritise roads that are contributing to economic and social needs and to also address the infrastructure decay of the rural road network.
Ultimately, if government does not attend to the road infrastructure backlog, road users and businesses will have to pay the price for poorly maintained roads. They will be the ones facing the inevitable challenges of delays, accidents, decreased productivity, increased vehicle operating costs, road closures, missed economic opportunities and more. And this, Minister, can no longer be afforded. Thank you.
The DEPUTY MINISTER OF PUBLIC ENTERPRISES: Hon Chairperson,
the two hon Ministers present here, chairperson of the select committee, hon Zolani Mkiva, on the line, hon delegates to the NCOP, the acting director-general and officials of the department, ladies and gentlemen, I am grateful for the opportunity to share the highlights of some of the state-owned enterprises, SOEs, as part of Budget Vote No 10 for the Department of Public Enterprises for the 2023-24 financial year, with you.
Currently, I assure you and reaffirm that we are firmly steering this ship into the right direction as we can see the light down the tunnel. As Charles Dickens puts it:
It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us ...
We are on our way to a new season, a new era of hope, of light, of belief, of wisdom and the best of times. We are where we are because of corruption and state capture that had eroded the capacity of a number of SOEs. Who is exposing that corruption? It is the ANC. Wait till all the cases are in court, and those who are exposed and who have done wrong things have to be dealt with, innocent as they are now.
However, once they are guilty they have to go through the punishment and the consequences. Wait for all the trials, including the VBS trial, and let’s see who will be appearing
... names ... in that particular case. So, that is the era of the times, where we say that the best times are coming.
It is permissible and granted that the running of our SOEs involves factors both external and internal. Take for example the COVID-19 pandemic which also contributed. Climate change is now beginning to have an effect. The war in Europe is now having an impact on Africa as a whole. The disruption of trade and supply chains due to high levels of corruption and state capture ... If you don’t believe ... about corruption and what it did, read the Zondo Report.
I, therefore, present the following key highlights of the SOEs as economic enablers and job creators for economic growth for the success of our country and its people. The Minister has already presented on Transnet, SA Airways, SAA, and Eskom. I will therefore focus specifically on Denel, Alexkor and the SA Forestry Company SOC Limited, Safcol.
Commitments with regard to Safcol relate to its strategy to realise a 50:50 revenue split between log sales and processed products, and the diversification of its product portfolio by entering strategic partnerships with the private sector. This is not privatisation. We all agree that Safcol’s model is proof of how SOEs ought to function.
With regard to its finances, despite the rapid increase in the cost of doing business in South Africa and a gloomy global economic outlook, Safcol maintained a stable growth in the past three years, where the company is the only state-owned company, SOC, to declare a dividend to the national fiscus of R1 million during the 2021-22 financial year. This performance continued in the 2022-23 financial year, as reflected in log sales of R970,8 million, which represents an achievement of 10% above target. Furthermore, the average selling price for logs for the year reached the 12% mark, allowing Safcol to generate a total revenue of R1 billion.
In terms of Safcol’s impact in certain regions, in Mpumalanga, Safcol’s business is key to building relationships with communities creating employment for communities. Safcol spent R30 million on community development programmes and initiatives in the last five years in the provinces where it operates, which is Limpopo, Mpumalanga and KwaZulu-Natal. The group therefore continues to invest in those projects that will benefit all members of these communities. It’s not only about making money but also to give back. For example projects such as Sukumani Youth Advisory Centre, which is 100%
complete, provides the community of Diepdale with youth development skills.
The construction of the Glory Hill Clinic in Graskop is one of their projects. Moreover, Safcol has proactively succeeded in addressing classroom shortages at the Edwaleni Primary School in White River, where children were learning under a garage covered with plastic material, with others in the library. Go there now and you will see happiness on the children’s faces, as I had handed over classrooms together with the board and management of Safcol on the 4th of May 2023, soon after arriving in the department.
In the region of Vhembe in Limpopo, Safcol will be making a long-term investment of approximately R450 million in processing facilities at the Timbadola Sawmill in Limpopo to increase its revenue stream and to create new jobs that will then be accruing. The communities will benefit from these jobs. The SOE has also contributed to skills development in the province through the construction of the Shanzha Skills Development Centre.
In terms of its impact in KwaZulu-Natal, similarly Safcol was involved in the construction of the Prince Somcuba School.
Those are the projects that Safcol is undertaking. Other projects that Safcol has also operated on are in Limpopo, Mpumalanga and KwaZulu-Natal, where they have built over
10 footbridges. The footbridge has provided a safe and reliable means of crossing rivers and other bodies of water. Footbridges can help improve access to education, health care and economic opportunities, which can have a positive impact on the overall wellbeing of communities.
With regard to other Safcol priorities, they will grow the Ifloma operations through a partnership in the fibre project in Mozambique where we have 80% of the forestry; plant
700 hectares in the Galinha province in Mozambique; grow South Africa’s plantation assets; invest in state-managed forestry plantations by sharing best forestry business management, to mention a few. In Zimbabwe, they are now in partnership with Old Mutual which owns the forestry ... there and we are going into Africa, taking advantage of the African Continental Free Trade Area agreement.
Our commitments on Alexkor related to strengthening the executive management team — it’s also one the SOEs that was affected by state capture — capacitating both entities with an appropriately skilled and a competent executive management team that has effectively turned the organisation which is now in operations and has been revitalised, also the joint venture on diamond operations from the community that won the land claims.
With regard to governance matters, it should be noted that while the company is stable at board level with the appointment of a six member interim board in January 2022, it is paramount to ensure stability at executive level. As a result, they are embarking on a recruitment process of a chief executive officer, CEO, and a chief financial officer, CFO, with the conclusion of this process expected by the end of the second quarter of this current financial year.
In terms of the revitalisation of the joint venture diamond operations, in the past financial year, the joint venture diamond output improved by 30% compared to the two prior years due to the COVID-19 pandemic and other regional challenges.
With regard to the impact in the Northern Cape, despite reduced mining activity, the Alexkor Richtersveld Mining Company’s Pooling and Sharing Joint Venture remains the largest employer in the Richtersveld region. For the current year, the joint venture has budgeted over R8 million towards various social programmes. Included in these plans is the assistance towards expansion of agricultural activities which have the potential to provide economic opportunities that are nondependent on mining operations. Furthermore, the joint venture is working together with the Northern Cape provincial government on the deep-water port project Boegoebaai which the Minister alluded to, which has the potential to create thousands of employment opportunities in the region. Both Alexkor and Safcol have made significant strides that are now starting to show in their financial ... and in governance.
Denel is considered a strategic national security and industrial asset, which has prompted the department to commit in assisting the SOC in firming up its business. With regard to Denel’s business case, I am pleased to report that in 2022- 23, Denel submitted a turnaround plan with a realistic business case and strategic objectives to the executive authority. In October 2022, the Minister of Finance announced
a recapitalisation of R3,4 billion for Denel in the Medium- Term Budget Policy Statement to support the restoration of Denel’s strategic and sovereign capabilities.
This recapitalisation allows Denel to fully implement its turnaround plan to ensure support to the Department of Defence and specifically the SA National Defence Force in order to secure our country’s strategic defence and security of supply of defence capabilities.
On its stabilisation of governance, as part of further efforts to assist Denel with the turnaround plan, the board has also initiated the process to appoint the group CEO and CFO which have been vacant for over two years.
In terms of the stabilisation of operations, Denel has made further progress in improving its relationship with the Department of Defence and the Armaments Corporation of SA, Armscor, and is also engaging other SOEs and state security agencies to provide advanced security solutions. In addition, government is taking proactive steps to assist Denel to restore its reputation with partners and clients, including Project Hoefyster with the Department of Defence. As you know,
it’s an R8 billion project. Denel is effectively refuting the assertions in the media that the contract of Project Hoefyster is in jeopardy, as not true.
Some of Denel’s priorities will be rationalising its operational divisions from six to four to manage costs and improve efficiencies. Consultations with organised labour are currently underway in this regard.
There is a growing interest in many parts of the world in Denel’s battle-proven intellectual property. The SOE is currently pursuing R30 billion worth of opportunities in different regions of the world — the Middle East, Africa, Asia-Pacific, the Americas and Europe. The Ministry, as a shareholder, will be assisting them to go back and renegotiate some of the contracts that it could not service.
With regard to Denel’s overall order book, I must also highlight the fact that Denel’s order book is looking very robust, at R18,37 billion for the 2023-24 financial year, while planned total sales are projected to be R2,08 billion, compared with R1,08 billion in 2022-23. So they are going to be increasing by 50%. Denel is indeed on the rise and
production in all divisions of the subsidiary is happening. Denel has a significant footprint in Gauteng, mainly in the Ekurhuleni and Tshwane metropolitan areas.
Mr J J LONDT: Hon Chair, through you, I want to inquire whether the hon Deputy Minister is willing to take a very short question please.
The HOUSE CHAIRPERSORN (Mr A J Nyambi): Hon Deputy Minister, are you ready to take a question?
The DEPUTY MINISTER OF PUBLIC ENTERPRISES: No, not now.
The HOUSE CHAIRPERSORN (Mr A J Nyambi): No, he’s not ready. Take your seat. You can continue, hon Minister.
The DEPUTY MINISTER OF PUBLIC ENTERPRISES: I’ll ...
[Inaudible.] ... taking it.
Mr J J LONDT: I dare you.
The DEPUTY MINISTER OF PUBLIC ENTERPRISES: Denel has a
significant footprint in Gauteng, mainly in the Ekurhuleni and
Tshwane metropolitan areas. The SOE supports a significant number of local companies, including small, medium and micro enterprises, SMMEs. This is done through Denel’s local spend that has averaged between 70% and 75% of its total procurement spend, over the years.
In terms of its regional impact in the Western Cape, there are two entities of Denel in the Western Cape province, namely Spaceteq, a state-owned space company in Grabouw and the Denel Overberg Test Range in Bredasdorp. The Denel Overberg Test Range is critical for South Africa’s space programme. In this regard, the University of KwaZulu-Natal’s Aerospace Systems Research Institute’s space propulsion programme launched a hybrid test rocket from the Denel Overberg Test Range on
13 March 2023, carrying experimental sensors and cameras. This was led mainly by young people of all genders and backgrounds doing mechanical engineering. Further launches are in the pipeline.
Furthermore, Rheinmetall Denel Munition, jointly owned by Rheinmetall of Germany with 51% and Denel with 49%, with a footprint in the Western Cape, in April 2023 unveiled a
5 megawatt capacity solar energy plant at its plant in
Somerset West. Once operational, the plant will be able to sell surplus power to the national grid. So, it is working. Denel is on the rise.
The SOEs have been actively assisting with the country’s transformation agenda with regard to its transformation of the economy. Furthermore, skills development for the economy remains one of the fundamental deliverables by SOEs. In this regard, all SOEs collectively had a learner pipeline pool of 3,455 trainees in the system.
As I conclude, although the organisation of SOEs remains a work in progress, the department is confident that with its strategic oversight and tactical guidance, the plans and initiatives currently underway will make our SOEs more agile, responsive, dynamic and financially viable. I therefore urge that this hon House adopts this particular budget. Hon Nhanha, I’ll deal with the other issues later.
Mr J J LONDT: Hon Chair, I’m more than willing to give a minute of my time for the Deputy Minster to take that question.
The HOUSE CHAIRPERSORN (Mr A J Nyambi): No, the Deputy Minister said he’s not ready to take your question, so you can’t smuggle it in.
Mr J J LONDT: {Inaudible.]
The DEPUTY MINISTER OF PUBLIC ENTERPRISES: If it’s allowed by
the Chair, I can do it.
Mr J J LONDT: Hon Chair, I appreciate your leeway in this and hon Deputy Minister, I truly appreciate your willingness to take the question. You spoke about Denel, and I want a yes or no ... Can you guarantee that not a single weapon made by Denel was put on that Russian ship which docked in Simon’s Town?
The DEPUTY MINISTER OF PUBLIC ENTERPRISES: Definitely not. I
was with the management of Denel two weeks ago and I asked that question. They are governed by the ... Conventional Arms Control Committee and they don’t have a permit to sell to Russia. Russia is capable of producing its own weapons. They are not part of the 13 countries that are on Denel’s list. If they were before the war, they didn’t do so. I think they have
the capability of producing their own weapons. So, that is my answer. Thank you very much.
The HOUSE CHAIRPERSORN (Mr A J Nyambi): Thank you. Order members! Hon Londt donated his minute when he asked the Deputy Minister ... So, now he’ll have four minutes instead of five. He donated his minute. We’ll make sure that when it’s his turn it’s going to be four minutes. The minute is gone. The next speaker is hon De Bruyn.
Afrikaans:
Mnr M A P DE BRUYN: Agb Voorsitter, ek het dit gister in die Huis gesê en ek sê dit vandag weer. Die mense van Suid-Afrika glo nie meer die feeverhale van sukses wat die Ministers in begrotingstyd hier kom staan en smous nie, veral nie vanaf ’n departement wat direk verantwoordelik is vir die feit dat ons in die donker moet sit en toekyk hoe ons ekonomie in duie stort en die werkloosheidsyfer deur die dak skiet nie.
Agb Minister Gordhan het die gister in die NAsionale Vergadering daarna verwys en ek moet sê, met opregte ANC-gees die blaam probeer skuif na die apartheid toe en selfs tot na die oorlog in Europa toe, eerder as om te herken dat dit die
ANC-regering is wat die land en al sy entiteite in die grond in bestuur het.
Die ANC-Ministers moet ’n ruggraat begin groei en hulle moet begin om die realiteit te aanvaar en eienaarskap te neem vir die toestand van Suid-Afrika.
Die Minister het gister met baie selfvertroue die syfers van biljoene opgenoem wat verlore geraak het in staatsentiteite, as gevolg van korrupsie en staatskaping en net soos die vorige vyf jaar, net beloof dat dit geprioritiseer sal word en dat korrupsie uitgeroei sal word.
Maar, hoewel die Minister erken het dat daar grootskaalse korrupsie en diefstal is in staats entiteite, het hy gerieflikheidshalwe vergeet om ook te erken dat dit gebeur het onder leiding van hom en sy departement.
Elke staatsentiteit in Suid-Afrika vandag is slegs ’n geraamte van wat hy eens was en dit is niemand anders se skuld behalwe die ANC nie.
Denel, wat eens een van die winsgewendste entiteite in die land was en menigte buitelandse kontrakte suksesvol kon handhaaf, sit tans met ’n jaarlikse verlies van biljoene rande en kan nie eens aan helfte van die Suid-Afrikaanse weermag se behoefte voorsien nie.
SAL, wat eens roetes gevlieg het na elke kontinent in die wêreld en ’n wins van $72 mil gewys het in 1995, het vandag ’n skamele ag vliegtuie en dien slegs twee plaaslike roetes.
In ander woorde, SAL is vandag slegter af as wat hy was in 1934. Ons het 89 jaar terug beweeg in tyd onder die bewind van die ANC.
Van Transnet, wat vroeër jare die hartklop van Suid-Afrika en die ekonomie was en derduisende werksgeleenthede geskep het, is daar vandag net hier en daar ’n spoor oor van die sukses van die eens trotse entiteit. Dit terwyl die oormaat van vragmotors die land se paaie verwoes in die poging om volhoubaar vrag te skuif en die ekonomie aan die lewe te hou.
Hier is geen suksesverhale nie. Elke staatsentiteit is wanfunksionerend en staan amper op ’n permanente basis bakhand
by die regering vir nog ’n reddings boei. En dit is die belastingbetaler wat self skaars kan oorleef, wat hierdie sirkus moet finansier.
English:
A Cabinet decision was taken in 1999 to accelerate the restructuring of state-owned enterprises. Little did we know in 1999 that this government would restructure SOE’s straight into the ground and cause the economic crisis that we have today.
Yet, hon Gordhan stated yesterday that he is fundamentally optimistic about the ANC’s ability to turn around the chaos in the country created by the same ANC.
Afrikaans:
Terwyl die Minister en die ANC op ’n wolk van optimisme sweef, verkies die res van ons Suid-Afrikaners om eerder realisties te wees en die realiteite raak te sien. En ons sal eerder die realistiese pad volg en verseker dat die ANC nie na 2024 die regering van die dag sal wees nie. Dankie.
Mr M NDLOVU (Mpumalanga): Hon House Chair, thanks for this opportunity, greetings to you and greetings also to the hon Deputy Chairperson of the NCOP, the Chief Whip of the Majority Party, hon Ministers, the Minister of Public Enterprise and the Minister of Transport, hon Deputy Ministers, hon chairpersons of the select committees, hon delegates to the NCOP, my fellow colleagues from different provinces, South African Local Government Association, Salga, representatives, our Director General, DG and officials greetings from Mpumalanga Province the ‘Place of the rising sun’.
Hon Mokause of EFF, I think I want to give here right from the beginning an advice, that she must stop to inflate a sense of self. He will not be charged of the two Houses. Leave the Secretary General, SG of the ANC to the ANC and concentrate on your ten old party, that enjoyed only 12% of the electoral support in the last elections. You must leave the SG of the ANC to the ANC. We appreciate the NCOP always ensures that provinces have a direct voice on issues that have a bearing on our development, especially issues on service delivery.
I represent Mpumalanga Province today on this debate, I will focus more on transport infrastructure. I thank our Ministers
for delivering very good budgets. Which are govern by several principles including transparency, accountability, participation, equity, non-discrimination, and equality.
The budget which is going to expand public transport network which are reliable and infrastructure as well as smart policies. Key travel options available and affordable for the people irrespective of their financial status. Gustavo Petro said:
A developed country is not a place where the poor have cars. It's where the rich use public transportation.
House Chairperson, we therefore as government continue to work collaboratively and in collaboration, as different spheres, national, provincial, and local with clear roles and responsibilities, to ensure that we build a better public transport system.
I can hear DA claiming credit on the work done by national in the Western Cape. When you take credit for the rail, you must also take blame for the drought, this was by Dwight Morrow.
Our public transport operators are valuable, we should not flood them with too many operating licences that creates conflict amongst them, hence in our province we’ve decided to limit issuing of new licences because the industry is saturated and proving to be unsustainable financially, as a result leaving to conflict for passengers.
We expect the taxi industry to operate peacefully. As such a taxi imbizo is planned for June 2023 to look on how the department and taxi operators can improve the performance of the industry in the province.
We are in process of finalising our lane transport negotiated contracts, which will assist us to address adverse competitions and conflicts in the taxi and bus industries.
Hon Minister, the suspension of Mbombela Municipality from Public Transport Network Grant, we want to request that it should be suspended, Mbombela is now ready, let’s engage. Our transport operators, big and small will benefit in the transport sector through government facilitated subsidy scheme, which bring the taxi industry into the mainstream of our economy.
We are working hard to create integrated public transport system, which will become the transportation mode of choice. A single national transportation structure, with single ticketing system of subsidised public transport operator.
Hon members, we are very much excited about the recently launched direct flights from Germany to Kruger Mpumalanga International Airport. This is a positive sign of trust on the tourism industry of our province. We are happy that these direct flights will expose and promote Mpumalanga Province as an international tourist destination of choice. This will continue to increase the number of tourists from Germany and Europe, travelling into our country and our province.
We continue to encourage other airlines to consider flying directly to our province. It is this reason why our road infrastructure must be of good quality and accessible to tourists, taking advantage of our beautiful landscape. We have the world most iconic game reserve, the Kruger National Park, the world third largest canyon, Blade River Canyon, we’ve got God’s Window, Ancient Caves, and many scenic and heritage attractions in our beautiful province. Hence, we are
facilitating robust safety and security measures for our people and internal visitors.
We want to create province where all people will be safe and secured. The former Minister launched operation ‘Vala Zonkhe’, we are continuing with this programme, a labour intensive preprogramme to fix potholes throughout the province. We purchased four jet patchers, one for each district in the province. Our intention is to that every day, when you wake up in Mpumalanga, we should work very hard to close potholes, rehabilitate and refurbish our roads.
We appreciate hon Minister, the continuous implementation of Maputo Corridor that makes Gauteng to be the capital city of Southern Development Community, SADC. The expanding of Moloto road is welcomed. We will continue hon Minister, to engage with the department on Moloto road.
The department intends to support the training of new courts of graduates in the form of internship and learnership.
Traffic policing will also be enhanced and will have enough traffic officials manning our roads for 24 hours a day and seven days a week.
As a province we are glad that we have a national department that has developed over the years a good funding model that focuses on the construction, maintenance and upgrading of our provincial road. This year our provincial road maintenance grant allocation has increased by R546 million to almost
R1,4 billion. Approximately, R190 millions of this budget will be spent on construction of 70 modular steel bridges, through the ‘Welisizwe Rural Programme’.
Provincially we are pursuing strategic partnership with Sasol, mining houses and farmers in order to meet the increasing demand for better roads. For an example the mining houses around Thaba Chweu will contribute 60% of the rehabilitation cost for road P171 which extends between the Dullstroom to Reinesekal junction.
We are encouraged that our public-private partnership initiatives are starting to bear results, and more will be done to promote a adopt a road approach.
House Chairperson, as a province we would like to acknowledge the law enforcement for their efforts which continue to yield positive results in reducing road carnages on our road. For
the 2022-23 festive season, fatalities in our province decreased from 189 to 144 which is equivalent to 23,8%. For the easter holidays we applaud our province for becoming one of the three provinces that recorded a reduction in road fatalities.
I can hear members of the opposition talking as if it’s easy to run government ... [Inaudible.] ... by the ANC President, OR Tambo to wait up until you are in government and it’s then that you realise that it’s not easy sustain political power. People are expecting more from the liberation movement turned government with the little allocation that we have we dare not fail the people of Mzansi. We support the approval of the two budgets. Ngiyabonga [Thank you.]
Mr N M HADEBE: Thank you, hon Ministers. It is quite worrying that these two Budget Votes have been clustered together today when there are serious issues with both departments in terms of their performance. Each of these departments has been failing on their mandate to the people of this country, their failures have not gone unnoticed amongst the South African citizens.
The public are the recipients of the failures by government and nonexistent service delivery. Eskom under the Department of Public Enterprises has been a long burning issue for a. number of years. Hon Minister Gordan stands before us explaining his future plans and delivering an all too well rehearsed speech on how government intends to rectify its own failures. Year on year, this Parliament has pointed out what needs to be done, what is expected by the public and committees have worked in vain to make meaningful recommendations, yet, these warnings have not been heeded, instead, lip service has been paid by the department.
In fact, to the committee report shows under the Auditor- General that the department’s annual performance plan is incredibly weak, vague and does not promote confidence in anyone, that all the entities under this department has the capacity to turn around its mismanagement with the sole exception for ... [Inaudible.] ... The service delivery failure is everything happening now. Check your load shedding schedule which gives you a small indication of the rot that has been taking place for more than a decade at Eskom.
To add insult to the injury - but also confirming the current governments intent not to be held accountable - is that Eskom wanted to select how its audited. Telling the people of South Africa that their very own tax ... [Inaudible.] ... do not need to be accounted for. It is clear that the extent to which government will go to cover up for its comrades extend well below principles of good governance and the transparent democracy. Hon Chairperson, the Department of Public Enterprises, as represented by its Minister, stands before us without a care for how much suffering is caused by its failures. As a result of just load shedding, businesses have closed down, many businesses are struggling to stay afloat and have no plans for expansion under the current economic regress in this country.
Our unemployment rate which sits at one of the highest in the world is attributed to the lack of investor confidence due to load shedding. The state-owned entities across the board are failing and they are bringing others down as casualties alongside them. For example, Transnet failure is a major hindrance to our country’s economy. There are many goods that could be delivered by rail, but due to poor management and the static decline over the years of railway usage, trucks have
been filling in the gaps for movement of these goods, making our flights more expensive and more deadly on our roads.
The Department of Transport has to look to fixing our roads at an alarming rate due to poor access to railway networks and the number of trucks placing additional stress on our roads.
However, the Department of Transport does not get off attributing its failures to Public Enterprise. It has trailers ball of its own under this department; the Passenger Rail Agency of South Africa, Prasa, the SA Maritime Safety Authority, Samsa and the Road Traffic Infringement Agency, RTIA, are underperforming and failing by blaming the lack of funding whilst also under spending. These entities have also yet to submit their annual performance plans to Parliament, which clearly shows their lack of will to account to the people of this country.
Moreover, this department has failed to address the danger of potholes which causes a twofold issue, especially in the northern KwaZulu-Natal in Pongola, where trucks are used to move coal and causing deadly roads fatalities. We call on government to get its act together and address the issues with both these departments. Even though we are not left with much
confidence, it is competent to do so. The IFP reject Budget Vote 10: Public Enterprises, but support to Vote 40: Transport. I thank you, hon Chairperson.
Mr S E HLOMUKA (KwaZulu-Natal): Madam Chair, greeting to yourself and greeting to the all hon members, the hon Minister of Transport, Minister of Public Enterprises, Deputy Ministers, our colleagues, MECs who are present, director- generals who are present, head of entities, all protocol is observed. Madam Chair, it is an honour to debate in this Budget Vote 40 which was presented by the Minister last week and by also the Minister of Public Enterprises. We must appreciate the good work that they are doing.
Madam Chairperson, allow me first to congratulate the Minister of Transport for such a clear articulated maiden and visionary speech which I have no doubt that this will take the country forward. The investment of more than R79 billion to this Portfolio of Transport is clear indication that the government of the day led by the ANC understand that transport is the backbone of the economy and without mobility we cannot achieve the target we have set for ourselves in the National Development Plan in other policy documents.
Madam Chairperson, the investment in transport and in all modes is eventual as we think to reposition our economy following the challenges that we have faced of COVID-19 pandemic. And in our case, as KwaZulu-Natal province, we are also recovering from the impact of the dead floods adventurous.
Chairperson, this budget policy speech presented by the Minister of Transport - it is important in ensuring that South African turn the tide against the unemployment as these projects that are going to be dealt by in this financial year is going to create more job opportunities. It also emerging service providers they are going to get opportunity. That means there will more transformation and empowerment of youth, women and persons with disabilities. As we are in our provinces, we are supported by the national government.
Madam Chairperson, this is why it is important that this budget policy is important in ensuring that South Africans understand that the current government is taking care of the roads across the country including in our province.
Chairperson, we will come the bold investment plan as announced by the Minister. As the provincial government, we
have also allocated R9,2 billion in this financial year to fund infrastructure delivery. Of this R2 billion, Madam Chair, R4,4 billion will be invested in the construction of the new projects and R3,9 billion will be invested in the maintenance of existing network. This is why, Chairperson, some of the members are debated today. This current government led by the ANC has built roads even in the rural areas even in the northern part of KwaZulu-Natal. We have built number of roads. Indeed, we agreed that there are challenges but we must appreciate the good work that is done by this government of the day.
We also want to indicate, Madam Chairperson, that this province has more than 800 backlog network of infrastructure especially in the town but we are working tirelessly to ensure that we upgrade our road from the gravel to tar. And we are working with the national government and supported by the Minister as a department as a whole.
As this province of KwaZulu-Natal, we welcome the investment of more than R25,4 billion allocated to the SA National Road Agency, Sanral, will come in because we are the major beneficiary of this investment as a province, with the number
of projects undertaken by the Sanral in the province. Our province remains the strategic corridor with two ports of Durban and Richards Bay.
In our budget policy speech, Madam Chair, we announced that Sanral will invest more than R80 billion in this province over the years. This will be done through the number of projects including the upgrade of N3 and N2 with the changing of infrastructure of the province as part of the N3 upgrade, Madam Chair.
The Minister was in Pietermaritzburg in the past few weeks where he launched the package of the Ashburton Interchange of the value of more than R2,5 billion. This is why we must appreciate the good work that is done by the Minister, hon Chikunga.
We are seeing the transformation; we are seeing the development because number of young people are benefitting in these projects that are taking place in our province. A number of women are also benefitting and people are happy about the work that is done by the current government. We pride ourselves with a number of other initiatives being implemented
by the Sanral including the construction of N2 and R56 in Kokstad, reconstruction of N2 in Umgababa and N2 Umhlali Bridge which were both affected by the floods. That means, this government has taken care of the projects that have been affected through floods.
As a provincial government, we are also working well with Sanral in the restoring the mobility and repair the other floods damage projects. As a provincial government, we have spent R2,9 billion fixing the infrastructure that was damaged through floods. Very few projects are remaining and processing are being finalised. We also want to welcome the announcement by the Minister of focussing on the pothole patching. We accept the fact that our infrastructure is aging and we need extra attention. This is why we have allocated some of our budget to deal with the potholes but we are going to as we already allocated a budget in maintenance as I have already indicated.
Majority of roads have reached their lifespan as there is a need to attend urgently to the challenge of potholes as a province. That’s why, Madam Chairperson, as a province with our line number of intervention with argument of Operation
Vala Zonke, all of which are aimed to improve the turnaround time in fixing potholes.
We know and understand our situation, Minister, on the road safety. As the province, we are willing to work with you and all other stakeholders in making all roads safe. KwaZulu-Natal continue to be the one amongst the leading province in the challenge of crush and fatalities.
We, however, believe that the Road Traffic Management Corporation will go a long way. We also need to be very aggressive in our roads safety campaigns to promote safety plan, education and adhere to the law.
As KwaZulu-Natal, we will continue to work with the Department of Transport nationally and to work to ensure that all the roads that are affected in terms of potholes we fix them.
We must, Chair, also because I have also listened to number of speakers raising challenges of electricity in our country. We also acknowledge that there are challenges but we must be happy that some of the people like myself coming from the rural areas when I grew up I also wanted to have electricity
like those who are staying in urban. And today, we are raising the issue of loadshedding.
As I conclude Chair, we must appreciate because this government has tried its level best to ensure that number of rural areas and townships have electricity of which before the 1994 they didn’t have electricity. We then want to welcome the Budget Vote of the two Ministers. And we have no doubt that it will make the change of the life of the people of this country and of our province. Thank you very much.
Cllr G MARAKALALA (Salga): Chairperson of the NCOP, hon Minister and Deputy Minister of Transport, Deputy Chairperson of the NCOP, Chief Whip, House Chairperson, ...
The HOUSE CHAIRPERSON (Ms W Ngwenya): Hon member, can you please show us your video, please?
Cllr G MARAKALALA (Salga): Okay. Can you see me?
The HOUSE CHAIRPERSON (Ms W Ngwenya): Hon councillor, ...
Setswana:
Ke tla go tlogela ...
English:
... for now. But I think the Deputy Chair when she opened the meeting, she gave all of us the Rules, and these Rules applies to all of us, not only individuals. I will allow now to do that, but they must assist you to see your face. Thanks, continue.
Cllr G MARAKALALA (Salga): Chairperson of the NCOP, hon Minister and Deputy Minister of Transport, Deputy Chairperson of the NCOP, Chief Whip, House Chairpersons of the NCOP, hon members of the NCOP, special delegates, greetings. The original funding model of the different spheres of government from the national revenue funds no longer holds. The assumptions about the ability of citizens to pay for services and consequently the ability of local government to collect revenue are no longer applicable.
The recent acute challenges on unavailability of energy have had an acute adverse impact on local government financial sustainability, as less energy is being used, which means less revenue for municipalities. As a result, the continuation of
provision of resources, including transport resources between the three spheres, as if these assumptions are true, only exacerbate the challenges that local governments face in different sectors. The distribution of plant transport functions, the most critical component of the entire transport system, are biased towards local government. But the distribution of the budget by the Department of Transport does not reflect this.
Both the Constitution and the National Land Transport Act, in joining both national governments and provincial government to assist local governments to perform their functions when they cannot. The current budget indicates a skewed willingness by the national government to assist provinces, whilst providing limited assistance to municipalities. Take the example of dedicated roads funding, the budget will provide R15,9 billion to the provincial roads’ maintenance grant, but no specific amount in it is mentioned for different assistance to local governments.
It is also noted that the Department of. Transport does not implement the provisions of the Division of Revenue Grant Act Framework, which enjoins provinces to provide an equal or more
dedicated funding as per Provincial Roads Maintenance Grant, PRMG in each province. A common excuse is made about a provision through the Municipal Infrastructure Grant, MIG. This grant is for all infrastructure and the entire provision for roads has never been above R3 billion per annum, even though municipalities are responsible for close to 60% of the road network, a similar amount is allocated to the South African National Roads Agency limited, even though they are responsible for less than 5% of the entire route network.
The inequitable distribution of dedicated roads funding will not assist the improvement or rapidly deteriorated municipal roads network exacerbated by climate change. Salga urge the Department of Transport and other related stakeholders to allow for participation of local governments in the research conducted on nanotechnology. A significant component of unsupervised roads, including unprogrammed roads, remains the responsibility of local government.
Salga welcomes the intervention of a Roads War Room and propose that the term of reference of such a war room be developed in consultation with organized local government. Salga is looking forward to engaging thoroughly with the
proposed Public Transport Subsidy Policy. This policy will inevitably impinge on the proposed devaluation of urban rail framework. Salga is participating fully in the process of developing the devaluation framework. The recovery of rail corridors throughout major event centres in the country is most welcome. This should lead to increased rail patronage and a significant reduction in percentage of households, disposable income used for transport and specifically commuting purposes. The achievement will also serve as a catalyst in the devaluation of urban rail functions to local governments.
Salga welcomes the developments in road law enforcements. Statistics clearly demonstrate that most fatal and severe injury incidents happen after hours and during weekends. Salga is concerned about the shrinking size of the Public Transport Network Grant, and the suspension of some of its members from this grant. Salga is engaging its members on a process to meet the readmission criteria. Salga continues to appreciate the support provided by the Department of Transport in this regard.
Finally, the budget is an indispensable tool by which the aspirations of our constituency are realised. We trust that the Minister of Transport will head our request. We remain available to work with the Ministry and the department in navigating these complexities associated with providing efficient mobility for our people. Thank you, House Chairperson.
Mr J J LONDT: House Chairperson, before I do my speech, ...
Afrikaans:
... wil ek net ’n oomblik neem om medelye te toon aan ’n goeie vriend en kollega, wat onverwags vanoggend afgesterf het.
Stoffel Botes, wat die onderburgemeester van Prins Albert was het ons heeltemal te gou en onverwags verlaat. So, omdat ons nie vandag mosies het nie, wil ek net graag ons innige medelye aan die familie van Stoffel Botes en die breër Prins Albert- gemeenskap oordra.
English:
Back to the speech. Hon Bapela, I do want to give you kudos. Quite often, people are too afraid to take any questions and we do criticise where it’s due, but also want to give credit
that you were willing to answer that question and go on record. Hon Mmoeimang, you quoted a paragraph that speak to transport being the artery. Now that I agree with you, the sad thing is that the fat cats in the ANC are blocking the arteries on South Africa’s roads. And we have a qualified nurse as a Minister, and you should know what blocked arteries does to the body. It slowly, slowly suffocates, and put the higher body - the country - at risk. So, it’s your job, hon Minister, to open those arteries and make sure that the country functions well.
Now, less than nine months ago, we had a debate in this House about the modernization of rail infrastructure. Usually, a typical example of ANC paying lip service to responsibilities they should have or will still undertake. One thing I ever stood out that day, and I think the ANC colleagues in the House forget that your elected SG and the predecessor of the current Minister, acknowledged that the mess was the doing of the ANC. However, like today, it seems like some of the colleagues speak to the ANC that caused this mess, as if it’s separate from the current ANC. It’s the same organization. You can’t divorce you from the ANC of a year ago and the ANC today. Unless you go on a trajectory that is completely
separate, you will continue doing the wrong things over and over again.
Mr M DANGOR: Will the hon member take a question?
Mr J J LONDT: If I can get an extra minute, I will take it.
The HOUSE CHAIRPERSON (Ms W Ngwenya): You will take a question?
Mr J J LONDT: If I can get an extra minute, then yes.
Mr M DANGOR: No! No! There is no extra minutes. Take a question.
The HOUSE CHAIRPERSON (Ms W Ngwenya): Are you taking a question? Okay, continue.
Mr J J LONDT: So, one of the things hon Minister, that you touched on is the two major bridge projects that’s being developed. And that’s massive. That's a massive opportunity. The problem is, how do we ensure that benefit the community surrounding it? Because if you drive in the Eastern Cape now,
and hon Mmoeimang I wish you to take the select committee to that region and drive on the roads because it seems like you are talking about a different Eastern Cape. Those bridges are washed away. The roads cannot be travelled on. But you speak about it as if you are delivering quality services and quality roads. Those bridges should be similar to what Bloukrans is, so that people from all over the world travel to those bridges and then they suddenly visit Storms River. They visit the neighbouring towns, and that adds to the economy.
So, we only have one choice going forward. And I do think, in conclusion, I’m going to disagree with my own colleague. I actually want to correct hon Badenhorst. You said that the DA is ready to take over government. Hon Badenhorst, you forgot one word. We are more than ready to build on the current track record of the DA, where we are in government and take over from the ANC. I thank you.
Mr M I RAYI: Good afternoon Chair, the Ministers, Deputy Ministers, Permanent and Special Delegates. The Budget Policy Vote 2023 comes at a critical time for the transport sector as the country is recovering from the negative effects of the COVID-19 pandemic and dealing the challenges of load shedding.
Transport is a key economic driver and is linked to the level of output, level of employment and income within a national economy. What this means is that efficient transportation is a critical component of national and global economic development.
Transport availability affects developmental patterns and can a boost or a barrier to the economic growth. Transportation investment links factors of productions together in a web of relationships between producers and consumers to create a more efficient vision of production leveraging the geographical comparative advantage and provides the means to expand the economies of scale and scope. Consequently, transportation project can lead directly to benefits beyond the traditional measures of travel or freight in part based on average of time and costs. The wider benefits of this relate to mainly the effects on business productivity, the factors that enable businesses to gain efficiency by reorganising their operations or by changing the means of inputs used to generate products and services.
Our national budget continues to allocate resources to South Africa’s core social and economic priorities while containing
an aggregate expenditure growth. Hence, governments spending plans to give effect to the priorities of the National Development Plan, NDP 2030 Vision and the Medium-Term Strategic Framework, MTSF. This is illustrated by the current budget, which prioritises spending on economic infrastructure with a specific focus on passenger and freight rail as well as roads.
Over the medium-term, the department plans to give effect to these policy priorities by focusing on: Cultivating an enabling environment for the maintenance of national and provincial road networks, facilitating integrated road-based public transport services, and revitalising passenger rail services. Delivering his 2023 state of the nation address, Sona, President Ramaphosa accentuated four areas that the department will be zeroing on in 2023/24 as he committed Government to: Restructuring that is underway at the Passenger Rail Agency of South Africa, Prasa, with 13 railway lines that have been reopened, significantly reducing the cost of travel for many workers. Hon Londt, I represent the Eastern Cape.
Constructing the Msikaba Bridge and Mtentu Bridge making travelling in the Eastern Cape much better. Constructing rural
bridges as part of the Welisizwe programme to enable residents to easily and safely reach schools, workplaces and amenities.
The construction on the Msikaba Bridge deck, located near Lusikisiki in the Eastern Cape, was started in December 2022. This 580m bridge will, when completed, cross the 195m deep Msikaba River gorge making it the longest span cable-stayed suspension bridge in South Africa. According to the South African National Roads Agency Limited Sanral, the anticipated completion date of the project is the end of 2024.
On completion, the Msikaba Bridge will play a crucial role in improving travel time, connecting previously divided communities in the region, and opening opportunities in business and community-based tourism for the Wild Coast.
The completed bridge will improve the travel time between Durban and East London by up to three hours for heavy freight and, by providing a high mobility route through an area that is extremely isolated and under-served by road infrastructure. The route will have significant social and economic benefits and will act as a catalyst for local and regional development.
The Mtentu Bridge which is expected to be Africa’s tallest bridge, will run across the Mtentu River in Mbizana in the Winnie Madikizela-Mandela Local Municipality, rising 223m into the Eastern Cape sky. Sanral awarded the tender to the Chinese Communications Construction Company, CCCC-MECSA, joint venture, after it was cancelled in May 2022 and re-advertised for fresh bidding. Construction is expected to start in March 2023, creating 2 500 full time equivalent jobs.
Over R1,8 billion will be expended on targeted local enterprises. This will be derived from the sub-contracting to be undertaken by the main contractor on the bridge structure, as well as the construction of associated roads. The Mtentu Bridge forms part of the N2 Wild Coast Road, N2WCR project, which is the Sanral’s flagship project in the Eastern Cape.
The Welisizwe programme is part of Government’s response to address mobility challenges in the rural areas.
Starting in 2020/21, 14 bridges were erected in various communities in KwaZulu-Natal, providing access to schools, work and clinics. The programme has contributed to skills development, with graduates appointed as bridge assessment, project management and maintenance teams. It also provides
Expanded Public Works Programme, EPWP, job opportunities in the surrounding areas where bridges are erected. Hon Chairperson and members, in the Eastern Cape, transport infrastructure continues to be priority and the department has indeed lived mostly up to its plans, in that considerable progress has been recorded on various major infrastructure investment projects which include: The last phase of the N2 to Siphethu Hospital in Ntabankulu currently reaching its completion, the reseal of DR08012 Matatiele to Maluti reseal, Alfred Nzo, which was then 60% complete. Phase two of the Willowvale to Dwesa road right up to Msengeni Junction currently reaching its completion. Phase one of the Hluleka Nature Reserve project currently reaching its completion.
Service Level Agreement, Sla with Enoch Mgijima Local Municipality for Phase four of the Thornhill and Tsolwana Reserve to do 12km that is currently reaching its completion. The Sterkspruit to Mlamli Hospital gravel road upgrade of 12km that includes four bridges are currently reaching their completion. The Elliotdale to Madwaleni Hospital road has been completed. However, in the current financial year the Eastern Cape continues to implement the following road infrastructure projects: The last 10km of the Centane to Qolorha road, Phase
three of Magusheni to Mzamba road which constitutes 8,5km on R61. The first 20km of the Clarkebury road from the R61 side. Furthermore, the second phase of the Hluleka Nature Reserve is currently underway, this will complete the surfacing of the entire length to the Nature Reserve. As government resolved to take projects to completion.
Similarly, Government will continue with the reseal projects in its portfolio that include, 30,5km on DR08004 from Magusheni to Flagstaff road. The 53,5km on TR04601 from Grahamstown to Port Alfred road, and the road between Butterworth and Centane.
In conclusion, this shows that relationship between transport infrastructure, transportation services and economic performance is mutually dependent. Transport infrastructure could serve to accelerate economic growth and development, a lack thereof could constrain expansion. The composition and performance of the national economy have a specific demand for transport infrastructure and transportation services.
Cognisance of local, regional and global economic structures and macro-trends will allow for the adjustment of the supply
of transport infrastructure and services to meet the required by economic activities.
IsiXhosa:
Sibuyele kwaba bebethethe phambi kwam.
English:
I think to the member of the DA, hon Nhanha, I understand that the DA itself a liberal party. My understanding of liberalism, I am not a liberal, talks about civil rights. You claim that you protect individuals and respect the rule of law. But you spent nine minutes on unfair personal attacks and allegations. That to me goes against your ideology of protecting the individual rights civil liberties. Nine minutes, on nothing about the programmes of the department, just personal attacks that are allegations. As you were continuing with our speech, the last part, you were talking about the investigations. Why first attack and then later you say there must be investigation because you have already decided and judged.
This thing of 2024, let me come to you. I said it yesterday and I am repeating it again. Can you explain in the area where you think you have the constituency but you are only three
now. You were four in 2014/19 administration. There were four delegates from the Western Cape. Now, you are three.
Nationally, you were at 23% and you dropped to 20% but you think that in 2024 you will be in government. Now that you know you are not going to be in government you come up with something called moon-shot pact because you know on your own you cannot be in government. You still going to fail, ANC will still be here in 2024. I can promise you that. The ANC supports this budget vote.
THE DEPUTY MINISTER OF PUBLIC ENTERPRISES (Mr K O Bapela) on
Behalf of the MINISTER OF PUBLIC ENTERPRISES: Chairperson, the Minister’s coughing is getting worse as he speaks and, therefore, has asked me to then respond on his behalf. Let me start with the remarks by Hon Nhanha and I’m going to read them as the Minister has asked me and then I’ll conclude on my remarks. Response to lies uttered by DA’s ... [Inaudible.] ... Nhanha, one, I reject with contempt accusations of corruption, and I challenge Nhanha to provide proof and he will not find one. Number two, Nhanha is willing to sell his soul, if he has one, to the DA’s fabricant narratives which form part of the DA’s election strategy, which includes a racist narrative.
Three, to Nhanha ... [Interjections.] ... [Inaudible.] ... it’s moving ... [Interjections.] ...
Mr J J LONDT: Hon Chair, on a point of order:
THE HOUSE CHAIRPERSON (Ms W Ngwenya): Order hon members!
THE DEPUTY MINISTER OF PUBLIC ENTERPRISES (Mr K O Bapela) on
Behalf of the MINISTER OF PUBLIC ENTERPRISES: I lost two seconds.
The HOUSE CHAIRPERSON (Ms W Ngwenya): Deputy Minister, can we listen to the order?
Mr J J LONDT: Hon Chair, I do not debate that the hon Deputy Minister may respond in any way but I do want to ask, is it parliamentary to cast aspersions on a member of the House by saying he doesn't have a soul? You can check with the Table Staff, but I do not think that is Parliamentary and I ask that the hon Deputy Minister please withdraw.
The HOUSE CHAIRPERSON (Ms W Ngwenya): You can continue; we will check with the Table.
THE DEPUTY MINISTER OF PUBLIC ENTERPRISES (Mr K O Bapela) on
Behalf of the MINISTER OF PUBLIC ENTERPRISES: Chairperson, to Nhanha and the DA facts do not matter. He has amnesia about State Capture. He defends the corrupt and attacks and defames people like me, as the Minister says, who fight corruption. SA Express was killed by corrupt management. Mango will not be liquidated because we're fighting it in court and also it had gone through corrupt activities, and then Denel and the others I think have explained the situation. The Director-General of the Department of Public Enterprises was suspended and then charged for directing a selection committed to interviewing a person who did not apply for the post. The disciplinary processes are going on led by Minister Lamola and it is expected that he will conclude the matter soon and will announce the outcome. So if you can wait for that. The suspended Director-General of the Department of Public Enterprises is lying, fabricating and trying to cover up his role. He led many of the processes that he now disowns.
Nhanha now has Jim and Tlhakudi as his bedfellows. I dare Nhanha to repeat his nonsensical accusations of corruption outside of Parliament. [Interjections.] I am just reading it hon ... [Interjections.] ...
The HOUSE CHAIRPERSON (Ms W Ngwenya): Order hon member, I can’t hear.
Mr F J BADENHORST: Chair, on a point of order: It’s not Nhanha, it’s hon Nhanha. We have respect in this House for each other.
THE DEPUTY MINISTER OF PUBLIC ENTERPRISES (Mr K O Bapela) on
Behalf of the MINISTER OF PUBLIC ENTERPRISES: Hon Nhanha!
Mr F J BADENHORST: Thank you, Chair.
THE HOUSE CHAIRPERSON (Ms W Ngwenya): Thanks, hon member.
THE DEPUTY MINISTER OF PUBLIC ENTERPRISES (Mr K O Bapela) on
Behalf of the MINISTER OF PUBLIC ENTERPRISES: Okay! You are correct, hon Nhanha, he will learn a lesson about why he should not manufacture and lie about me. I dare you. You have no right to smear my integrity and public service. That's the Minister's response, but on the issues raised, the ANC will continue to be a government come 2024. We will be a government, not with arrogance but with humility. We'll go to
the people where we have made mistakes. We'll then indicate to them. Where we have done well, we will also be able to do so.
Then the people are there to listen to us. We will fight corruption without any fear or doubt and definitely corruption must be fought. The number of cases that are in court speaks for themselves. Those who have been arrested and are in court, including all the cases including VBS are also on the court roll. We hope names and companies will be mentioned there.
That is part of cleaning corruption. Also, we are going to be focusing on improving our service delivery. The rail and logistics, passenger and logistics work are going on there to improve on that. SA Airways, SAA, is back in the sky flying our flag as our pride and then the Denel workers are back at work producing and soon Denel will be self-reliant and then also expanding and ensuring that it is self-sustainable.
Transnet is expanding its infrastructure and the Minister was in China to go and resolve the issue of the 1 064 locomotives, over 1 000 locomotives that are stuck in a dispute because of certain issues that happened. This is aimed at ensuring that freight moves from trucks to rail, and in that way, we'll reduce the number of trucks on the road once these locomotives are back in the system.
Therefore, we are then saying that the meeting of the select committee, hon Nhanha was your request for that meeting. It was not requested by the Department of Public Enterprises after you did not turn up at the meeting jointly with the portfolio committee of the National Assembly and then we only met the portfolio committee and then you are not there. You then realised later that it did not happen, and hence that special meeting, which was convened, and we were invited and we responded to it. So, as we conclude, we then say that the issue of privatisation is not on the agenda of the ANC. We're using the model of the public-private partnership, PPP and then the Bbuild-Operate-Transfer, BOT, and that is the model that South Africa is doing and not privatisation. Hon Mokause, please have your facts correct. Thank you.
Mr J J LONDT: We are just waiting for that ruling, Madam Chair. The ruling.
The HOUSE CHAIRPERSON (Ms W Ngwenya): I did rule by saying I will ask the Table to give me that answer before you raised that one.
The MINISTER OF TRANSPORT: Thank you very much, hon Chairperson, let me start by thanking all members who participated in this Budget Vote 40 debate. We pay full attention as members make their points. However, Chairperson when members give us powers that we do not have, we have every reason to laugh or frown, we decide on what to do and it cannot be dictated to us.
Hon Mokause, I own no buses, but the day in question was an ordinary working day for South Africans. We therefore could not then allow buses that we have contract with to actually
... [Interjections.]
The primary purpose of buses is to transport commuters as schedule services. Any special hire should not disrupt normal contracted services. That is a fact and how ironic that the member uses transport ideals and objectives such as affordability, reliability, safety, etc. These were first proposed by the ANC government from the time of the White Paper on Transport. The ANC lives, the ANC leads and they follow and say what we say.
On the taxi subsidy, we are busy with the National Subsidy Policy that will target public transport user rather than the service providers. So, yes, the taxi industry, when we target the users will defiantly benefit from that.
Coming to hon Boshoff, we agree with you on some of the state of our provincial and municipality roads. That is why we presented here measures that we need to put in place to ensure that the potholes are patched, to ensure that we rehabilitate some roads. Of course, we will be using Nano Innovation which is said to be durable to attend to our gravel roads, which I think, you mentioned here that they actually account for 79% of the total road network and cannot be ignored. However, hon Boshoff, it is also your apartheid government that designed roads for 20 years and there was simply no plan from the National Party government to maintain those roads and as a matter of fact, they were meant for white people only. We have come to build roads for all South Africans.
Hon Badenhorst, Prasa is taking corruption seriously hence all corrupt contracts have been dealt with. The SIU has done extensive work in investigating Prasa on material irregularities, 27 cases have been concluded. Furthermore, on
issues addressed in the State Capture report will be dealt with in a new SIU declaration to deal with the era of State Capture issues. So, yes, we are attending to the matter.
Also hon members, hon De Bruyn says every entity in South Africa is dysfunctional. This is not true. Sanral is not dysfunctional, Acsa is not dysfunctional. As a matter of fact, if Jan Smuts was to come back from hell, he will not recognise OR Tambo International Airport that was once named after him, because Acsa is working, the Railway Safety Network Regulator is working, TNS is working SACCA is working, RMTC is working and RAF is working. These are state-owned companies and they are working. We agree Prasa is improving. It is recovering some corridors, but we also agree that there is still a lot to be done in order to take it to where it is supposed to be.
Hon MEC Ndlovu from Mbombela, yes, we are willing to assist them so that they can be reinstated. Hon MEC Hlomuka, we appreciate the allocation from the KZN Equitable Share. We believe that it is going to take us forward as-far-as roads are concerned. Hon MEC Meth, Sanral is ready to operate roads that have been handed over to Sanral by Eastern Cape government.
Hon Londt, we are the heartbeat, that is what we call ourselves and indeed, when we say that we have in the Mega Project that you spoke about. Sanral has actually identified a number of access roads that lead to those bridges and I agree fully with you that those bridges are the highest in Africa, the longest in Africa. The Huguenot tunnel longest in Africa. I believe that we can make use of those too to attract tourists. I fully agree with you and we can actually assist the general aviation industry to perform because they will be able to fly people who want to go there. I agree with you fully that any engineering student must actually go and experience what is happening and see what is happening in those Mega Projects. So, in that one probably I agree with you. However, yes, I hope you agree with me as well.
Then lastly, hon De Bruyn, you know for a fact that the people of South Africa cannot imagine themselves being ruled and oppressed by the racist Freedom Front Plus and the DA and good for nothing EFF. Come 2024, the ANC will lead and the ANC and the people of South Africa know and understand exactly, the organisation of their own that gave them this liberation, and this democracy they are enjoying today. It is the ANC and nothing else. All of them have no history, we have the history
that is rich. It is only the ANC that builds roads for people in the rural areas. It is only the ANC that continues to build schools for the people. It is only the ANC that does not sleep at night concerned about what our people are benefiting. You have never done it, you will never do it for us because here in the Western Cape, people in Khayelisha get the big bare minimum and the rest goes to you. Black people will never forget that you oppressed them and you oppressed us, we will never vote for the DA and your friends. You can say it. Thank you very much, Chairperson.
Mr J J LONDT: Sorry, House Chair.
The HOUSE CHAIRPERSON (Ms W Ngwenya): Hon delegates.
Mr J J LONDT: Hon House Chair.
The HOUSE CHAIRPERSON (Ms W Ngwenya): Hon member, you are making noise. I want to finish and now you stand up.
Mr J J LONDT: Hon House Chairperson, it is not making noise if there is a point of order.
The HOUSE CHAIRPERSON (Ms W Ngwenya): Hon Members, I said to you, I will come back with the ruling.
Mr J J LONDT: Chairperson, it is not difficult to make a ruling if a speaker says that somebody is soulless. It is not that difficult. So unless you are not competent to do your job, as a Chair.
The HOUSE CHAIRPERSON (Ms W Ngwenya): Can you please sit down. Sit down!
IsiZulu:
Hawu, ngiphindaphinde into eyodwa kaningi.
English:
I repeated to you three times. Hon members, there are members who do not want peace. Every day when we have to go out, they do not like peace. Order, hon members. Order!
Isixhosa:
Suphendula into ongayizwanga.
English:
I have made a ruling. I have made a ruling already.
IsiZulu:
Anifuni ukuya emakhaya.
The DEPUTY CHAIRPERSON OF THE NCOP: Can you please close the meeting. They must respect the ruling.
The HOUSE CHAIRPERSON (Ms W Ngwenya): Order, hon members! I mean, hon member did not hear what I have said.
IsiXhosa:
Ndithe ndiza kubuya nesigqibo.
English:
Hon members, I have made a ruling that I will come back with the ruling of what the hon member asked. So ...
IsiXhosa:
... andazi ke amagqwetha la amthethelelayo ukuba athethelela ntoni.
English:
Hon delegates, that conclude the debate and the business of the day. I would like to thank the Minister, the Deputy Minister, permanent delegates, MEC’s and all special delegates and Salga representative for availing themselves for the sitting. The House is adjourned.
Debate concluded.
The Council rose at 18:19.
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