ATC200612: Report of the Select Committee on Transport Public Service and Administration, Public Works and Infrastructure on Budget Vote 40: Transport and Strategic Plans and Annual Performance Plans 2020-21 of the Department of Transport and Entities Reporting to the Minister of Transport, Dated 10 June 2020

NCOP Transport, Public Service and Administration, Public Works and Infrastructure

REPORT OF THE SELECT COMMITTEE ON TRANSPORT PUBLIC SERVICE AND ADMINISTRATION, PUBLIC WORKS AND INFRASTRUCTURE ON BUDGET VOTE 40: TRANSPORT AND STRATEGIC PLANS AND ANNUAL PERFORMANCE PLANS 2020-21 OF THE DEPARTMENT OF TRANSPORT AND ENTITIES REPORTING TO THE MINISTER OF TRANSPORT, DATED 10 JUNE 2020

 

The Select Committee on Transport, Public Service and Administration, Public Works and Infrastructure,having consideredBudget Vote 40: Transport and the Strategic Plans and Annual Performance Plans of the Department of Transport and the entities reporting to the Minister of Transport, reports that it could not reach a decision on the Budget Vote.

 

1.         INTRODUCTION

The Select Committee on Transport, Public Service and Administration, Public Works and Infrastructure considered the 2020/21 budget of the Department of Transport (the Department) on 6 May 2020 in a joint meeting with the Select Committee on Transport, Public Service and Administration, Public Works and Infrastructure. This report contains a summary of the Department’s budget allocation and the observations and recommendations of the Committee on the budget. In preparation for this report, the Committee was briefed on the 2020/21Strategic Plan, Annual Performance Plan (APP) and Budget Allocations of the Department of Transport.

 

The Committee further hereto engaged with three of the Department’s entities on their Strategic/Corporate Plans and APPs for 2020/21 – 6 May 2020 (joint meeting,by the Committee and the Portfolio Committee on Transport, with Department and the Driving Licence Card Account (DLCA)), 3 June 2020 (Committee meeting with the Department and the Passenger Rail Agency of South Africa (PRASA)).

 

The report details an overview of the performance of the Department during 2019/20, policy priorities for 2020/21 and and how they are aligned with national, regional, continental and global developmental agendas. It also analyses the 2020/21 budgets of the Department and its entities. The report also covers the tabled 2020/21 Strategic/Corporate Plans and APPs of the entities. It concludes by capturing the observations and recommendations made by the Select Committee on Transport in this regard.

 

The Committee engaged with the entities of the Department on their APPs, Corporate Plans and Budgets during the meetings. The Committee met with the following entities Passenger Rail Agency of South Africa (PRASA) and Driving Licence Card Account (DLCA)

 

The Department’s (and the relevant entities) revised Strategic Plan(s) and APP(s) will be submitted with the adjustments budget that will be tabled later this year by the Minister of Finance.

 

The report on the budget of the Department is based on information accessed through:

• The 2020 State of the Nation Address (SONA);
• The Department of Transport’s APP for 2019/20 and 2020/21 and its Budget Allocation outlined in the Budget Review for 2020/21; and
• The National Development Plan (NDP).

 

2.         MANDATE OF THE DEPARTMENT OF TRANSPORT

The Constitution of the Republic of South Africa, 1996, identifies the legislative responsibilities of various spheres of Government pertaining to all modes of transport and its associated infrastructure.[1] The Department of Transport (“the Department”) is responsible for the formulation of legislation and policies for rail, pipelines, roads, airports, harbours, and the intermodal operations of public transport and freight. As such, the Department is entrusted with:[2]

• Conducting sector research;
• Formulating legislation and policy to set the strategic direction of subsectors;
• Assigning responsibilities to public entities;
• Regulating through setting norms and standards; and
• Monitoring and implementation.

 

In an endeavour to discharge its mandate effectively and efficiently, the Department is structured as follows:

• Programme 1: Administration;
• Programme 2: Integrated Transport Planning;
• Programme 3: Rail Transport;
• Programme 4: Road Transport;
• Programme 5: Civil Aviation Transport;
• Programme 6: Maritime Transport; and
• Programme 7: Public Transport.

 

The structure of the Department places significant emphasis on modes of transport. Complementing this modal emphasis are two programmes that seek to provide strategic support to key programmes of the Department. It is the belief of the Department that its internal programmes not only set its agenda, but they bode well “for a collective, integrated and harmonised approach to addressing sector challenges”.[3]

3. overview of the 2019/20 financial year[4]

3.1 First Quarter Expenditure of 2019/20

Table 1: 2019/20 First Quarter Expenditure

Programme R’ Million	Main Appropriation	Available Budget	Q1 Actual Expenditure	Expenditure as % of Available Budget	Q1 Projected Expenditure	Variance from Projected Expenditure	% Variance from Projected Expenditure
Administration	463.0	463.0	97.8	21.1%	108.8	11.1	10.2%
Integrated Transport Planning	169.2	169.2	14.0	8.3%	20.8	6.9	32.9%
Rail Transport	16 573.8	16 573.8	3 482.8	21.0%	3 564.1	81.3	2.3%
Road Transport	33 018.1	33 018.1	8 468.4	25.6%	8 422.2	-46.3	-0.5%
Civil Aviation Transport	245.1	245.1	29.3	11.9%	59.8	30.5	51.1%
Maritime Transport	136.8	136.8	28.0	20.5%	31.1	3.1	9.9%
Public Transport	13 588.1	13 588.1	1 070.6	7.9%	1 218.3	147.7	12.1%
Total	64 194.2	64 194.2	13 190.8	20.5%	13 425.1	234.2	1.7%

(Source: (National Treasury, 2019b)

By the end of the First Quarter of 2019/20, the Department had spent R13.2 billion (or 20.5%) of the total available budget of R64.2 billion for 2019/20. The Department had projected spending of R13.4 billion by the end of the First Quarter of 2019/20, indicating a delay in spending of 1.7% (or R234.3 million). The delay in spending was mainly in the Rail Transport and Public Transport programmes.

 

As at the end of the First Quarter of 2019/20, the Department had spent R114.7 million of the total available budget of R534.7 million on the Compensation of Employees. The Department had projected spending R131.4 million by the end of the First Quarter of 2019, translating into a delay in spending of 12.7% (or R16.7 million).[5] The Department had filled 734 posts against a funded establishment of 819 posts. The vacancy rate stood at 10.4% (or 85 vacant posts) by the end of the First Quarter.[6]

3.2 Second Quarter Expenditure of 2019/20

Table 2: 2019/20 Second Quarter Expenditure

Programme R’ Million	Main Appropriation	Available Budget	Q2 Actual Expenditure	Expenditure as % of Available Budget	Q2 Projected Expenditure	Variance from Projected Expenditure	% Variance from Projected Expenditure
Administration	463.0	443.0	197.8	44.6%	227.0	29.3	12.9%
Integrated Transport Planning	169.2	166.2	32.1	19.3%	120.0	87.9	73.2%
Rail Transport	16 573.8	16 573.8	8 498.6	51.3%	8 020	-478.0	-6.0%
Road Transport	33 018.1	33 073.9	17 471.8	52.8%	17 918.6	446.8	2.5%
Civil Aviation Transport	245.1	243.3	57.9	23.8%	115.5	57.6	49.8%
Maritime Transport	136.8	136.8	55.4	40.5%	65.7	10.3	15.7%
Public Transport	13 588.1	13 568.1	3 759.3	27.7%	4 446.7	687.4	15.5%
Total	64 194.2	64 205.1	30 072.9	46.8%	30 914.1	841.2	2.7%

(Source: (National Treasury, 2019c)

 

By the end of the Second Quarter of 2019/20, the Department had spent R30.1 billion (or 46.8%) of the total available budget, indicating slower than planned spending of 2.7% (or R841.2 million).[7] The delay in spending was mainly in:[8]

• Road Transport programme for transfers and subsidies;
• Public Transport programme for transfers and subsidies, as well as goods and services; and
• Integrated Transport Planning programme for goods and services.[9]

 

As at 30 September 2019, the Department had spent R237.2 million of the total available budget of R534.7 million on the Compensation of Employees. The Department projected spending of R262.4 million by this point in the year, indicating a delay in spending of 9.6% (or R25.3 million). The delay in spending was largely owing to the slow filling of vacant posts.[10] The Department had 732 filled posts against a funded establishment of 819 posts, with the vacancy rate standing at 10.6% (or 87 vacant posts).

3.3 Third Quarter Expenditure of 2019/20

Table 3: 2019/20 Third Quarter Expenditure

Programme R’ Million	Main Appropriation	Available Budget	Q3 Actual Expenditure	Expenditure as % of Available Budget	Q3 Projected Expenditure	Variance from Projected Expenditure	% Variance from Projected Expenditure       Projected Expenditure
Administration	463.0	443.0	303.6	68.5%	318.2	14.6	4.6%
Integrated Transport Planning	169.2	166.2	49.3	29.7%	131.2	81.9	62.4%
Rail Transport	16 573.8	16 573.8	12 313.5	74.3%	12 312.5	-1.1	0.0%
Road Transport	33 018.1	33 073.9	27 614.3	83.5%	26 269.1	-1 345.1	-5.1%
Civil Aviation Transport	245.1	243.3	127.1	52.2%	121.2	-5.9	-4.8%
Maritime Transport	136.8	136.8	97.1	71.0%	89.6	-7.5	-8.4%
Public Transport	13 588.1	13 568.1	7 669.1	56.5%	7 249.5	-419.7	-5.8%
Total	64 204.6	64 205.1	48 174.1	75.0%	46 501.8	-1 682.8	-3.6%

(Source: (National Treasury, 2019d)

 

By the end of the Third Quarter of 2019/20, the Department had spent R48.2 billion (or 75 %) of the total available budget. Spending  was R1.7 billion (or 3.6%) higher than projected mainly due to transfers made earlier than had been planned in the Road Transport programme.[11] The Department had spent R360.4 million on the Compensation of Employees against the projection of R362.8 million, indicating lower than planned spending of R2.4 million (or 0.7%). This was due to the slow filling of vacant posts. The Department had 734 filled posts against a funded establishment of 819 posts. The vacancy rate stood at 10.4% (or 85 vacant posts).

 

By the end of the Third Quarter of 2019/20, the National Treasury had approved the following virements and shifting of funds:[12]

• R1.7 billion shifted from capital transfers to PRASA to current transfers to the Agency, i.e. R387.2 million and R1.3 billion from Signalling and Metrorail: Refurbishment of Coaches, respectively, to Metrorail: Operations to pay creditors such as municipalities and Eskom for electricity, as well as the court settlement for the illegal dismissal of employees.

 

3.policy priorities for 2020/21 and alignment with national, regional, continental and global DEVELOPMENT agendas

 

4.1 National Development Plan (NDP) and the Medium-Term Strategic Framework (MTSF)

The work of the Department contributes to the realisation of the vision of improved social and economic development articulated in the NDP and priorities 1 and 4 of Government’s 2019-2024 MTSF. Chapter 4 of the NDP calls for the development of economic infrastructure as the foundation of social and economic development.

Transport is one of the Departments with the largest infrastructure build programme across entities.[13] Massive infrastructure investments are found in the Department entities PRASA, SANRAL and ACSA.

Priority 1 of the MTSF focuses on economic transformation and job creation, while priority 4 advocates spatial integration, human settlements and local Government.[14] It is against this backdrop that in the 2020/21 financial year, the Department has committed itself to giving effect to these guiding policies by focusing on:[15]

• Building and maintaining national and provincial networks;
• Providing rail infrastructure and services; and
• Facilitating the provision of integrated public transport networks (IPTNs).

 

Delivering his 2020 State of the Nation Address (SONA), President Ramaphosa accentuated two areas that the Department will be zeroing in on during 2020/21 as he committed Government to:[16]

• Fixing the commuter rail in an endeavour to modernise PRASA’s rail network. In this regard, it undertook that R1.4 billion will be invested to refurbish and upgrade the Central Line in the Western Cape, while a similar amount will be allocated to the Mabopane Line in Pretoria; and
• Piloting of “an alternative rural roads programme during which four experimental roads stretches of 50 km will be constructed”. It is maintained that this initiative will “ensure cost effective solutions to the State, meaningful skills transfer and higher potential for labour intensive job creation than conventional roads construction methods”.[17]

 

4.2 Agenda 2063

The African Union (AU) envisions that by 2063 the necessary infrastructure will be in place to support Africa’s accelerated integration and growth, technological transformation, trade and development. This will include high-speed rail networks, roads, shipping lines, sea and air transport, as well as Information and Communications Technology (ICT) and digital economy. A Pan-African high-speed rail network will connect all the major cities of the continent with adjacent ways and pipelines for gas,oil, water, ICT broadband cables and other infrastructure. This will serve as a catalyst for manufacturing skills development, integration and intra-African trade, investment and tourism. The Department has committed itself to contributing to the aspirations of “an integrated continent, politically united and based on the ideals of Pan Africanism and the vision of Africa’s Renaissance”.[18]

Investment in infrastructure is vital in addressing the challenges encountered in infrastructure maintenance and expansion that are crucial for the stabilisation of the country’s economy and creation of new opportunities for growth, equity and employment. The current socio-economic challenges cannot be resolved utilising only the scope and resources of Government or any single role player. Enduring economic partnerships between Government and the private sector are needed to develop trusting relationships for integrated operations, investments and management of transportation infrastructure.

A perusal of the Department’s budget allocation for 2020/21 lends credence to its commitment to national, regional, continental and global imperatives. This is evidenced by strong investments in Road, Public and Rail Transport programmes respectively.

It is a truism that an efficient transport infrastructure provides social and economic benefits to both advanced and emerging economies by improving market accessibility. In addition, it ensures balanced regional, continental and global economic development. Finally, an efficient transport infrastructure creates employment, promotes labour mobility, and connects communities.

4.BUDGET ANALYSIS

The section below analyses the budget allocation for the Department for 2020/21.

Table 4: Overall Budget – Transport

Programme	Budget		Nominal Increase / Decrease in 2020/21	Real Increase / Decrease in 2020/21	Nominal Percent change in 2020/21	Real Percent change in 2020/21
R million	2019/20	2020/21
Administration	443.0	491.8	48.8	28.1	11.0%	6.3%
Integrated Transport Planning	166.2	104.5	-  61.7	-  66.1	-37.1%	-39.8%
Rail Transport	16 573.8	13 195.2	- 3 378.6	- 3 934.7	-20.4%	-23.7%
Road Transport	33 073.9	33 816.7	742.8	-  682.4	2.2%	-2.1%
Civil Aviation Transport	243.3	240.7	-  2.6	-  12.7	-1.1%	-5.2%
Maritime Transport	136.8	149.4	12.6	6.3	9.2%	4.6%
Public Transport	13 568.1	14 038.0	469.9	-  121.7	3.5%	-0.9%
TOTAL	64 205.1	62 036.3	- 2 168.8	- 4 783.4	-3.4%	-7.5%

(Source: (National Treasury, 2020).

 

For 2020/21, the Department receives R62 billion (excluding direct charges) – constituting 6.4% of the R963.1 billion national budget vote.[19] Nominally (without inflation), the Department’s budget declines by -3.4% from the previous financial year, and it decreases by -7.5% when one takes cognisance of inflation (real terms). The noticeable decreases are in the Integrated Transport Planning, and Rail Transport programmes respectively. The former goes down significantly by -39.8% (with inflation), while the latter declines with -23.7% (with inflation). The drastic decrease in the allocation to the Rail Transport programme begs the question in the light of the fact that the provision of rail infrastructure and services is underscored as one of the policy priorities for the Department for 2020/21.

In terms of economic classification, transfers and subsidies comprise R60.6 billion (or 97.7%) of the departmental budget, and the bulk is allocated to the following bodies:[20]

• Provinces and municipalities (R24.9 billion);
• Departmental agencies and accounts (R22.1 billion); and
• Public corporations and private enterprises (R13.1 billion).

 

The overall allocation to compensation of employees increases from R504.9 million previously to R571.4 million in 2020/21. Expenditure on consultants (business and advisory services) is set to decrease from R461.3 million in 2019/20 to R451.3 million in 2020/21. The notable reduction in the use of consultants (business and advisory services) is in the Integrated Transport Planning programme that decreases from R104.3 million in 2019/20 to R35.7 million in 2020/21, translating into a decrease of 65.8%. Conversely, funding for the use of consultants in the Public Transport programme increases from R233.1 million in the previous financial year to R281.5 million in 2020/21 (17.2% in real terms).

 

5.1 Programme Analysis

As stated in the introduction, the Department has seven programmes. What follows below is an analysis of the budget allocation for each programme, and where relevant or necessary, it refers to the programmes’ sub-programmes.

 

5.1.1 Programme 1: Administration

The Administration programme is entrusted with providing strategic leadership, management and support services to the Department. It comprises five sub-programmes, as illustrated in the table below:

Table 5: Programme 1: Administration

Programme	Budget		Nominal Increase / Decrease in 2020/21	Real Increase / Decrease in 2020/21	Nominal Percent change in 2020/21	Real Percent change in 2020/21
R million	2019/20	2020/21
Ministry	41.1	39.8	-  1.3	-  3.0	-3.2%	-7.2%
Management	70.5	90.0	19.5	15.7	27.7%	22.3%
Corporate Services	234.6	259.5	24.9	14.0	10.6%	5.9%
Communications	37.9	40.2	2.3	0.6	6.1%	1.6%
Office Accommodation	59.0	62.3	3.3	0.7	5.6%	1.1%
TOTAL	443.0	491.8	48.8	28.1	11.0%	6.3%

(Source: (National Treasury, 2020).

 

The Administration programme receives R491.8 million, translating into a 6.3% above inflation increase from the previous financial year. All sub-programmes have above inflation increases, bar the Ministry sub-programme which declines with -7.2% below inflation. The Corporate Services sub-programme receives the biggest share of the Administration allocation, i.e. 52.8%. The exponential increase is to the Management sub-programme (an increase of 22.3% above inflation).

5.1.2 Programme 2: Integrated Transport Planning

The Integrated Transport planning programme integrates and harmonises macro-transport sector policies, strategies and legislation. In addition, it coordinates and develops sector-related policies, research activities, as well as regional and inter-sphere relations. The programme also facilitates sector information and provides sector economic modelling and analysis.

 

 

 

 

 

Table 6: Programme 2: Integrated Transport Planning

Programme	Budget			Nominal Increase / Decrease in 2020/21	Real Increase / Decrease in 2020/21	Nominal Percent change in 2020/21	Real Percent change in 2020/21
R million	2019/20	2020/21
Macro Sector Planning	14.4	18.1	3.7		2.9	25.7%	20.4%
Freight Logistics	20.1	21.6	1.5		0.6	7.5%	2.9%
Modelling and Economic Analysis	93.4	24.2	-  69.2		-  70.2	-74.1%	-75.2%
Regional Integration	14.6	14.3	-  0.3		-  0.9	-2.1%	-6.2%
Research and Innovation	16.8	17.4	0.6		-  0.1	3.6%	-0.8%
Integrated Transport Planning Administration Support	7.0	8.8	1.8		1.4	25.7%	20.4%
TOTAL	166.2	104.5	-  61.7		-  66.1	-37.1%	-39.8%

(Source: (National Treasury, 2020).

The Integrated Transport Planning programme budget decreases significantly by -39.8% including inflation. The allocation totals R104.5 million in 2020/21, down from R166.2 million in the previous financial year. The highest decline is in the Modelling and Analysis sub-programme, down from R93.4 million in 2019/20 to R24.2 million in the current financial year. The sub-programme’s allocation decreases by -75.2% with inflation (real terms).

The Modelling and Economic Analysis sub-programme is responsible for undertaking economic studies and providing “innovative and enabling transport infrastructure funding options that respond to the socioeconomic needs of the national agenda”.[21] In addition, the sub-programme “applies economic analysis tools for the development of policy in the transport sector”.[22] On the contrary, both the Macro Sector Planning and the Integrated Transport Planning Administration Support sub-programmes register the highest increase in the programme, each with 20.4% including inflation.

5.1.3 Programme 3: Rail Transport

The Rail Transport programme facilitates and coordinates the development of sustainable rail transport policies, rail economic and safety regulation, and infrastructure development strategies that reduce system costs and improve customer service. In addition, it oversees rail public entities and the implementation of integrated rail services. Five sub-programmes fall under this programme.

 

Table 7: Programme 3: Rail Transport

Programme	Budget		Nominal Increase / Decrease in 2020/21	Real Increase / Decrease in 2020/21	Nominal Percent change in 2020/21	Real Percent change in 2020/21
R million	2019/20	2020/21
Rail Regulation	20.1	21.4	1.3	0.4	6.5%	1.9%
Rail Infrastructure and Industry Development	7.4	7.6	0.2	-  0.1	2.7%	-1.6%
Rail Operations	16.4	15.7	-  0.7	-  1.4	-4.3%	-8.3%
Rail Oversight	16 525.7	13 144.1	- 3 381.6	- 3 935.6	-20.5%	-23.8%
Rail Administration Support	4.1	6.4	2.3	2.0	56.1%	49.5%
TOTAL	16 573.8	13 195.2	- 3 378.6	- 3 934.7	-20.4%	-23.7%

(Source: (National Treasury, 2020).

Constituting 25.8% of the Department’s budget, the Rail Transport programme is the second largest departmental spending area, after the Road Transport programme. However, the programme’s budget goes down from R16.5 billion previously, to R13.2 billion in 2020/21. This translates into a below inflation real decrease of -23.7% and a decline of -20% nominally (not calculating for inflation). The Rail Oversight sub-programme receives the biggest allocation of the programme’s budget, but decreases from R16.5 billion previously to R13.1 billion in 2020/21. This indicates an inflation-linked decrease of -23.8%. Transfers to PRASA to the value of R13.1 billion and R67 million to the Railway Safety Regulator (RSR) are funded from this sub-programme. Conversely, the allocation for the Rail Administration Support sub-programme increases exponentially by 49.5% above inflation, up from R4.2 million in 2019/20 to R6.4 million in the current financial year.Transfers to PRASA to the tune of R13.1 billion are divided up as per the tables below:

Table 8: PRASA Transfers: Current

Entity/Programme R million	Budget
	2019/20	2020/21
Metrorail (Operations)	R4.4 billion	R4.6 billion
Mainline passenger services (Operations)	R1.1 billion	R1.2 billion
Rail maintenance operations and inventories	R811.0 million	R912.9 million
TOTAL	R6.3 billion	R6.7 billion

(Source: National Treasury (2020).

Table 9: PRASA Transfers: Capital

Entity/Programme R million	Budget
	2019/20	2020/21
Other capital programmes	R600 million	R395.2 million
Rolling Stock Fleet Renewal	R5.8 billion	R3.6 billion
Signalling	R2.1 billion	R1.3 billion
Metrorail (Refurbishment of caches)	R1.5 billion	R913.8 million
Mainline Passenger Service (Refurbishment of coaches)	R169.2 million	R105. million
TOTAL	R10.2 billion	R6.4 billion

(Source: National Treasury (2020).

5.1.4 Programme 4: Road Transport

The Road Transport programme is entrusted with developing and managing an integrated road infrastructure network, as well as regulating transport and ensuring safer roads. Moreover, it oversees road transport public entities. The programme is divided into five sub-programmes.

Table 10: Programme 4: Road Transport

Programme	Budget		Nominal Increase / Decrease in 2020/21	Real Increase / Decrease in 2020/21	Nominal Percent change in 2020/21	Real Percent change in 2020/21
R million	2019/20	2020/21
Road Regulation	46.5	47.8	1.3	-  0.7	2.8%	-1.5%
Road Infrastructure and Industry Development	32.6	38.4	5.8	4.2	17.8%	12.8%
Road Oversight	32 955.2	33 691.5	736.3	-  683.6	2.2%	-2.1%
Road Administration Support	11.8	9.6	-  2.2	-  2.6	-18.6%	-22.1%
Road Engineering Standards	27.7	29.4	1.7	0.5	6.1%	1.7%
TOTAL	33 073.9	33 816.7	742.8	-  682.4	2.2%	-2.1%

(Source: National Treasury (2020).

 

The total expenditure for the Road Transport programme grows from R33.1 billion in 2019/20 to R33.9 billion in 2020/21. While this constitutes a nominal increase of 2.2%, when taking into account the effects of inflation (real terms) its allocation in fact decreases with -2.1 % from the previous financial year.

For this programme, the highest increase is for the Road Infrastructure and Industry Development sub-programme whose allocation goes from R32.6 million in 2019/20 to R38.4 million in 2020/21, resulting in 12.8% above inflation. However, the Road Oversight sub-programme dominates the programme budget, going up from R32.6 billion previously to R33.7 billion in the current financial year. While the sub-programme’s allocation increases nominally by 2.2%, it decreases by -2.1% below inflation.

The Road Oversight sub-programme reviews and analyses the performance of road transport public entities and monitors their compliance with regulations and legislation. It also transfers funds to SANRAL, the Road Traffic Management Corporation (RTMC), and the Road Traffic Infringement Agency (RTIA). Moreover, the sub-programme makes provision for the Provincial Roads Maintenance Grant (PRMG).

Major transfers from the Road Transport programme are as follows:[23]

Table 11: Major Transfers from the Road Transport Programme

Entity/ Programme R million	Budget
	2019/20	2020/21
RTMC	R210.2 million	R220.5 million
SANRAL: Gauteng Freeway Improvement Project (GFIP)	R550.5 million	R600.1 million
RTIA	R7.8 million	R8.2 million
SANRAL	R5.6 billion	R6.9 billion
SANRAL: Non-toll network	R12.3 billion	R12.4 billion
SANRAL: Moloto Road upgrade	R1.7 billion	R785 million
SANRAL: N2 Wild Coast	R1 billion	R1.1 billion
Rural Roads Asset Management Systems (RRAMS) Grant	R113.9 million	R108.4 million
PRMG: Road maintenance component	R10.6 billion	R11.6 billion
PRMG: Disaster relief component	R266.9 million	-
PRMG: Mpumalanga coal haulage roads maintenance	R526.2 million	-

(Source: National Treasury (2020).

Expenditure under Programme 4 lends credence to policy priorities for 2020/21. Poor road conditions are a significant contributor to the costs of moving people and goods within South Africa and across the Southern African region, increasing travel time and vehicle operating costs. There is, therefore, an imperative to improve national, provincial and municipal road networks.

5.1.5 Programme 5: Civil Aviation Transport

The Civil Aviation Transport programme facilitates the development of an economically viable air transport industry that is safe, secure, efficient, environmentally friendly and compliant with international standards through regulations and investigations. In addition, it oversees aviation transport public entities.

Table 12: Programme 5: Civil Aviation Transport

Programme	Budget		Nominal Increase / Decrease in 2020/21	Real Increase / Decrease in 2020/21	Nominal Percent change in 2020/21	Real Percent change in 2020/21
R million	2019/20	2020/21
Aviation Policy and Regulations	25.5	29.7	4.2	2.9	16.5%	11.6%
Aviation Economic Analysis and Industry Development	14.5	15.9	1.4	0.7	9.7%	5%
Aviation Safety, Security, Environment, and Search and Rescue	121.5	112.5	-  9.0	-  13.7	-7.4%	-11.3%
Aviation Oversight	72.9	76.5	3.6	0.4	4.9%	0.5%
Aviation Administration Support	9.0	6.2	-  2.8	-  3.1	-31.1%	-34%
TOTAL	243.3	240.7	-  2.6	-  12.7	-1.1%	-5.2%

(Source: National Treasury (2020).

 

For 2020/21, the allocation to the Civil Aviation Transport programme equals R240.7 million, down from R243.3 million previously, translating into a decrease of -5.2% after inflation. The major decrease is in the Aviation Administration Support sub-programme that constitutes a -34% decrease with inflation. The sub-programme’s allocation declines from R9 million in 2019/20 to R6.2 million in 2020/21. The second highest decrease (-11.3% with inflation) is in the Aviation Safety, Security, Environment, and Search and Rescue sub-programme, going down from R121.5 million in 2019/20 to R112.5 million in 2020/21.

5.1.6 Programme 6: Maritime Transport

The Maritime Transport programme promotes a safe, reliable and economically maritime transport sector through the development and implementation of policies and strategies. In addition, the programme oversees maritime public entities. Five sub-programmes fall under the Maritime Transport programme.

Table 13: Programme 6: Maritime Transport

Programme	Budget		Nominal Increase / Decrease in 2020/21	Real Increase / Decrease in 2020/21	Nominal Percent change in 2020/21	Real Percent change in 2020/21
R million	2019/20	2020/21
Maritime Policy Development	16.2	13.0	-  3.2	-  3.7	-19.8%	-23.1%
Maritime Infrastructure and Industry Development	12.9	19.5	6.6	5.8	51.2%	44.8%
Implementation, Monitoring and Evaluation	59.1	68.3	9.2	6.3	15.6%	10.7%
Maritime Oversight	41.5	43.8	2.3	0.5	5.5%	1.1%
Maritime Administration Support	7.1	4.8	-  2.3	-  2.5	-32.4%	-35.2%
TOTAL	136.8	149.4	12.6	6.3	9.2%	4.6%

(Source: National Treasury (2020).

The budget allocation for the Maritime Transport programme increases from R136.8 million in 2019/20 to R149.4 million in 2020/21, translating into an increase of 4.6% above inflation. The biggest budget increase is in the Maritime Infrastructure and Industry Development sub-programme that grows up from R12.9 million in 2019/20 to R19.5 million in 2020/21. This indicates an above inflation increase of 44.8%. This sub-programme facilitates the development of integrated maritime infrastructure and a maritime industry. Conversely, the Maritime Administration Support sub-programme has a noticeable decrease, down from R7.1 million in the previous financial year to R4.8 million in the current financial year, indicating a decline of -35.2% with inflation.

5.1.7 Programme 7: Public Transport

The Public Transport programme is tasked with providing and regulating safe, secure, reliable, cost-effective and sustainable public transport services in South Africa through legislation, policies and strategies. The Public Transport programme comprises six sub-programmes.

 

 

Table 14: Programme 7: Public Transport

Programme	Budget		Nominal Increase / Decrease in 2020/21	Real Increase / Decrease in 2020/21	Nominal Percent change in 2020/21	Real Percent change in 2020/21
R million	2019/20	2020/21
Public Transport Regulation	53.3	62.1	8.8	6.2	16.5%	11.6%
Rural and Scholar Transport	40.5	45.4	4.9	3.0	12.1%	7.4%
Public Transport Industry Development	203.2	217.5	14.3	5.1	7.0%	2.5%
Public Transport Oversight	13 232.4	13 679.1	446.7	-  129.8	3.4%	-0.9 %
Public Transport Administration Support	17.7	12.6	-  5.1	-  5.6	-28.8%	-31.8%
Public Transport Network Development	21.0	21.3	0.3	-  0.6	1.4%	-2.9%
TOTAL	13 568.1	14 038.0	469.9	-  121.7	3.5%	-0.9%

(Source: National Treasury (2020).

In 2020/21, Programme 7 receives R14 billion, up from R13.6 billion in 2019/20. However, this increase did not keep track with the effects of inflation, and it therefore declines with -0.9%. The biggest increase is in the Public Transport Regulation sub-programme which receives R62.1 million in 2020/21, up from R53.3 million previously, indicating an increase of 11.6% above inflation. This sub-programme manages the development and maintenance of policy, legislation and regulation. It also coordinates and facilitates implementation.

On the contrary, the marked decrease in the allocation is in the Public Transport Administration Support sub-programme that goes down from R17.7 million in the previous financial year to R12.6 million in the current financial year. This indicates a decrease of -31% that does not keep track with the effects of inflation.

Selected transfers in the Public Transport programme are as follows:[24]

Table 15: Selected Transfers in the Public Transport programme

Entity/Programme R million	Budget
	2019/20	2020/21
Taxi Recapitalisation Programme (TRP)	R414.7 million	R458.6 million
South African National Taxi Council (SANTACO)	R23.8 million	R25.1 million
Public Transport Network Grant (PTNG)	R6.5 billion	R6.4 billion
Public Transport Operations Grant (PTOG)	R6.3 billion	R6.7 billion
TOTAL	R13.2 billion	R13.7 billion

(Source: National Treasury (2020).

 

6.         2020/21 ANNUAL PERFORMANCE PLANS, STRATEGIC AND CORPORATE PLANS AS WELL AS ESTIMATES OF NATIONAL EXPENDITURE PER ENTITIES

This report summarises the Key Performance Indicators presented by the entities in terms of their APPs and Corporate Plans as well as their Budget allocations for the 2020/21 financial year.

6.1        Airports Company South Africa (ACSA)

ACSA was established terms of the Airports Company Act (1993) and the Companies Act (2008). Listed as a schedule 2 entity in terms of the Public Finance Management Act (1999), the company owns and operates 9 of South Africa’s principal airports, including OR Tambo International Airport, Cape Town International Airport and King Shaka International Airport, it is also one of the concessionaires operating Mumbai International Airport in India and Guarulhos International Airport in Sao Paulo, Brazil.

Over the medium term, the company will continue to focus on airport development, management and maintenance. It anticipates that 67.7 million passengers will depart from these 9 airports and 827 581 aircraft will arrive at them over the MTEF period. To support this, total expenditure is expected to increase from R6.7 billion in 2019/20 to R8.8 billion in 2022/23, at an average annual rate of 9.5 per cent. The company’s spending of R13.9 billion over the medium term on capital and infrastructure is expected to be financed through a combination of borrowings (R7.4 billion) and cash reserves.

Total revenue over the MTEF period is expected to amount to R27.2 billion, with aeronautical and nonaeronautical revenue comprising 97.6 per cent of this amount. Aeronautical revenue, which includes income from passenger facilitation and airline services, such as charges and tariffs for aircraft parking and landing fees, is expected to amount to R13.4 billion; and non‐aeronautical revenue from property rentals, advertising and parking fees is expected to amount to R12.9 billion.

6.2        Passenger Rail Agency of South Africa (PRASA)

PRASA was established in terms of the Legal Succession to the South African Transport Services Amendment Act (2008), with the primary mandate of providing rail commuter services within, to and from South Africa in the public interest. The agency also provides long‐haul passenger rail and bus services within, to and from South Africa.

In its efforts to stabilise operations, over the medium term, the agency will focus on responding to its historic challenge of underspending on capital programmes with the aim of reducing its persistent operating deficits.

Accordingly, to increase the number of passengers using Metrorail and mainline passenger services, the agency plans to continue its modernisation programme. Over the MTEF period, this entails: refurbishing a targeted 1 314 train coaches; upgrading and improving 150 stations; upgrading signalling infrastructure; improving depots; acquiring 166 new train sets; and securing the agency’s assets, including all stations.

As a result of historic underspending on capital programmes, the agency had a cash balance of R18.3 billion at the end of 2018/19, which it plans to use over the medium term on infrastructure for Metrorail and mainline passenger services. An estimated 66.3 per cent (R36 billion) of the agency’s total expenditure of R54.4 billion over the medium term is earmarked for spending on the Metrorail and mainline passenger services programmes, including the modernisation programme.

Total revenue over the MTEF period is expected to be R44.4 billion, of which transfers from the department account for an estimated 70.1 per cent (R30.4 billion). Other sources of revenue include the sale of train and bus tickets, rental income from the leasing of properties, on‐board sales, and interest earned. Partly due to the non‐payment of fares by passengers, total revenue is expected to increase at an average annual rate of 4.1 per cent, from R14 billion in 2019/20 to R15.8 billion in 2022/23. As a result, the agency’s operating deficit is set to increase from R2 billion in 2019/20 to R4.1 billion in 2020/21. Persistent operating deficits are expected to result in the agency’s trade and other payables increasing from R11.9 billion in 2019/20 to a projected R29.3 billion in 2022/23, at an average annual rate of 34.9 per cent.

6.3        Road Accident Fund     (RAF)

The RAF is a juristic person established in terms of the Road Accident Fund Act (No. 56 of 1996). The RAF provides compulsory social insurance cover to all users of South African roads, rehabilitates and compensates people injured as a result of the negligent driving of motor vehicles in a timely and active manner. In addition, the RAF actively promotes the safe use of the nation’s roads.  According to the Act, the object of the RAF is the payment of compensation in accordance with the Act for loss or damage wrongfully caused by the driving of a motor vehicle.

The fund receives its revenue from the road accident fund fuel levy, in terms of the Customs and Excise Act (1964). Over the medium term, revenue from the fuel levy is expected to increase at an average annual rate of 1.2 per cent, from R43.9 billion in 2019/20 to R45.4 billion in 2022/23. Due to the fund operating on a pay‐as-you‐go model and paying out what it is able to with the revenue it has, it has insufficient revenue to meet its liabilities, thereby increasing its indebtedness. Claims against the fund increased from R66 billion in 2016/17 to R108.3 billion in 2019/20, and are expected to increase to R145.6 billion in 2022/23. As a result, the accumulated deficit is expected to increase from R329.7 billion in 2019/20 to R593.1 billion in 2022/23.

To address this systemic challenge, the Road Accident Benefit Scheme Bill proposes to transform the fund from a liability insurance scheme to a system based on social security principles. This is expected to result in a more equitable and affordable road accident compensation scheme. In the meantime, the fund is developing a turnaround plan to prioritise, amongst others, reducing legal fees and transforming the claims management systems and processes.

6.4        South African National Roads Agency (SANRAL)         

SANRAL was established in terms of the South African National Roads Agency Limited and the National Roads Act (1998) and is registered in terms of the Companies Act (2008). The agency is mandated to finance, develop, improve, maintain and manage South Africa’s national road network for both toll and non‐toll roads. The focus of the agency over the medium term will be on the maintenance, improvement, development and overall preservation of roads.

Due to the entity not having tabled their Strategic Plan and APP in time for consideration as part of this report, the information herein only focusses on the budget allocation per the estimates of national expenditure as tabled per the Budget Vote 40.

Total expenditure is expected to decrease at an average annual rate of 6.8 per cent over the MTEF period, from R24.1 billion in 2019/20 to R19.5 billion in 2022/23. This is mainly driven by an overall decrease in spending on road maintenance of 3.6 per cent, from R10.2 billion in 2019/20, increasing to R14 billion in 2021/22 and decreasing to R9.2 billion in 2022/23. As the spending for maintenance decreases, capital investment is set to increase at an average annual rate of 3.8 per cent, from R10.8 billion in 2019/20 to R12.1 billion in 2022/23.

The agency expects its headcount to increase from 442 in 2019/20 to 490 in 2022/23 as it fills vacancies to better align its organisational structure with its operations. As a result, spending on compensation of employees is expected to increase at an average annual rate of 15.4 per cent, from R523.1 million in 2019/20 to R803.2 million in 2022/23.

The agency’s total revenue over the MTEF period is expected to be R62.1 billion. Of this amount, it is set to derive R42.7 billion through departmental transfers and R14.7 billion through toll road fees. Despite Cabinet’s approved reductions of R1.4 billion on transfers to the agency, total revenue is expected to increase from R19.1 billion in 2019/20 to R21.8 billion in 2022/23 at an average annual rate of 4.4 per cent.

6.5        Air Traffic and Navigation Services Company (ATNS)

ATNS was established in terms of the Air Traffic and Navigation Services Act (1993) with the mandate of providing safe, orderly and efficient air traffic navigational and associated services, in accordance with the standards of the International Civil Aviation Organisation, to the air traffic management community.

The company will, over the medium term, continue to focus on providing safe, efficient and cost‐effective air traffic management solutions and related services as it expands its footprint to cover the rest of Africa and the Indian Ocean region. As a result of this focus, an estimated 69.6 per cent (R4 billion) of the company’s total expenditure over the medium term is earmarked for investment in communication and simulation systems, which are essential to ensuring safety and improved capacity at airports. Total expenditure is expected to increase from R1.7 billion in 2019/20 to R2 billion in 2022/23 at an average annual rate of 6.9 per cent.

The company generates revenue by providing aeronautical services to the aviation industry. Total revenue is expected to increase from R1.8 billion in 2019/20 to R2.1 billion in 2022/23 at an average annual rate of 6.2 per cent as a result of a projected increase in tariff fees.

6.6        Cross-Border Road Transport Agency (C-BRTA)          

C-BRTA is a schedule 3A public entity established in terms of the Cross‐Border Road Transport Act (1998). The agency’s legislative mandate requires it to advise the Minister of Transport on cross‐border road transport policy, regulate access to the market by the road transport freight and passenger industry in respect of cross‐border road transport by issuing permits, undertake road transport law enforcement, and play a facilitative role in contributing to the economic prosperity of the region.

6.7        Driving Licence Card Account(DLCA)

DLCA manufactures credit card‐format driving licences based on orders received from driving licence testing centres, and generates its own revenue through the sale of licence cards.

The provision of driver licences started in 1998 as non-line function until 2007 when the Treasury approval was granted and the instruction was received to create a trading entity called the Driving Licence Credit Card Trading Entity Account (aka DLCA) with retrospective effect to produce credit card format driving license cards.

As part of the conditions of establishment of the DLCA, the National Treasury stated that the Accounting Officer of the Department is the Accounting Officer of the Trading Account.

The entity is a self-funding establishment. Prodiba was contracted during 1997/1998 to manage the production of the new credit card licences and was responsible for the production of the cards until 5 May 2015 when the Department as per a court order took over the card production facility. As part of the take-over, the DLCA also took over the day-to-day operations of the business. Since then the staff of the production unit have been appointed as contract workers.

Of particular importance for the 2020/21 performance, would be the new card project. The DLCA took over the card production facility in 2015 and discovered that the card machine had not been upgraded since 1998 and that the live capture units (LCUs) also needed an upgrade. The DLCA embarked on a journey to modernise the card production environment which involved the replacement of the LCUs with LEUs and the introduction of a new driving licence card. The DLCA at same time, started with the project for the introduction of a new driving licence card but the security of the card design was compromised when the laptop of the DLCA official was stolen. The new card project has been resuscitated in 2020/21 and it is envisaged that a new durable driving licence card with improved security features will be introduced by the end of 2021/22. This new driving licence card will also be ISO 18013 compliant thereby ensuring that it is internationally accepted.The estimates of national expenditure indicate the entity’s total budget for 2020/21 as R230.2 million.The entity’s estimated expenditure for 2019/20 was R235 million.

6.8        Ports Regulator of South Africa (PRSA)

The Ports Regulator derives its mandate from the National Ports Act (No. 12 of 2005) and policy instruments such as the White Paper on Commercial Ports (2002) and the Comprehensive Maritime Transport Policy.

PRSA performs functions that relate mainly to the regulation of pricing and other aspects of economic regulation, the promotion of equal access to ports facilities and services, the monitoring of the industry’s compliance with the regulatory framework, and the hearing of any complaints and appeals lodged with it. The regulator’s total budget for 2020/21 is R40.4 million.The regulator’s estimated expenditure for 2019/20 was R37.4 million.

6.9        Railway Safety Regulator (RSR)           

The RSR was established in terms of the National Railway Safety Regulator Act (No. 16 of 2002) as amended, to establish a national regulatory framework for South Africa, and to monitor and enforce compliance in the rail sector. The primary legislative mandate of the RSR is to oversee and enforce safety performance by all railway operators in South Africa, including those of neighbouring States whose rail operations enter South Africa. In terms of the Act, all operators are primarily responsible and accountable for ensuring the safety of their railway operations.The regulator’s total budget for 2020/21 is R248.9 million.The regulator’s estimated expenditure for 2019/20 was R240.6 million.

 

6.10      Road Traffic Infringement Agency (RTIA)

The RTIA is a Schedule 3A public entity listed in the PFMA and is established by section 3 of the Administrative Adjudication of Road Traffic Offences Act of 1993. The Agency reports to the Executive Authority i.e. the Minister of Transport. The Minister appoints a Board which serves to provide an oversight role.

RTIA promotes road traffic quality by providing for a scheme to discourage road traffic infringements to support the prosecution of offences in terms of national and provincial laws relating to road traffic, and implements a points demerit system. The agency’s total budget for 2020/21 is R286.4 million.The agency’s estimated expenditure for 2019/20 was R258.9 million.

6.11      Road Traffic Management Corporation (RTMC)

The RTMC was established in terms of Section 3 of the Road Traffic Management Corporation Act, No. 20 of 1999, for co-operative and coordinated strategic planning, regulation, facilitation and law enforcement in respect of road traffic matters by the national, provincial and local spheres of government. The corporation’s total budget for 2020/21 is R1.5 billion.The corporation’s estimated expenditure for 2019/20 was R1.5 billion.

6.12      South African Civil Aviation Authority (SACAA)           

The South African Civil Aviation Authority (SACAA) was stablished on 01 October 1998, following the enactment of the now repealed South African Civil Aviation Authority Act, 1998 (No. 40 of 1998). This Act was replaced by the Civil Aviation Act, 2009 (Act No. 13 of 2009), which came into effect on 31 March 2010.

SACAA is a Schedule 3A public entity. The Civil Aviation Act provides for the establishment of a stand-alone authority, mandated with controlling, promoting, regulating, supporting, developing, enforcing and continuously improving levels of safety and security throughout the civil aviation industry. The above was achieved by complying with the Standards and Recommended Practices (SARPs) of the International Civil Aviation Organization (ICAO), whilst considering the local context.  The entity’s estimated expenditure for 2019/20 was R792.5 million.

 

 

6.13      South African Maritime Safety Authority (SAMSA)

SAMSA is a Schedule 3A public entity in terms of the PFMA. The entity was established on 1 April 1998, subsequent to the enactment of the South African Maritime Safety Authority Act (No. 5 of 1998). The Act provides for the establishment of an authority charged with regulating and enforcing maritime safety, marine pollution from ships and promoting South Africa’s maritime interests. The entity is governed and controlled by a Board of Directors that are appointed by the Minister of Transport, in terms of the SAMSA Act. The authority’s total budget for 2020/21 is R531.2 million.The entity’s estimated expenditure for 2019/20 was R505.7 million.\

 

1. COMMITTEE OBSERVATIONS

As general observations, the Committee remained of the view that there needs to be greater alignment in all the entities between their Key Performance Indicators and the outcome of actual service delivery or improvements to service delivery to the people. The Committee will no longer accept that an entity might meet 100% of its set targets, while actual service delivery felt on the ground does not equate to the set targets or the expenditure on set targets or that those targets are not truly measurable when linked to service delivery outcomes. Furthermore, the Committee was of the view that transformation targets for the entities were not sufficient to deliver true transformation in the various industries.

At the time of engagements with the entities (SACAA, DLCA and PRASA) and following an assessment of the status at other entities, the Committee was still of the view that vacancies in the Boards and Management of the entities must be dealt with as a matter of urgency, as was stated in the 2019 Budget Vote Report by the Committee. There was also a concern expressed that SANRAL was unable to submit its APP or Strategic Plan by the legislated timeframes, and that this may also lead to a late submission and tabling of its Annual Report.

The impact of Covid-19 restrictions on the various transport industry players was concerning. The Committee was concerned on how the budget re-allocations and target adjustments as a result of the Covid-19 measures would impact the audit outcomes of the entities.

 

Members made the following observations during discussions:

7.1        Allocation for road maintenance

SANRAL has had an increase of R11.4 billion on 21000 kilometres of road network, whereas about 49 000 kilometres of South Africa’s tar road network are under the jurisdiction of provincial departments of transport, these were only budgeted over 5 years to receive a R4 billion increase. This funding increase difference between a national road agency as compared to all nine provincial road maintenance allocations appeared unjustified.

7.2        Impact of the Covid-19 pandemicrestrictions on the entities of the Department

The Committee expressed concern about the impact of Covid-19 travel, transport and construction restrictions on entities such as the RAF, ACSA, SACAA, ATNS, PRASA, DLCA, C-BRTA and SANRAL.

It was noted that the RAF would be severely affected by the Covid-19 lockdown restriction specific to the driving population as the reduction in fuel sales would affect RAF income which in turn will affect its ability to process payments to claimants.

The aviation industry (ACSA, SACAA, ATNS) was regarded as one industry that was severely affected by global restrictions imposed to prevent the spread of the Covid-19 pandemic.

The DLCA would be financially affected by the restriction on issuing and renewals of driving licence cards during the lockdown restriction periods and this would also impact its production of cards which would likely lead to a backlog once production is allowed to commence. This is of particular concern as the entity had only just recently caught up to the backlogs caused by a strike during the 2019/20 year.

PRASA had already shown a concerning decline in passenger revenue over the previous years and would be severely impacted by the lockdown restrictions as the PRASA passenger rail industry would only be allowed to reconvene operations during the level 3 restriction phase.

C-BRTA revenue would be affected by the limitation on cross-border transportation of only essential goods during the level 5 and 4 restrictions.

SANRAL operations would be affected by the restrictions during level 5 as well as level 4 where only essential infrastructure maintenance and construction would have been allowed. Any projected toll income during the lockdown restrictions would also have been reduced dramatically, given that the country was under complete lockdown during the Easter holiday period.

7.3        Implementation of the IPTNs

Concern was raised about the progress on the planned targets for roll-out of the IPTNs in the municipalities compared to the billions of allocated funds already spent on the projects. It was noted that more than R41 billion was spent on the 13 cities for the implementation of the BRT systems, yet very few of them were functioning.

7.4        Shova Kalula

The R22 million budget for the implementation of the Shova Kalula bicycle programme was noted, however, it was further noted that the implementation of the project or any of the value add services (such as bicycle repair services near the roll-out areas) that were meant to be implemented by the bicycle project was not visible in provinces such as the Free State.

7.5        Gauteng Freeway Improvement Project (GFIP)

Members were of the view that the e-toll issue must be finalised as it was not acceptable to have it drag on any longer.

7.6        Under expenditure of the Administration programme

The continued under expenditure of the administration programme was noted as well as the 10% vacancy rate reduction target which had been repeated over the 2018/19 and 2019/20 financial years.

7.7        Increase in use of consultants in the Public Transport programme

The 17.2% increase in use of consultants in the Public Transport programme was raised as a concern despite the Cabinet decision regarding the limitation in the usage of consultants.

 

 

7.8        Funding of programmes

Concern was raised regarding the funding for some programmes. It was noted that the Department kept asking for funding in programmes where it showed regular underspending, for example the Taxi Recapitalisation Programme.

7.9        Infrastructure development     

More information was requested on the budget allocation for infrastructure development, as this matter was not presented on in detail by the Department.

7.10      Taxi Recapitalisation programme

The Taxi Recapitalisation programme had been running for 20 years and a revised programme was recently implemented, however, so far only 72 653 taxis had been scrapped and R4.5 billion was already spent. It was noted that the Minister mentioned formalisation of the industry, but members did not see any budget allocation for that in the presentation. Only an increase in the Revised Taxi Recapitalisation programme budget allocation was noted and this was a concern. The Committee further noted with concern that the taxi industry would be included into the integrated single ticket system that would be implemented by 2023, while the industry was not yet formalised.

7.11      Universal accessibility

Accessibility of public transport by people with disabilities remained a concern to the Committee.

7.12      Operational risks on Western Cape Railway Lines

The Department was asked to explain the steps it and PRASA took to reduce operational risks on the Western Cape railway lines. Trains were being burned and there was no discussion on how the matter would be resolved.

7.13      Provincial Road Maintenance Grant (PRMG)

In the 2019/20 financial year there was an allocation for the Provincial Road Maintenance Grant (PRMG) in disaster relief and Coal haulage. This allocation was not reflected in the 2020/21 budget.

 

7.14      Moloto Road Upgrade

The Department was asked to clarify whether the Moloto Road upgrade, done by SANRAL, would be contributed to with funds by provinces benefitting from the road upgrade and whether the road would remain under SANRAL assets or post-upgrade be moved back to provinces.

7.15      Reduction in the capital expenditure budget of PRASA

The Committee noted the reduction in the capital expenditure budget of PRASA.

7.16      Vacancies and Acting Positions

The Committee noted that there was some progress made by the Department and its entities in finalising the filling of Board and executive management posts. The Committee appreciated that the Covid-19 restrictions would impact the planned filling of vacancies, but there was still a need to ensure the filling of essential posts.

7.17 Scholar Transport and Public Transport Covid-19 Prevention

The Committee noted that the Department would need to allocate funds to assist with the sanitisation measures that must be in place going forward to combat the spread of Covid-19 on public transport and scholar transport modes.

7.18 Impact of Rating Agency Downgrades on Entities

The Committee noted that there had been rating agency downgrades after the tabling of the entities’ plans. However, there was a concern on how this would impact ACSA and SANRAL going forward.

 

8.         COMMITTEE RECOMMENDATIONS

The Committee recommends that the Minister, through the Department, should ensure the following:

8.1        Impact of the Covid-19 pandemic as well as ratings agencies’ downgrade on the Department as well as its entities

The Department should provide detail on how it envisioned the impact of the Covid-19 regulationsas well as the ratings agencies’ downgrade on budget re-prioritisation for the Department and its entities in terms of the estimations and programme allocation.

8.2        Increase in use of consultants in the Public Transport programme

The Department must brief the Committee on all consultants used and the expenditure linked to these appointments. The Department should indicate whether the consultants transferred relevant skills to the employees of the Department.

8.3        Infrastructure development     

More information was requested on the budget allocation for infrastructure development, as this matter was not presented on in detail by the Department.

8.4        Universal accessibility

The Department and its entities should increase the implementation of programmes aimed at increasing Universal Access to all modes of public transport and for all transport and road infrastructure.

8.5        Operational risks in all its operational lines

The Department and PRASA should provide the Committee with detailed plans to reduce operational risks on the railway lines.

8.6        Provincial Road Maintenance Grant (PRMG)

The Department should provide the Committee with quarterly monitoring reports on the implementation of the PRMG.

8.7        Moloto Road Upgrade

The Department should provide the Committee with an updated presentation on the project as well asthe maintenance plan for the Moloto Road.

 

 

8.8        Shova Kalula

The Department deliver quarterly updates to the Committee on the progress made regarding the programme. The report should include information onwhere the bicycles have been distributed, the number of bicycles distributed and plans for future distribution.

8.9        Implementation of the IPTNs

The Department deliver an updated report to the Committee on the roll-out, expenditure and reasons for delays in active operations of the IPTN programmes in the 13 original cities as well as the way forward with the remaining 10 cities.

8.10      Taxi Recapitalisation programme

The Department deliver an updated report on the roll out of the revised taxi recapitalisation programme and how it aims to work towards formalisation and corporatisation of the taxi industry.

 

Report to be considered.

 

 

ANNEXURE A: LIST OF ABBREVIATIONS/ACRONYMS

Abbreviation/Acronym	Meaning
AARTO	Administrative Adjudication of Road Traffic Offences
ACSA	Airports Company South Africa
AFCAC	African Civil Aviation Commission
AGM	Annual General Meeting
AGSA	Auditor-General of South Africa
AI	Aviation Infrastructure
AIC	Aeronautical Information Circular
AIMO	Aeronautical Information Management Officer
ANSP	Air Navigation Service Provider
APP	Annual Performance Plan
ARDP	(Draft) Access Road Development Plan
ASO	Aviation Security Operations
ATM	Air Traffic Management
ATNS	Air Traffic Navigation Services
ATS	Air Traffic Services/ Aircraft Tracking Systems
ATSO	Air Traffic Service Officer
AU	African Union
AvSec	Aviation Security
BAC	Bid Adjudication Committee
BARSA	Board of Airlines Representatives of South Africa
B-BBEE	Broad-Based Black Economic Empowerment
BRICS	Brazil, Russia, India, China and South Africa
BRRR	Budget Review and Recommendations Report
BRT	Bus Rapid Transport
CANSO	Civil Air Navigation Organisation
CAPEX	Capital Expenditure
Cat	Civil Aviation Technical
C-BRTA	Cross-Border Road Transport Agency
C-BRTRF	Cross-Border Road Transport Regulators Forum
CEO	Chief Executive Officer
CFO	Chief Financial Officer
CNG	Compressed Natural Gas
CNS	Communications, Navigation and Surveillance
COTO	Committee of Transport Officials
CPO	Chief Procurement Office
DCA	Director of Civil Aviation
DG	Director-General
DGEC	Directors-General of the Economic Cluster
DDG	Deputy-Director General
DGOs	Dangerous Goods Operators
DLCA	Driving Licence Card Account
DLTC	Driving Licence Testing Centres
DPE	Department of Public Enterprises
DPME	Department of Planning, Monitoring and Evaluation
DPSA	Department of Public Service and Administration
EDL	Examiner of Driving Licences
EE	Employment Equity
EI	Effective Implementation
eNaTIS	Electronic National Traffic Information System
EoV	Examiner of Vehicles
ESEID	Economic Sectors, Employment and Infrastructure Development
EXCO	Executive Committee
FIU	Flight Inspection Unit
FMPPI	Framework for Managing Programme Performance Information
FOSAD	Forum of South African Directors-General
GA	General Aviation
GFIP	Gauteng Freeway Improvement Project
GHG	Greenhouse Gas
GDP	Gross Domestic Product
GDYC	Gender, Disability, Youth and Children
GTS	Green Transport Strategy
HR/HRD	Human-Resource/Human-Resource Development
IA	Issuing Authority
ICAD	International Civil Aviation Day
ICAO	International Civil Aviation Organisation
ICT	Information and Communications Technology
IMO	International Maritime Organisation
IPAP	Industrial Policy Action Plan
IPTNs	Integrated Public Transport Networks
IPTTP	Integrated Public Transport Turnaround Plan
IRERC	Interim Rail Economic Regulatory Capacity
IT	Information Technology
KPI	Key Performance Indicator
LDV	Light Delivery Vehicle
LEU	Live Enrolment Unit
LPG	Liquefied Petroleum Gas
MARPOL	International Convention for the Prevention of Pollution from Ships
MECs	Members of the Executive Council
MEOSAR	Medium Earth Orbit Search and Rescue
MET	Maritime and Training
MLPS	Long Distance (Main Line) Passenger Service
MOSP	Master Oversight and Surveillance Plan
MOU	Memorandum of Understanding
MRCC	Maritime Rescue and Coordination Centre
MTEF	Medium-Term Expenditure Framework
MTP	Comprehensive Maritime Transport Policy
MTSF	Medium-Term Strategic Framework (2014-19)
MTT	Ministerial Task Team
M&E	Monitoring and Evaluation
NA	National Assembly
NADP	National Airports Development Plan
NAFISAT	North East Africa Indian Ocean VSAT Network
NATMAP 2050	National Transport Master Plan 2050
NCAP	National Civil Aviation Policy
NCLB	No Country Left Behind
NCCRS	National Climate Change Response Strategy
NCOP	National Council of Provinces
NDP	National Development Plan
NEDLAC	National Economic Development and Labour Council
NGO	Non-governmental Organisation
NICRO	South African National Institute for Crime Prevention and the Reintegration of Offenders
NIP	National Infrastructure Plan
NLTA	National Land Transport Act
NQF	National Qualifications Framework
NRSS	National Road Safety Strategy
NRTA	National Road Traffic Act
NRTLEC	National Road Traffic Law Enforcement Code
NSRI	National Sea Rescue Institute
NT	National Treasury
PEPFRA	Ports Economic Participation Framework
PFMA	Public Finance Management Act
PICC	Presidential Infrastructure Coordinating Commission
PMDS	Performance Management and Development System
PPP	Public-Private Partnership
PRASA	Passenger Rail Agency of South Africa
PRSA	Ports Regulator of South Africa
PRMG	Provincial Roads Maintenance Grant
PSC	Passenger Safety Charge
PSP	Private Sector Participation
PTNG	Public Transport Network Grant
PTOG	Public Transport Operations Grant
RABS	Road Accident Benefit Scheme
RAF	Road Accident Fund
RFS	Road Freight Strategy
ROD	Record of Decision
ROS	Regulatory Outcomes Strategy
RPAS	Remotely Piloted Aircraft Systems
RSA	Republic of South Africa
RSR	Railway Safety Regulator
RTIA	Road Traffic Infringements Agency
RTMC	Road Traffic Management Corporation
RTRP	Revised Taxi Recapitalisation Programme
SAAF	South African Air Force
SAATM	Single African Air Transport Market
SABC	South African Broadcasting Corporation
SABOA	Southern African Bus Operations Association
SACAA	South Africa Civil Aviation Authority
SACU	Southern African Customs Union
SADC	Southern African Development Community
SAMSA	South African Maritime Safety Authority
SANRAL	South African National Roads Agency Limited
SAPS	South African Police Services
SARAP	South African Road Assessment Program
SARPS	Standards and Recommended Practices
SARS	South African Revenue Service
SASAR	South African Search and Rescue Organisation
SCM	Supply Chain Management
SDIP	Service Delivery Improvement Plan
SEIAs	Socio Economic Impact Assessment System
SIDS	Standard Instrument Departures
SIP	Strategic Infrastructure Programme
SLA	Service Level Agreement
SMART	Specific, Measurable, Achievable, Realistic and Timely
SMME	Small, medium and micro enterprises
SMS	Senior Management Service
SmS	Safety Management System
SMSR	Safety Management System Report
SOC	State-Owned Company
SOEs	State-owned Enterprises
SONA	State of the Nation Address
SRAB	Starting Regulatory Asset Base
STARS	Standard Terminal Arrival Routes
STER	Single Transport Economic Regulator
TAT	Transport Appeals Tribunal
TETA	Transport Education and Training Authority
TFR	Transnet Freight Rail
TNPA	Transnet National Ports Authority
ToR	Terms of Reference
TRP	Taxi Recapitalisation Programme
TVET	Technical Vocational Educational and Training
UN	United Nations
USOAP	Universal Security Audit Programme
VSAT	Very Small Aperture Terminal
VTC	Vehicle Testing Centres
WEGO	Weighted Efficiency Gains from Operations
WHO	World Health Organisation

 

 

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[1]Constitution of the Republic of South Africa, 1996.

[2]National Treasury (2019a).

[3]Department of Transport (2018).

[4]It should be underscored that this section only covers the first Three Quarters of 2019/20, as the Fourth Quarter was not yet available at the time of analysis.

[5]Department of Transport (2019b).

[6]Ibid.

[7]National Treasury (2019c).

[8]Ibid.

[9]Ibid.

[10]Ibid.

[11]National Treasury (2019d).

[12]Ibid.

[13]Department of Transport (2020).

[14]National Treasury (2020).

[15]Ibid.

[16]Ramaphosa (2020).

[17]Ibid.

[18]Department of Transport (2019).

[19]National Treasury (2020).

[20]Ibid.

[21]National Treasury (2020).

[22]Ibid.

[23]National Treasury (2020).

[24]National Treasury (2020).