ATC211125: Report of the Portfolio Committee on Transport on the 2021/22 First Quarter Expenditure of the Department of Transport, Dated 23 November 2021
Transport
Report of the Portfolio Committee on Transport on the 2021/22 First Quarter Expenditure of the Department of Transport, Dated 23 November 2021
The Portfolio Committee on Transport, having considered the expenditure of the Department of Transport for the First Quarter of the 2021/22 financial year, reports as follows:
- INTRODUCTION
The prime mandate of the Committee is governed by the Constitution of the Republic of South Africa, 1996 (“the Constitution”), in respect of its legislative and oversight responsibilities as public representatives. It is required to consider legislation referred to it and consider all matters referred to it in terms of the Constitution, the Rules of the National Assembly or resolutions of the House. It is also required to respond to matters referred to it by Government within its mandate. In addition, the Committee is entrusted with considering the budgets, Strategic Plans and Annual Performance Plans of the Department and entities that fall within the transport portfolio. This report provides an overview of the expenditure of the Department of Transport for the First Quarter of the 2021/22 financial year, as presented to the Committee on 1 September 2021.
2. ANALYSIS OF THE 2021/22 FIRST QUARTER EXPENDITURE OF THE DEPARTMENT OF TRANSPORT
- Introduction
In 2021/22, the budget allocation of the Department of Transport (“the Department”) stands at R66.7 billion. By the end of the First Quarter of 2021/22, the Department spent R14.6 billion against the Quarter’s projection of R15 billion.[1] Spending was R383.7 million (or 2.6%) lower than projected. This was mainly in transfers and subsidies under the Road Transport and Public Transport programmes.
The Department spent R114.3 million against the First Quarter projection of R127.8 million for Compensation of Employees.[2] This was R10.6 million (or 13.5%) lower than projected mainly due to the slow filling of vacant posts.[3] The Department had 748 filled posts against a funded establishment of 921 posts. This represented a vacancy rate of 18.8% (or 173 vacant posts).
- budget expenditure per programme
Table 1: Budget Expenditure per Programme, First Quarter 2021/22
|
Programme R’Million |
Main Appropriation |
Available Budget |
Quarter 1 Actual Expenditure |
Expenditure as % of Available Budget |
Quarter 1 Projected Expenditure |
Variance from Projected Expenditure |
% Variance from Projected Expenditure |
COVID-19 Spending |
|
Administration |
497 |
497 |
96.8 |
19.5% |
119 |
22.2 |
18.6% |
0.2 |
|
Integrated Transport Planning |
92.2 |
92.2 |
14.6 |
15.8%[4] |
16.7 |
2.1 |
12.5% |
0.0 |
|
Rail Transport |
16 785.8 |
16 785.8 |
3 714.2 |
22.1% |
3 717.9 |
3.7 |
0.1% |
0.0 |
|
Road Transport |
34 166.7 |
34 166.7 |
9 361.9 |
27.4% |
9 461.3 |
99.4 |
1.1% |
0.0 |
|
Civil Aviation Transport |
503.9 |
503.9 |
116.6 |
23.1% |
143.7 |
27.1 |
18.8% |
0.0 |
|
Maritime Transport |
157.5 |
157.5 |
17.5 |
11.1% |
39.8 |
22.3 |
56% |
0.0 |
|
Public Transport |
14 488.6 |
14 488.6 |
1 280.4[5] |
8.8%[6] |
1 487.3 |
207[7] |
13.9% |
0.0 |
|
Total[8] |
66 691.8 |
66 691.8 |
14 601.9[9] |
21.9% |
14 985.6 |
383.7 |
2.6% |
0.2 |
Source: (National Treasury (2021)
2.2.1 Programme 1: Administration
By the end of the First Quarter, the Administration programme spent R96.8 million against a projection of R119 million for this period. Spending was R22.2 million (or 18.6%) slower than projected mainly due to the slow filling of vacant posts, and slow spending on business activities such as travel and subsistence, as well as advertising.[10]
2.2.2 Programme 2: Integrated Transport Planning
The Integrated Transport Planning programme spent R14.6 million against the First Quarter projection of R16.7 million. Spending was R2.1 million (or 12.5%) lower than projected, largely due to slow progress on the Regional Corridor and the Autonomous Vehicle Regulations projects.[11] The Department also indicated that the under expenditure was due to slow filling of vacant posts and on goods and services items such as travel and subsistence due to less travelling as a result of the Covid-19 pandemic.
2.2.3 Programme 3: Rail Transport
By the end of the First Quarter of 2021/22, the Rail Transport programme spent R3.71 billion against the Quarter’s projection of R3.72 billion. Spending was R3.7 million (or 0.1%) lower than projected, in large part, due to slow progress on projects such as the White Paper for Rail Transport, and the National Rail Safety Amendment Bill.[12] The Department also indicated that the under expenditure was also due to slow spending on travel and subsistence due to less travelling.
2.2.4 Programme 4: Road Transport
The Road Transport programme spent R9.4 billion against a projected R9.5 billion at the end of the First Quarter. Spending was R99.4 million (or 1.1%) lower than projected. Delays in spending under the programme were due to transfers to the Road Traffic Infringement Agency (RTIA) that had been lower than previously anticipated.[13] Funding for the rollout of the Administrative Adjudication of Road Traffic Offences (AARTO) is based on an agreement between the Agency and the Department. Instead of a lump sum transfer, a revised agreement now sees the rollout taking place over several phases, and transfers will be made based on the achievement of milestones of each phase.[14] The Department also indicated that the under expenditure was also linked to the following projects: Development of Road Disaster Management Plan and the Sustainable Roads Implementation Guideline as well as Programme Development for S’hamba Sonke.
2.2.5 Programme 5: Civil Aviation Transport
The Civil Aviation Transport programme spent R116.4 million against the First Quarter projection of R143.7 million. Spending was R27.1 million (or 18.1%) lower than projected, mainly under goods and services due to less travel. The Department also indicated that there was slow filling of vacant posts under this programme. A delay in payments for foreign membership to the Aviation Safety Organisation (ASO), International Civil Aviation Organisation and Commission and Cospas-Sarsat also contributed to the slower than planned spending.[15]
2.2.6 Programme 6: Maritime Transport
The Maritime Transport programme spent R17.5 million against a projected R39.8 million in the First Quarter. Spending was R22.3 million (or 56%) lower than projected due to the suspended International Maritime Organisation (IMO) World Maritime Day Parallel Event. In addition, the Department was awaiting invoices from the Ports Regulator for work done on the Department’s behalf.[16]
2.2.7 Programme 7: Public Transport
The Public Transport programme’s expenditure by the end of the First Quarter was R1.3 billion against the Quarter’s projection of R1.5 billion. Spending was R207 million (or 13.9%)[17] lower than projected, largely owing to a delay in transfers to the Taxi Recapitalisation Programme (TRP), the procurement of services for the Public Transport Grant monitoring programme, and the implementation of Shova Kalula programme.[18]
2.2.8 COVID-19 Spending
As at 30 June 2021, the Department spent R226 million on COVID-19 related projects and business activities.[19] The COVID-19 spending mostly pertained to “the procurement of protective equipment and other interventions within the Department, as well as support to public transport operators in response to the pandemic”.[20] The Department indicated that there was still R774 million available budget for the PRJ-COVID-19 Response.
- COMMITTEE OBSERVATIONS
Members made the following observations during discussions:
3.1 Out of the 35 targets set for the First Quarter, the Department only met 26 targets, and at only 40% performance the Integrated Transport Planning Programme was the worst performer for this quarter. While the Department had projected to spend R15 billion by the end of the First Quarter of 2021/22, it ended up spending R14.6 billion – i.e. 21.9% of the total available budget of R66.7 billion for 2021/22. This translated into the delay of R383.7 million (or 2.6%); expenditure was lower than projected. The Public Transport programme had spent R122.1 million lower than projected due to lower than expected demand on the Taxi Recapitalisation Programme and delays in projects such as Public Transport Grant Monitoring and Shova Kalula Bicycle Programme, following the COVID-19 pandemic lockdown
3.2 The R96 million underspending in the monitoring of the PTOG due to a delay in the approval of the business case and gap analysis was noted.
3.3 It was noted that the Department’s report on its expenditure did not mention a budget for the formalisation of the Taxi industry.
3.4 A delay in payments for foreign membership to the Aviation Safety Organisation (ASO), International Civil Aviation Organisation and Commission and Cospas-Sarsat contributed to the slower than planned spending.
3.5 The Committee noted that only 6 IPTN operating cities (City of Cape Town, Johannesburg, Tshwane, Ekurhuleni, Nelson Mandela Bay, George) reported on the number of average weekday passenger trips.
3.6 The Committee noted that a total of nine (9) new trains were provisionally accepted during the quarter under review in the Rolling Stock Fleet Renewal Programme. The Department was asked why it did not focus on the improvement of passenger capacity as opposed to the number of trainsets. There was also a concern raised that despite the amount spent under the Rail Transport programme, there remained several rail corridors that were not running trains to transport passengers.
3.7 The implementation of Scholar Transport remains a concern to the Committee, but it did not seem to be a priority in the Department.
3.8 Noting the majority of the underspent was linked to less travel due to COVID-19 restrictions, the Department was asked whether future budgets will take into consideration that this will continue as a long-term effect on operations and conversely the budget will continue to be affected.
3.9 The slow filling of vacancies remained a concern and the Department was asked whether it assessed the impact of the slow filling of vacancies and how this will affect service delivery.
- COMMITTEE RECOMMENDATIONS
The Committee recommends that the Minister ensure that:
4.1 The Department provides detailed reasons for the underspending and to indicate whether it assessed the impact of the slow filling of vacancies on service delivery. The Department should also indicate whether it has put measures in place to curb the slow filling of vacant posts.
4.2 The Department explains why it does not seem to have found mechanisms to address the repeat of lower than projected spending on the Taxi Recapitalisation Programme, Public Transport monitoring programme and Shova Kalula programme.
- The Department provides the following information to the Committee:
4.3.1 Timeframes for the migration of freight from road to rail;
4.3.2 Detailed information on the corporatisation of Transnet National Ports Authority, the Operation Phakisa Oceans Economy Three-Foot Plan, and the Memorandum of Agreement between municipalities and SANRAL on the Integrated Single Ticketing System;
4.3.3 Updates on the Administrative Adjudication of Road Traffic Offences (AARTO) Act project roll-out;
4.3.4 Feedback from National Treasury on the proposed integration of Road Traffic Law Enforcement entities;
4.3.5 An update on the implementation of the Gauteng Freeway Improvement Project (GFIP).
The Economic Freedom Fighters (EFF) abstained from the adoption of the report.
Report to be considered.
[1] National Treasury (2021), p. 138.
[2] National Treasury (2021), p. 140.
[3] Ibid.
[4] The Department reported this (per its presentation to the Committee) percentage as 16%.
[5] The Department reported this (per its presentation to the Committee) line item expenditure as 1 340.9.
[6] The Department reported this (per its presentation to the Committee) percentage as 9%.
[7] The Department reported this (per its presentation to the Committee) line item variance as 146 371.
[8] The table does not indicate the Direct charge: International Oil Pollution Compensation Fund budget of 11 602, however, this budget remains unspent and available.
[9] The Department reported this (per its presentation to the Committee) total as 14 662.5.
[10] National Treasury (2021), p. 139.
[11] Ibid.
[12] National Treasury (2021), p. 139.
[13] Ibid.
[14] Ibid.
[15] Ibid.
[16] National Treasury (2021), p. 139.
[17] The Department in its presentation to the Committee indicated that this underspent was by R146 million – differing substantially from the figures in the National Treasury report on this quarter’s expenditure.
[18] National Treasury (2021), p. 139.
[19] Ibid.
[20] Ibid.
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