ATC130308: Report of the Portfolio Committee on Transport on its Oversight visit to the South African Maritime Safety Authority (Samsa), dated 19 February 2013.

REPORT OF THE PORTFOLIO COMMITTEE ON TRANSPORT ON ITS OVERSIGHT VISIT TO THE SOUTH AFRICAN MARITIME SAFETY AUTHORITY (SAMSA), DATED 19 FEBRUARY 2013.

The Portfolio Committee on Transport, having undertaken an oversight visit to the South African Maritime Safety Authority (Samsa), reports as follows.

1. INTRODUCTION

The Portfolio Committee on Transport undertook an oversight visit to the South African Maritime Safety Authority (Samsa), an entity of the Department of Transport. The purpose of the visit was to interact with Samsa on challenges faced by the entity in terms of its mandate and operations. As part of the visit the Committee visited the Samsa Centre for Sea Watch and Response, the ship building company Southern Winds, the ports of Ngqura and Durban and well as PetroSA.

2. BACKGROUND

During the Strategic Planning workshop of 30 to 31 March 2011 that the Committee had with the Department of Transport and its entities, Samsa raised some of the issues faced by South Africa that prevented it from becoming competitive in the maritime industry. South Africa , with its coastline of about 3 000km, is geographically a maritime nation. Despite this, South Africa did not own a ship register and cargo handled in South Africa was transported on foreign ships, with little benefit to the country.

In response to this meeting, the Committee decided to conduct an oversight visit to Samsa from 2 to 5 August 2011 to respond to Samsa’s request to be exposed to the potential that South Africa had in the maritime industry. The visit to Sama focused on the following:

1. Skills development, training facilities and placement opportunities offered in the maritime industry;

2. Site visits to the training facilities, shipyards and ports.

3. COMPOSITION OF THE DELEGATION

The multiparty delegation consisted of Hon NR Bhengu (Chairperson and leader of the delegation): ANC, Hon DE Dlakude (ANC), Hon N Duma (ANC), Hon M Manana (ANC), Hon S Farrow (DA) and Hon EJ Lucas (IFP). The Committee was accompanied by the following support staff: Ms Valerie Carelse (Committee Secretary), Mr Sifiso Ngesi (Researcher) and Ms Claudine Adams (Committee Assistant). The Committee was also accompanied on the visit by Samsa officials.

4. MANDATE OF THE SOUTH AFRICAN MARITIME SAFETY AUTHORITY

Samsa was established on 1 April 1998 in terms of the South African Maritime Safety Authority, Act 5 of 1998. Samsa is governed by a Board made up of the Chief Executive Officer and six non-executive members, including the Chairperson and Deputy Chairperson, as appointed by the Minister. The organisation’s objective is to lead and champion South Africa ’s maritime interests as custodians and stewards of maritime policy, vigorous promoters of the maritime sector and giving full and complete effect to our obligations for the benefit of all stakeholders.

The primary responsibility of Samsa is:

o Participating in the development and implementation of national and international Maritime safety and marine environment protection standards;

o Enforcing technical and operational standards for all shipping operations in South African waters and for South African ships anywhere, to promote responsible operations in terms of seaworthiness, safety and pollution prevention;

o Enforcing training standards and competency of seafarers;

o Managing the national capability to respond to marine pollution incidents and other maritime emergencies;

o Operating the Maritime Rescue Co-ordination Centre to coordinate maritime assistance services and to detect, and coordinate the location and rescue of people in maritime distress situations throughout the internationally agreed South African Search and Rescue Region;

o Overseeing the provision of maritime distress and safety communications services to discharge South Africa 's responsibilities under the Global Maritime Distress and Safety System;

o Administering South Africa 's voluntary ship reporting system (SAFREP) for identifying and tracking ships at sea for safety purposes and to provide a ships' database for responding to marine emergencies.

In addition to these responsibilities, Samsa also investigates maritime casualties and delivering related services including. It further raises public awareness and education in marine safety and pollution prevention, administers South Africa 's ship registration system and provides the publication of, and access to, ship safety and environmental standards.

The Samsa Act mandate is divided into two broad and distinct areas, namely to meet the United Nation’s conventions in regard to safety and pollution at sea and to attend to the nation’s developmental challenges as they affect our oceans and inland waters. The first area was achieved by ensuring safety of life and property, as well as marine environmental protection , within the South African waters and beyond. This was done through search and rescue services, salvage tug services to protect the marine environment, port state control ship surveys, coastal state control and qualification and certification of seafarers.

INSTITUTIONAL RISKS AND CHALLENGES FACED BY SAMSA

4.1 Human Capacity

4.1.1 There is a shortage of seafarers worldwide. There was currently 1, 5 million seafarers globally of which South Africa has only 6 000 of which most were port based.

4.1.2 South Africa did not own a shipping fleet. Most cadets were therefore employed on the ships that trained them. Other cadets return due to social problems, but are then employed at the ports. Most of the 153 cadets in training by Samsa were form Limpopo and Kwazulu-Natal . Samsa said that they were unable to train more cadets due to the lack of a ship register. This had a negative impact on building a seafarers database and skills development to sustain the maritime industry.

4.1.3 Samsa’s aim was to train 1200 cadets in 4 years. 153 cadets are trained in this financial year. All cadets with Standards of Training, Certification and Watchkeeping for Seafarers (STCW) tickets were employed.

4.2 Legislative

4.2.1 There was a backlog in maritime-related legislation due to a lack of capacity in the Department of Transport to process the legislation. The Board of Samsa expressed its frustrations about the situation and a meeting was subsequently held with the Director-General of the Department of Transport to discuss the matter. A joint legislation committee was established to process draft legislation. Samsa said that the first draft legislation would be ready for processing in six months’ time.

4.2.2 There was ongoing liaison with the Directors-General from other government departments regarding the legislation on issues that cut across the sectors.

4.2.3 The South African Maritime Safety Authority Act was outdated. Over 34 pieces of maritime legislation and regulations have been found to be outdated.

4.2.4 There was a need for legislation to deal with maritime disasters, such as pollution at sea. There was no contingency funding mechanisms for major wreck removals and maritime disasters.

4.2.5 Unfunded or underfunded government mandates were crippling Samsa’s delivery capacity.

4.2.6 Skills shortage in key maritime technical areas remained a key risk.

4.2.7 The ratification of international instruments into domestic law was a strategic focus for Samsa in the current financial year. The International Labour Organisation’s Maritime Convention which came into force requires country to have updated seafarers documentation. South Africa did not ratify the convention. Seafarers are now unable to go to shore in countries like Brazil . Talks were ahead with the Department of Transport and the Department of Labour to ratify the Convention. The revised code on STCW tickets needed to be ratified by countries in order for the documents to be valid. In the absence of ratifying, seafarers will be subjected to additional tests and will therefore be uncompetitive

4.2.8 The strategic direction for the maritime industry was not coherent and the support form the Committee was needed in order to establish a coherent policy. Samsa said that there was an anomaly in how maritime was structured in the country.

5. SITE VISIT FINDINGS

5.1 Visit to the Centre for Sea Watch and Response

The Committee visited the Samsa Centre for Sea Watch and Response, based in Plattekloof in Cape Town . The Centre for Sea Watch and Response was established to comply with the requirements of International Maritime Organisation Conventions - Safety of Life At Sea (SOLAS) and national legislation. The aim of the centre was to ensure maritime safety of navigation, maritime security, the protection of the marine environment and to protect and promote South Africa ’s maritime interests. The centre i dentifies and responds to possible maritime incidents, monitor coastal and offshore activities and it cooperates with government departments with respect to maritime matters

The Committee was shown the implementation systems for maritime surveillance, identification, monitoring and tracking of vessels within South African territorial waters, the SAR region extending to the Antarctica . The Committee was shown how the centre m aintained maritime domain awareness of South Africa ’s extended maritime area and communicated with vessel traffic. Samsa explained that the facilities included m aritime surveillance equipment which enabled the Authority to do long range identification and tracking of ships, a vessel monitoring system, maritime radio communication system and automated identification system.

The centre had the response capability to assist vessels in difficulty to prevent pollution or grounding, and to cooperate with other departments with respect to maritime incidents. The centre could, in conjunction with other relevant national agencies, respond to oil pollution at sea.

5.2 Visit to Southern Winds

The Committee visited Southern Winds Shipyard, a shipbuilding facility based in Athlone, Cape Town , to be exposed first hand to the shipbuilding industry, learn what its current status was and the challenges experienced by the industry. The Committee was shown its operations by Mr Alberto Del Cinque, the Commercial and General Affairs Manager of Southern Winds. The company specialises in the production of yachts mainly for the export market. The facility is one of the few shipyards which were able to carry out almost the whole ship construction in-house.

The Committee was given a tour of the assembly which consisted of four production departments for carpentry and internal fitting, engineering and steel and deck hardware as well as the lamination section. During the site visit the Committee noted the skills needed for South Africa to build its shipbuilding industry as well as its job creation potential.

5.3 Visit to Ports and PetroSA

As part of the oversight visit, the Committee visited the ports of Ngqura (Coega) and Durban as well as PetroSA. The aim of these visits was to show the extent of Samsa’s mandate and operations in relation to the ports. In terms of its mandate, Samsa was responsible for the port State control inspections of vessels calling on South African ports in accordance with standards adopted by the International Maritime Organisation (IMO). The entity had the responsibility for the inspection of foreign flagged ships in South African ports, and for ship cargo surveys of bulk chemicals, dangerous goods, grains, etc. During these visits the Committee noted that the maritime industry did not only consist of the shipping industry, but also extended to other strategic interests that were not trade related. During the visit the Committee observed what the opportunities and challenges were in the maritime industry for job creation and logistical support.

5.3.1 Port of Ngqura

Ngqura is the deepest container terminal in Southern Africa . It has the ability to accommodate the latest generation of container ships. It has an automated gate system with pre-booking or pre-advice functionality to improve truck processing time and eliminate human error. It also has a state-of-the-art planning centre that provides a 3-D view of the terminal for real-time performance monitoring and security surveillance. Vessel and ship calls at Ngqura had increased from an average of eight calls per month during its start up to an average of 32 calls per month currently. The truck and rail volumes have shown a steady increase.

The employment figures presented to the Committee showed that 2 350 contract workers

were employed per day during the construction of Ngqura construction, of which 98% were

from the Eastern Cape region. In the operational phase 376 permanent jobs were created,

of which 99% were from the region.

The challenges faced by Ngqura were securing appropriately skilled mariners in terms for engineering. Transnet had 102 cadets trained for decks and the engine rooms and a decision was made to double the number of cadets to 204. The same applied to the open licence/pilot training. Transnet cadet training was done internally and the entity had a challenge to attract candidates from previously disadvantaged groups. The entity was in the process of introducing new players in the marine industry with a focus on value for money and transformation. The development of a maritime school in the Eastern Cape was required for skills development for the maritime industry. The initiative would be supported by Transnet.

5.3.2 Port of Durban

The port is the busiest multi-product port in Africa in the Southern hemisphere. A total of 4 554 sea-going ships were processed at the Port of Durban in during 2008/9 and handled 38% of all ship calling on South Africa . During the 2008/9 financial year the port handled 74,683,597 tonnes of cargo, which included oil and petroleum products and containers. An average of 83 000 containers per month were handled at the port container terminal. The Durban car terminal is the country’s largest import and export facility for the motor car industry. The port employs 6 000 people.

During its visit the Committee noted the congestion of trucks on the busy roads outside the port entrance due to delays at the container terminal.

5.3.3 PetroSA

The Committee visited PetroSA to understand the importance of the mandate and operations of Samsa in relation to PetroSA.

PetroSA , South Africa ’s national oil company, owns, operates and manages South Africa ’s petroleum industry commercial assets. It has 2 000 employees . PetroSA obtained its pollution safety certificates for its offshore assets like the FA platform and the ORCA from the South Africa Maritime Safety Authority. They were also required to comply with any conditions laid out by the Authority. If PetroSA did not comply with these conditions, non-compliance could lead to the withdrawal of certificates of compliance and fitness. This would lead to forced stoppage of operations.

Their offshore platforms are serviced by ships with foreign flags. The vessels used are not used in South Africa . There were no South African tenders because there are no vessels that have the current specifications. In order to comply with South African Maritime legislation, PetroSA is therefore forced to go to foreign suppliers.

6. FINDINGS AND RECOMMENDATIONS

6.1 The mandate of the Portfolio Committee on Transport was to oversee all four modes of transport. All four modes of transport have a responsibility to social and economic development. The integrated development of road, rail, air and maritime transportation formed the basis for positive economic growth, job creation and poverty alleviation.

6.2 About 95% of South Africa ’s total imports and exports traded by volume and 80% by value are carried by ships. Yet all 12 000 of those ships handling trade through South African ports are foreign and employ about 240 000 foreign seafarers.

6.3 With the decision to sell the national fleet in 1993, South Africa was left with no ships on its register and pays over R36 billion in maritime transport services to foreign owners and operators resulting in a negative affect on the balance of payments and job creation and it exposed South Africa to geo-political risks.

6.4 South Africa has a long coastline of about 3 000km and has many international obligations towards marine environmental, shipping safety and security, but has limited response capabilities and facilities.

6.5 The Committee expressed its concern that, although Samsa repeatedly raised the issue of a backlog in legislation, no draft maritime legislation has been forwarded to the Committee for processing. There have also not been debates on urgent maritime legislative issues such as legislation that would address pollution in the marine environment.

6.6 The Committee noted the challenges faced by Samsa to place cadets for training due to a challenge to find ships to place these cadets for training. The Committee further noted that the placement of young cadets on foreign ships has lead to some of the cadets being subjected to hardships because they were not protected by South African labour laws.

6.7 The Committee noted the congestion of trucks entering the Port of Durban and, during the presentation of Transnet, found that approximately 30% of the goods from the ports were transported by rail while approximately 70% of goods were transported by road. The Committee expressed its concern at the damage that was caused to the road infrastructure. The focus should be to shift the transportation of goods from road to rail to avoid more damage to the road infrastructure.

In the light of these findings, the Committee recommends that the Minister of Transport

ensures that:

6.8 Initiatives are explored to increase South Africa ’s maritime infrastructure capacity and performance as this would contribute to economic growth and job creation in the sector.

6.9 The institutional arrangements that currently existed between the Departments of Public Enterprises, of Environmental Affairs, of Defence and Military Veterans and of Transport are addressed to formulate a coherent maritime policy.

6.10 The development of South Africa ’s maritime skills capacity is prioritised as this would address the shortages of seafarers in the industry. The Minister also has to ensure that awareness is created to attract women, youth, rural and previously disadvantaged participants to the maritime industry.

7. CONCLUSIONS

An efficient and reliable maritime industry is crucial to South Africa ’s economic growth. In order to fully participate in the global economy, the country has to build a skilled and resourced industry. There was therefore an imperative on the part of South Africa to build its maritime capacity as this would provide an opportunity for new entrants to enter into this sector effectively, transforming the sector from its current status.

Report to be considered.