Railway Safety Regulator (RSR) 2019/20 Annual Report; with Deputy Minister

Meeting report

The Deputy Minister of Transport, Dikeledi Magadzi, was present.

Railway Safety Regulator (RSR) 2019/20 Annual Report
Dr Zethu Quta, RSR Board Chairperson, introduced the presentation and handed over to Ms Kgare, RSR Acting CEO, to present the 2019/20 performance highlights followed by the followed by a risk management, human resource and financial report. There was a drop in the performance trends from 100% achieved in 2018/19 to 94% in 2019/20 for its  three objectives: Railways are safer; Sustainable institutional growth and development; Improved stakeholder services. RSR received an unqualified audit with fewer findings and had an accounting surplus of R41 million.

The activities RSR conducted included:
237 stage 2 audits
283 inspections
3392 operational occurrences and RSR is working towards reducing this number.
The three operators – Transnet, Prasa and Mbombela – conducted 133 with a safety permit.

Challenges included:
Human Resources – There was a 16% vacancy rate due to the restructuring of RSR.
Employment Equity – There are 147 employees in total with some under representation.
Finance – It had a R230 million budget and it was fundamentally funded by government.

Discussion
Mr M Dangor (ANC, Gauteng) asked about risk assessment and if the railway between Johannesburg to Cape Town was operational as the railway did not appear to be. This is where the Cape Town and the Kimberley trains travel. He asked if the risk resulting from that gap had been calculated. He said that the East Rand railway had been stripped. Was there any better way they have thought of for connecting those from the North to the South. He emphasised his concern about railway security in these areas.

Mr T Brauteseth (DA, KZN) pointed to the employment cuts, asking who has been cut and what section of the Regulator did the cuts affect in railway security.

His second question was about the number of manual authorisations PRASA had conducted in the last three months according to its baseline assessment, as this is a clear indication of the state of maintenance.

He agreed with Mr Dangor about risk assessment and the safety status survey, given the high levels of violence although during lockdown things were quieter.

He asked about the Regulator’s involvement with commencement of services when the lines were closed and opened during lockdown as the levels of lockdown varied. He asked what the offline services were and what the length of time was being offline. What were the number of trains currently in service and the number currently being tested? Is the Regulator is getting the independence it needs?

Mr Brauteseth noted that RSR proudly presented that they have doubled cash reserves since 2018. He asked if the money should not be spent trying to secure safe railway lines instead of sitting with a fat account that is not being used. What effort is the Regulators putting into spending the money on safety rather than sitting on it? Lastly, he asked if consequent management was applied in the regulation of the expenditure by the audit committee.

Mr M Rayi (ANC, Eastern Cape) needed more information from RSR as the presentation was thin on detail and length. The information on the slides was high level, making it very difficult to understand for someone who did not go through the actual Annual Report.

His concern was at the level of senior management as the staff introduced at this meeting were all in acting positions: Acting CEO, COO, CFO and Risk Officer. They cannot have an organisation run by acting people in strategic positions. He implored the Board Chairperson and Deputy Minister to explain why there is such a challenge in top management.

The audit findings reflected challenges with competency guidelines, workload permits and not getting quotations from service providers. He asked RSR what steps they have taken to correct these findings.

The National Railway Crime Combating Forum could not meet due to the Covid-19 pandemic. Recently, departments and entities have been reporting on their inability to meet 2019/20 targets due to Covid-19 although the national state of disaster was declared on 15 March 2020 with only 16 days until the end of the financial year. His question was how could that small number of days affect 2019/20 performance?

There was an audit concern about insufficient progress made by management to address internal controls. He asked what has been done to respond to the Auditor-General's concerns.

The CEO did not mention minimising conflict of interest as senior managers were expected to disclose their business interests. He asked if such disclosures had been signed by the senior managers.

Mr Rayi asked if there are employees with disabilities according to employment equity guidelines. He asked for the number of inspectors that conducted the 233 inspections. He asked about the relationship that RSR has with the Department of Labour. He pointed out that the case rate of 60% is very high and that needed to be addressed. Looking at employment equity, it was a concern to him that no Indians were employed.

Complaints that have been brought to him about how bad the communication is between the the train drivers and the train control officers (TCOs). RSR must investigate the best way to correct this. Some of the doors of the coaches do not close. According to the rules, the train cannot leave with doors that are not closing. Cleanliness is a great concern especially with the Covid-19 pandemic still being present. There is a complaint that the stations and the coaches are not fumigated. The locomotives are not properly set. What methods are being put in place to address this. There are no sanitizers for those in the locomotives of the trains.

On the R1 578 846 irregular expenditure, he asked if disciplinary action was taken against those causing this irregular expenditure.

Ms S Boshoff (DA, Mpumalanga) noted RSR spoke about external bursaries given to 29 students. She asked about the value received back in the issuing of bursaries. What happens to students once they have completed their training?  And the internal bursaries given to staff, do the trained staff remain with RSR? She asked how many staff trained by RSR have resigned.

The vacancy rate is a concern. Also, she asked about the number of enquired about the number of severance packages that were issued. She asked what they were going to do to reach the national norm for employing persons with disabilities.

She asked how they are going to address the smart new trains if they are struggling with handling the current trains?

Ms B Mathevula (EFF, Limpopo) asked why RSR did not mention people with disabilities. She requested a breakdown of the bursary recipients – how many were women, men, youth, and people with disabilities. She noted that provinces and municipalities have inherited apartheid railway infrastructure designed to serve the minority. She asked RSR about how they assist municipalities in terms of safety and maintenance?

The Limpopo delegate asked about the role of local government and SAPS in addressing the infrastructure challenges. He had seen informal settlements on both sides of the railway line with unregistered immigrants living there. Infrastructure will be stolen. This needs to be addressed. He had seen on social media that people were found with railway equipment. He had challenged PRASA to explain the steps taken to arrest the suspects.

Mr M Mmoiemang (ANC, Northern Cape) raised the audit findings on procurement and contract management. RSR did not estimate the minimum threshold for local production and content. What measures were in place to address this as this is a requirement in terms of the 2017 Preferential Procurement Regulations. This should be at the forefront in addressing the findings.

The Auditor-General had raised non-compliance in expenditure management, as well as internal control and attributed these to the lack of stability. It would be important to hear from the RSR board chairperson on the steps taken to ensure this is remedied.

RSR response
Dr Quta replied that RSR has a full board, however, they assumed that only two board representatives need attend this meeting. On the acting positions at RSR, it might look as if there are many people acting whereas in essence it has not been many. He explained that the acting CFO is having his 17th day as an acting CFO as the CFO resigned at the end of January. The acting CEO is the actual COO of the organisation. She had to relinquish her COO position when accepting the position of acting CEO. The previous board finalised the recruitment process and the necessary recommendations were made for a CEO. Consequently, the current board is engaging in finalising the process. They are awaiting the competency assessment to be concluded this month and hope to make a recommendation to the Minister before the end of this month.

On the relationship between RSR and big operators such as PRASA, in the past PRASA did not have a permanent board. Now that there is a new board, they have had an engagement with the new board chairperson and would like to have an engagement between the two boards to address compliance concerns before they require external interventions. They are hopeful that the relationship between two will attend to vandalism and theft of rail assets and rail reserves safety. They want to report on these issues to Parliament but they entail the coordination of all the state's affairs. They are raising this as an indirect means to plead for the state to address these matters. Intergovernmental work makes governmental work easier to conduct.

Ms Kgare replied that infrastructure vandalism is a matter of concern. They have collected the data on the number of occurrences. It is a concern they have raised with the operators; in fact, they are currently conducting an adequacy assessment on the security arrangements. PRASA has faced the biggest threat around their assets. RSR has requested the operators give their security arrangements and plans for RSR to conduct an assessment. The assessment will enable RSR to have a clearer view about improvements that the operators need to apply.

As PRASA resumed service during Covid, RSR conducted a readiness assessment and found that the vandalism had led to areas where PRASA was unable to operate and these were communicated to PRASA. Security measures need to be put in place to protect the assets for PRASA to resume service. This has far reaching consequences on the operators. Not only is this a safety concern such as signals not working, but RSR makes these security assessments as well to ensure that any reduction in service is addressed in terms of security of infrastructure so PRASA does not go back to the same challenges they have faced.

PRASA had been given a one year permit instead of a three-year permit due to the leadership instability. The Regulator must have confidence that leadership is in place to drive a safety culture. That means that currently every year RSR goes into PRASA’s plans to ask the necessary questions but also to ask for specific conditions. The infrastructure security challenges are a big concern.

On employment cuts, the actual restructuring at RSR happened in 2018/19. What preceded the restructuring was a shortfall in the budget. They had to then seek additional funding to conclude the financial year. Nevertheless, they came up with a recovery plan to ensure that this does not occur again. The agreement was to keep the cost of employment at 50% of the expenditure. However, RSR has reached a new agreement of recruiting at about 60% as they had recruited to below 50%.

The retrenchments that occurred meant about three or four employees being retrenched.  There was, however, a big uptake of voluntary severance packages in 2018/19. They had to rationalise their expenditure such as office accommodation. They developed a new structure to deliver their services and mandate efficiently and so the retrenchment packages were part of the revised structure. However, there were areas where young people in the technical and professional space were not enticed by the way RSR functions looking at the years that RSR has been existing.

On the manual train authorisations by PRASA between January 2019 to March 2020, there has been a reduction observed from about 124 000 to 29000 manual authorisations. However, as March 2020 would have been during lockdown, that reduced number was affected by the lockdown. RSR emphasized the importance of PRASA providing proper control and supervision of manual train authorisation. This is an area of great importance.

Covid protocols are being observed and sanitizers are being provided. However, there is a need for an emphasis on the operators to continually ensure that Covid protocols are observed. On vandalism and adequacy inspections, in the Western Cape, there was an infrastructure assessment using a drone to understand what went wrong. A report with recommendations to PRASA was produced.

She asked the COO to answer on the number of new trains in service. RSR has conducted a technical review of the trains and tests them even before the trains are deployed. There were four running with passengers before the vandalism and then 12 were now at the trial phase in the Western Cape. There is an understanding that there is a request for 10 to go to KZN but monitoring and assessment will continue.

Despite the Covid-19 impact, they still managed to meet their 94% targets achieved. Yes, they are committed to achieving 100% of their targets. They believe that their systems, such as the virtual audits, have enabled them to continue functioning amidst the Covid-19 pandemic.

There are just under 30 inspectors. Even if there were 100 inspectors, they would not be able to be on site at the same time hence they have come up with ways of deploying their inspectors efficiently using the necessary tools. As part of the audit intervention plan, RSR appointed a manager for supply chain management (SCM).

Ms Kgare replied that the gender of the bursary recipients is not recorded. They train as many as they can and at the end of the training, depending on the availability of positions, RSR looks forward to absorbing the students trained. For internal bursaries, there is a clear contract that the employee needs to get the bursary. This contract addresses specific obligations. The amount paid out was about R4.9 million for bursaries.

Mr Molefi Kgomari, RSR Acting COO, replied about the security status survey, saying that RSR is doing security assessments on PRASA. They are also at a CEO level trying to understand the progress PRASA has made on security plans. They are doing the necessary expenditure on their part but are still needing assistance. They are investigating also the effects of Covid-19. RSR have a fully functioning audit committee that is independent as well.

Mr Kgomari commented on competency data, but it was inaudible due to a network glitch.

The Chair asked the COO to disconnect his video to make the audio sound better.

Mr Kgomari said page 26 of the Annual Report noted a meeting was to be held with the Deputy Minister on the 2019/20 audit report; however, this was not held due the Covid-19 lockdown. In short, they are hoping for a clean audit for 2020/21.

Follow-up questions
Mr Brauteseth asked if the staff cuts weakened the organisation.

Mr Dangor had a follow-up question but it was inaudible due to a network glitch.

RSR response
Ms Kgare clarified that the 18 staff members were not retrenched, they received voluntary packages. The actual number of retrenchments was around or below five.

Mr Kgomari added that they have four new blue trains that have just come in. On the concern that Mr Rayi raise, the new trains do not allow the train to move with the doors open.

The Committee adopted the minutes of the meeting of 10 February.

The meeting was adjourned.