Department of Transport, PRASA, SAMSA, SACAA, C-BRTA & Ports Regulator on their 2015/16 Annual Performance & Strategic Plans

Meeting report

Passenger Rail Agency of South Africa (PRASA)

Dr Popo Molefe, Chairperson of PRASA, introduced the presentation, and then handed over to the CEO to give the presentation.

Mr Lucky Montana, Chief Executive Officer of PRASA, said that the main objectives of the 2015 PRASA strategic plan were:

• To provide for the long-haul passenger rail and bus services within, to and from the Republic, in terms of the principles set out in section 4 of the National Land Transport Transition Act.
• PRASA, as a secondary business, should generate income from the exploitation of assets acquired by it, which included real estate and property portfolio.

In the course of carrying out its business and objectives, PRASA had to have due regard for key government social, economic and transport imperatives and policy objectives.

The strategy driver of PRASA was government initiatives; this was embodied in legislation, government policies and strategies such as:

• National Transport Policy
• Public Transport Strategy
• Legislation such as the National Land Transport Act
• Green Paper on rail, and
• Economic Strategy and Job creation initiatives

Mr Montana said that PRASA had salient features which enabled it to be a leader in public transport solutions. It owned 2 228 kilometres of rail track and 585 train stations country wide. PRASA was also to provide long haul passenger rail and bus services.. The total fleet was made up of 1 311 motor coaches and 3 424 trailer coaches. Metrorail had 525 million passenger trips per annum. Main Line Passenger Services (MLPS) had 1 082 million passengers per annum. Autopax had over 3 157 million passengers per annum, including 553 buses.

When PRASA’s initiative was established and built, based on its predecessor, the SA Rail Commuters Corporation (SARCC), it had embarked on systematic and sustained programmes to redress some of the legacy issues of under-investment in public transport infrastructure and services. This programme had been rolled out in three phases:

• 2007-2010: stabilization of commuter rail
• 2011-2014: focus driven from refurbishment to replacement
• 2015-2018: growth and expansion

As such the evolution of the PRASA strategy had been defined in three periods of transition:

• 2009-2010: establish and re-position
• 2011-2014: consolidate and recapitalise
•  2015+: integrate and expand.

The National Development Plan had also been instrumental in aligning the strategy of PRASA to its imperatives. PRASA was involved in the development and deployment of the total transport network which would help improve transport efficiency and accessibility while reducing the overall environmental, social and economic costs. PRASA had focused on creating workable urban transit solutions that would streamline an effective urban transport system, which would involve:

• An increase in investment in public transport and resolving existing public transport challenges;
• Developing transport management for local government;
• Providing incentives for public transport use;
• Renewing the commuter train fleet.

The National Transport Policy had six clear goals which were outlined in the White Paper. He added that there needed to be investment in t public transport -- specifically railway -- to reduce the number of motor vehicles, and this could be achieved by:

• Supporting the goals of the reconstruction and development programme (RDP) for meeting basic needs, growing the economy, developing human resources, and democratising decision making;
• Enabling customers requiring transport for people or goods to access the transport systems in ways which best satisfy their chosen criteria;
• Improving the safety, security, reliability, quality and speed of transporting people;
• Improving South Africa’s competitiveness and that of its transport infrastructure and operations through greater effectiveness and efficiency to better meet the needs of the different customer groups, both locally and globally;
• Investing in infrastructure for transport systems in ways which satisfied social, economic or strategic investment criteria;
• Achieving the above objectives in a manner that was economically and environmentally sustainable, and minimised negative side effects.

The development of the corporate plan for the medium term economic framework (MTEF) 2015/16-2017/18 was aligned with PRASA’s national strategic plan, which prioritised a list of rail services and network expansion interventions that would:

• provide more capacity to accommodate forecast growth;
• transform the rail product on many corridors;
• seek to make better use of the network; and
• propose corridor extensions to new or growing settlements.

There were clear proposals for improving integration between rail and other public transport modes to make it easier for passengers to use railway services as part of a wider intergrated transport system, which included enhanced city distribution; improved intermodal interchanges, and the use of Autopax to feed and complement rail’s services and priority hubs in the network. Also, a review of the corridor classification in the 2006 National Rail Plan was needed to reconfirm priorities.

In developing countries, urbanisation was processing at breakneck speed. There was a rapid growth, as 50% of the passengers in the cities were using railway as an effective and sustainable form of transportation which saved energy. It was no coincidence that there had been a revival of rail worldwide. The increased use of railway had attracted investment and a reduction in car and fuel reliance. The benefits of rail could not be ignored, as rail had the capacity to decrease environmental pollution. Rail used less land and attracted investment.

Mr Montana said that in its strategy development, PRASA understood the changes in preference of commuters, passengers and users of PRASA facilities. PRASA continued maintaining relevance in a market that had become competitive. PRASA wished to become the leader in passenger transport solutions, unlocking non-operational and non-core assets and to deliver public value.

PRASA had identified and defined its strategic ambitions in the coming three years as;

• Rolling out a train system of the future;
• Expanding PRASA networks and services;
• Embarking on a robust asset investment programme;
• Enhancing organisational capacity;
• Improving funding and its financial position.

To achieve these strategic ambitions, PRASA would require a sustainable business defined by an integrated network of quality service that delivered public value and supported by strategic pillars like world–class metro services, asset investment, internal capacity and a viable funding model.

The key themes informing the delivery on the corporate plan and its objectives would be characterised by the public’s transport mode of choice, modernisation, public value, growth and expansion, mobility expenditure, accessibility, sustainability, service excellence and spatial planning. PRASA delivery of the public value at the centre of its public transport solutions and services would be achieved by using the following public drivers:

• Improved accessibility and connectivity to marginalised communities;
• Supporting economic growth and development through the provision of access to major employment areas;
• Public employment programmes
• Localisation and industrialisation;
• The employment of women in rail;
• Special programmess for the unemployed;
• Supporting the main economic development nodes;
• Contributing to emissions reduction and clear cities.

Mr Sipho Sithole, Chief Financial Officer, said PRASA had three main sources of revenue -- fare revenue, rental income and a government subsidy. The Metrorail fare revenue was expected to grow by 13% in the 2015/16 financial year. This increase was mainly driven by an increase in passenger trips and an improvement in fare collection by reducing fare evasion. Autopax revenue was also expected to grow by an average of 5% over the MTEF due to price increases and introduction of new routes and services. Rental income was currently a small part of the total revenue of PRASA but showed a high increase year on year. It was expected to grow by an average of 24% a year to R976 million in year 2017/18. The subsidy had been increased over the years by an average of 4.5%, which was always less than the inflation rate, and was expected to be R12.8 billion in the MTEF period. From the current allocation, R1.4 billion had been earmarked during the same period.

Key outcomes of PRASA include:

• Increasing rail’s share of public transport by 3% by 2018;
• To deliver the first 44 sets of trains over the next three years, 12 modernised stations by 2018, and signalling upgrades to be completed in Gauteng and in the Western Cape;
• To create 10 000 job opportunities;
• To target R3.6 million for women-owned enterprises;
• Introducing six regional services with 52 additional locomotives by 2018.

Cross Border Road Transport Agency (C-BRTA)

Ms Pam Pokane, Chairperson of C-BRTA, introduced her team and she informed the Committee that the CEO would be giving the presentation.

Mr Sipho Khumalo, Chief Executive Officer, Cross-Border Road Transport Agency, said that the Agency’s mission was to spearhead social and economic development within the South African Development Community (SADC) region, by facilitating unimpeded cross-border road transport. The C-BRTA’s mandate was to work with other entities and border players, in order:

• To ensure regulation of the movement of foreigners in South Africa, as there was a huge influx of illegal immigrants which, when it got out of hand, led to attacks of foreigners within our country;
• To improve the flow of passengers and freight by road transport in the region;
• To regulate competition in cross-border road passenger transport by using the same systems that neighbouring countries were using. This meant that if a neighbouring country was issuing a certain number of licences, South Africa had to issue same number to that country.
• To reduce operational constraints for the cross-border road transport and support trade facilitation. Recently, the Agency had had a meeting with the Minister in Zimbabwe, where these issues were discussed.

Mr Khumalo said that the strategic thrust of the C-BRTA was set out in the National Development Plan (NDP). He briefly covered the core functions of the board, which were facilitation and law enforcement. (See document). The Agency worked according to the presidential nine-point plan, even though not every aspect spoke to the organisation’s area of operation, but the entity had to be mindful of the priorities of the government like;

• Moderating workplace conflict, as the board had a role to play to ensure that it had good relations with the unions;
• recruiting suitably qualified personnel;
• Ensuring in the development of rural towns close to our borders, to take advantage of the existence of the border posts and boosting the role of state-owned companies.
• Operation Phakisa, which aimed at stimulating the economy of the country.

Mr Khumalo stated that the entire mandate of the C-BRTA should be activated, to enable seamless and efficient passenger and freight logistics in the cross-border space. There should be harmonization of regulatory frameworks between the C-BRTA system and other licensing (provincial) authorities.

Mr Khumalo went on to set out some of the strategic objectives for 2014 to 2019, and said that they were all broadly based around introducing and implementing regulated competition in the transport sector. The Annual Performance Plan (APP) for 2014/15 showed that the C-BRTA intended to revise the C-BRTA mandate, promote efficiencies in permit issuing, and generate and deploy strategic intelligence capabilities to improve compliance with road transport legislation.

Key Performance Indicators set out in the APP included implementation of the scientific tool used by the Regulatory Committee, taking initiatives to revise the C-BRTA mandate, developing and implementing the new permit system, developing and implementing the Operator Compliance Accreditation Scheme (OCAS), putting into operation the smart law enforcement system, setting up the permanent deployment of inspectors within a two km proximity from major borders, and ensuring that a set numbers of inspections were conducted.

Mr Khumalo briefly described key priorities included in the Minister of Transport’s delivery agreement and in the NDP, which included decent employment, empowerment of those living with disabilities, and capacity building of staff at all levels. He pointed out the background, noting that at the beginning of the 2010/11 financial year, C-BRTA was on the brink of collapse and the Committee had even said the Agency was an entity in intensive care, but the situation had greatly improved.

New initiatives of the board were the reciprocity between neighbouring countries and South Africa, covering an integrated regulatory framework, and the levying of cross-border charges. The Agency would be approaching the Committee for advice and with a list of those countries that had not been paying cross border levies. Another initiative concerned the Beit Bridge between South Africa and Zimbabwe, which had been built by a private company, and for 21 years it had been under this company as per contract. It was in Limpopo and was tolled, and all accrued levies were given to the company. On 1 April 2015 the bridge had been handed over to the South African government. South Africa had not been ready to take over administrative responsibility and was still not ready, and this delay was causing South Africa to lose 50% of the tolled levy, as it had been agreed that only Zimbabwe would toll the bridge. The Minister of Transport had informed the team involved in this project to come with a plan.

The Agency was ready to present annual reports on an integrated regulatory framework, where annual reports on the progress of the state of the border operation would be monitored annually.

On-going litigation against the C-BRTA over the increase in permit fees was still a key challenge which was currently in the Constitutional Court, and the outcome was awaited. The Agency’s potential financial obligations were up to R356 million, and of that amount, only R37 million had been provided. This might render the Agency technically insolvent, and the Treasury might be asked to assist.

Mr Nchaupe Maepa, C-BRTA Chief Financial Officer, said that the Agency’s budgeted expenditure was expected to be R271 million in 2015/16, increasing to R324 million in 2016/17 and R348 million in 2017/18.. The revenue budget for the same periods grew from R241 million, to R300 million and R320 million. Almost 83% of total income was derived from permit revenue.

South African Civil Aviation Authority (SACAA)

Mr Smunda Mokoena, SACAA Chairperson, said there were eight critical elements of a state safety oversight system. South Africa subscribed to these elements and the strategic development process.
The mission and vision for 2020 was to be in the world’s top 20, which was a grand promise to keep the public safe in the sky. Its strategic goals were to regulate the aviation industry, accelerate aviation industry transformation, and improve communication with other stakeholders.
 
Ms Poppy Khoza, Director of Civil Aviation at SACAA, said there had been a general decline in aviation accidents. The Authority had enhanced the enforcement of safety, and had also ensured that a level 2 compliance with the BBBEE Act had been maintained. A permanent home for the SACAA was needed, and it was in the process of establishing how to acquire suitable premises.

A new and improved SACAA organogram was being implemented. Demographics currently showed that males still dominated within the aviation industry. The current targets had not been met in this regard, but there seemed to be a concerted effort to improve in this area. More women were being trained and qualifying as pilots, and it was recognised that much improvement had been achieved in the ratio of black pilots to white pilots, even though there was still a long way to go to meet the targets. Transformation initiatives continued to be of importance. SACAA was providing bursaries to students.

Mr Asruf Seedat, CFO of SACAA, stated that although the entity was viable, it needed to be reviewed as a going concern. The largest portion of the budget was revenue generated from the increase in passengers, and the increases in tariffs.

Mr Mokoena concluded by saying that there was a bridge to cross, and that all strategic risk mitigation factors were in place to ensure that SACAA remained a going concern.

Port Regulator of South Africa (PRSA)

Ms Thato Tsautse, Member of the Ports Regulator, apologised for the absence of the chairperson, and said the vision of PRSA was to be regarded nationally and internationally as a world class institution which set the standards for economic regulation in the maritime ports. Its mission was to support the development of the ports industry and systems, and also to exercise economic regulation of the South African ports system, consistent with the government’s strategic objectives and the National Ports Act (NPA).

The Regulator was responsible for activities in the industry that were related mainly to:

• Administration, which dealt with the regulatory framework;
• Economic regulation, which included pricing, tariff setting and tariff research; and
• A tribunal, established to hear and adjudicate complaints and appeals under the NPA. The Regulator was also responsible for monitoring the industry’s compliance with the regulatory and legislative framework.

The Regulator had an economic impact through rationalising tariffs and being proactive in mitigating risks. Its strategic objectives were to enhance and maintain administration by ensuring there was a sufficient staff complement to meet the capacity requirements of the organisation. Ongoing staff training and development had to be done in order to meet the unique competencies required by the Regulator. The organisation would strictly comply with the PFMA and Treasury regulations in to obtain and maintain a clean audit. An annual tariff assessment, and revised directives to include procedures for monitoring and compliance, would be conducted as well as economic research that would be looking at global economic trends and assessing port capacity and efficiency.

Mr Thokozani Mhlongo, Acting Chief Financial Officer (CFO), presented the Medium Term Expenditure Framework (MTEF) budget 2015/16- 2017/18 for the Regulator classified per programme and expenditure per economic classification and the actual figures achieved which had to be compared to targets that had been set. The total budgeted expenditure for 2015/16 was R17.9 million, growing to R18.9 million in 2016/17 and R19.8 million in 2017/18. PRSA’s strategic objectives were fully described (See document).

Support was required on challenges facing the Regulator, including the need for a new funding model, which would require legislative change. The small size and budget of the PRSA budget prevented the Regulator from achieving some APP targets, like the evaluation project. The Single Transport Economic Regulator (STER) was supported, but transitional arrangement would need to be reviewed carefully by legislators. The Regulator required greater enforcement capability, and amendments to the Act had been proposed and may soon be served before the legislature, therefore support from the Committee would be required.

PRSA’s funding proposal was in response to the Minister of Transport’s request to PRSA for a sustainable funding model regulator. This funding was to ensure a degree of autonomy of the activities and responsibilities of any regulator. Regulator’s ability to effectively execute its mandate might be constrained from year to year if there was no secure funding. The funding of PRSA was currently dependant on the fiscal as an allocation from DoT. The funding of the organisation had to ensure that the funding model reinforce its independence from all stakeholders.

PRSA had three regulatory funding models. These were:

• General regulatory charge.The overall level of funding was derived from determining the regulator’s revenue requirement for the fiscal year, and then either using a formula (e.g. a percentage of regulated revenues) for obtaining the funds, or a precise amount to be levied. This was the most common method for funding regulation. This model was a stable and a reliable source of funds, it was easy to administer and it was transparent.
• General tax revenues. Internationally, this was less common because it facilitates, even though it does not always attract, political interference in the operation of the Regulator and may not be as reliable or stable as direct ring-fenced cost recovery.
• Specific fees. The third, and least common model, was specific fees for services/activities. This model has the highest transaction costs, and may yield less stability and reliability in a revenue stream. However, fees could be a very useful mechanism for providing supplementary funds for regulators when required for a specific purpose.

Most regulators used a hybrid of one or more models, depending on the prevailing financial management legislation in the country and the legislation of that particular regulator. PRSA proposed the introduction of a hybrid model that would retain the current budgetary approval processes, with oversight by the DoT as well as the National Treasury. This would retain the credibility of the national budgetary processes and lend transparency to the price-setting processes. PRSA proposed an average 0.3% increase in order to fund the establishment of the full PRSA organogram. PRSA also proposed amendments to the National Ports Act section 42 (1) so that it included a section 42(1) (b): “regulatory charges imposed as a percentage of the approved overall revenue allowed to the regulated entity by the regulator”

Key challenges experienced by the Regulator included budgetary constraints due to the expansion of the mandate of the Regulator, amendments to the Act were required in order to close policy gaps, 17 organogram posts had to be filled, and change was required with regard to the regulatory architecture of the transport sector.

South African Maritime Safety Authority (SAMSA)

Mr Sobantu Tilayi, Chief Operations Officer: SAMSA focused his presentation on four strategic outcome-oriented goals.

The first goal was to establish a highly competent maritime authority by 2020. The objective was to improve the level of organisational resources and capabilities from level 3 to level 5 by 2020. In order to support the goal, the organisational capability development programme would work on improving the IT hardware infrastructure; developing and implementing a long term financial sustainability strategy; implementing and developing the SAMSA knowledge management system; and implementing a SAMSA human capital development initiative.

The second goal was for clean seas, and safer lives and property for the maritime transport environment in South Africa by 2020. To support this goal, the maritime safety programme was looking into promoting fishing safety and supporting Operation Phakisa projects for the recapitalisation of fishing. The programme would also launch safety awareness campaigns and improve fishing safety practices, in collaboration with the National Fishing Forum. The programme planned to increase the number of surveyed inland boats and licensed skippers operating in our waters and stricter observance of boating safety best practices.

The maritime security programme was looking to increase the maritime domain awareness of South Africa; strengthen integrated maritime security governance through participation at all national maritime security forums; and to integrate maritime security technology capability and effectively manage the pre-arrival notifications by ships when entering South African waters.

The maritime environmental protection and climate change programme was looking to implement the ratified annexure IV and VI of the Convention for Prevention of Marine Pollution from Ships (MARPOL); to develop and implement strategies to respond to marine pollution incidents and implement a maritime pollution risk management plan; and to develop and communicate the marine regulations and procedures for the industry and look at the impacts of climate change on the maritime environment.

The maritime governance programme intended to enforce compliance with applicable national laws and to ensure South Africa adhered to the relevant regional, continental and international instruments; implement and provide technical support to the Oceans Economy development initiatives; implement the African Maritime Charter and Africa’s Integrated Maritime Strategy (AIMS) 2050; and embark on national, regional and international marketing and promotion of the South African ship registry.

The third goal was about a developing, transforming and job-creating maritime sector. In order to realise this goal, the maritime sector development programme would focus on promoting a meaningful participation of black youth and women entrepreneurs in the maritime sector of South Africa; technical development of proposed amendments to maritime policy, incentive schemes and legislation; and launching an SA ship registry marketing and promotion campaign.

The fourth goal was about a competent, supported and globally competitive South African seafarer. For this goal’s objectives to be achieved, the seafarer development programme and welfare programme would seek to address a comprehensive review and implementation of improvements in the provision of standardised education, training and examination systems; provide technical support to the Department of Higher Education and Training on continued delivery of a dedicated training vessel through the Nelson Mandela Metropolitan University (NMMU); a seafarer welfare development programme; and accreditation of Technical Vocational Education and Training (TVET).

Targets set for this MTEF period were around providing technical support to the Department in addressing the policy, strategy, legislative and regulatory backlog, including the finalisation of the national maritime policy; and preparing a detailed capability plan for earth observation technology and integration into a capability roadmap under initiative 6.

With regard to finances, it was reported that the major challenge involved financing the core business; escalating costs for marine personnel, who were hard to find; and more budget being consumed by operational expenses.

(Tables and graphs were shown to illustrate key performance indicators, flow of funds and budget)

Department of Transport

Mr Collins Letsoale, Chief Financial Officer: Department of Transport, indicated that the spending focus over the medium term would be on maintaining road infrastructure, upgrading the rail infrastructure and services, and enhancing public transport. The total amount of budget allocated for 2014/15 was R48.87 billion. This would increase to R53.4 bn, R56.1 bn and R59.3 bn over the following three years.

Major administration projects included the integrated communication and marketing strategy, which included the October Transport Month and Arrive Alive Campaigns; office accommodation; and other support services. The allocation for 2014/15 was R424.9 million, dropping to R383.5m in 2015/16 and increasing to R399.2m and R421.1m in the following two years.

An amount of R81.2 million had been allocated to Integrated Transport Planning in 2014/15, growing to R87.6m by 2017/18. Major projects included the National Transport Master Plan (NATMAP), the White Paper on National Transport Policy, and the Single Transport Economic Regulator (STER) Bill, all submitted to Cabinet.

The rail programme’s major projects were the National Railway Policy and National Railway Safety Regulator Amendment Bill, both submitted to Cabinet, developing the economic regulations for the rail sector, and facilitating the approval of the branch-line strategy. Most of the budget was comprised of transfers to the Passenger Rail Agency of SA (PRASA) – R18.2bn in 2015/16, R19.2bn in 2016/17 and R20.2 in 2017/18.

The South African National Roads Agency Limited (SANRAL) and the Provincial Road Maintenance Grant (PRMG) took up the bulk of the road programme budget, which would increase from R22.4 bn in 2015/16 to R24.9 bn in 2017/18. Major projects include the White Paper on roads policy, submitted to Cabinet, monitoring of the construction and maintenance of national and provincial roads, submission to Cabinet of the Administrative Adjudication of Road Traffic Offences (AARTO) Amendment Bill and the access road development plan.

Regarding civil aviation, major projects included the:

• ACSA and ATNS Amendment Bills, submitted to Cabinet;
• National Civil Aviation Policy, submitted to Cabinet;
• South African Civil Aviation Authority (SACAA) Amendment Bill, submitted to Cabinet;
• National Airport Development Plan, submitted to Cabinet;
• Air service agreements reviewed annually, in line with the Yamoussoukro decision.

The annual budget allocation increased from R149.5m to R165.4m during the MTEF period.

Major projects in the maritime programme included the:

• White Paper on the Maritime Transport Policy, submitted to Cabinet;
• Cabotage Policy for Coastal, Regional and Continental Waters, submitted to Cabinet;
• Merchant Shipping Bill (2016), submitted to Cabinet;
• African Maritime Charter, submitted to Parliament.

The annual budget allocation increased from R111.1m to R120m during the MTEF period.

Concerning the public transport programme, major projects included the:

• National Learner Transport Policy submitted to Cabinet
• National Land Transport Amendment Bill submitted to Cabinet
• Rural Transport Strategy submitted to Cabinet
• Taxi Recapitalisation Review report submitted to Cabinet
• Integrated public Transport Turnaround Plan submitted to Cabinet

The annual budget allocation increased from R11.5m to R12.8m during the MTEF period.

(Tables and graphs were shown to illustrate the flow of funds, expenditure outcome and medium term expenditure estimates and budget)

Discussion

Passenger Rail Agency of South Africa (PRASA)

Ms D Carter (COPE) was concerned with the fact that there were no services in Limpopo, the Eastern Cape and KwaZulu-Natal. She also wanted clarity on the security measures put in place on the trains and the on communication to passengers on-board when the train broke down. She asked how long it would take to upgrade the Shosholoza project, since it had been put on hold four years ago. What were the benefits given to passengers using high-speed trains? What was happening to the Pietermaritzburg station after millions had been spent on it?

Mr M Sibande (ANC) wanted clarity as to whether people had been consulted in the agreements between PRASA and the municipalities, and gave an example about the people of Plumstead in the Western Cape, who had not been consulted about their houses which had to be demolished because of a PRASA project. He was disappointed that PRASA had not included Moloto in the the presentation. He wanted to know if the rail track was not going to be a problem when the new 43 trains were introduced, as it had been said that the new trains were smaller than the current ones.

Dr Popo Molefe, Chairperson of PRASA, informed the Committee that it was a legal requirement for PRASA to consult the community about the demolishing of the houses. He assured the Committee that the process of demolishing the houses would be done in stages, and not simultaneously.

Mr M de Freitas (DA) congratulated PRASA on doing a great job.

Ms S Boshielo (ANC) wanted to know if the municipalities were ready to accept the PRASA projects. She also wanted to know the number of skilled consultants needed for the project of making trains in South Africa. She suggested that the taxi operators had to be taken on board by PRASA, as they would be needed in some of the projects. She said that it had been 20 years since the Moloto project had started, and it had to be finalised.

Dr Molefe informed the Committee that it was the responsibility of the provincial government to consistently monitor the readiness of municipalities.

Ms S Xego (ANC) wanted to know the groups that were funded by PRASA. She suggested that railway lines be revived across South Africa, even if PRASA started by transporting ore. She wanted to know if PRASA had a strategy for dealing with train accidents, like the Road Accident Fund.

PRASA promised the Committee that it would respond to the unanswered questions when it returned before the Committee.

Cross Border Road Transport Agency (C-BRTA)

Mr Sibande thanked C-BRTA for its presentation and the support it had given to the Committee in Mpumalanga province. He wanted clarity as to the reason South Africa had not taken over its administrative responsibility at Beit Bridge, and asked how long before this would happen. He wanted to know how often C-BRTA was meeting with cross-border taxi operators, as this issue had been raised by the Sterkspruit community. How often did C-BRTA meet with its sister departments? What role was played by C-BRTA with regard to the gangsters that were helping people to cross the border illegally?

Mr Khumalo that C-BRTA was working on alternative models for the Beit Bridge project, and would come up with the final model. Zimbabwe taxi operators were also South African citizens, which meant that they were benefiting on both sides.

Mr T Mulaudzi (EFF) wanted clarity about the cross-border court interdict concerning the Lesotho border. He also wanted to know how long C-BRTA would have to wait for the appeal decision in the case of the permit processes. What was the visibility of the South African Police Service close to South Africa’s borders? Did the entity still need financial assistance?

Mr Khumalo said that the Free State MEC was also a party in the permit case, and the appeal decision had been given in favour of the taxi operators. As the result of the decision, the Minister of Transport had set up a task team to deal with the matter and C-BRTA was waiting for the guidance of the task team on this matter. In the meantime, C-BRTA was under pressure from the operators, the industry and the Southern African Development Community (SADEC).

Ms Boshielo said that PRASA was the only entity that had taken into consideration environmental wellness. She asked what measures were in place to allow more goods to be transported by rail instead of by road. In the presentation, she had seen targets of the entity, but it was unclear when the implementation of these would be. Procrastination had to stop, and the Acting DG had to inform the Committee within 30 days as to who was responsible for dealing with Lesotho cross-border taxi operations.

The Chairperson wanted to know when the task team on the Lesotho project was going to meet with the Transport Minister, before the Minister had to meet with the Lesotho Minister of Transport. She also wanted to know what had prevented the meeting from taking place.

Ms Zodwa Manase, Director of PRASA, informed the Committee that the task team was supposed to have met a week ago, but the DDG had been on leave. This was confirmed by Mr A Sobekwa, Acting Deputy Director of the DoT.

The Chairperson said she was not pleased with the fact that the meeting could not proceed because the DDG was on leave, while someone had been appointed to act on his behalf while he was on leave. She explained the definition and the duties of someone acting in someone else’s post, and told both the Acting DG and DDG to take the Department’s state-owned enterprises (SOEs) very seriously. She said the Committee could penalise the Department by not passing its budget. She told the Acting DG that he had to respond to a leader of the cross-border taxi operators, Mr Ntathe Mokoena, and had to proceed with the task team meeting. The Department was heading the task team, and if this was not done, she would write a letter to the Speaker of Parliament and to the Minister, and complain that the DOT was defying the Committee and was being disrespectful of the President.

Ms Boshielo told the Department and the entities that the Committee had to be taken seriously.
 
South African Civil Aviation Authority (SACAA)

Mr Mulaudzi expressed his appreciation on the work done by the SACAA, and the manner in which the document had been presented as a whole. He advised that although it was a good idea to empower youth, it was best that a list of schools in the SACAA programme be outlined. Regarding the organisational structure, it would be a good idea to state that SACAA was a subsidiary of the DoT.

Mr Sibanda said that the issue of transformation had been on the table for a long time and seemed like little had been done in this regard, coupled with the issue of compliance. He also wanted to know if the schools with which SACAA was engaged were in one province, or whether they supported schools in all the provinces. He also wanted to know if there was a risk management strategy and team. He had been happy when SACAA had promised that safety was an important feature in their operations, but considered it wrong that SACAA was not monitoring who was coming in and out of the country. He asked how SACAA marketed itself, as it had been unable to outline its achievements.

Ms Boshielo said that SACAA was not communicating its activities well, and as a result they were not convincing the public that they were doing as well as had been said in their presentation. SACAA had mentioned that they were urgently awaiting legislation, but had not indicated how far they were regarding communication.

The Chairperson advised that they should increase their communication with other entities, like aircraft owners, as they were the ones involved. She also suggested it should go on radio stations and detail its portfolio.

Port Regulator of South Africa (PRSA)

Mr Mulaudzi wanted clarity as to why PRSA had to outsource its internal audit, and asked how many clean audits PRSA had had before the last audit.

The Committee was told that PRSA paid far less when it outsourced its internal audit than if it were to conduct the audit itself. It was hoped PRSA would conduct its own audit. The entity had two learners, but these learners were being paid by other departments.

Mr C Hunsinger (DA) informed PRSA its presentation was not clear regarding depreciation in the MTEF budget.

Ms Xego said that the Department had to have a standard format for presentations of its entities. She wanted to know how many vacant positions there were, as this was not stated in the presentation document. She also wanted to know why internal audit was being outsourced. The successes of PRSA had not been stated in the presentation document.

Ms Boshielo told the Acting DG that she hoped that the Department of Transport was ready to appoint the new PRSA board or to extend the term of office of the board that was currently in office.

The Committee and PRSA could not engage further on the presentation, as they had run out of time and there was still another entity that still had to give a presentation.

SAMSA

Mr Mulaudzi wanted to know if the entity had an acting Board, or if it was paralysed.

The Chairperson indicated the Minister had appointed an interim Board.

Mr Sibande asked for clarity on the issue of the slow ratification of legislation, and enquired how the entity planned to address the issue of ship registration and abandoned ships. He also wanted to know how far the entity had gone in developing black-owned companies.

Mr Tilayi, on the issue of slow legislation ratification, said that a committee had been set up to look at regulatory issues. There was legislation that still dated back to 2005/06, which had not gone through the system. The entity was working with the Department to make sure those pieces of legislation reached the Committee and Parliament. The capacity to address loopholes in the legislation was available. Regarding abandoned ships, he reported that international law allowed ships to be abandoned. Intervention happened only when the ships ran into trouble. If that happened, the ship was abandoned. The only thing one could then do was to claim from the international body to have it removed. Regarding the development of black-owned businesses, he said BEE strategies and initiatives were supported, especially those involving women and youth.

Ms Boshielo) wanted to find out what the entity meant by “little appreciation of the potential impact of maritime on the future of the economy of South Africa”. She also asked the entity to explain what it meant by lack of relevant skills, because it exported people to go overseas and other areas. She wanted to establish how far SAMSA was in using stakeholders like provinces in combating inland water waste. Lastly, she enquired what SAMSA had done about the ship that had sunk in Angola with seven SA members on board.

Mr Tilayi explained that on the issue of “little appreciation,” he was referring to the Maritime Chapter awareness that was proving to be difficult in order to make people in provinces aware about opportunities in the maritime field. On the lack of relevant skills, he said seafarer skills were long term in nature. The challenge was that training took a long time. For instance, engineers were needed, but to get there, the candidates had to go through the ranks first. Regarding land water waste, he said that from a safety point of view, they were working closely with the SAPS Water Wing, but it was having its own capacity challenges. There was a plan in place to increase the footprint of SAMSA in that area. Regarding the stranded seafarers in Angola, he informed Members that the Department of International Relations and Cooperation was doing what it could, under the advice of SAMSA. The entity was quite involved in the matter and had invoked all international protocols, which had been taken up diplomatically.

The Chairperson asked SAMSA what its relationship was with other stakeholders in terms of recruiting people for SAMSA.

Mr Tilayi said SAMSA was part of the Border Management Agency and cooperated with the navy on the sharing of information. Generally, information for the navy came from SAMSA.

Department of Transport

Due to time constraints, questions from Members were not responded to and the Department promised to reply in writing. For example, Members wanted to know how the Department was going to ensure that conditional grants given to provinces were going to be used effectively and not returned. What could be done to make sure the taxi recapitalisation programme was finalised? What was the exit point around the bus subsidy? What was the plan for the taxi assistance programme in future? What was the value of grants allocated to municipalities?

The Department responded only to a question Ms Boshielo had raised regarding reported fraud within the Road Accident Fund (RAF). The Minister informed the Committee that the RAF had turned things around and the people of South Africa were seeing value in it. She said it must be remembered there were people who would not like the way the RAF worked. The Fund had been innovative and had paid out R800 million to claimants. The entity had been to all the corners of the country, trying to sell its services and educating people about what it does. The bad things said about the RAF were just a ploy to make the entity not be innovative in its work and derail its transformation.

The meeting was adjourned.