Department of Transport 2014/15 Fourth Quarter Expenditure

Meeting report

Adoption of Minutes

Minutes of Committee meetings held on16 April 2015; 21 April 2015; and 12 May 2005 were adopted without amendments.

Briefing by Department of Transport (DoT)

Ms Dalian Mabula, Chief Director: Compliance, DoT, focused her report on progress made on the implementation of the seven programmes and projects in the periods covering 01 January 2015 to 31 March 2015. The focus was on optimal performance of deliverables in terms of the MTEF 2014/15 – 2016/17.

Programme 1: Administration

The implementation of action plans to address audit findings is in progress and monitored on a quarterly basis. Seven findings affecting the AGSA were reported, and five of those have been successfully completed. One is being given adequate attention. 85% of the findings have been completed. The marketing and communication strategy and the international relations strategy were completed in the period under review. 40 vacant posts were filled. 57 interns were selected and placed across all branches.

Challenges prioritised for remedial action were around the approval of the Transport Sector Human Resource Development Strategy that was delayed due to internal consultative processes, and the approval of the Transport Sector Drug Master Plan that was delayed due to internal processes. To correct these issues, inputs from stakeholders would be incorporated and finalised in Quarter 1 of the 2015/16 financial year and be submitted to EXCO and Minister for approval.

On goods and services, the programme under-spent due to a number of projects that were not undertaken in the year. Under-expenditure in the programme was shifted to Programme 4. Regarding transfers and subsidies, transfers and subsidies to the University of KwaZulu-Natal were not transferred and the rollover has been requested.

This programme achieved 82%.

Programme 2: Integrated Transport Planning

The Draft Multi-Modal Transport Planning and Coordination bill was developed. The Bill would assist in facilitating integrated macro Transport Systems Planning in view of guiding investments in the sector.

The draft Regional Corridor Strategy and the Reviewed National Freight Logistics Strategy were developed. These strategies seek to enhance integrated and seamless movement of freight across all modes of transport. The final report on the energy consumption reduction study was completed in the period under review. The objective of the study was to determine the energy consumption ratio of the Transport Sector in view of the need to reduce consumption and enhance environmental protection.

It was noted that consultations with PICC on NATMAP 2050 were lagging behind. Consultations and re-submission to Cabinet would be prioritised for the 2015/16 financial year. The funding strategy for the Durban-Free State-Gauteng Logistics and Industrial Corridor was developed and it would be finalised and submitted for approval during the 2015/16 financial year.

Concerning goods and services, the programme under-spent mainly because of under-expenditure on the National Transport Planning Databank. Under-expenditure was shifted to Programme 4.

This programme achieved 64%.

Programme 3: Rail Transport

The draft White Paper on National Rail Transport Policy has been developed. This policy is aimed at setting institutional arrangements to drive investments and reforms in the Rail Industry. The draft Branchline Strategy has been developed. The strategy would enhance sector performance through the reduction of direct transport costs and externality charges for the economy especially in rural areas.

The Gap Analysis report on the National Rail Safety Strategy has been completed. The report highlights railway safety needs to inform the strategy. The overall goal is to improve rail safety regulatory effectiveness.

This programme over-spent because of excess expenditure on the Moloto Development Corridor. Funds were shifted across the programme to cover the shortfall.

This programme achieved 100%.

Programme 4: Road Transport

The draft Road Infrastructure Policy has been completed. The policy aims to facilitate investment for the implementation of the Road Infrastructure Strategic Framework of South Africa in line with the S’hamba Sonke and Road Infrastructure Asset Management Programmes.

The DoT participated in the implementation of the 365 Road Safety programme in conjunction with the Road Traffic Management Corporation. The Programme consists of integrated road safety projects aimed at enhancing road safety and decreasing accidents and road fatalities.

The draft Road Safety Policy has been enhanced through comments and inputs resulting from stakeholder engagements with provinces, sectors, entities and industry in the period under review.

With regard to goods and services, this programme over-spent due to the cost of maintenance and operations of the eNaTIS. Pertaining to transfers and subsidies, the programme over-spent on payments that were not paid to the Road Traffic Management Corporation in 2013/14. The payments were made during 2014/15. Under spending was due to the payment to the Road Traffic Infringement Agency that was claimed late and was requested as a rollover.

This programme achieved 90%.

Programme 5: Civil Aviation

The National Civil Aviation Policy and National Airports Development Plan were submitted to the Minister for Cabinet consideration. This policy and plan were developed to enhance maintenance and strategic expansion of the Civil Aviation infrastructure network for improved efficiency and competitiveness. The permission applications by Airport Company South Africa (ACSA) and Air Traffic Navigation Services (ATNS) for 2015/16 – 2019/20 were concluded and gazetted.

The 8th Amendment of the Civil Aviation Regulation; Draft State Action Plan on Carbon Dioxide Emissions Reduction and the Amendment Bills for ACSA and ATNS were submitted to the Minister for consideration.

The Aviation Industry Transformation Letsema 2014, was not hosted in the period under review due to resource limitations, and was a challenge for remedial action. It is now planned for August 2015.

Over-spending in this programme was due to the cost of repatriation of South Africans who died in a building that collapsed in Nigeria. Funds were shifted across programmes to cover the shortfall.

This programme achieved 67%.

Programme 6: Maritime Transport

The African Maritime Charter was submitted to the ICTS Cluster. Its aim is to support job opportunities within the Maritime Sector. The Torremolinos Convention was submitted to the ICTS Cluster. Its objective is to reduce the number of accidents and incidents in the sea environment.

On goods and services, the programme under-spent because a number of projects were not undertaken in the year. Concerning transfers and subsidies, the programme under-spent due to Foreign Membership fees not claimed during the year.

This programme achieved 22%.

Programme 7: Public Transport

The National Learner Transport Policy was amended after comments were received following the publication of the policy in the third quarter and was re-submitted to Cabinet. This policy aims to provide a policy framework to address the challenges learners encounter on a daily basis and overall management of learner transport.

The Shova Kalula Programme saw 3000 bicycles distributed to provinces. The programme aims to improve access and mobility, especially in rural areas. 860 Old Taxi Vehicles (OTVs) were scrapped in line with the Taxi Recapitalisation Programme. The objective of the programme is to eliminate old and unroadworthy taxi vehicles and introduce environmentally friendly vehicles.

The Taxi Recapitalisation Programme has experienced a low uptake by the industry. The plan is to review it over the MTSF.

With regard to transfers and subsidies, the programme under-spent because no claims were made to the South African National Taxi Council. Fewer taxis were scrapped and this resulted in under-spending on the Taxi Recapitalisation Programme.

This programme achieved 82%.

The Department was allocated a budget of R48 771 billion. It spent 100, 8% of its budget. The Department overspent due to the cost of e-ENaTIS maintenance and operations.

(Tables and graphs were shown to illustrate budget breakdown and expenditure)

Discussion

Mr T Mulaudzi (EFF) asked how many cooperatives that belong to women and youth were empowered through the 240 SMMEs the Department supported. He further asked why people are not interested in giving up their old taxis. Regarding the performance of the fourth quarter, why were some sectors within the Department not getting 100% while others were, and if there are strategies in place to achieve 100%.

Mr Mokonyama Mathabatha, Deputy Director-General, DoT, replied that the Department is working closely with the Department of Small Business Development regarding the issue of cooperatives to see how they could be incorporated into the programmes of the Department. As to why people are still clinging to their old taxis, the annual performance plans of 2015/16 indicate that the review of the Taxi Recapitalisation Programme would be concluded at the end of this year and it is going to culminate into a new Taxi Plan. It cannot continue over three years.

With regard to overall performance, the target of the Department in the last financial year was 85% but the Department ended up with 72%. For some projects the Department was talking with the internal audit regarding the performance of other sectors within the Department. It is possible to achieve 100%. The internal audit wants proof for work done but some branches did not submit evidence of work done; hence other branches have not achieved 100%.

Mr P Sibande (ANC) asked what was the status quo regarding the Maritime Charter; and how the financial year plan is going to ensure that overspending due to e-ENaTIS is not going to re-occur.

Mr Mathabatha responded that the Maritime Charter is still at a ratification phase. South Africa still has to finalise it. Pertaining to overspending, the issue could only be solved when the court has settled the dispute the Department has with its service provider, Tasina. That is why there is continued overspending.

Mr M De Freitas (DA) asked for clarity on the issue of vacancies.

Mr Mathabatha stated that the Department had a vacancy rate of 43%. The posts would be filled as a matter of urgency and the Department would investigate those posts that are no longer required.

Mr G Radebe (ANC) did not understand why the Department is using a middle man to transfer funds to universities instead of dealing directly with the institution because the middle man takes a percentage of the funds earmarked for the institution.

Ms S Boshielo (ANC) asked for clarity on the Moloto Road Project. The presentation documents had gaps and did not provide sufficient information for the public to understand the content. The documents did not indicate timelines for consultation on internal matters were full of inconsistencies and not sincere and only about what the Committee wants to hear.

Mr Mathabatha said the challenge concerning the Moloto Road Project is that it is not a national road. It belongs to three provinces – Gauteng, Limpopo and Mpumalanga. Plans are on the cards to declare it a national road. Already, Mpumalanga and Limpopo have agreed to the declaration and talks are at an advanced stage with Gauteng.

On the issue of documents, that observation was the first issue he raised when he joined the Department on how to report and set targets. The challenge is to strike a balance between what Treasury wants the Department to do and making sure there is an impact. This is something that needs to be discussed with the strategic planning committee. This was discussed with Treasury and the Auditor-General because they want to see ticked boxes and it was indicated to the Treasury and Auditor-General that it is hard, if not impossible, to tick boxes on service delivery matters.

Mr L Ramatlakane (ANC) asked the Department to comment on the MyCiti Wynberg to Cape Town Route. He wanted to know if the figures presented on expenditure trends represented what was expected to be achieved; and whether the Department is aware that the Learner Transport Policy has gaps and the Department of Education went ahead with it.

Mr Mathabatha, on MyCiti Wynberg route, stated that a report was submitted to Cabinet. The issue is around tenants in the area who have signed a lease with the City of Cape Town.  The tenants are saying if they are removed, they need to be given alternative accommodation. Discussions are still continuing.

Concerning expenditure trends, the targets are always set at the beginning of the year on things that need to be achieved, which explains the 72%. Some of the projects were supposed to be done during the 2014/15 period but were completed in April 2015, and missed the report. The Maritime Division has done little because of limited capacity.

Regarding the Learner Transport Policy, the policy document submitted to Cabinet did not have Rands, cents and kilometres. The Department needs to be given more time to close the gaps.

Mr Mathabatha also informed the Committee that challenges he encountered when he joined the Department were around the issues of driver’s licences, e-tolls and e-ENaTIS. The Department now runs the driver’s licence facility; there is no middle man involved or facilitator.

Regarding e-tolls, a panel was tasked to look into the matter and consultation was done with various stakeholders. This culminated into the announcement made by the Deputy President recently. The cap has been reduced according to the size of the vehicle. The dispensation is that those who owe money would be given a 60% discount. The e-tag is no longer compulsory.

The e-toll has resulted in the shortfall of R390 million per annum and Treasury has to go back to Parliament to request more funds. The projects that were made were correct but the adjustments caused the shortfall. Many sectors are supporting the new dispensation.

Pertaining to e-ENaTIS, Tasina was handling this project. The contract started in 2002 and was expected to end in 2007 but was extended by court rulings. The Department told the court the matter could not be perpetual. A judgement for now is still reserved because the Department wants to do the project itself. Advertisements have been placed in the media for the filling of posts. Then Tasina sent the Department to the court, saying the Department cannot advertise posts for the work it does. The court has set the matter aside. Employees from Tasina resigned en masse, applied to the Department and are now in the employ of the Department. The Department has approached the courts to find out ways of taking over the facilities from Tasina.

The meeting was adjourned.