Temporary Chairperson, Minister of Transport, Comrade S'bu Ndebele, chairperson of the portfolio committee, Comrade Ruth Bhengu, hon members, MECs who I see in the audience, the DG and his staff, CEOs from entities and many stakeholders from the transport family, the Minister already provided a comprehensive overview of the Department of Transport's 2010 budget allocation. I would just like to focus on a couple of additional matters.
Two days before the Easter weekend, Judge Fabricius delivered a landmark judgment in the North Gauteng High Court in Pretoria. Perhaps because it was just before the Easter weekend and it was a long judgment of 204 pages, or perhaps - this is more likely - because the outcome of that particular judgment was not liked much by those who often use up a lot of space in the commercial media including, sometimes, my colleagues from over there on the other side of the House, the DA, or for one reason or another, the judgment didn't get much reportage in the newspapers. And yet this 204-page judgment is of considerable significance and importance to the broad South African public.
Those of you who have followed the occasional reporting of this matter will know that the Law Society of South Africa, LSSA, and the SA Association of Personal Injury Lawyers, SAAPIL, challenged the constitutional validity of the Road Accident Fund Amendment Act, which came into operation in 2008.
In delivering his long judgment, the judge first prefaced it with a number of contextualisations - the context within which this case had been brought to his court. He noted that the legal costs for the fund in the year ending 31 March 2009 were a whopping R1,6 billion.
These were merely the so-called "party and party" legal costs, that is, the costs paid directly to lawyers by the fund itself. The attorney-client costs, the judge noted, were a matter of conjecture since they were privileged information. However, the judge accepted as plausible the Road Accident Fund's estimate that these costs amounted to somewhere near R4,3 billion in the financial year 2008-09. That's a total of nearly R6 billion going to lawyers.
The hon Farrow says to us that there's a crisis at the RAF and so on. It has challenges, for sure, but we need to ask why there is a crisis. The good judge had the good sense to give us a good sense of what the problem might be.
The figures produced in the judgment are roughly similar to those that were also suggested by the Satchwell Commission in 2002, which said that roughly half of the fuel levy which the RAF gets, which we all contribute to as road users and which is currently standing at about R12 billion, ends up not going to hospitals or people injured in accidents but to professional fees.
So, against this background - because this was just the background - they then considered the legal arguments. Judge Fabricius ruled against the LSSA and the SAAPIL on every single count of their attempt to prove that this amendment Act was illegal, bar one minor technicality in the regulations of the judgment, and the judge was quite right there.
With regard to the unconstitutionality of removing a claimant's right to take up a civil case for the balance of a claim not paid by the fund, he noted that contrary to the applicants' - the lawyers' - assertion that it took away more than it gave, the judge said:
The substitution of a statutory claim ...
In other words, the claim against the fund in law ...
... for the common-law claim against a driver is to the advantage of claimants insofar as they now have a debtor with a "deep pocket": the RAF. They would otherwise have been at risk of having a good common-law claim, perhaps, on the one hand, but against someone who might not be able to pay at all. The substitution of the risky common-law claim with a statutory claim against a public fund is a significant advantage.
That was a critical finding by the judge. Looking at the same issue from the perspective of a driver who might be at fault, the judge further noted that while we all pay into the fund through the fuel levy, those who would be unable to afford additional personal insurance for indemnity - the poor - might be forced into bankruptcy as a result of what might have simply been a moment's inattention on the road - because sometimes it does occur.
As for the other allegations of a lack of fairness in the Act, because we capped the amount in terms of loss of future income, for instance; we said that general damages can be awarded only for serious injuries and so on - the judge ruled the exact opposite of what the lawyers were claiming. He said:
While contributing the same fuel levy, the poor obtained much less because they can claim less, if anything, for loss of earnings. They are less likely to institute large claims for medical expenses because they cannot afford to pay for the treatment upfront, and they are less likely to obtain the same amount of general damages as the rich, having regard to the consistency and quality of treatment in respect of general damages.
In short, in reaching his findings in favour of the Department of Transport and the RAF, the judge found that the Road Accident Fund Amendment Act was not irrational or unconstitutional, and that it advanced the objectives of a road accident compensation system that was more equitable, reasonable, affordable and sustainable.
In warmly saluting - as I hope that at least the majority of the members on this side of the House will do - the content and the contextualisation of the judge's findings, we should note that there is every reason to believe that the LSSA and the SAAPIL will take this judgment on appeal to the Constitutional Court.
I am quite convinced that the Constitutional Court will find in the same way. But, certainly, as the Department of Transport, through our Minister of Transport, we commit ourselves to actively taking up the defence of what we've achieved through this amendment Act, not for the sake of winning a legal case but in order to defend public interest in this matter. [Applause.]
These findings are related to an amendment Act which is related to the current RAF. In other words they are, in effect, transitional measures, as we lay the basis for a complete overhaul of the system of road accident compensation in South Africa.
Members will remember that earlier this year we presented to the portfolio committee the Department of Transport's draft policy document on a no-fault road accident benefit scheme. We intend for this to be an integral part of a comprehensive social security net. No longer will R6 billion go to professional fees and not to medical care or to the assistance of people who are injured and to families who suffer the loss of a breadwinner. We absolutely need to fight this case and make sure that we win it. We salute what the judge has done so far in the North Gauteng High Court.
I also make this point, hon Farrow, because of course there are challenges in some of the agencies and entities falling under our budget. The hon member tended to present all entities as if in crisis - unfortunately, he said "anus horribilus", but I think he meant "annus horribilus" [Laughter.]
It sounded as if there was this fog of depression and negativity in which everything simply became grey. I think that's unfair. The RAF, in difficult circumstances and needing major transformation - I think generally we agree on that - is not doing badly. We need to change the operation, but it is not as though there is some failure at the level of the CEO, the board or whatever. There might be some other issues, but let's not be so negative that we fail to analyse fairly what the challenges are. [Applause.]
The RAF judgment got scant attention in the media. Unfortunately, the same cannot be said for the state of our roads and the potholes in our roads in South Africa. There has been a great deal of adverse publicity around these matters.
First of all, a word of qualification - but I don't want to be overly defensive, and others have also said it, including opposition parties - not all of our road system is in bad shape, specifically the 17 000km, more or less, that the SA National Road Agency Limited, Sanral, is responsible for. It is generally in excellent or good shape. Often foreign visitors in South Africa are quite surprised by the state of the roads that they see and they comment favourably on them.
However, there are some really serious problems on our roads. I don't want to imply that we don't have serious challenges. The Department of Transport asked Sanral to conduct an evaluation of the total national road network. The report makes for very sobering reading. About 80% of our road network in South Africa is older than the 20-year design lifespan for which it was originally built. Even more sobering is the fact that in making its assessment of the entire network, Sanral was able to rely on data for only 64% of the roads falling under the nine metros. When it came to municipalities, there was data available for only 4% of 340 000km of roads. In other words, the majority of municipalities, let alone maintaining or looking after their roads, are not even doing a basic evaluation of what is happening on them. Unless you do that, how can you spend the budget effectively? How can you allocate your budget effectively?
It would be tempting for Minister Ndebele and me to shrug our shoulders and say that's a provincial and municipal issue. But we cannot do that; none of us can do that. We need to accept collective responsibility for the state of our road system.
So what can be done? A whole number of things are necessary, and other members have already suggested many of them. Indeed, we are actively engaged with these measures.
First of all, yes, we have to get our rail system working again - freight rail, for instance. Although there has been further investment and some capitalisation in Transnet Freight Rail, TFR, over the last few years, it has continued to lose freight market to road haulers. That is hugely problematic and we have to turn that situation around.
As the department we don't necessarily want to take over TFR but we do want to introduce a rail economic regulator in order to get a better handle on what is happening there, including some of the other issues that were mentioned here, for instance, the issue of charges to Prasa by TFR. So, we need an economic regulator.
We also need - and other members have mentioned this - to improve our road freight control and inspection measures, working together with the Road Traffic Management Corporation, RTMC - when we get it right, and there are challenges there - with the Road Freight Association, RFA, with labour, and so on. There are responsible road haulers out there, but there are also many fly-by-night operators. They are damaging the roads terribly.
We need to ramp up road construction and maintenance as a major component of our Expanded Public Works Programme, EPWP. Already, there are very important experiences in several provinces, not least the pioneering work that Minister Ndebele introduced when he was MEC in KwaZulu-Natal in terms of rural roads and low-cost, labour-intensive methods of maintaining them.
Others have mentioned that we need to ring-fence budget allocations. Whether or not it becomes a national fund is a further debate we need to have, but we certainly need to ring-fence budget allocation to roads. Too often money is notionally allocated to provinces and municipalities for road construction and road maintenance but then disappears in all kinds of other directions.
Many small municipalities and even some provinces have limited in-house engineering capacity. Project management capacity is often weak and, therefore, wide open to abuse and corruption, not least from a stratum of "tenderpreneurs". There is a well-known case in a particular province up north in South Africa that has come up. But that's symptomatic of the broader problem: lack of effective management capacity.
So, we need to pay a lot of attention - maybe that's something that Sanral can do - and take responsibility for the whole road network in South Africa, but also assist with capacity development at municipal and provincial level.
There's good news in the bad news. For instance, many of our pothole problems can be eliminated through very basic road maintenance, which is eminently suited to EPWP's labour-intensive work. We're talking about such tasks as clearing drains, cleaning up the verges of roads - all those things eliminate the build-up of water on the surface and beneath road surfaces. Road-surface cracks must be sealed timeously so that a crack doesn't become a pothole, a trench, or anything else.
Finally, we need to help provinces and municipalities to prioritise preventive maintenance as much as possible. When the budget is actually spent on roads, the tendency is to go for either a big, new "vanity" road project or to fix the very worst roads. For the same budget you can mend 1km of seriously deteriorated road or fix 18km of a road that hasn't deteriorated completely. We need to assist with all of those things.
I am trying to work out what this clock is saying. It's going up. It's very difficult to figure out. I need Sanral to assist me with some capacity- building!
I've said that as the national government and national entities we need to work very closely with municipalities to assist with capacity to rescue the road network. We also need to do so in regard to public transport. Working closely with metros and municipalities is absolutely central to transforming the public transport reality in South Africa.
Minister Ndebele has already spoken eloquently about the priority that public transport enjoys in the department's strategic plan, notwithstanding what the hon Mbhele had to say. It's central. It's the critical thing in terms of our planning. We've got to get public transport right.
We are not going to be able to achieve sustainable, reliable and affordable public transport without, at the same time, beginning to transform the persisting apartheid geography of low-density, sprawling suburbs that are reliant on cars and freeways on the one hand and, on the other hand, the distant, marginalised dormitory townships, which we often unwittingly recreated with Reconstruction and Development Programme, RDP, housing over the last 15 years.
As long as that reality is there, public transport will be for those who are condemned to it - those who can't afford a car. The rest of us who live in suburbs with freeway access will use cars. Public transport needs to become the first choice for all of us, rich and poor. That's how great cities and towns work, where public transport is the key mode. You use a car occasionally when there's no alternative, but fundamentally your daily life revolves around public transport.
Public transport is not just about moving people. It is about democratising space; it is about de-racialising the spatial geography that is still so deeply entrenched in the South African reality.
This means that planning of public transport needs to devolve to the local level - and that's why when we ring-fence road maintenance, for instance, the question is: Do we hold it as a national fund? It might be tempting, because we think we can do it better, but we've got to make municipalities ... [Interjections.]