Tag Archive | department of transport

Green Paper on rail transport published

sent to clients 12 October…..

National rail policy mapped out…..

metrorailA Green Paper on South Africa’s National Rail Policy has been published for comment naming the country’s challenges in rail transportation, recommending policy direction and containing broad proposals for the way forward to develop the current rail network.

Gazetted recently, the Green Paper represents work commenced in 2010 and says the document “Seeks to revitalise the local railway industry by means of strategic policy interventions”.   Not only is freight rail included in the proposals but long-distance rail passenger and localised commuter services.

Road dominates at a cost

Minister Peters said in a media statement at the time that railways in South Africa had operated for almost more than a century without a proper overarching policy framework to guide development.   “The railway line and its railway stations have played a pivotal role in the day-to-day lives of communities, especially those in the rural areas, but as far as freight is concerned, 89% of freight is still transported by road and the future of commuter rail conducted on an ad hoc basis”.

roadsThe emphasis of road transport is costing the country millions of rands annually in road maintenance, money that could have been well spent on developing freight rail, she said.

The process

Cabinet last month approved the release of the Green Paper for public consultation. When all is finished, a final White Paper on National Rail Policy will be released to guide and direct development of infrastructure and develop more modern commuter systems. A National Rail Act will be the final result of the White Paper.

These interventions, according to Minister Peters, will reposition both passenger and freight rail for inherent competitiveness by “exploiting rail’s genetic technologies to increase axle load, speed, and train length.“

Lining things up

railway lineWider-gauge technologies are on the cards.   The government has said it is converting 20 000km of track to standard gauge from the narrower Cape gauge. This would bring the network in line with an African Union resolution on the subject and at the same time would boost capacity of goods carried, with longer trains and a reduction in transportation costs.

With both passenger and freight rail falling within its scope, part of the envisaged national transport policy includes involvement by the department of transport (DOT) in the local government sphere to create capabilities to move more passengers by rail with infrastructure, more rail line and technical assistance.

Creating local commuter rail

Secondly, once the localised capacity is in place, DOT says it will be able to appropriate subsidies for urban commuter rail, the management of the mini-systems then being devolved to municipalities themselves.

The Green Paper talks of investment and funding, private sector participation, inter-connection with the sub-Continent, skills planning, investment strategies and the start of a regulatory system.     Part of the master plan at operations level would include a branch line strategy with the private sector involved to improve connection between cities with towns and industrial areas.

Other articles in this category or as background

Transnet improves on road to rail switch – ParlyReportSA

South Africa remains without rail plan – ParlyReportSA

Minister comments on taxi and rail plans – ParlyReportSA

PRASA gets its rail commuter plan started – ParlyReport

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Transnet improves on road to rail switch

Transnet tries new formats…..

Troad railerransnet is piloting an innovative rail wagon termed a “road railer” which can use both rail track and the road system, all in further efforts to recover its loss of haulage to the private road sector, enter new markets and to improve turnaround times.   Addressing the Portfolio Committee on Public Enterprises on Transnet’s third quarter performance, Ravi Nair, Marketing and Operations Manager, said that this was one of the innovative pilot programmes in Transnet’s engineering facilities, which included also a flat rail wagon onto which private investors could invest with their own wagon specifications to meet tailored products hauled by Transnet rail. The meeting was specifically held to study Transnet’s road to rail strategy and progress.  Matters regarding Passenger Rail Agency (PRASA) were not involved.

Automotive industry important

Transnet, Ravi Nair said, were also introducing specialised wagons to meet the greater traffic needs of the automotive industry because of the introduction of SUVs and other wider bodied road vehicles, Ravi Nair said. The improvement of siding facilities for customers with necessary off loading equipment was also being undertaken as part of the general view taken of a strategy to improve the road to rail switch. It was noted that rail traffic with the automotive industry had greatly increased at the expense of road haulage. Nair said that on the whole there had been a 28% improvement in turnaround on the Durban/Gauteng line with an improvement in Duran harbour with new crane installations and container handling facilities.  An average turnaround time of 23hrs had been reduced to 18hrs for the trip.

Gauteng terminal reducing blockage

high-density-container-terminal-picture-credit-getty-imagesRaisile Letibe of Transnet said that the City Deep terminal in Johannesburg was due for further investment in sidings, warehousing and equipment. Throughout Transnet, a principle had been adopted that where maintaining line and signalling that had gone way beyond its age and maintenance was a waste of money, all line, signalling and switching gear was being replaced if maintenance was deemed necessary. Approximately 450 new locomotives were starting to pass through Transnet’s new plant at Kodooesberg, Pretoria, this being GE and South China Railway (CSR) locomotives of which some 100 CSR type had already emerged. Only 10 were built by CSR in China during the training period.

Hauling more

In mining terms, these locos will be able to improve a haul of 75 wagons up to 150 for magnetite, up to 200 wagons for manganese and probably double whatever was required with chrome, all possible according to the different class of locomotive used in the new range. The balance of Bombardier and China North locomotives will be built in Transnet’s Durban engineeringbombardier train works, taking the total number for Transnet freight haulage locos to well over 1,000. Transnet took advantage of a R50bn loan from China to conclude these contracts with the main operators and their BEE constituents, Transnet said. However, as things stood at present there was a general increase of 19% turnabout in mining haulage with increases for steel and cement, agriculture and bulk liquids and a major improvement in automotive products haulage and general manufacturing all recorded.

Freight and commuters

A daily meeting was now held with the Passenger Railway Agency (PRASA) on frequency of needs for commuters and the need for haulage of goods on the same track and the system was working well. There was a common understanding on signalling use and track needs at certain hours in cities and to industrial areas. PRASA were also engaged on their  massive development of commuter locomotives and carriages, or “trains” and the integration of both the needs of Transnet and PRASA were being satisfactorily co-ordinated, Transnet commented. rail sidings Raisile Letibe said that R300m had been invested in branch lines to attempt to keep them in shape for concessionaires when the plan to privatise branch lines was finalised. He said that the matter of branch lines brought Transnet with into contact with many other bodies involved in developmental matters including agricultural development, SEZ planning and rural development generally.

Private investment: branch lines

It was hoped to get the issue of the development of branch lines underway as soon as possible. Opposition members complained that this proposal was five or six years old. Under questioning, Transnet admitted that major “challenges” at the moment were breakdown of locomotives, all of which were now aged and parts had to be especially engineered a bought. Wagon availability was also a problem but both these “challenges” should be addressed by new rail stock. Industrial action and economic conditions contributed to the problems facing Transnet but to a lesser degree.

Rural outreach

Parliamentarians continued to be intrigued with the idea of a “road railer” which served the double purpose to become an off-rail road transport trailer. Nair, in answer to questions on this, said probably the private sector would be called in on road haulage issues to rural destinations and the system was used in many other parts of the world. A prototype was being constructed at the Transnet engineering workshops. Nair said that a number of bi-lateral meetings were being held with SADC countries, DRC, Mozambique and Namibia all with the purpose of improving volumes of haulage, particularly in Zambia where copper could be moved despite that country’s plans to open a rail link to the West Coast. However, the general purpose also was to strengthen economic growth through rail in the Southern Region. MPs all agreed that it was good news that at least one state utility in their portfolio was improving. Other articles in this category or as background Transnet says freight rail operations coming right Operation Phakisa to develop merchant shipping – ParlyReportSA Transnet doing better but resists carving up its assets South Africa remains without rail plan – ParlyReportSA Minister comments on taxi and rail plans – ParlyReportSA

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SANRAL gets more out of transport budget

SANRAL part of much bigger picture…..

roadsPrior to Deputy President Ramaphosa’s defence in the National Assembly of the-tolling system with its decreased tariffs , Minister of Transport, Dipuo Peters, told Parliament earlier in her budget vote speech that her department had a budget of R53.7bn for 2015/16, of which 12.5bn would go to South Africa Roads National Agency (SANRAL) – the total budget of R53.7bn being 6% more than last year’s budget.

Speaking at a media briefing prior to her budget vote, the Minister said that the projects administered by the department of transport (DoT) are run through thirteen different transport entities, to where 96.7% of the budget was appropriated and which included mainly provinces and municipalities.

Taxis moving major bulk of commuters 

dipou petersMinister Peters said, “Taxis remain moving 68% of the country’s 5.4 million passengers on a daily basis and contribute immensely to our economy, the taxi remaining the most important part of the public transport system.” Consequently it was her intention, she said, to review the taxi recapitalisation programme to bring about more affordability.

The Minister further stated that with the increase of vehicle transport on roads, DoT was altering its programme of expansion of the road network, doubling the capital available for the upgrade and expansion of provincial and local roads. In fact, the number of vehicles on South Africa’s roads had increased from 5-million in 1994 to over 11-million in 2014.

Nothing much since 1986

It was to be noted, the minister said, that the R1.1bn Moloto road to the north of Pretoria was a priority in view of the number of fatal accidents. “Hardly any significant new highways have been built since 1986, except for those that were constructed as part of the toll projects,” she said.

The additional funding for SANRAL was in respect of roads being added to the SANRAL network, especially in the provinces, which had to be upgraded if tolling was to be introduced. “All this work cannot be funded from the fiscus alone in the form of increased appropriations”.

Minister Peters said that more goods had to be transported by rail rather than by road and the number of vehicle accidents in the country brought down. “This move will equally unlock more economic potential and job creation. It will also help decrease congestion by road freight and with them transporting so much in the way of dangerous and heavy goods.”

Good money after bad?

Opposition shadow transport minister, Manny de Freitas, in reply, pointed out that SANRAL was well short of the R250m a month it said it needed in its original targeting – in fact he had heard that SANRAL had only reached R120m per month income, probably resulted from an estimated 23% of users resisting or not paying collections, in Gauteng.

He queried, as had the High Court he said, SANRAL’s tolling model and hoped the R12.5bn was not a subsidy to make up for the Gauteng impasse, especially as SANRAL seem determined to toll part of the Winelands route in Western Province.

Other articles in this category or as background
http://parlyreportsa.co.za/finance-economic/minister-comments-taxis-e-tolls-road-rail/
http://parlyreportsa.co.za/trade-industry/national-road-traffic-bill-passed-legally/
http://parlyreportsa.co.za/cabinetpresidential/e-tolling-transport-laws-bill-held-over/
http://parlyreportsa.co.za/uncategorized/e-tolling-becomes-a-financial-mess/

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South Africa remains without rail plan

 Feature article….

Minister Peters fails on rail policy…

dipou Peters2In a written reply to Parliament on the whereabouts of the promised Green Paper on rail policy, transport minister Dipuo Peters told her questioners that such a document which has the intention of outlining South Africa’s rail policy was to be presented to cabinet in November. GCIS statements for cabinet meetings for November and the final cabinet statement in December 2014 made no reference to any such submission having been made – alternatively, the minister might have failed to have it put on the agenda. The country therefore went into Christmas recess once again without an established government policy on both freight and passenger rail transport matters, worrying both industrialists, investors and, not the least, built environment planners.

Just talking together

A draft Green Paper was first submitted to cabinet a year ago but cabinet instructed that more consultation on the proposals was necessary, particularly interchange between the transport and public enterprises departments. The portfolio committee on transport stated that policy on freight rail upgrading and infrastructure development was unclear, plans for commuter and long-distance passenger services confused and no clear picture had emerged on Transnet’s promised policy of structural re-organisation. Subsequent to this, the department set up a national rail policy steering committee to oversee the consultation process and introduce the required changes to policy. It has also divested itself of a number of non-core assets but no clear picture has emerged in statements on the promised policy of giving direction on the privatisation of branch lines.

Since time began…

According to the minister at the time, cabinet’s concerns had also involved the adoption of a standard gauge, private sector participation and economic regulation.  Subsequently, DoT indicated that standard gauge has been selected as the most suitable gauge for the South African rail network and as a result a final revised Green Paper was tabled before the steering committee in October 2014. Nothing has emerged. In the absence of any agreed policy, particularly to meet the proposed idea of rail freight re-assuming its dominant role over road transport in the light of the deteriorating national road picture, a number of developments have indeed taken place with regard to the purchase of diesel and electric train stock, signal systems upgrades and station re-building and passenger coach rolling stock manufacture. Nevertheless, no clear picture has emerged on the road ahead with regard to the freight/road picture, branch line privatisation, commencement dates for full long distance passenger services nor satisfactory plans and targets expressed on domestic commuter rail services.

All said before

Jeremy Cronin, when deputy transport minister, told Parliament in April 2011 that by establishing a local manufacturing base for the new rolling stock, benefits would ensue by creating a substantial number of local jobs. He added that as a result of the redevelopment of rail engineering capacity, skills that have been lost over decades of underinvestment in the local rail engineering industry would be recovered. The then deputy minister also said, “We are currently (2011) in the Green Paper phase with the primary objective of preparing the way for effective stake holder engagement. We are poised to reverse the decline in our critical rail sector that began in the mid-1970s and gathered pace in the late 1980’s.” In April 2015 therefore the country will be the fourth year of waiting for South Africa to outline its rail policy, “a system critically in decline” according to minister Cronin.

Recent update from Maties

A few months ago, a most important paper on rail transport, now in the in the hands of DoT, was published and out into the public domain by Dr Jan Havenga, director: centre for supply chain management, department of logistics, Stellenbosch University, who led a team of transport logistics experts to complete this erudite and informed report. The report is entitled “South Africa’s freight rail reform: a demand-driven perspective” and opens with a definition of government’s responsibilities in rail transport matters. “The role of the government is, primarily, to facilitate the development of a long-term logistics strategy that optimally equilibrates demand and supply through ‘anticipation’ of the market character.” “The definition of a national network of road and rail infrastructure and their intermodal connections will flow from this, presupposing neutrality across modes by taking full account of all relevant social, environmental, economic and land-use factors.” “This ensures that the mix of transport modes reflects their intrinsic efficiency, rather than government policies and regulations that favour one mode over another. The strategy is subsequently enabled by a clearly defined freight policy, a single funding regime for the national network and, lastly, the establishment of appropriate regulatory framework.”

Volume of freight critical

The report notes that “the American Trucking Association (2013) forecasts that intermodal rail will continue to be the fastest-growing freight mode in the next decade. Only the very busiest railway networks, which can exploit the density potential of volume growth, are likely to generate sufficiently high financial returns to attract substantial risk capital in long-term railway infrastructure.” “The Association of American Railroads as well in 2013 also highlights the impact of density on efficiency, revenue and, ultimately, the ability to reinvest.”

Lacking in market intelligence

Dr Havenga says, “The failure of South Africa’s freight railway to capture this market is attributable to a lack of policy direction regarding the role of the two modes (road and rail) in the surface freight transport industry and according to the Development Bank of Southern Africa, caused by the absence of sufficient market intelligence to inform policy.” He goes on to confirm that “one of the key requirements for an efficient national freight transport system is better national coordination based on market-driven approaches.”

Pressing need

“To avoid the ad hoc policy responses of the previous century, which led to sub-optimisation, increasing complexity and decreasing end-user quality, the pressing reform issue for South Africa, therefore, is agreement on the design of an optimal freight logistics network based on a market-driven long-term strategy that holistically addresses the country’s surface freight transport requirements.” Dr. Havenga’s final comment in the report, only a few weeks old, states that South Africa’s freight task is expected to treble over the next 30 years, with further concentration on the long-distance corridors. He points out that the country desperately needs a profit-driven market related core rail network to serve industry and manufacturing, as well as a developmental-driven branch line network to serve rural development. Other articles in this category or as background http://parlyreportsa.co.za/transport/minister-comments-taxis-e-tolls-road-rail/ http://parlyreportsa.co.za/finance-economic/prasa-gets-its-rail-commuter-plan-started/ http://parlyreportsa.co.za/uncategorized/transnet-says-freight-rail-operations-coming-right/ http://parlyreportsa.co.za/uncategorized/rail-is-departments-main-focus-in-year-ahead/

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road accident bill South Africa

Road Accident Benefit Bill changes everything

Road Accident victims paid out regardless of fault…

A draft Road Accident Fund Scheme Bill was recently published for comment by the department of transport (DoT) as part of the new “no fault” scheme of benefits, the Bill establishing an office of an administrator to implement and subsequently administer the scheme of injury and death benefits.

The idea of a no-fault approach to compensation, says DoT, is in part to respond to the problems identified with the current fault-based approach, and also to improve and simplify claims procedures so that claims are more speedily dealt with.

This is distinct from the present “insurance-based” procedure where the question and quantum of liability can drag on for years in the courts, the department says in its background document.

Social security first

The Bill seeks to provide for a social security scheme for the victims of road accidents for bodily injury or death and will exclude liability of certain persons otherwise liable for damages in terms of the common law.

DoT says the proposals state that “no civil action for damages in respect of bodily injury or death”, in the case of a road accident, be pursued against any owner’s vehicle involved, drivers or employers of drivers.  Rather, payment is made in terms of the defined benefits of the new scheme regardless of who caused the accident.

DoT says the new Bill forms part of an initiative to replace the third party compensation method with a system that is “reasonable, equitable, affordable and sustainable”.

Public comment was open on the new draft Bill until early September and considerable debate will probably ensue in parliamentary hearings on the question of the extent of the benefits schedule and quantum.

 

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Transport ministry studies taxi, e-tolls and rail

Minister briefs on transport…..

dipou petersTransport minister, Dipuo Peters, told parliamentarians during the annual budget vote debate during a transport portfolio committee meeting that she had to re-look at the failing taxi recapitalisation programme; encourage Gauteng road users to pay e-tolls by announcing incentives; tackle urgently the upgrading of roads; and consider methods to restore freight rail transport as a the primary carrier for the Durban/Gauteng corridor.

The minister said that she recognised that the taxi industry played a critical role in the South African economy by providing 300,000 jobs and contributing an estimated,R40bn to the economy, she said.

Upgrade of taxi industry

The need to modernise the taxi industry still remained as an urgent issue, she continued, and also there was a need to further deploytaxi industry  taxi drivers to other industries, including the bus rapid transit system, possibly aviation and to ports and shipping.

She attributed the slow pace of the recapitalisation programme to the fact that heavily indebted taxi operators chose to remain with old taxis rather enter the process of recapitalisation.   Also, the scrapping allowance had been overtaken by rising prices of new taxis. The entire system needed a priority overhaul, she said, since the safety of the South African passengers was at risk.

Later it became evident during debate that the taxi recapitalisation programme had for all intents and purposes stalled, since only 2,752 vehicles had been scrapped in some eighteen months.

Easing off the pressure

On the subject of e-tolls, Minister Peters said that in order to “make things easier” for the public, DoT was providing an extension of the payment period from seven days to fifty one days; a 48% e-tag-holder discount; 60% discount on the alternative tariff if a non registered user paid within the same 51 days; time-of-day discounts applicable in certain cases; frequent user discounts and a cap on class A2/light vehicles

The minister was asked if Sanral intended to continue its “prosecution and possibly criminalisation of some one-million people who have not paid their e-toll bills”. She replied that she hoped the new arrangements would assist in reducing the financial burden for motorists. She urged Gauteng users of tolled roads to “accept their responsibilities in the interests of better roads for South Africa if SANRAL were to perform their duties and meet their targets.”

She asked MPs to take the lead and say publicly that they were.

Breakdown

The total DoT budget was R48.7bn. for 2014/15, rising to R53.9bn. in 2015/16. This amount included allocations to provinces, municipalities, state owned companies and agencies. Road transport received 43.7%, rail transport had 34.9% and public transport 21%, whilst civil aviation and maritime each received 0.4%. DoT was responsible for transfer of payments and conditional grants to provinces and municipalities.

On the issue of road conditions nationally, DOT heads stated that only 10% of roads were in “poor” condition and the department indicated that it would provide R21.9bn in critical support to SANRAL who were the roads delivery agent for DoT.

Commuter rail focus

metrorailOn rail issues and rail transport, Mawethu Vilana, acting DG for DoT, said passenger rail accounted for a large slice of the commuter transport used by the national work force, R15bn being allocated to the railways accordingly.    He said DoT was trying to reduce the cost and to improve the services of Metrorail, as well as accelerate implementation of integrating rail services with other transport services.   A White Paper would be issued on rail integration issues.

Integration of systems

This was enlarged upon by Mathabatha Mokonyama, DG of public transport, who said the focus was on accelerating integrated transport systems “so as to improve its overall productivity” and DoT would to allocate R81m to the integration process, expected to increase to R84m in 2015/16 and again to R89m in 2016/17.

Mokonyama reconfirmed that whilst rail transport played a major role, DoT had to focus on reducing the cost of public transportcity deep generally and it would also monitor the progress of the Passenger Rail Agency in its objective to restore to the country national rail passenger systems.

He indicated that rail freight transport had to play a larger role in order to compete with road, particularly the Durban/Gauteng corridor and to service industry in Mpumalanga.

Draft White Paper on way

Mokonyama again pointed to the new draft updated White Paper on Transport which was on its way as a framework for public discussion. DoT would also update the Moving South Africa plan and the seven-year old rural transport strategy. This new planning called for further updated legislation.

Minister Peters, in conclusion, conceded under questioning that DoT urgently needed to update scholar transport policies and re-introduce urgency to programmes to reduce road fatalities.

In an odd ending to the debate, when discussing the budget vote on maritime issues, it was said by the DoT maritime services DG that there was a need to establish a maritime shipping sector. The chair promptly asked, “What has happened to the country’s ships?”

The deputy minister of transport, Sindisiwe Chikunga, replied “All our ships were sold on the eve of democracy to make sure that the current government did not participate in the international shipping industry”.

This position was to be reversed, she concluded.

Other articles in this category or as background
http://parlyreportsa.co.za//finance-economic/prasa-says-upgrade-of-rail-transport-will-involve-local-industry/
http://parlyreportsa.co.za//finance-economic/bumpy-road-for-e-tolling-bill-continues/
http://parlyreportsa.co.za//uncategorized/transnet-says-freight-rail-operations-coming-right/
http://parlyreportsa.co.za//energy/transport-subsidies-to-business-are-wrong-says-parliament/

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New Road Accident Benefits Scheme based on “no fault”

Schedule of benefits

A revised draft Road Accident Benefits Scheme Bill, designed to provide a social security scheme for the victims of road accidents, is to be tabled in Parliament to provide a set of defined benefits on a no-fault basis for injury or death arising from car accidents.

At this stage, a draft has been published by the department of transport (DoT) for comment by early July 2014.

The idea of a no-fault approach to compensation is in part to respond to the problems identified with the current fault-based approach, and also to improve and simplify claims procedures so that claims are more speedily dealt with.   This is distinct from the present “insurance-based” procedure where the question and quantum of liability can drag on for years in the courts, the department says.

No civil actions

DoT says the proposals will remove the possibility of civil action for damages in respect of injury or death arising from road accidents instituted against the owner or driver of a vehicle as well as the employer of the driver.

The scheme envisaged by the draft Bill lists a number of stated benefits which can be applied. The administrator of the scheme and his department will have six months in which to accept or reject a claim.   If accepted, payment will be to the claimant within 30 days.

Some of the benefits include health care services, income support, family support and funeral expenses. Payments will be made in respect of medical bills direct to medical parties.

Scheme administrator

Department of transport says a road accident benefit scheme administrator (RABSA) will be appointed and placed in charge of compensation of defined benefits, rather that drawing court awards with legal costs from the road accident fund (RAF), which in turn will fall away.
The key change proposed by the draft legislation is a move away from the insurance-based system of compensation which has been largely unchanged in South Africa since its inception in 1946, to a system of defined and structured benefits.

Legal experts dealing with past claimants requesting payment from the RAF have commented that no compensation will be payable in terms of the proposed schedule of benefits for pain and suffering; loss of amenities of life; disfigurement and emotional suffering.    Also they warn that the cost of running the administration of such a system as RABSA is likely to “eat up” reserves.

More importantly, they say, the legislation “suggests” that only state healthcare and state tariffs would be provided for.

Insurance-based system out

On the subject of the key changes from the insurance-based system, DoT says the proposals state that “no civil action for damages in respect of bodily injury or death” in the case of a road accident be pursued against owner’s vehicles involved, drivers or employers of drivers.  Rather, payment is made in terms of the defined benefits of the new scheme regardless of who caused the accident.

DoT says the new Bill forms part of an initiative to replace the third party compensation method with a system that is “reasonable, equitable, affordable and sustainable”.

Other articles in this category or as background
http://parlyreportsa.co.za//finance-economic/road-accident-fund-mess-continues/

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Was National Road Traffic Bill passed legally?

Query on status of National Road Traffic Bill….

Perhaps a more serious constitutional threat to e-tolling has now emerged than just simply public objection to the new road tax imposed by the National Road Traffic Bill based on information captured on camera mounted on road gantries, to pay for roads development and maintenance in South Africa.

This has emerged as a query on parliamentary procedure of the National Road Traffic Amendment Bill, the legislation passed by Parliament before becoming a necessary amendment to the Act thus allowing e-tolling.

Was Bill a section 76 Bill for provincial debate?

The query comes from the Democratic Alliance as to whether the Bill was correctly “tagged” when it was debated in Parliament and approved. Whilst the Bill was also objected to by COSATU, the DA maintains that the legislation was presented as a section 75 Bill, thus allowing approval by the National Assembly alone with simple concurrence from the NCOP.

The DA maintains that as e-tolling affects all motorists and vehicle operators throughout the country, the Bill should have been “tagged” as a section 76 Bill, which would have meant that the Bill should have been referred to all nine provinces and debated at a local level, provincial mandates for approval being obtained.

The DA is also aware that there is strong objection to e-tolling in the Western Cape where main national highways affect township transport, the winelands industry and tourism.

Purely national or provincial as well?

It is possibly a moot point whether National Road Traffic Amendment Bill is a national issue alone involving the minister of roads having the authority and public finance, by a public tax, to develop roads classified as “national” or whether the consultation process in the passage of the Bill was not correctly followed to allow for consumer opinion.

All would seem a little late however. In any case this, such a major change to legal procedure, would have to go to the Constitutional Court, an expensive process presumably needing to be funded by the main objectors, the Opposition to Urban Tolling Alliance (OUTA).

SANRAL has stated that “investors (in the system of e-tolling) are awaiting information as to their success in recovering the toll income from users, as this will determine whether they invest further or withdraw their current investment”

SANRAL commenced e-tolls, or electronic tolling, in Gauteng province, after a series of delays caused by opposition from road users and trade unions but from revenue so far received has said “although the numbers must still be verified, from the initial indications we are satisfied that we are on track to meet our debt obligations”.

Refer previous articles

http://parlyreportsa.co.za//finance-economic/bumpy-road-for-e-tolling-bill-continues/
http://parlyreportsa.co.za//finance-economic/transport-laws-bill-on-e-tolling-amended/
http://parlyreportsa.co.za//cabinetpresidential/e-tolling-transport-laws-bill-held-over/
http://parlyreportsa.co.za//finance-economic/transport-laws-bill-enabling-e-tolling-tabled-in-parliament/

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Troubled bus industry goes to Parliament

SA bus industry operators in trouble

lowveld-bus-The South African bus system is on the verge of collapse, says the Southern Africa Bus Operators Association (SABOA) and, as the second largest mode of transport in SA behind only taxi transport, this fact was bad news for both commuters and those in industry and commerce whose workers use it extensively, Parliament was told.

Professor Jackie Walters, of the University of Johannesburg and strategic advisor to SABOA, told the portfolio committee on transport that, by its nature, the bus industry in South Africa was partially subsidised and was one of the only countries in the world that seemed to manage on month-to-month contracts.

Subsidies out of date

The bus industry in the past, in order to receive it’s subsidies, worked its calculations on the basis of commuters carried but the industry had slowly switched to contracts where kilometers covered are now the basis for calculation, a preferable system in the industry.  However there had been no extensions or expansion allowed in kilometers covered by subsidies for thirteen years.

Prof. Walters maintained that the bus industry performed a critical role in balancing demand and the pricing system within the public transport system.

The policy applicable to the commuter bus industry was founded on the White Paper on National Transport Policy of 1996, and in a number of other documents such as the Moving South Africa Strategy (MSA), the National Land Transport Transition Act of 2000 (NLTTA) as well as a Model Tender Document and the Heads of Agreement (HOA) between organised labour and the Department of Transport (DOT).

Money disappearing

He told parliamentarians that it was the Southern African Bus Operators Association (SABOA) that regulated aspects of the tendering system but the industry was under stress due to the unintended consequences of Division of Revenue Act (DORA) and the bus contracting system to the government, which was supposed to provide financial stability for industry. Whilst funds may be allocated under DORA to provinces, what happened after that was out of control of central government.

The financial stability intended for the bus industry to provide for commuters was a theory but on the ground quite the opposite was happening, he maintained.   This short-term horizon for the industry made longer-term investment decisions difficult and banks were reluctant to provide funding because of the uncertainty over the future of the contracts.  “No industry can operate on this basis‚” Prof. Walters said.

No windfalls, no shortfalls even

He attributed the problem again to the negative effect of DORA, which left it to provinces to make up the difference between the public transport operations grant allocated to provinces by national treasury and an agreed-upon escalation rate‚ which was linked to increases in the consumer price index.  Provinces continually claimed that they did not have the money to make up the shortfall.

Prof. Walters said the government had not taken into account at any stage the onerous operational cost increases that bus companies had to bear; namely 44% for labour‚ 28% for maintenance and the national escalation on fuel. There had to be risk sharing between government and the operators, he said.

 

No conformity

There were different types of contracts in the industry, he went on to explain, some which were seventeen years old and which were supposed to have been transformed after three years with competitive tendering and negotiation of contracts.

He said that in all there were 39 interim contracts in operation, 66 tender contracts and 10 negotiated contracts. The contract types in operation were based on a user-pays principle regarding the subsidies.

In conclusion, Prof Walters said that above all it was important to get national treasury to acknowledge the contracts and not leave things to the provinces.

DOT to investigate

MPs generally agreed that in the longer term, common ticketing systems over all services in the country generally had to be introduced, similar to that in the BRT system but a short term answer also had to be found to keep the industry alive in terms of the explanations from Dr Walters. 

DOT was told to  report back to Parliament.

Refer previous articles in this category
http://parlyreportsa.co.za//energy/transport-subsidies-to-business-are-wrong-says-parliament/
http://parlyreportsa.co.za//bee/all-not-well-in-the-trucking-industry/

Posted in Finance, economic, LinkedIn, Public utilities, Trade & Industry, Transport0 Comments

Oil pollution in SA waters to be tackled

Oil pollution clean up fund….

oil_tankerWith a series of Bills on merchant shipping, South Africa is about to fall into line with international conventions on oil pollution at sea. The department of transport has now briefed the relevant parliamentary committee on two bills, the last of four now being dealt with designed to fund South Africa’s ability to clean up on any future oil spills in regional waters.

Opposition members pointed out that the minister of transport, who tabled the Bill, appeared not to have consulted with environmental parties in the drafting of the Bill and in subsequent discussions with stakeholders, being merely concerned with SA’s international obligations and the collection of levies by SARS for a fund, they said.

Getting the law right

Advocate Adam Masombuka, chief director for legal services, department of transport (DOT), said that before them were the tandem Merchant Shipping (Civil Liability Convention) Bill and the Merchant Shipping (International Oil Pollution Compensation Fund) Contributions Bill, the first being designed to enact the International Maritime Organisation Protocol of 1992 and the second to create mechanisms for companies to pay into a fund for oil pollution damage.

Both would ensure that the amended International Convention on Civil Liability for Oil Pollution Damage of 1969 becomes law in South Africa, he said.   He added that the other two Bills were Money Bills, separately being tabled by Treasury to deal with the collection of tariffs by SARS and consequent distribution.

Polluter pays

“The purpose of the fund is to pay compensation to victims of pollution damage and the fund is to be financed by cargo owners, namely those who transport more than 150 000 tonnes of oil per annum”, Adv. Masombuka said.   He gave the assurance that the Bill was fully supported  by the fuel companies importing oil and by the SA Petroleum Producers Association.

The two Bills are in tandem; conform to international best practices and complement each other, he said. He told parliamentarians that enactment of the Bills would provide a fund for insurance against damages from shipping accidents; the ship owners carrying the oil cargo being covered by insurance with a fee into the fund and the cargo owners, mainly the fuel companies or their agents who imported oil products, paying a levy.

The fund itself acted as a “top-up” insurance to pay the outstanding balance for any pollution damages, said Adv. Masombuka. The portfolios committee did not present any objections to either Bill.

Like carbon tax

Hamida Fakira, deputy director general, DOT explained to MPs asking questions that in reality that ship companies  conveying the goods paid an insurance for liability for any accident but the oil companies, the cargo owners importing petroleum, had to contribute as it was a pollutant.   It was a similar issue to that of carbon tax, she said.

Opposition members pointed to the fact that whilst the oil companies, DOT and the relevant international agreements seemed to be all lined up, nobody had consulted with environmental bodies and obtained their views. “This will come out during early August parliamentary hearings”, commented the chairperson.

Refer previous articles in this category
http://parlyreportsa.co.za//energy/merchant-shipping-bills-on-oil-pollution-levies-approved/
http://parlyreportsa.co.za//energy/cef-still-has-its-troubles/

Posted in Energy, Enviro,Water, Facebook and Twitter, Finance, economic, Fuel,oil,renewables, Justice, constitutional, Land,Agriculture, LinkedIn, Public utilities, Trade & Industry, Transport0 Comments

All not well in the trucking industry

Call that corruption exists

trucksIn answer to a call made by the portfolio committee on transport on the state of the trucking industry in South Africa, it became evident from responses by the department of transport (DoT); from the Road Freight Association (RFA) and examples given by an independent small operator, that large truckers dominated in an industry in an unfair manner that was rife with corruption.

Mawethu Vilana, deputy director-general DoT, said that going back to 2002/3, the department had begun an exercise to look at how to provide opportunities and also broaden the space for participation by smaller operators in the road freight sector. It became clear that smaller entrants lacked finance; that an “unscrupulous broking sector was part of the industry” and generally there was a lack of skills and know-how in the trucking industry generally due to poor provision of training facilities and an industry which was undercapitalised except but a few large operators.

DOT not playing proper role

Vilana admitted that when it came to black empowerment opportunities, the main player was the department of trade and industrydot logo (DTI) and not DoT, DTI having the BEE verification control system in their court, DoT playing virtually no part in either reform of the industry or the development of SMME’s.

On the subject of crime, little could be done about bribery and corruption, Vilana admitted under questioning by parliamentarians, unless legislation was beefed up with proper powers and a full, properly constituted investigation carried out into the industry.

Road users must pay

roadsHe also admitted that permit fees were high because of the principle of “user pays” which had been adopted by government “since road truckers caused great damage to the road system.”

Gavin Kelly, RFA said his association had 385 members, with 109 affiliates and 40 associates representing different levels of possible enforcement and ability to develop skills and training but complained of massive permit fees (the last being 412%); large levels of corruption amongst government officers and no value being added by the government’s road agency to the industry in general.

RFA also stated that there appeared to be no proper government road freight strategy and single government officials determined policy without ministerial approval.    Kelly said “no real consultation exists between the state road agency and the industry” and it was the RFA view that DoT “was just going through the motions.”

Trucking group says market closed

One medium sized operator, Tramarco, said that despite heavy investment in trucks and bearing in mind the “ever rising price of

tramarco site

tramarco site

fuel”, it was almost impossible to break into the transport business to obtain long-term “tangible” contracts from major mining groups and state utilities.   They appeared to feel “safer” using old contacts and larger companies and quite clearly favours were being granted, they said.

Their spokesman said that the entire industry was dominated by a number of large trucking groups and smaller entrants were effectively “locked out” of the industry because the industry was either not regulated properly.

AARTO somewhat dubious

They also said the licensing AARTO system was not working properly; there was a lack of legislative enforcement; too many corrupt officials had too much power and there appeared a lack of interest by large companies generally to uplift smaller operators, little interest in encouraging training and building the trucking job market.

Tramarco said that no favours or finance was called for by the medium and small sized companies but merely a fair chance to compete for tenders.   They called on government to provide leverage within its own government departments, state utilities and with industry to break up monopolistic habits and encourage more black empowerment opportunities.

“Large groups and utilities make lots of statements on freeing up the market but nothing happens”, Tramarco said.

MPs demand better skills development

MPs demanded of DoT that concrete steps be taken to assist small entrepreneurs and to provide proof of a record in the area of skills development. “It was clear that little had been done by the DoT in this area”, said one ANC member.

Opposition members said they were convinced that DoT “had no meaningful understanding of what the situation was on the ground.” One MP said the City of Cape Town had provided a solution by cutting the bigger contracts into smaller parts, supplying smaller quantities and increasing the number of entrants slowly. He called on DoT to start thinking of similar solutions on a national scale.

Roads to nowhere

Ruth BhenguChairperson Ruth Bhengu told DoT that the meeting had been called because an examples had been given to parliamentarians whereby “large companies gave small companies short-term contracts and rates that would not take them anywhere and businesses that were desperate could not only pay for their trucks but could not maintain them, the business going ‘broke’ as a result”.

There was also an immoral business broking sector emerging, she felt.

Vilana of DoT said there was nothing government could do to protect such entrepreneurs and that this was the nature of the industry which was high capital risk with a road system that was deteriorating.

The committee found this all very unsatisfactory and called for further meetings with DoT stating that these matters had to be resolved and that the challenges facing the trucking industry were to be investigated further. Also cross-parliamentary meetings with public enterprises and trade and industry committees were to be called. DoT was told it would be re-called for further reports.

Further archived references

http://parlyreportsa.co.za//public-utilities/aarto-amendment-bill-gives-back-up-to-road-law/

http://parlyreportsa.co.za//finance-economic/transport-laws-bill-on-e-tolling-amended/

Posted in Finance, economic, Mining, beneficiation, Public utilities, Security,police,defence, Transport0 Comments

All not well in the trucking industry

Trucking dominated by large companies…

In answer to a call made by the portfolio committee on transport on the state of the trucking industry in South Africa, it became evident from responses by the department of transport (DoT); from the Road Freight Association (RFA) and examples given by an independent small operator, that large truckers dominated in an industry in an unfair manner that was rife with corruption.

Mawethu Vilana, deputy director-general DoT, said that going back to 2002/3, the department had begun an exercise to look at how to provide opportunities and also broaden the space for participation by smaller operators in the road freight sector. It became clear that smaller entrants lacked finance; that an “unscrupulous broking sector was part of the industry” and generally there was a lack of skills and know-how in the trucking industry generally due to poor provision of training facilities and an industry which was under capitalised except but a few large operators.

DTI main players

Vilana admitted that when it came to black empowerment opportunities, the main player was the department of trade and industry (DTI) and not DoT, DTI having the BEE verification control system in their court, DoT playing virtually no part in either reform of the industry or the development of SMME’s.

On the subject of crime, little could be done about bribery and corruption, Vilana admitted under questioning by parliamentarians, unless legislation was beefed up with proper powers and a full, properly constituted investigation carried out into the industry.

He also admitted that permit fees were high because of the principle of “user pays” which had been adopted by government “since road truckers caused great damage to the road system.”

RFA has its say

Gavin Kelly, RFA said his association had 385 members, with 109 affiliates and 40 associates representing different levels of possible enforcement and ability to develop skills and training but complained of massive permit fees (the last being 412%); large levels of corruption amongst government officers and no value being added by the government’s road agency to the industry in general.

RFA also stated that there appeared to be no proper government road freight strategy and single government officials determined policy without ministerial approval.    Kelly said “no real consultation exists between the state road agency and the industry” and it was the RFA view that DoT “was just going through the motions.”

One medium sized operator, Tramarco, said that despite heavy investment in trucks and bearing in mind the “ever rising price of fuel”, it was almost impossible to break into the transport business to obtain long-term “tangible” contracts from major mining groups and state utilities.   They appeared to feel “safer” using old contacts and larger companies and quite clearly favours were being granted, they said.

Their spokesman said that the entire industry was dominated by a number of large trucking groups and smaller entrants were effectively “locked out” of the industry because the industry was either not regulated properly.

Not happy with AARTO

They also said the licensing AARTO system was not working properly; there was a lack of legislative enforcement; too many corrupt officials had too much power and there appeared a lack of interest by large companies generally to uplift smaller operators, little interest in encouraging training and building the trucking job market.

Tramarco said that no favours or finance was called for by the medium and small sized companies but merely a fair chance to compete for tenders.   They called on government to provide leverage within its own government departments, state utilities and with industry to break up monopolistic habits and encourage more black empowerment opportunities.

“Large groups and utilities make lots of statements on freeing up the market but nothing happens”, Tramarco said.

Help SMMEs

MPs demanded of DoT that concrete steps be taken to assist small entrepreneurs and to provide proof of a record in the area of skills development. “It was clear that little had been done by the DoT in this area”, said one ANC member.

Opposition members said they were convinced that DoT “had no meaningful understanding of what the situation was on the ground.” One MP said the City of Cape Town had provided a solution by cutting the bigger contracts into smaller parts, supplying smaller quantities and increasing the number of entrants slowly. He called on DoT to start thinking of similar solutions on a national scale.

Chairperson Ruth Bhengu told DoT that the meeting had been called because an examples had been given to parliamentarians whereby “large companies gave small companies short-term contracts and rates that would not take them anywhere and businesses that were desperate could not only pay for their trucks but could not maintain them, the business going ‘broke’ as a result”.

There was also an immoral business broking sector emerging, she felt.

Roads deteriorating

Vilana of DoT said there was nothing government could do to protect such entrepreneurs and that this was the nature of the industry which was high capital risk with a road system that was deteriorating.

The committee found this all very unsatisfactory and called for further meetings with DoT stating that these matters had to be resolved and that the challenges facing the trucking industry were to be investigated further. Also cross-parliamentary meetings with public enterprises and trade and industry committees were to be called. DoT was told it would be re-called for further reports.

Posted in BEE, Labour, Land,Agriculture, Mining, beneficiation, Trade & Industry, Transport0 Comments

AARTO Amendment Bill gives back up to road law

South Africa heading towards demerit system…

Public comment on an AARTO Amendment Bill (administrative adjudication of road traffic offences) is being called for, the Bill eventually to be tabled by the Minister of Transport, geared to back up current road laws and strengthen compliance by facilitating payment of traffic fines. A system of “demerit points” is envisaged for offenders, a system which would it is assumed be linked into the e-NaTis  traffic control IT system.

The draft Bil is geared, it says, for a national roll-out, a scheme having been in operation in pilot form in both Tshwane and Johannesburg until now. Paying by cheques or queuing up at a municipal office maybe a thing of the past once the electronic aspects have been legalised and regulations brought in.

Another govt. agency to be formed

The background to the draft says that the proposed Bill aims to “strengthen compliance with road traffic laws and facilitate the payment of traffic fines”.   The bill will also introduce measures that “allow for the effective adjudication of traffic infringements with a Road Traffic Infringement Agency being established to give more back up to the mandate given to the authorities.

Whilst the currently established traffic authorities will remain responsible for bringing offenders to court, the Agency will maintain records of road users that have failed to pay fines, review appeals by infringers and provide rehabilitation programmes for serial infringers.

The proposed legislation also clarifies the process whereby non-compliant offenders are served with a warrant issued by a magistrate’s court.

Paying fines by EFT coming

The bill also seeks to put in place electronic forms of communication. The department of transport are calling for public input until 22 March.

An investigation has been called for Parliament’s portfolio committee on transport on facts that emerged from the Auditor General’s report on the department of transport that the e-NaTis contract was renewed for a further period with the existing outside contractors without ministerial consent.

Posted in Public utilities, Trade & Industry, Transport0 Comments

PRASA gets its rail commuter plan started

Thousands of new coaches to be built for a start…..

Delivery of the first of new rail car rolling stock will start arriving in South Africa during the beginning of 2015 with a factory being built in South Africa to complete the balance of 3,600 new coaches, all being part of a R51bn passenger coach contract recently concluded  by the Passenger Rail Agency of South Africa (PRASA) with Gibela Rail Transportation.

CEO of PRASA, Lucky Montana, told the parliamentary committee on transport two weeks ago that the entire the current fleet would be replaced in the course of time and all trains, both commuter and long distance, would boast high level security, bigger seats, a new shape and better communication and technology.    A statement was issued in early December confirming that the tender had been won by Gibela.

Worldwide tender process instigated

Minister Sibusiso Ndebele instigated the tender system for new rolling stock in mid-April this year “inviting manufacturers from all over the world to participate in the procurement process” and during the launch indicated a target of 65% localisation target as part of the bid conditions for the new rolling stock.

He said then that “PRASA must ensure the manufacture of an estimated 7,224 Metrorail coaches nationally to meet the passenger demand over the next 20 years as well as the upgrading and the construction of new rail infrastructure such as depots facilities and signalling.”    Investment projects at key national high-passenger demand corridors in KwaZulu Natal, Western Cape and Gauteng were critical he said.

Hand in hand with necessary infrastructure

In addition, PRASA is currently implementing a series of such as the construction of a rail link for the Bridge City development north of Durban as well as the Greenview doubling project east of Tshwane “which will address the archaic single rail design and cater for the increased demands for a more efficient service in this area”.

Over 50 station upgrades, the building of new stations and developing “intermodal hubs” are underway in conjunction with local and provincial governments.  Montana said at the time,  “We have chosen strategic high-passenger corridors as our key upgrade corridors where the demand for our service is quite high with an average 30,000 to 60,000 passengers at peak hours”.

As far as the new contract is concerned, Montana said this week, “It was a mistake for South Africa to not invest in railway for the past 33 years. We are paying the price for that lack of investment.” About 90% of current passenger coach rolling stock was purchased in the 1950s, with the last purchase made in 1986, he said.

State of art travel

 “The new coaches will have air-conditioning  and will have CCTVs for security plus on-board communication”, he said, adding that automatic doors would be included on the short-haul coaches that the long distance trains would have WiFi installed, plus modern toilet facilities.

“We are not looking at increasing fares in the next five years on a massive scale; there will be adjustments to meet inflation, but we are saying that the current workers can’t bear the burden for the upgrade.”

À la Française

PRASA has now invested R123bn to the upgrade its portfolio over a period of 20 years and production of the trains are set to start in 2014. It was in November that PRASA announced that it had accepted a tender from French company Alstom for the programme, Gibela now being announced as the name of the consortium formed as a result.  Canadian, Spanish and Chinese companies also bid.

Posted in Electricity, Finance, economic, Labour, Public utilities, Trade & Industry, Transport0 Comments

Transport to get one transport regulator

Transport legislation to be revised.

In a written reply to a parliamentary question on the subject, the minister of transport, Ben Martins, says that his department of transport is considering setting up a single transport regulator to consider all matters relating to tariffs; the protection of the public as far as transport matters are concerned and to consider the revision of a number of regulations.

He emphasised that lessons learnt from the energy and communications sectors showed that regulators should be incorporated into the transport process itself and the “the new model might entail merging several economic regulators currently operating in the transport industry into one”.

According to the minister, he will now have an investigation commenced which will look at regulation of tariffs across the transport sector; regulations regarding quality of service  and matters regarding the protection of the public interest.

“Predictable tariff structures had to be put in place”, he said.

Minister Martins reply included the fact that necessary regulatory and legislative framework would be in place by 2014 to allow for the setting up of a single transport regulator, who would then be responsible for all transport infrastructure pricing including roads, aviation, rail and maritime matters.

The proposed regulator would be created via legislation and a position paper was to be drawn up by the end of the first quarter next year and draft legislation to follow.

He concluded that the idea was also to provide a better climate for investors.

Posted in Finance, economic, Public utilities, Security,police,defence, Trade & Industry, Transport0 Comments

Transport fuel subsidies to business are wrong, says Parliament.

Parliamentary committee says transport fuel subsidies should go to consumers

The chairperson of the portfolio committee on transport, Ms “Nellie” Bhengu, told the department of transport (DOT) that in her view by not actually giving the consumer, or the household, any portion of state transport fuel subsidies, the  integrated public transport system (IPTS) plan as presented to Parliament, particularly on the subject of fuel pricing, “was not really speaking to the needs of the people.”

Although under considerable pressure to explain why government’s approach to the IPTS should not be driven by commuter subsidies, Mathabatha Mokonyama, deputy director general, public transport, of the department of transport (DOT), explained that this was not a practical suggestion. The reality was that DOT had to deal with operators, he said.

Mokonyama said the current system of fuel pricing was likely to stay the same in South Africa for the foreseeable future.

He told parliamentarians that South Africa system was to negotiate subsidies with transport operators in terms of the legal structure governing the country and explained that both the history of private bus operators in SA and the growth of an independent taxi industry had mitigated against a commuter subsidy system and had led to the current system, however ideal other proposals might be as far as government was concerned.

MPs argued that in countries such as the England, Canada, Germany Sweden and even Kenya, such systems existed and citizens could purchase open tickets across of whole range of forms of transport and commute therefore at lesser costs to their already strained household budgets.

All is not well in the transport system in South Africa, DDG Mokonyama admitted to the committee, “and we cannot not hide from this fact. We are dealing with up to forty years in backlog of capital items, particularly rail rolling stock”, he said.

He told parliamentarians in the portfolio committee on transport that the proposed integrated public transport networks (IPTNs) in SA, some partially implemented and some still in planning, involved the integration of local rail, bus, mini-bus, taxi and “on-demand” services, and also to which link long distance services such as air, train, coach and midi-bus taxi were tied in.

Current constraints, as were well known, included lack of pre-travel information, poor sidewalks, badly maintained directional signage, lack of vehicle destination information, lack of real-time travel information and lack of safety.

Whilst the public may appear to prefer private transport, in census results this only came about because of the lack of public systems, the public being aware of the very poor maintenance aspect to bus and coach services, insufficient rail alternatives and no provision for cycling.

97.5% of the vehicles used for transport were acquired in the ‘fifties, DDG Mokonyama said, and effective vehicle mobilisation and surbanisation of the population only occurred in high and relatively high middle-income groups. Added to which problems it was to be noted that approximately 3.1m RDP housing units had been “inappropriately” located, he said.

Poor planning at local government level had exacerbated the problem, he said, and when questioned by MP Ian Ollis (DA) which came first; building a housing area near a rail line or insisting a rail line is taken to a housing area, the answer came from DDG Mokonyama that DOT worked through the integrated planning committees, some of which worked well and others not, but nevertheless that DOT could only recommend, not give instructions. He said he understood what Ollis was saying.

DOT noted with statistics that whilst London, Jakarta and Paris handle slightly over 30 million people in a sprawling areas in total area probably equalled by Gauteng (Jhbg, Benoni, Brakpan, Sandton etc). The situation was not the same just because of geographic size.

Although apartheid and forced removals had started the decentralisation, distance problems with urban sprawl were much of the problem and the urbanisation of millions of potential commuters from rural areas to cities had completely altered the scenario and made any comparisons irrelevant.

The commuter impact, he said, of the this “sprawling” in SA was high peak rushes and a “tidal flow” demand pattern, leaving vast amounts of transport idle for three quarters of a working day, coupled in SA particularly with “patchy” weekend services which also did not happen from a comparative viewpoint in many countries. Many developing counties worked through a seven-day week.

Mokonyama said DOT had identified the short distance commuter transport bus system known as BRT (Bus Rapid Transport); high quality long distance bus services and what was referred as “rapid rail”. All three were as critical elements of the department’s IPTN but stated there were “the municipal situations that warranted an intervention.” He did not expand on this.

He confirmed earlier survey reports that South Africa “had a poor public transport system” and 31% of SA households had access to a car – the “split” for travel to work being 32% for car travel; 23% of people walked to work and 25% used a taxi. The number of persons using bus and train only amounted to 15% of the total, whilst 5% used “other means”.

Meanwhile, Mokonyama  said, whilst it might look like that in SA that operational subsidies given by the state were relatively similar to other countries, the vast difference in incomes compared with SA and overseas showed SA as having “cost of transport” as one of the major and highest items in household expenditure.

Statistics also indicated that whilst only 31% of South Africans owned a vehicle, operational subsidies allocated to rail and buses was R3.5bn and R4.3bn respectively for 2012 and 2013.  Persons earning less that R500 a month spent 35% of their income on transport; those earning between R501-R1000 spent 23% and households earning between R1, 001 – R2, 000 spent 14% of their income on transport.    On government interactions and interventions taken recently, the first approach had been the National Land Transport Act to bring about some form of regulation, infrastructure oversight and operational funding process to the situation. Following this, the main metros had been instructed to commenced integrated transport systems, which was now process of happening, he said.

DDG Mokonyama then gave a city by city report on each (IPTS), showing that Cape Town, Johannesburg and Tshwane were relatively advanced, Johannesburg’s Rea Vaya scheme from Soweto to City having come into operation in February 2011 and already had carried 1.1m passengers but labour unrest had shut down the system for two months.

The second phase of Rea Vaya to Parktown was 90% complete and the Parktown to Sandton route had been changed to incorporate Alexandra township but had not yet started.

In Cape Town, the feeder service, My Citi, was carrying 12,000 passengers per month on 42 buses, 50% being former vehicle commuters.    R1.5bn was due to be spent by June 2013 to complete Phase 2 of My Citi which was in part operation.   Phase 3 incorporated metro east operations and would be underway in the following two years.

An Example of an integrated system for the whole of Tshwane was shown, indicating a combination of buses, existing rail, Gautrain, the existing BRT corridor and new rail for places as far apart as Mamelodi, to Mabopane, Garankuwa and Rosslyn, from Centurion to Hammanskraal taking in the national rail line, all inked to the CBD and Hatfield in the centre. Such IPTNs were in place for most cities in SA, he said.

When asked if the Moloto Corridor programme was part of the integrated transport plan, DDG Mokonyama told parliamentarians that it was. “We are doing the analysis.  Rail is so much safer than bus on open roads over a long distance and this fact has given more impetus to the plan”.    He admitted that the plan had originally turned down but said this was not a wish not to proceed but that no feasibility study had been conducted.

Again ANC MPs asked why subsidies did not go to commuters but in reply, DDG Mokonyama quoted an example with Sasol and their commuters, Sasol running a bus system where they, as employers, were paying an operator a bus subsidy.

However, the union involved had demanded the sum and there were, Mokonyama said, “bad consequences for the commuter”.   The department had learnt from this, he said to parliamentarians.  “I would like to believe we can get rid of some of the unintended consequences by not dealing with matters in this way”, he added.

 

 

Posted in Energy, Finance, economic, Fuel,oil,renewables, Public utilities, Trade & Industry, Transport0 Comments

Transnet says freight rail operations coming right

Brian Molefe, CEO of Transnet, went before the portfolio committee on transport regarding the utility’s annual financials and reported that cash generated from operations was up 24% to R18.3bn for 2011/12, being the year under review, and that the Transnet balance sheet recorded a profit of R4.1bn, Transfreight Rail providing around half the revenue.

Mostly importantly he advised (9/10/2012) that in the light of the strong balance sheet, Transnet would be able to borrow for future capital expansion without government guarantees. On the subject of freight improvements he said that coal freight for 2011/12 was up 8.8%, iron ore was up 13.2%, and gross tonnes per kilometre productivity was improved by 1%.

Although maritime container volumes had increased, Molefe said, Pier 2 in Durban had experienced a decline during the current refurbishment period, new cranes having been ordered to improve the position.

Karl Socikwa, Transnet Port Terminals, however, told parliamentarians that productivity issues with Durban container terminal in general was improving and that the “the dwell time of ships were now three to four days.” With the replacement of cranes now being undertaken “Pier 2 was basically a construction site at present”, he said.

In his general report, CEO Molefe said that petroleum volumes decreased by 7.1% because of “industry supply problems” and the Durban – Johannesburg pipeline usage decreased by 8.8%.

On equity issues he said that the Transnet workforce was currently made up of 78.5% blacks and 21.5% whites with 78% being males and 22% being females and that the human resources division would take on sixty engineering trainees, 181 technician trainees and 854 artisan trainees. Training accounted for 3.9% of personnel costs. The total number of employers was 50 992 which pushed up the total employed by 6.6%.

On the subject of reduced revenue experienced by Transnet Pipelines for the period 2011/12, Charl Möller, chief executive, said much of the slowdown in volumes passing through what was known as NMPP was mainly as a result of the slowdown in economic activity; various market changes; improved fuel efficiency and the introduction of Gautrain.

Posted in Energy, Finance, economic, Fuel,oil,renewables, Labour, Public utilities, Trade & Industry, Transport, Uncategorized0 Comments

Road Accident Fund mess continues

In terms of its annual report tabled before Parliament recently the Road Accident Fund (RAF) remains technically bankrupt according to its CEO, Eugene Watson who was appointed to the post recently.

“The Road Accident Fund incurred a net loss of R16.487m during the year ended March 2012 and, as of that date, the entity’s total liabilities exceed its total assets by R46.395m”, he told parliamentarians.

In a separate report but incorporated into the presentation, the auditor general’s remarks were highlighted where it was stated that the financial position cast doubts on the RAF to operate as a going concern and there still be a lack of controls to curb the wastage of unnecessary expenditure.

Watson said funding models were being considered as an alternative, including funding from the road levy. Both funding and the approach to claims had to be re-considered, he said.

“The fund recorded a deficit of R16.5 billion in the financial year under review compared to a net deficit of R1.5bn in the previous year,” said Watson and this was as a result, he said, in provisions having to be made for outstanding claims. The figures he presented showed an increase from 2010/11 of R34bn to 2011/12 at R54bn.

The report highlights the fact that thousands of claimants have outstanding compensation cases and many involve claims serious injuries. Some of the claims have been outstanding for a number of years.

“Government need to consider interim legislative measures to ensure that inefficiencies in the current compensation system, which we cannot control, are contained”, he told the committee parliamentarians.

 

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