Tag Archive | parliamentary committee on transport

E-tolling: OUTA takes it to Parliament

Committee unsympathetic to OUTA…

sent to clients 20 February…. Tough words were used in Parliament when the Opposition to Urban Tolling Alliance (OUTA, now called Organisation Uniting against Tax Abuse) presented its views on e-tolling twayne duvenageo the Parliamentary Portfolio Committee on Transport, particularly of the idea to fund SANRAL of of the fuel levy.  In the end Wayne Duvenage, OUTA Chairperson, was told by the Committee that the only way forward was that OUTA and the SA National Road Agency (SANRAL) get together and negotiate a compromise.

The view of ANC members was perhaps more clearly demonstrated by one MP who stated that the user-pays system had to be retained, since the poor could not afford the costs of freeway development being absorbed into the fuel levy, as was proposed by OUTA.

She explained quite simply that if you could afford a car licence and petrol in the first place, one must pay for e-tolls, otherwise the e-tolling would be added to the price of sugar and soap through the fuel levy because of distribution costs. At the time, members were not aware of the forthcoming fuel levy increase in the Budget.

No either, or…

Whilst ANC members agreed with OUTA that the Gauteng e-toll scheme as currently imposed had not been a great success, it was considered unlikely that Parliament would even consider halting the programme as such and would not encourage a switch to levy funding. A way of making e-tolling a success had to be found, they said.

The main platform of OUTA’s complaints was the issue of poor public engagement and an “arrogant imposition” of the programme which had been badly thought out, they said.    Wayne Duvenage claimed that the argument that an increase in road levies would hurt the poor was hypocritical since government has themselves had increased the fuel levy by 92% over 8 years.

Free ride

OUTA held that e-tolls amounted to extortion and the fact that none of the 46,000 exempt Gauteng taxis had fitted e-tags suggested that the scheme was being shunned, even when free.

nazir alliThey reminded MPs that the High Court had set aside the interdict granted to SANRAL that further discussions had to take place before e-tolling commenced on the basis that SANRAL could start but a door had to be left open for a collateral challenge from society. This was now the case.

OUTA complained also that and that there were no adequate alternatives to easing congestion as required and that the Competition Commission had found the relevant construction companies guilty of collusion.     Yet earlier, SANRAL had claimed that there was nothing untoward about construction costs before the Commission’s findings. MPs said they wanted to know more about this and there would be a follow up by Parliament.

Compliant motorists double penalised

Currently, Duvenage said, compliance stood at about 9%, which was vastly unfair to those paying. (This meeting took place before it was discovered that in all likelihood the remaining 91% had the slate of outstanding fines wiped clean).

Duvenage warned that coupling licence renewals with e-tolling compliance “was an invitation for public resistance” e-toll gantryand not encouraged by OUTA since it would destroy the basis of the AARTO Act and the foundation of road governance.

OUTA called for the e-toll principle be halted in practice overall and that an “exit strategy” be planned for existing contracts.      OUTA was reminded by Chairperson Ramakatla that the Commission of Enquiry into e-tolling had not advised that the user-pay principle be discarded. The response from OUTA to the chair that it was not the right tax mechanism to be used and was also unfair. Users were already paying for road use through fuel levies and taxes.

Talking only route

M de Freitas (DA) said it seemed at the time likely that Gauteng as a Province would oppose e-tolling and to head off the licence fees confrontation, OUTA and SANRAL had to appear at the same meeting and talk of compromise to avoid this happening. Such a confrontation would be disastrous for the country at a difficult time.

OUTA defended themselves by saying that they did not support anarchy and had not stated ever that they were in agreement with e-tolling, their argument being that it was not the right mechanism at all, so it would difficult to find a compromise on e-tolling as a programme.

OUTA said the system used was not a “boom down” system but a straight drive through and “the long-distance model had to be separated from the e-tolling model.”
Wayne Duvenage added he never went as far as Mpumalanga but the e-toll system charged him for freeway building in that part of the world. However, he said, he was already paying for un-tolled Mpumalanga roads through his normal tax, in fact any roads.

Fuel levy out of equation

Chairperson Ramakatla told OUTA that although agreement had been expressed that people had to pay for road use, the OUTA response seemed to be saying something else and their argument that there had to be sole reliance on the fuel levy was not acceptable.

If there was something wrong with the e-tolling system in their view they should make suggestions how to get it right but the fuel levy option was clearly out.

Whilst OUTA had submitted that there was a lack of consultation in 2007, and this was probably true, he said, the lack of consultation was later corrected and that argument no longer applied and this should be borne in mind if a resolution to the problem was to be found by stakeholders.

He said that Parliament would decide on its view on the e-toll issue in further debate.

Previous articles on category subject
Bumpy road for e-tolling Bill continues – ParlyReportSA
Transport Laws Bill on e-tolling amended – ParlyReport
Parliament says Transport Bill on e-tolling will go forward
Transport Laws Bill enabling e-tolling tabled – …

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PRASA says upgrade of rail transport will involve local industry

The CEO of Passenger Rail Agency of SA (Prasa), Lucky Montana, told the public services select committee that a preferred bidder for new passenger coaches would be selected before the end of 2012 and a contract to commence building the first of 3000 new coaches over the next ten years concluded by the middle of 2013.

He told parliamentarians that the current stock of some 4,600 Metrorail coaches “would soon be unsafe to use” ranging in age from 20 to 50 years old. The same applied to its 1,200 long-distance Shosholoza Meyl train units and the replacements were to be supplied on the basis that that 65% of content was locally manufactured.

This would mean the bidder would have to have in place the manufacturing ability to meet such a commitment, Montana said, adding that “the first train would roll out of the new manufacturing plant in 2014/15.”

Montana said that whilst finished coaches could probably be imported sooner, the plan was rather to revive the local manufacturing industry thus developing skills and new jobs. A feasibility study had been undertaken by Prasa with National Treasury and the departments of public enterprises and transport, and together they had established the need for some 7,200 coaches.

He told the select committee that  in general terms South Africa’s rail system as it stood “had come to the end of its design life”. Technology used was obsolete, he said, and the whole rail structure was inefficient because of high costs of maintenance and “there are many areas that we can’t close down because we have to provide some sort of service.”

Of the international standards criteria for passenger coaches, of the twenty two issues that should be met for passenger safety and comfort, the current fleet only met one item on the list – that of heating for passengers, he said.

Signalling systems also had to be totally renewed throughout the country, he said, current ineffective systems currently inhibiting any ability to increase turn around or run more trains.

R7bn in new signalling systems was to be spent, Montana said, and he showed parliamentarians a capital expenditure budget indicating a spend of R26bn on rolling stock and infrastructure development which included signalling over the period 2012/13 to 2014/15.

In terms of future planning, he described a Johannesburg/ Durban high speed link; a further high speed rail system for the Moloto rail corridor;  a rail link for Baragwanath to Johannesburg and commuter rail links for Cape Town and King Shaka airports.

In a subsequent development outside of committees, Ben Martins, the newly appointed minister of transport, in a replying to a parliamentary question on the subject of commuter needs commented that it was “a constitutional aspiration and a stated policy that public (rail) transport should eventually devolve to the level of government closest to its delivery.”

Minister Martins noted that PRASA, as it was currently structured, “provided for limited accountability to customers” and it was imperative to “restructure service delivery in such a way as to introduce accountability and obtain better governance over the deployment of public funds.”

Talks were underway with regional governments, provincial structures and municipalities on the running of metro rail services, minister Martins stating that at this stage it was government’s intention is to devolve “only rail operational subsidies” to metropolitan municipalities, who would act as “conduits for payment” and not act as operators.

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

Davies to re-introduce his ailing BEE

Following the gazetting of a draft Broad-Based Black Economic Empowerment Amendment Bill in December 2011 for comment (60 days), trade and industry minister, Rob Davies, has recently indicated his view that the planned  amendments to BBBEE legislation would “seek to strengthen access to procurement opportunities and to assist with black enterprise development.”

He also indicated in his statement that fronting was a practice that had to be eliminated and penalties for non-compliance as far as regulations were concerned would be introduced in the legislation, which included jail sentences. How this would relate to the Liquid Fuels Charter is not clear. . In terms of the draft BBBEE Act Amendment Bill, the cabinet statement set out the proposed amendments, some of which included amendments including the penalties mentioned for non-compliance in terms of enterprise development, or lack of it, fronting and procurement elements not complied with in terms of the BBBEE scorecard.

Definitions of what is termed as fronting are given in order that legislation may apply and the appropriate regulations enforced. On this issue, much was passed on by minister of energy, Dipuo Peters from the energy conference in November 2011.   Minister Davies said that more emphasis was to be placed on enterprise development and procurement within key sectors, in terms of both the IPAP and new growth path plans. Incentives were to be created for broad based black ownership and the use of such tools as employee share ownership, co-operatives and community ownership.

Relevance to the Employment Equity Act was an important factor, Minister Davies said, as was aligning skills requirements to current and new skills development strategies involved in the new growth path and elsewhere. Targets for this, for procurement matters and enterprise development had to be “adjusted” accordingly, he said.

Meanwhile, Minister Dipuo Peters also welcomed the BBBEE legislation as contributing towards the objectives of the liquid fuels charter. Challenges facing her department were irregular monitoring of compliance, pockets of poor performance within the value chain and lack of financially sound BEE deals, she said late last year.

She also added that her department was looking at ways to strengthen liquid fuels strategic stocks to cover any emergencies that might arise.

She advised the media in November the compliance report on the liquid fuels charter had been submitted to the cabinet for approval. At the time, she expressed her view that current shareholding was not spread uniformly across the value chain and total assets spread in line with demographics, noting that whilst technical issues such as access to storage facilities was a significant problem. In general, she complained that the participation of women, procurement and enterprise development lagged behind targets.

She also added that her department was looking at ways to strengthen liquid fuels strategic stocks to cover any emergencies that might arise. Her recent comments on the new BBBEE legislation were made in the light of Minister Davies announcement.

Reference to both BBBEE legislation and the Liquid Fuels Charter is expected to come up in President Zuma’s address to the nation.

Posted in Cabinet,Presidential, Education, Electricity, Energy, Finance, economic, Fuel,oil,renewables, Health, Justice, constitutional, Labour, Land,Agriculture, Mining, beneficiation, Public utilities, Security,police,defence, Trade & Industry, Transport0 Comments

Transport regulatory mess to be sorted out

At an initial meeting of the parliamentary transport meeting, mention was made of  a new Transport Planning and Implementation Bill that was in draft form to act as a regulatory backdrop for the proposed shake up in the national transport as it applies to all three tiers of government.

Government planners advised they were undertaking an overview of current transportation systems, an analysis of different scenarios for land based transportation and an implementation plan.

The committee heard that existing transport legislation had to be totally overhauled because much in the way of regulatory control was being handled badly or not at all at local government level and that even at national level some aspects of transport law were not being implemented at all.

The committee was told that in terms of the Constitution, it was imperative that all spheres of government co-coordinate and co-operate on matters of government policy and execution  and, consequently, new, all embracing legislation that applied to all levels of government as far as road transport was concerned, was to be introduced shortly.

Posted in Energy, Finance, economic, Mining, beneficiation, Trade & Industry, Transport0 Comments


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