Deputy Minister of Transport, Mr Jeremy Cronin
Honorable Chairperson and members of the Transport portfolio committee and other members present here
Department of Transport Director-General, Mr George Mahlalela and the entire team DoT
Other leaders of government present here today
The leadership and representatives of transport entities
All members of the Transport family
Members of the media
Distinguished guests
Ladies and gentlemen.
Please allow me to start by expressing my sincere heartfelt condolences to the people of Nigeria who have been visited by tragedy. As you may all be aware that all 153 people on board the commercial airliner that was flying between Abuja and Lagos died when it crashed into a densely populated neighborhood in the capita on Sunday.
It is indeed a tragic end to life and our thoughts are with the government and people of Nigeria as they observe a 72-hour mourning period. Back to the business of the day, it is an honour for me to once again present the Department of Transport's budget vote for the year 2012/13 before this house. The National Council of Provinces (NCOP) is an important house representing the views and aspirations of our people in all the nine provinces.
It is a very critical instrument of our democracy that seeks to ensure that the needs of our people, particularly those residing in geographically marginalised communities, are given attention at all times. We firmly believe as the Department of Transport that together with the NCOP, we can take forward the task of building better communities and successfully tackle the socio-economic challenges confronting our people.
Provinces and municipalities are at the coalface of service delivery. Having spent at least 15 years as a member of the provincial executive myself, I have a better understanding of the importance of the NCOP in ensuring efficient service delivery. It is for this reason that we are currently in the process of strengthening provincial and municipal capacity to efficiently deliver on the identified transport infrastructure programmes.
We move from the premise that this partnership with the NCOP goes beyond just mere cooperative governance between ourselves as institutions of the state. We believe that it is also about forging strong and dynamic relations with communities. I stand here today to present the Department of Transport budget for the financial year 2012/2013 amounting to 39 billion rand.
I do so with the expectation that you will sincerely engage us on the future direction of transport in our country. Of this budget allocation, 17.3 billion rand is earmarked for roads and public transport programmes in provinces and municipalities. 7.9 Billion rand has been set-aside for provincial roads, part of which 489 912 million rand is for Disaster Management and 663 400 million rand goes towards the Coal Haulage Network in Gauteng and Mpumalanga.
We have allocated 9.7 billion rand for the South African National Roads Agency Limited (SANRAL). It is important to note that this allocation is not part of the conditional grant issued to provinces. It is also in addition to the 5.75 billion rand that we committed towards the Gauteng Freeway Improvement Project earlier this year.
Honorable chairperson, members, one of the crucial elements of a functional economy is an efficient public transport system. We continue to make strides in ensuring that all South Africans have access to efficient, reliable and safe public transport. We have therefore allocated 9.3 billion rand for this very important function; broken down into 4.9 billion rand for municipal public transport infrastructure and 4.3 billion rand for provincial public transport subsidies.
In addition to these conditional grants to provinces, we intend making additional investments to provinces through the Presidential Infrastructure Co-ordination Commission, (PICC). His Excellency President Jacob Zuma announced towards the end of 2011 the establishment of the PICC - an infrastructure development coordination machinery that seeks to address all challenges related to the roll-out of infrastructure in our country.
Whilst there's a natural expectation that National Treasury would increase budget allocations for infrastructure development to support our ambitions, a sizeable portion of this funding will be through leveraging private sector investments mainly through our State-owned companies.
The current ANC policy discussion document offers a view on the question of infrastructure funding, and I quote: "Composition of expenditure should be changed in favour of infrastructure development. It is going to be difficult to finance infrastructure initiatives from the fiscus only, thus, the question of infrastructure funding and appropriate pricing of infrastructure is key. It would be important for employment creation and for long-term economic growth prospects that infrastructure expenditure be clearly funded through a combination of fiscal allocations, borrowing and user fees," unquote.
The main transport project to be funded through the fiscus will be the Passenger Rail Agency's much-anticipated new rolling stock acquisition programme that has a budget of 139 billion rand attached to it. This programme will ensure that we position rail as the backbone of public transport in our country.
Honorable chairperson, members, South Africa is poised for a major infrastructure shake-up. Our country will in the next coming years be turned into a virtual construction sites, with gigantic cranes occupying the skyline. This major infrastructure drive will bring with it economic spin-offs including the creation of sustainable jobs and other economic opportunities.
But more importantly the new face of South Africa beyond the drilling and digging will be one that will position our country as an investment destination of choice and ensure that we stand shoulder-to-shoulder and compete with the best in the world.
Some of the key projects that are currently at various stages of development include:
- Improving road and rail systems in Lephalale, Moloto corridor and rail services in Mpumalanga linking the coal line to Richards Bay in the provinces of Limpopo, Mpumalanga and KwaZulu-Natal. I’m glad to announce that the work of the Steering Committee assigned to the Moloto Corridor project is at an advanced stage.
The team is expected to report back to me on the outcome of their feasibility study by the end of the year. This Committee comprises all the critical role players in this project including the provinces of Gauteng, Mpumalanga and Limpopo, and their key municipalities. - The second key project is the KwaZulu-Natal, Free State and Gauteng through the improvement of rail-road networks as part of the Durban-Gauteng Corridor development initiative
- Upgrading of the N2 in the Eastern Cape that's set to improve mobility and access of all our coastal provinces to the Western Cape and
- The North West strategic infrastructure programme which has as its main focus the upgrading of their main road networks.
Challenges in provinces
Our provincial departments have been hard at work to ensure efficient delivery in our three important areas of service delivery roads, public transport and road safety. All provinces have made major advances in these areas over the past years. They continue to build and maintain road networks, improve our public transport systems and implement sustained and targeted road safety campaigns.
However all transport authorities at provincial and municipal levels continue to experience challenges with insufficient funding, capacity and compromised technical standards in road construction.
The challenge moving forward therefore is to continue focusing on mobilising the required resources for roads and public transport, strengthening technical capacity in all transport authorities and putting in place monitoring and evaluation systems to ensure that standards are adhered to without compromise.
Honorable chairperson, members, please allow me to briefly share with you some of the critical interventions we are making in ensuring that we have the best road infrastructure, efficient, reliable and safe public transport system and how we intend saving more lives on our roads.
On road infrastructure
Our roads programme must, as a matter of priority, address provincial economic development, urban mobility and rural access to achieve a balanced road network for our country. As we reported last year, we launched the new Road Maintenance programme called S’hamba-Sonke (Re Sepela Ka moka) and after a year of implementation, we are reporting successes in many provinces. There’s still a lot that needs to be done in other areas wherein provincial authorities continue to experience challenges.
Based on information received from provinces to date, I can report that the total collective expenditure by provinces through S'hamba-Sonke for 2011/2012 was 5.9 billion rand against a target of 6.4 billion rand, representing 92 percent expenditure. During the first year of this programme a total of 60 089 full time equivalent jobs were created against our original target of 70 000, representing 83 percent achievement against the target we had set ourselves.
We are currently in the process of finalising several interventions to address capacity and other related challenges experienced by provinces. To this effect we have finalized a project delivery support mechanism with the South African National Roads Agency, SANRAL for all provinces. We are establishing a Project Management Unit through SANRAL to provide support to affected provinces. At the same time, we are re-positioning SANRAL to provide greater strategic support throughout the country.
The aim is to bring back to service retired engineers who will work with new graduates to share expertise and ensure that we have the necessary capacity to roll-out the best road networks in our country. The S'hamba Sonke budget allocation for the next Medium Term Expenditure Framework (MTEF) is 25 billion rand and the allocation for 2012/2013 is 8 billion rand.
This budget for this programme is allocated to provinces in the following order:
- 1.3 billion rand for the Eastern Cape
- 1.5 billion rand for Kwa Zulu Natal
- 1.1 billion rand for Limpopo
- 1.2 billion rand for Mpumalanga
- 564 million rand for the Free State
- 579 million rand for Gauteng
- 594 million rand for the North West Province
- 478 million rand for the Western Cape and
- 483 million rand for the Northern Cape
In addition to the above allocation, SANRAL is currently undertaking the development of the Durban North Coast Interchange project worth64 million rand. Also is busy with the upgrade of the toll plaza in Mdloti and Tongaat worth 51 million rand.
We are also working on the Ventersburg to Kroonstad Road upgrade. 147 million rand has been allocated for this project. The Harrismith to Kestell Road is also being upgraded to the tune 42 million rand during this financial year. Another major road project we are currently undertaking with SANRAL is the 341 million rand Sitebe-Komkhulu to Viedgesville Road on the N2 in the Eastern Cape.
Honorable Chairperson and members:
We need to measure our performance on whether our communities have access to schools, clinics, economic opportunities and other social amenities. Part of this will be a re-commitment to a 100% target of rural access to schools, clinics and economic centers by 2014. In simple terms, this means that we will be running while everyone walks. In our main urban centers, our focus is on the challenge of congestion and the development of integrated municipal, provincial and national networks, supported by an affordable and seamless public transport system.
Please allow me to briefly deal with the big question confronting us as a country: How do we fund our road infrastructure projects? We have a backlog of 139 billion rand for roads and unless we find other alternative funding sources, we will not be able to reverse this backlog as the fiscus alone will not be able to fund these much-needed road networks.
It is important that we acknowledge the importance of alternative funding sources including the user-pay principle if we are to successfully address the historical backlog we face as a country. Building and maintaining infrastructure using future revenue streams is a funding tool used all over the world. At the moment provincial governments rely mainly on limited sources of funding for road infrastructure and these are: equitable share from the fiscus, the ring-fenced Provincial Road Maintenance Grant (S'hamba-Sonke) and license fees.
In municipalities as is the case in provinces, equitable share allocations and own revenues constitute a pool of funds from which municipalities are able to finance their road infrastructure needs and they also have a discretion in determining the amount of resources allocated for roads. It is also important that we establish a shared development principle. If we are to achieve balanced development in our country, it would be incorrect for us to over-invest in one province at the expense of the rest of the country.
The ANC policy discussion documents once again seek to address this question in the following manner, and I quote: "Our economic transformation programme seeks to promote a geographically inclusive economy. This will require that infrastructure development be rolled out in targeted areas in a phased manner, especially in former homelands. In this context, we must optimize the investments that we have already made in the establishment of Industrial Development Zones through special determinations relating to incentives, access to adequate and affordable basic inputs such as electricity and water," unquote.
Honourable members, we have over the past few years invested substantially in improving our public transport infrastructure and systems. We have made major progress in our main metropolitan areas. Additional investments are still required in Johannesburg, Durban, Cape Town, Tshwane etc. We will continue to make these interventions.
Our public transport sector requires a renewed focus to reverse the deterioration experienced over the years. Investments in public transport operations through the taxi recapitalisation programme, rapid bus transit systems and the subsidy systems have sustained appropriate levels of services up to now.
We have sustained our commuter rail services, through the refurbishment of commuter rail coaches and the introduction of GAUTRAIN. Through Passenger Rail Agency South Africa (PRASA) new rolling stock acquisition programme, we aim restore metrorail services to their best levels by ensuring that the infrastructure is of acceptable standards and therefore improve on the efficiency of the train services, including introducing new advanced technology that would result in shorter train intervals.
However there are still major public transport challenges in many small towns and rural areas. These endemic challenges that continue to undermine the efficient and effective performance of public transport, in particular subsidised bus services are as follows:
- Subsidised public transport contracts remain bus only contracts and almost the majority of them have been managed on a month-to-month basis for a long time
- As a result of the short term nature of these contracts, most operators have not been able to recapitalise their fleet for a long time
- Lack of transformation has perpetuated the dominance of a few players in the industry, among others.
Public transport subsidies
Honorable Chairperson and members:
There’s a general agreement within the Transport family that the current bus contracts should be renewed through a managed negotiated process. These negotiations will be with existing operators with provisions for taxi empowerment. This approach will allow for a progressive replacement of current bus contracts and the phased implementation of additional route networks based on new approved integrated municipal transport plans.
I am happy to announce that at the recent meeting between myself and all MECs of Transport, we reached an agreement on the need to enter into negotiations with bus operators regarding longer term contracts. The MinMec established a Committee that would provide oversight and monitor the negotiation processes. Provinces and affected municipalities will manage negotiation processes. We intend to finalise these processes by the end of this current financial year.
Given the urgency required to integrate different public transport modes as well as the associated increase in the cost of doing so, a substantial rethink of the method of implementing this process is required. A negotiated approach will provide a win-win solution to numerous challenges that are facing the current contracting system. Government would be able to influence and realise economic empowerment for the previously disempowered whereas current operators would be guaranteed stability through longer term contracts.
Scholar transport
Another critical area that has been receiving our attention is the finalisation of the Scholar Transport Policy. We have been in dicussions with the Department of Basic Education in a bid to find an amicable solution to this challenge. Currently there's a disjuncture in the location of this function in different provinces. In 5 provinces, the function lies with the Departments of Transport while in 4 other provinces it is the reponsibility of the Department of Basic Education.
The general understanding emerging form our discussions is that the Department of Transport should be the custodian of this policy and function. The proposed new policy approach on this matter will be brought before the Portfolio Committee on Transport soon.
Road safety
Let me start by acknowledging the South African drivers and road users for their positive contribution towards reducing road fatalities in our country. We are of the view that there's a culture of personal responsibility that’s beginning to define the character of the South African driver. A culture that says road safety begins with me. South Africa is a signatory to the United Nations Decade of Action for Road Safety 2011/2020 together with other UN member states.
Through this initiative, we have committed to halve road fatalities by 2020. I’m glad to say that in South Africa we are well on our way to achieving this target. I say this because we have been able to reduce the number of deaths on our roads during the 2010 FIFA World Cup, the 2011 December holidays and during the recent Easter long weekend break wherein the death toll came down remarkably from 297 to 181.
This is by no means a cause for celebration. But it says to us that this is possible and we should continue to work with government through the "Friends of the Decade" to do even better. We have introduced "The Friends of the Decade of Action" group as part of maintaining momentum towards the implementation of the United Nations Decade of Action for Road Safety. The purpose of the group is to roll-out the Decade of Action campaigns.
We have so far seen several campaigns implemented under this banner in partnership with the Department of Transport, including: The iPledge campaign with Imperial Holdings, a pedestrian safety campaign called Think Pedestrian in partnership with Equestria Fleet Management, the launch of the first aid training programme for taxi drivers with South African National Taxi Council (SANTACO) among others. We invite other private sector players to come on board and play their role in reducing road fatalities. Working together we can do more.
In conclusion, it is important that we work closely with all our provinces and municipalities to ensure that we achieve the targets we have set ourselves on road infrastructure development, public transport and road safety.
This coordination is very important because indeed the realisation of our plans for transport is dependent on the successful execution of these set targets. I therefore urge all parties concerned to join hands with us and ensure that we work together for the betterment of the living conditions of our people.
Chairperson and members, I now request this house to support this budget of the department of transport for the year 2012/13.
I thank you.
