MEC Ismail Vadi: Gauteng Roads and Transport Budget Vote 2016/17

SPEECH
VOTE 9 - ROADS AND TRANSPORT BUDGET SPEECH
GAUTENG PROVINCIAL LEGISLATURE
27 May 2016
Madam Speaker
I am pleased to table the 2016/17 Budget for the Department of Roads and Transport.

The Department has been allocated R7.3 billion for its capital projects and operational expenses. Broadly speaking, this has been earmarked for five key programmes, namely, Administration (R317 million); Transport Infrastructure (R2.5 billion); Transport Operations (R2.3 billion); Transport Regulation (R299 million) and Gautrain (R1.8 billion).

The Department is the principal contributor to the Provincial Revenue Fund. It accounts for over half of the provincial government’s “own revenue”. The bulk of the R3 billion collected is derived from motor vehicle registration and licensing fees. In this regard, I sincerely wish to thank all vehicle owners for diligently registering and renewing their licenses and contributing positively to the provincial fiscus.

In terms of the payment of suppliers for work done I can report that the Department is able to pay 98 percent of all properly processed invoices within 30 days. Also, all tender awards over R50 million that the Department approves are now subject to the Open Tender procedures stipulated by Provincial Treasury.

Madam Speaker

This Budget continues to promote an infrastructure-led growth path. As an important component of the economic cluster, the Department is at the frontline of rolling out road and transport infrastructure to stimulate economic growth and create jobs. This is absolutely necessary at a time when the national and provincial economy is lethargic in its performance. As the Premier indicated in his budget speech on Tuesday, it is imperative that we place Gauteng back onto a growth trajectory. In her book, The Entrepreneurial State, Mariana Mazzucato maintains that the State has to lead to create an “entrepreneurial economy” by making investments to transform, modernise, innovate and reindustrialise an economy. She states that public investments should aim not only to kick-start the economy, but also, and possibly more importantly, to do things that are not even envisioned, and therefore,
not done at all. This is the essence of the Gauteng Provincial Government’s socioeconomic and political agenda. The Transformation, Modernisation and Reindustrialisation goals and the Ten Pillar programme of the ANC-led administration are designed to stimulate real economic growth, create employment, reduce inequality and set Gauteng on a developmental path over the next 15 years.

There are many good stories to tell about the Department’s infrastructure projects. I believe that we have delivered on our mandate within the available resources allotted to us. We prioritise the maintenance and expansion of our road network precisely because it is an enabler of broader economic growth, job creation and the empowerment of small and medium enterprises. We invest in public transport infrastructure as we believe that we need to promote a shift from private to public transport. We see rail as the backbone of our public transport system supported by the bus rapid transit networks in metropolitan municipalities. And we are of the view that the taxi industry should be corporatized, professionalised and integrated into the broader public transport system in our province.

Road Infrastructure

In the past year we have successfully completed a number of major road rehabilitation projects. The N12 freeway project from the south of Johannesburg to the North West boundary valued at over R500 million has been completed. Phase 2 of the R82 valued at R259 million was officially opened on Wednesday this week. The R511 from Erasmia to Diepsloot was officially opened last month. Work on the major rehabilitation of the N14 freeway is progressing very well. The triple carriageway along William Nicol Drive was completed and the next phase has been launched.

Later this year we will put out an open tender for Phase 3 of the R82/Old Vereeniging Road. We will also implement road expansion projects to support the Pick and Pay Freight and Logistics Park near Zandspruit; the expansion of the road networks to support the Waterfall City and the River City Developments in Johannesburg and Emfuleni respectively. For further details of the roads programme Members can access Vote 9 in the Estimates of Provincial Revenue and Expenditure.

Building a new highway

There is a growing need to build new freeways in Gauteng. The last time a highway was built in our province was in 1982. In spite of the Gauteng Freeway Improvement Project led by SANRAL, our freeways - particularly during peak hours - are congested and at times gridlocked. The 25-Year Integrated Transport Master Plan (ITMP25) projected that our car population will increase from 3.5 million in 2011 to 6.5 million by 2037. To date we have a car population in Gauteng of 4.5 million vehicles. The increasing number of cars in our province, and the consequent traffic congestion, comes at huge social and economic costs to our people as we spend many unproductive hours trapped in traffic congestion. It contributes to the high cost of doing business in Gauteng. It is this costly reality that we must address more urgently.

I would like to announce that the Department is busy with the initial planning to build the 35km long PWV15 to support the development of an Aerotropolis at the OR Tambo International Airport. The construction of the PWV15 must be seen as a strategic project. It will have a multiplier effect on the Eastern Corridor. Apart from alleviating traffic congestion on the existing road network, it will accelerate the development of the Aerotropolis and enhance the adjacent land value along the route for housing, industrial and commercial development. It would serve as a catalyst to modernise the road network in the Eastern corridor; unlock economic opportunities through the revitalisation of the manufacturing sector in Ekurhuleni; allow for the free flow of freight traffic from the N3 to the N1 freeways, and greatly relieve traffic pressure at the Gillooly’s Interchange, which has been superbly upgraded by SANRAL through the Gauteng Freeway Improvement Project. What is needed now is for all of us to have a sensible, rational and pragmatic conversation about how this new, mega road project is to be funded.

Speaking about the Eastern Corridor, let me emphasise that Gibela’s R1 billion train manufacturing plant at Dunnotar, near Nigel, will give further impetus to the reindustrialisation of the manufacturing and rail sectors. It is part of the localisation, development and transformation of our rail manufacturing, engineering and entrepreneurial capabilities. This must be seen as part and parcel of PRASA’s rail modernisation programme to replace its 40 year old rolling stock. It is a pity that I could not join the Minister of Transport on the test ride of the new and modern Metrorail train on Tuesday this week. The government’s multi-billion investment programme to modernise the Metrorail rolling stock will bring much needed relief to one million rail commuters in our province.

Gautrain

Early this year, Gautrain had put out what commonly can be described as expressions of interest from rail manufacturers to procure 48 new train coaches. The formal call for bids will be announced shortly and we anticipate that the preferred bidder will be announced by November this year. The acquisition of new rolling stock is aimed at increasing Gautrain’s capacity to meet rising ridership demand over the next 10 years. In addition to the rail cars, the project involves the expansion of the existing depot to maintain additional trains; signalling improvements; additional traction power, and new maintenance equipment. The planned expansion of its rail capacity shows that Gautrain enjoys high levels of confidence by rail commuters and that the passenger demand is growing steadily since its inception in June 2010. I would like to take this opportunity also to announce that within the next few weeks we will release the feasibility study for the further expansion of the Gautrain rapid rail system.

Transport Authority

In March this year, the Department hosted an informative International Conference on Transport Authorities. Based on 15 international case studies the Conference recommended the establishment of a Transport Authority for the Gauteng City Region. The Department has initiated a process to formally establish the Transport Authority. In collaboration with the Department of Transport and municipalities we have formulated legislative proposals to be considered by the Portfolio Committee on Transport during the public hearings for inclusion in the National Land Transport Act Amendment Bill, which has been tabled in parliament. Together with the Office of the Premier, we are planning to conclude with municipalities a Founding Agreement on the establishment of the Gauteng Transport Authority. This will be a landmark institutional development for the Gauteng City Region as it will allow for integrated transport planning and improved co-ordination in the provision of public transport in our province.

Gauteng Travel Household Survey

With regard to future transport planning, the Department recently released the results of the 2014 Gauteng Travel Household Survey, which was conducted by the Council for Scientific and Industrial Research. Gauteng is the only province carrying out dedicated household travel surveys. This survey interviewed all occupants in 29 779 households across municipalities in the province and provides a good comparative picture of people’s travel patterns, attitudes and perceptions on public transport since 2000, which can be used profitably for transport planning. The following notable information emerged from the survey:

  • Two thirds of households do not own or have access to a car and these households are on the increase.
  • More than 50 percent of households have no member with a driver’s license and these households are also on the increase.

This implies that public transport in the province is a basic necessity for the majority of households.

  • The proportion of household income spent on public transport increased significantly, which is closer to 20 percent for lower income groups.
  • Passenger travel demand is increasingly being absorbed by low capacity transport modes demonstrated by the increased proportion of private car and minibus taxis that serve travel demand. The use of private cars in particular increased markedly in spite of the massive investments in public transport infrastructure.
  • Walking is still the predominant mode of transport in the province; 11 percent of people walk all the way to work or to institutions of learning as compared to 3 percent in 2000. This signals that facilities for non-motorised transport should receive priority.
  • The average travel time to work and back home has increased markedly from 32 minutes in 2000 to 46 minutes in 2014.
  • 39 percent of minibus taxi users were dissatisfied with the behaviour of drivers; the roadworthiness of taxis and felt unsafe in transit. Commuter satisfaction levels with train services were lower with travellers complaining about overcrowding, frequency and punctuality of train services and the distance of stations from their homes.
  • One third of workers in our province do not work the usual 5-days a week and this has implications on how public transport services are designed, including ticketing.
  • And lastly, the corridor between Ekurhuleni and Johannesburg has the largest inter-municipal travel demand, which have implications on the prioritisation of inter-municipal public transport services.

SUBSIDISED BUS CONTRACTS AND TAXI INDUSTRY

The Department manages the Public Transport Operating Grant, which funds 34 bus subsidised contracts. The bus services are operated by 12 private companies on behalf of government through interim or tendered contracts. Presently, many commuters are rightly complaining about the poor quality of some services and that in certain areas the services are not meeting their time schedules. This in itself shows the need to hasten the review of these bus contracts. The Department will invite tenders for the provision of subsidised bus services in terms of the applicable legislation and is keen on promoting the inclusion of historically disadvantaged groups and the taxi industry in this transport sub-sector. At the same time the new contracts must lead to an improvement in the overall quality of services being rendered to passengers.

The provincial government is extremely concerned about the growing rate of fatalities related to taxi violence and road crashes. It unconditionally condemns any act of violence and intimidation emanating from the minibus and metered taxi operators and drivers. As has been indicated by the MEC for Community Safety, the government will host a taxi summit next month to squarely address these issues. eg-FleeT

Finally, the Department believes that g-FleeT has a critical role to provide state departments and entities with vehicle fleet services. I wish to report to the House that the entity is addressing the root causes of the negative audit opinion it had received in the previous financial year. It also is committed to strengthening the managerial team of the entity. We will report on this matter on an on-going basis to the House and its relevant Committees.

I conclude by thanking our senior management and entire staff complement headed by the HoD, Mr Ronald Swartz, the CEO of Gautrain, Mr Jack van der Merwe, and the acting CEO of gFleeT, Ms Noxolo Maninjwa. I also want to thank the Chairperson and Members of the Portfolio Committee on Transport for their spirited oversight over the Department and for their valuable recommendations to improve transport services to our people.

Lastly, I want to thank all the transport stakeholders whose contributions assist us to up our level of performance and service delivery.

Province

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