Minister of Transport Budget Speech, responses by ACDP, FF+, DA & IFP

Watch: Mini-Plenary (Debate on Vote 40)

 

SPEECH DELIVERED BY THE MINISTER OF TRANSPORT, MS SINDISIWE CHIKUNGA, ON THE OCCASION OF THE TRANSPORT BUDGET VOTE IN THE NATIONAL ASSEMBLY ON 17 MAY 2023 AT 15H00

Honourable House Chairperson
Deputy Minister, Mr Lisa Mangcu
Acting Chairperson of the Portfolio Committee on Transport
Honourable Members
Fellow South Africans House Chairperson,
As I deliver my maiden Budget Vote speech as the Minister of Transport I am guided, by the wise words of the founding father of our democracy, Tata Nelson Mandela, when he said, “After climbing a great hill one only finds that there are many more hills to climb.” But regardless of the hills before us the time is always right to do what is right, that is, making the lives of our people and communities better, a kilometre at a time.

These words resonate with the acknowledgement that economic growth and social development of any nation is a continuous feat which we must always be committed too at all material times.

Our singular focus remains in ensuring that we deliver tangible outcomes our people can see and experience.

House Chairperson;

Our 2023/24 budget allocation of R79,565 billion will be channelled towards delivering on these tangible outcomes.
Of the R79, 565 billion, total transfers and subsidies account for approximately 98% of the department’s expenditure to the tune of R77.9 billion, in the 2023/24 financial year. Of this, R47.2 billion are transfers to our public entities and agencies, and R30.2 billion is transfers to other spheres of government.

ROADS PROGRAMME

House Chairperson;
Our roads programme plays a pivotal role in facilitating activities related to maintaining the country’s road networks. Investments in road networks are targeted at ensuring that passengers and freight carriers, which haul almost 80% of South Africa’s freight load, have adequate access to safe roads. In this regard, we are working towards finalising South Africa’s Roads Funding Policy by the end of this financial year.

For this financial year we have budgeted R42.6 billion to fund efforts to construct, upgrade and maintain the national and provincial road networks. Allocation to SANRAL is R25.4 billion. Of this budget R15.8 billion is to strengthen and upgrade the national non-toll network. Amongst the SANRAL Mega projects we are continuing with construction of the Moloto Road Corridor, the N2/N3/N7 road-network expansion and N2 Wild Coast projects which include the construction of the two iconic bridges, Msikaba being the highest and Mtentu being the longest bridges in the continent of Africa. We are also in the process to commence with construction work in the North Bound section of the 3.9km long Hugeunot Tunnel, making it the longest road-based tunnel in Africa. These SANRAL Mega Projects confirm the diverse engineering excellence and profound expertise found right here in South Africa.

REFURBISHMENT, REHABILITATION  AND ERADICATION OF POTHOLES PARTICULARLY IN PROVINCIAL AND MUNICIPAL ROADS

Honourable Members;

Our work to improve the condition of our road network, which includes refurbishment, rehabilitation and eradication of potholes particularly in Provincial and Municipal roads continues to gain momentum. In the process of undertaking this work, job creation through labour intensive methods remains our priority. We are also working closely with TETA to develop requisite skills

For the Provincial Roads’ Maintenance grant, we have allocated R15.9 billion, of which R4.6 billion is specifically earmarked for road refurbishment, disaster relief and the construction of 96 Welisizwe bridges in rural areas.

We also recognise the value of working with research institutions like the Centre for Scientific and Industrial Research for innovative solutions, like the nano technology solutions which we will be piloting this year in the gravel road upgrade program. It is our intent to employ the nano technology solutions to upgrade our gravel roads to well- engineered, and all-weather condition network. We are also committed to working with the private sector in a structured manner to address this challenge and create a multiplier effect, in the rehabilitation and maintenance of our provincial and municipal road network.

REBUILDING INFRASTRUCTURE DAMAGED BY FLOODS
Honourable Members;

The work continues to restore and rebuild infrastructure that was damaged by floods during April 2022 that affected the Provinces of KwaZulu-Natal, Eastern Cape and North-West.

We are committed to ensuring that we build the capacity of our municipalities through support interventions to achieve efficiencies in road maintenance. In this regard we are also going to establish a Roads War Room to address all road- based challenges.

ROAD SAFETY
Honourable Members;

We are purposeful in our efforts to arrest the carnage on our roads. In this regard, the Road Traffic Management Corporation, has introduced a new era in traffic policing Training Curriculum. We now have the first cohort of graduates, qualified with a NQF Level 6 qualification and have joined the ranks of our traffic law enforcement officers.

This new generation brings to the table, fresh and innovative solutions to the intractable challenge of the carnage on our road. They are reinforced by technological innovations to reign-in the lawlessness on our roads and provide visibility 24/7 and 365 days.

We have previously committed to maximising visibility of our traffic law enforcement officers by declaring traffic policing a 24-hour, 7-day job. The number of Provinces that have completed the necessary processes has increased and our intention is to ensure that the remaining Provinces finalise outstanding work in this regard by the end of this financial year. For this task, we have allocated a budget of R220 million this financial year to the Road Traffic Management Corporation (RTMC).

THE CBRTA AND ROAD FREIGHT INDUSTRY

Honourable Members;
We remain resolute as government to deal with challenges confronting the freight industry. In June, last year, the Minister of Transport together with the Ministers of Labour, Police and Home Affairs, signed an 11 – Point Plan with the entire Freight Industry to find common ground, and thus find each other in stabilising the industry.

Ours is to continue to build the sector to grow a transformed and inclusive economy served by a modern and resilient transport system.

The Cross-Border Road Transport Agency is central in regulating the road freight industry and ensuring its ability to meaningfully contribute to the economy through the implementation of Linking Africa Plan and through the Africa’s Continental Free Trade Agreement. The C-BRTA is a self-funding entity, its expenditure is expected to increase from R274 million to R286 million in 2023/24.

PUBLIC TRANSPORT
House Chairperson,

Our work towards delivering a public transport system that meets the needs of our people continues to gain traction. The department plans to achieve seamless integration of all modal public transport operations that provide a public transport system for the delivery of efficient, affordable, safe and reliable transport.

In this regard, we will achieve this through the Public Transports Network Grant and the IPTNs, the details of which will be covered by the Deputy Minister.
We are processing the Public Transport Subsidy Policy, which will be published for comments soon after approval by Cabinet. The Public Transport Funding Model will also be approved this financial year.

The Taxi Recapitalisation Programme (TRP) remains an important intervention in the transformation of the industry, underpinned by improvement of passenger safety.

The budget for the Taxi Recapitalisation Programme increases from R477 million to R479 million in 2023/24.

In this financial year we will implement the recommendations of the reviewed of the Taxi Recapitalisation Programme by implementing projects which amongst others include:

The Finalisation of the approved 60% ownership of the Taxi Scrapping Agency by the taxi industry.
Implementation of Taxi Broad-based Ownership Structures or Cooperatives across the fifty-seven (57) regions, nine (9) provinces and a single national structure.
We will Pilot and monitor the single ticketing system for all government‐ subsidised public transport operators.

The Taxi Relief Fund

The Taxi Relief Fund (TRF) secured by the Department to mitigate the negative financial impact of Covid19 on the mini bus taxi industry came to an end on the 31 March 2023. Approximately R440 million has been disbursed accounting for over 80 000 operating licenses. Discussions are taking place with the National Treasury to ensure that the unspent funds if possible do l reach the intended beneficiaries.
We are supporting the parliamentary process of the Transport Appeal Tribunal Amendment Bill as well as the National Land Transport Amendment Bill, for approval by March 2024, which be ready by March 2024

RAIL PROGRAMME
Honourable Members;


In the 6th Administration, we have made significant milestones which include the historic White Paper on National Rail Policy, manufacturing of modern trains at the Gibela factory in Ekurhuleni, recovery of critical commuter rail corridors following devastating theft and vandalism of our rail infrastructure.

ON PRASA
Our work to rebuild commuter rail continues in earnest. In the last financial year, we committed to recover 10 priority corridors. I am pleased that we not only achieved the target, but we exceeded it by recovering 13 corridors. This financial year we plan to recover 16 priority corridors total, eight (8) in Gauteng, four (4) in KwaZulu-Natal and four (4) in the Western Cape and these priority corridors are:

The full recovery of the Central line in Cape Town remains our top-most priority. The cooperation between the National and the Western Cape Provincial Departments of Human Settlement, the HDA and the City of Cape Town to relocate the illegal settlements on the rail reserve, will enable us to achieve full recovery of the line.

For the 2023/24 financial year, we will transfer R20.5 billion to the Passenger Rail Agency of South Africa. These funds will mainly focus towards implementing PRASA’s strategic corridor recovery programme, signalling and continuing with its rolling stock renewal drive. Capital expenditure is expected to increase from R12.5 billion to R12.9. The portion of the transfers to the agency for operational expenditure increases from R7.2 billion R7.5 billion in 2023/24

NATIONAL RAIL POLICY
In his State of the Nation Address, President Cyril Ramaphosa indicated that the National Rail Policy will guide the modernisation and reform of the rail sector, providing, among other things, for third-party access to our rail network.

The National Rail Policy pronounced that the Interim Rail Economic Regulatory Capacity (IRERC) will guide the strategic direction for implementing economic regulation in the rail sector.

In addition, the National Rail Policy mentions IRERC as a model that will be utilized as an interim arrangement for rail economic regulation within its mandate until the Transport Economic Regulator is established.

I must announce that the Department has commenced the process to develop the urgently required National Rail Master Plan; which will further assist in the identification of network constraints, opportunities, including infrastructure improvements and rail network expansions required to assist in creating a conducive environment for private and public sector participation.

TRANSPORT ECONOMIC REGULATION BILL
Chairperson,
As we continue to transform the face of our economy, the transport sector cannot be left behind as we remain focused on transformation and greater participation to enable the development and growth of a truly inclusive transport sector.

It is for purposes of effective transformation of the sector that we have formulated the Transport Economic Regulation Bill. This Bill when passed will ensure a level playing field in the sector and ensure regulation of monopolies towards fair pricing and easier access to new entrants among other aims.

THE TRANSPORT SECTOR INTEGRATED B-BBEE COUNCIL
House Chairperson;

It gives me pleasure to announce that just last week we appointed and introduced the Integrated Transport Sector B-BBEE Council. The urgent task of the Council includes ensuring that as a sector we have Integrated Transport Sector B-BBEE Codes to address acute transformation challenges experienced in the main within the aviation, road freight and maritime sectors as well as to create a tool to bring awareness and address the skills shortage in ensuring development of Black professionals.

MARITIME PROGRAMME
Honourable Chairperson;
the maritime sector remains strategic in enabling economic growth and increased trade. Our efforts to support the maritime manufacturing capabilities, boat building, skills development and training will be strengthened and will be led by SAMSA. We are testing out different solutions to address the Tax Regime as an instrument to attract shipping companies to register their vessels in South Africa leading to the growth of our register.

AVIATION PROGRAMME
AIRPORTS COMPANY SOUTH AFRICA,

Honourable members
Our aviation infrastructure programme will provide support to the Airports Company South Africa’s Recover and Sustain Strategy that includes playing an active role to support provincial airports and invest in specialised airports such as drone airports, taking advantage of emerging opportunities brought about by technology in moving freight.

At its airports, the company forecasts a passenger growth of 25.2% in 2023/24 and an increase in air transport movements of 17.3%, growing from 11.7% year-on-year.

Revenue is expected to increase to R5.7 billion in 2023/24, driven by the expected increase in passenger numbers as the air travel industry continues to recover from the COVID-19 pandemic.
We will support ACSA to grow its footprint and play a bigger role in building and managing airports in the country and elsewhere in the continent. We equally intend supporting the growth of the domestic aviation industry.

For the year 2022/2023, OR Tambo International won Best Cargo Airport in Africa. Cape Town International Airport won the Best Airport, and the Best Airport Staff in Africa award, while King Shaka International Airport won the Best Regional Airport in Africa award.

THE AIR TRAFFIC AND NAVIGATION SERVICES COMPANY

The Air Traffic and Navigation Services Company maintains its focus on providing safe, efficient and cost-effect air traffic management solutions and related service, with the bulk of its budget expected to be used on communication, surveillance and simulator systems. Its total revenue is expected to increase from R1.3 billion in 2022/23 to R1.9 billion in 2023/24.

The non-regulated business has become increasingly critical for ATNS's growth and long-term positioning on the African continent. Through its commercial services division, and as part of its service excellence and innovation strategic pillars, ATNS is seeking to further leverage strategic joint venture opportunities on the African continent, thereby extending its services, product offering and geographic reach.

SOUTH AFRICAN CIVIL AVIATION AUTHORIRTY

Expenditure for the South African Civil Aviation Authority (SACAA) is expected to increase to R894 million in 2023/24.

SACAA will focus on strengthening their effort in the implementation of General Aviation Safety Strategy through the use of innovation and technological solutions.

I am pleased to announce that the SACAA led a coordinated process of audits conducted by the following international bodies.

The United States Federal Aviation Administration (FAA) following an audit conducted in November 2021. The final outcome audit assessment confirmed that South Africa has retained its category 1 status with the United States. The benefit of this outcome is that South African airlines, can operate directly into the United States with no hindrance.

August 2022, South Africa was also subjected to a Universal Security Audit Programme by ICAO. I am pleased to confirm that South Africa has now received the final report from ICAO and the State received an unqualified audit opinion with no significant security concerns raised by ICAO.

In November 2022, South Africa’s aviation security cargo system was assessed by the United States Transport Security Administration. The outcome of this assessment confirmed yet again that the cargo security system of South Africa is on par with that of the US. As a result, the TSA granted South Africa permanent recognition. This means that South African cargo operators wishing to operate in the USA can do so unhindered, without a need to undergo individuals’ assessment by the USA.

In November 2022, South Africa also received the final report from the United States Federal Aviation Administration (FAA) following an audit conducted in November 2021. The final outcome of this assessment confirmed that South Africa has retained its category 1 status with the United States. The benefit of this outcome is that South African airlines, can operate directly into the United States with no hindrance.

In March 2023 we were again audited by ICAO under its Universal Safety Oversight Audit Programme. From this audit, South Africa did not attract any significant safety concern and received an overwhelming Effective Implementation (EI) score of around 92%. This is a significant improvement from the 87.39% that ICAO gave the country in the 2017 audit. The recognition of South Africa’s aviation systems by leading aviation States and Bodies has huge economic benefits for the State and the operators in our country.

IN CONCLUSION,
We pride ourselves as Team Transport for the progress and achievements recorded, which sometimes seemed as insurmountable hills to climb. But with the support of the Deputy Minister, the Director-General, the Boards, the CEOs,The Executive Management of both DOT and our SOEs and Public Entities, as well as the Ministry led by the Chief of Staff and the Departmental Staff and the entire sector industry stakeholders, the diligent team work, commitment have made the Hills to become enablers to economic growth and development opportunities.

As I conclude, regardless of the Hills, the Time is Always Right to do what is Right.

House Chairperson; I present the budget allocation for the Department of Transport, Vote number 40 for the Financial Year 2023.

I thank you.

 

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SPEECH DELIVERED BY THE DEPUTY MINISTER OF TRANSPORT, Mr. LISA MANGCU (MP) ON THE OCCASION OF THE TABLING OF BUDGET VOTE 40 OF THE DEPARTMENT OF TRANSPORT IN THE NATIONAL
ASSEMBLY ON 17 MAY 2023

Honourable House Chairperson
Chairperson of the Portfolio Committee on Transport Minister of Transport, Ms Sindisiwe Chikunga (MP) Ministers and Deputy Ministers
Director General of the Department of Transport Honourable Members
Fellow South Africans

I am honoured to be given this opportunity to debate in this budget vote before this house,
Last month marked 30 years since the brutal killing of Comrade Chris Hamilton Hani by the enemies of democracy.This heartless killing robbed us of a leader,a father and a visionary. We have not forgotten !!
We also learnt with shock and horror of the passing of 14 peole in the last few days, 6 of these were killed on the N2 between Mosselbay and Voorbaai in the Western cape on the 13 th of this month and 32 people were seriously injured
8 people were killed on the 14th near Sibangweni outside Umtata on the direction of Tsolo and Qumbu. We extend of heartfelt condolences to those families and wish those injured a speedy recovery.

Road traffic crashes, injuries and deaths not only have a terrible impact on individuals but also have an impact on communities and the countrys financial and health resources. Road crashes have the effect of not only causing grief and suffering but has a potential to ruin our countrys wealth due to the high costs associated with health care systems and loss of productivity and prosperity with economic repercussions.
Road Safety

House Chair and hourable Members,

(In the words of President Obama, “ The cynics may be the loudest voices – but I promise you, they will accomplish the least” )
The task of achieving a reduction of 25% of road fatalities looms large and requires of us collectively to employ a different approach to dent this stubborn phenomenon on our roads.
Road traffic Infringement Agency

After successful piloting of the AARTO we were set back by the Gauteng north high court from the National roll out, we however remain optimistic that the constitutional court will rule in our favour as to the constitutionality of the AARTO Act.
Accordingly, Expenditure for the RTIA is expected to increase at an average annual rate of 4.5 per cent from R487 million in 2023/24 to R555.6 million in 2025/26 with goods and services accounting for an estimated 60.8 per cent of the total spending.
The agency derives its revenue mainly through administrative fees and transfers from the Department.
Road Accident Fund

The RAF has been in the news recently for all the wrong reasons albeit having done exceptional work in compensation road crash victims. We are making good progress in resolving all the issues in this year.
The Road Accident Fund has a legislative mandate to compensate road users for losses or damages caused by motor vehicle crashes within the Republic.
The total value of claims paid out over the MTEF period is expected to decrease from R 43.3 billion 2023/24 to R 35.9 billion in 2025/26.

The levies through which the RAF derives some of its income are expected to increase at an average annual rate of 0.5 per cent in line with projected increase in fuel sales.
Railway Safety

Honourable Members

Railways provide a safe and sustainable form of transport worldwide.

Whilst the actual level of safety achieved can vary widely even within economically developed areas such as the European Union, railways are typically amongst the safest modes of transport.
Inevitably this level of safety comes with an associated cost and balancing safety performance and cost is one of the key global challenges for the rail industry.
Rail Safety Bill

The Rail Safety Bill seeks to improve the regulatory framework regulating railway safety to improve the safety of passengers and freight. It seeks to repeal the National Railway Safety Act, 2002 (NRSR).
In addition, the Department seeks to improve competition in the rail sector by finalising the private sector participation framework by March 2024 for implementation by March 2025.
Railway Safety Regulator

The Railway Safety Regulator (RSR) continues to elevate the safety of our railways to global standards. To this end, the RSR will be hosting international rail experts from at the International Rail Safety Council here on South African soil from 01- 06 October 2023 in Cape Town.
The Railway Safety Regulator’s primary aim for hosting the Council is to sensitise international delegates about the opportunities, challenges and needs concerning investments in rail infrastructure, rolling stock, technologies, and research.
In this year the RSR focuses on its primary business of issuing safety permits to railway operators. We will conduct 48 safety initiatives in 2023/24. These include education and awareness campaigns, community involvement programmes and training for safety ambassadors and we are going to “Dzingidzingi and pofadder”.

Expenditure is expected to increase at an average annual rate of 3.6 per cent, from R263.2 million in 2022/23 to R292.5 million in 2025/26.
The regulator expects to generate 70 per cent (R591.1 million) of its revenue over the period ahead from administrative fees and the remainder through transfers from the department.
Climate Change Mitigation

The development of transport systems is however not exclusive of the protection of the environment and has thus required effective steps towards climate change mitigation, pollution control, and building climate change resilient infrastructure.
The development of the transport sector must happen in tandem with a implementation of a clear strategy to mitigate climate change impacts, and in our case to reduce emissions deriving from transport activities.
We must continue to contribute to global attempts to mitigate adverse climate conditions globally. This has required that we ratify conventions to that effect. We will continue to monitor what progress is being made across modal areas to reduce emissions and pollution.
PORTS REGULATOR AND STER Bill

The passage of the Economic Regulation of Transport Bill requires of us to play catch up in the implementation plan as we are 2 years behind schedule in implementation of this policy intervention. We will therefore commence with the work that will enable quick turnaround times in the implementation of the Act, once signed into law.
The Ports Regulator will morph into the Transport Economic Regulator, we will therefore attend to the administrative issues that will ensure our readiness to hit the ground running upon the promulgation of the law.
We will immediately get down to work to ensure that once the bill is signed into law, the Economic Regulator is fully operational within reasonable time.
One of the Departments priorities in this Financial year is the development of effective economic regulation mechanisms for the transport sector to increase competitiveness and access to transport modal networks.

We acknowledge the potential of the maritime transport sector to create jobs and transorm the sector by among others bringing in new entrants and exploiting the whole value chain for the achievent of economic transformation.
To this end the Ports regulator of South Africa will prioritise the reduction of costs for maritime as a priority sector by increasing efficiency and effectiveness of our ports.
Expenditure is expected to increase at an average annual rate of 2.9 per cent, from R44.5 million to R48.5 million in 2025/26.
Integrated Transport Planning

Government continues to improve the lives of South Africans and our contribution has been and will continue to be in the area of mobility of the citezens. In the outgone financial year we continued to monitor the performance and roll out of BRT system which is but a part of the IPTN and not the IPTN as a whole.
In this year we are working on assisting the three metros who have been suspended to get back to the system for the betterment of the lives of the people in those cities ( Msunduzi, Buffalo City & Mbombela ).
Furthermore the Department is focussing on the following key interventions but not limited to;
Finalising the National Public Transport Funding model the key thereof is is to subsidies the user irrespective of the mode they use
We will develop and operationalise a National Public Transport Regulator (NPTR) which will be fully responsible for all functions envisaged in the NLTA amongst which is issuance of tourism operating licences and oversee Provincial regulating Entities
Full implementation of the recommendations of the review of the Taxi Recapitalisation Programme
I am pleased to announce to the citezens of Mbombela, Buffalo City and Msunduzi that we have resolved to work with these cities to ensure they are readmitted and benefit in the PTNG ( BRT ) in this year.

We commit to a more interventionist approach in our monitoring and evaluation function.
Conclusion

In conclusion Chairperson, as we wrap up this debate today I wish to quote the words of President Obama at the occasion of his address to UN general Assembly in 2014;
“ We choose hope over fear. We see the future not as something out of control, but as something we can shape for the better through concerted and collective effort”
In the words of President Obama “ We did not come to fear the future. We came here to shape it “
God Bless South Africa and its People

Thank you