Departments of Human Settlements and of Transport: Strategic Plan & Budget 2009/10

Meeting report

Department of Human Settlements (DHS or the Department): Strategic Plan and Budget 2009-10
Mr Joseph Leshabane, Chief Operations Officer, Department of Human Settlements (DHS), noted that the new focus of the Department had moved beyond merely housing, to encompass also the need to find a delivery process for basic services and infrastructure, so that an enabling framework for the delivery of complete settlements could be concluded. Through this DHS could respond to climate change questions confronting South Africa (SA). There was also a need to enhance and streamline planning processes across Government and progressive upgrading of informal settlements to achieving the Millennium Development Goals.

Mr Leshabane said that there were standing priorities within the housing sector. These included the need to provide housing for Military Veterans, the need to make interventions in the industry to curb price escalations, creation of legislation to prevent the mushrooming of informal settlements, the need to diversify products, especially rental stock, the necessity for central planning to better direct resources in a co-ordinated response to human settlements, and the restructuring of funding mechanisms so that all would be consolidated to respond to human settlements and improve sustainability. He also said that the Housing Development Agency (HDA) must be created. There should be a once-off injection of resources to attack the housing backlog and ensuing poverty, and there should also be introduction of measures to assist people with building materials to encourage involvement. In this regard, DHS would be introducing a subsidy scheme to assist individuals to obtain materials.

DHS Strategic Objectives drove the departmental programmes. The objectives were included accelerating housing delivery and integrated sustainable human settlements, using housing as a catalyst for job creation, ensuring that residential property was accessible to all to alleviate asset-poverty and create wealth, promoting social cohesion, and mainstreaming alternative technologies and innovative planning for human settlements.

Mr Leshabane outlined the DHS structure, and said alignment had been achieved between branch and programme structure. The five-year Strategic Plan, to coincide with this term of Government, would be finalised by September 2009. The five programmes of DHS were presented.

Programme 1 related to administration in DHS. The relating sub-programmes included Executive Support Services, Internal Audit and related matters, Human Resources, Corporate Support, Legal Services, and Information Technology. Special Investigations was highlighted, pertaining to anti-corruption measures. He noted the handling of many cases under investigation and implementation of the requirements to give effect to those investigations. DHS would continue to work with the Special Investigations Unit (SIU) in all housing cases across provinces.

Programme 2 focused on Policy and Research. It existed to develop and promote sustainable human settlements and housing policies supported by responsive research, and to monitor and assess implementation performance of the sector. This up-scaled monitoring capability, insisted upon by this House, was new. Planned policy activities for the year included distributing the new National Housing Code, refining the farm-worker housing policy, finalising the Inclusionary Housing Programme, providing a supportive policy formulation model for provinces and municipalities, and giving them advice to help expedite delivery. Activities in relation to monitoring and evaluation included a drive to harness quality management monitoring, an on-going evaluation on the planning, implementing and performance of national housing policies and its impact on programmes, and undertaking occupancy audits on the alleged relinquishing of houses by beneficiaries. Research activities sustainable human settlement priority areas, providing research support across the sector, disseminating and applying research, and, importantly, determining trends in the micro and macro environment, as the impact on the programmes could be complex.

The focus of Programme 3 lay in implementation and delivery support, building capacity and liaison with stakeholders in the sector. The branch comprised six sub-programmes, including the Rental Housing Programme (RHP) and Public Housing Programme (PHP), to facilitate the development of a pipeline of projects for delivery of appropriate stock. Unless there was a healthy pipeline, the targets of the planned implementation projects would not be achieved. Thus much emphasis was placed on the planning. DHS would support the RHP and the PHP sectors through the Rental Housing Amendment Act and the Social Housing Act, and would also support the Rental Housing Tribunals in provinces. Capacity development would focus on managing training and skills development, and supporting professional development of the sector. The Capacity Development Programme would be treated carefully, as the fluctuation of skills availability was of concern. Programme Implementation support focused on supporting provinces and municipalities to unblock stalled projects, implement housing programmes and upgrade informal settlements. Human Settlements Planning dealt with planning requirements of local and national government, and this was where re-alignment would be undertaken, given the DHS’s expanded mandate. With stakeholder liaison and management, partnership projects were identified and implemented with various stakeholders across the sector, including Women and Youth in Housing. Other priorities facilitated by DHS included N2 Gateway, Zanemvula and Khutsong.

The focus of Programme 4 was the funding of housing and human settlement development programmes, and the provisioning of financial and grant management services to DHS. Its three areas included financial administration and supply chain management services, overall budgetary and grant management services, and ensuring housing finance was available and accessible to all. Reporting requirements and management relating to the division of revenue, and the transfer and administration of funding to provinces were also important.

Programme 5 focused on Strategy, Relations and Governance. It comprised Inter-Governmental Relations (IGR) and International Relations, the governance and oversight of Housing Institutions, Management Information Services, and Communication Services. The need to better manage the collaboration between all spheres of Government, including the accreditation of municipalities, was highlighted. DHS International Relations Programme was determined by the International Relations Department, yet there were also standing multi-lateral agreements that determined DHS conduct. Housing Institutions had mandates against which they had to perform and good governance was also promoted. With the conclusion of the mandates of Thubelisha, Servcon and the Social Housing Foundation, the single Social Housing Regulatory Authority (SHRA) would be established. Management Information Services was the intelligence sector of DHS. Media issues, public information and internal communication were dealt with in Communication Services.

Mr Leshabane noted that the DHS budget of R13.5 billion for this financial year was divided between the five programmes, with Housing Development receiving the bulk, because of the Housing Grant of R12.5 billion being situated in this Branch. Various statistics, graphs and tables relating to DHS and its budgetary spend were explained.

Discussion
The Chairperson asked about the farm workers housing policy, and whether farm workers knew what their rights to the land were. He wondered what programmes there were for education and when these would start.

He also asked whether there was the possibility of including those living in groups in flats in inner cities into Human Settlement in terms of the Sectional Title Act. He said that could assist in alleviating the housing shortage.

The Chairperson asked what the progress of the Khutsong Resettlement Project was. He noted that President Zuma, in his recent State of the Nation Address (SONA), had appealed to Members exercising oversight and implementation to ensure there was no roll over of funds. He wondered if HAD would have the capacity to utilise the R49.5 million allocated to it.

Mr Leshabane said DHS would bring the legislation concerning Sectional Titles and Community Schemes before the House in response to these challenges. The Programme dealing with Farm Worker Housing was new, but had almost reached the point of implementation. At provincial level, where the programmes were implemented, DHS was attempting to attend to the education and empowerment needs of communities. The rationale behind Priority Projects was to attend to matters that were a challenge to South Africa. N2 Gateway required massive upgrading and city restructuring and DHS wanted to be able to copy some of those interventions elsewhere. Khutsong was back with Gauteng and allocations for infrastructure development were in the first phase. The initial 6 000 houses, to which the community would be relocated, had been contracted. In respect of the Housing Development Agency, he noted that R49.5 million was actually a small amount, and there was no risk of under-expenditure. HDA needs were close to R500 million, as it needed to acquire land that was not State-owned.

Mr D Montshitsi (ANC) asked what housing cover for military veterans meant, as the understanding was that there would be a certain quota of houses per province. He asked if there were figures to show the provincial numbers. He also asked whether, in respect of Special Investigations, there was a hotline to which constituency offices or the public could report corruption, and asked whether there had been any arrests and convictions. In respect of Programme Implementation and Support, DHS had indicated it could assist provinces and municipalities unblock stalled projects, and he therefore asked what kind of support DHS would provide in upgrading informal settlements.

Mr Leshabane said the Policy provided for registered military veterans to receive priority to access 40m² subsidised houses. DHS used the Defence Department’s database and, together with provinces, prioritised veterans. Veterans then said they did not want the subsidy houses and made specific requests that were being processed. This had now become an issue that went beyond DHS to Government, and was being dealt with by a different process. Thus not much progress had been made, given the veterans’ demands. Provinces and municipalities would be helped to prioritise blocked projects and to determine the cause of the blockage.

The questions on special investigations and blocked projects did not appear to have been answered.

Mr Z Mlenzana (Eastern Cape, COPE) asked about Housing Priorities and how DHS would interact with the Public Works Department to encourage self-involvement of people in the construction of their own houses.

Mr Mlenzana also asked if there were timeframes in the co-ordination of investigations with SIU, as some local government leaders currently handling cases might no longer be in office after upcoming local elections. He enquired if DHS would track the monetary cost against the total value of cases being investigated.

Mr Mlenzana asked if the South African Bureau of Standards would ensure the quality outcome of a project when outside stakeholders were involved. He noted that Thubelisha’s mandate had differed slightly in the provinces from what was given in this presentation. He noted that Thubelisha was holding large sums of money and outsourcing had occurred without close monitoring.

Mr Leshabane said it was encouraging how many contract and allocation corruption cases had been rooted out, and he said the numbers could be provided to the Committee. He explained that the investigations conducted by DHS would first try to recover whatever had been misappropriated. These investigations were very intense, and would often lead to prosecution, which had a deterrent, and these factors provided credibility to the Housing Programme and proof of acting against moral decay, rather than being concerned with recovery of costs. He noted that as institutions were closed, rigorous procedures were put in place to attend to all audits, accounting, reconciliation and staff welfare. Even though the Umsombomvu Youth Fund (UYF) was being phased out, for instance, the commitments already agreed up would be reviewed to find an appropriate successor. The Rural Housing Intervention (RHI) was a programme looking to address the existing gap in rural areas. From a cost perspective it was difficult to have a contractor build houses exactly where the community wanted them. Communities often did not want to have urban forms of houses, but wanted the dwellings to fit their settlement pattern and circumstances. RHI made building material and skills available to rural communities for them to erect appropriate structures.

Ms M Themba (Mpumalanga, ANC) asked if there was a Gender and Youth unit in DHS to monitor projects specific to this Department.

Mr Leshabane said there was a unit in DHS facilitating programmes for women and youth. Each province also made its own determination in this regard, and was monitored by a Member of the Executive Council (MEC).

Mr H Groenewald (North West, DA) asked what DHS would do to stop informal settlements forming around rivers, because when they flooded they caused extensive damage and negatively affected people’s health.

Mr Groenewald also asked what would be done to house military veterans in the North West.

Mr Groenewald commented that self-involvement of owners in housing projects was a good idea but people needed up-skilling to perform effectively, so he wondered who would assess the quality of the completed work.

Mr Leshabane said informal settlements arose so quickly that even municipalities had difficulty regulating where people resided. Legislation provided that if someone a person occupied land for longer than 48 hours and had not been moved, then they could not be evicted without following court procedures. Although DHS knew that people were residing in risky areas, and although it was also working with municipalities to strengthen their land monitoring systems, ideally legislation was needed to provide a better regulation. The issue was complex and DHS wanted to engage with provinces, municipalities and communities to regulate this area correctly.

Mr R Tau (Northern Cape, ANC) looked at the Department’s Annual Report for 2007/08 and said Inter Governmental Relations (IGR) was mentioned as one of the issues in which there had been difficulties in effecting improvement. However, he pointed out that the 2008/09 and 2009/10 budget reflected a decrease in funds allocated to improve the capacity of DHS to deal with IGR. There was also a substantial increase in expenditure on consultation and legal services but a decrease in internal expenditure on training and bursaries for staff. This went against the point made in SONA that departments should be moving away from using external consultants towards improving Government’s internal capacity to provide services. He also asked about the increase in DHS subsistence and travel budget. He queried whether the allocation for Thubelisha and Servcon was an oversight as, according to the presentation, they had ceased to exist and the Housing Development Agency (HDA) was expected to take over their role. Querying Planned Activities in Programme 3, he asked what DHS would do, now that the UYF no longer existed and had been replaced by the Youth Development Agency.

Mr Leshabane said DHS had several Housing Support Institutions, including the National Home Builders Registration Council and the National Housing Finance Corporation, which provided sector funding. Thubelisha and Servcon were the outcome of the agreement between Government and the Financial Services Sector. There was a need to normalise that environment after the rent boycotts of pre-1994, so that lending could continue. Servcon was established to attend to defaulters and to find solutions for them. This process was agreed to run only until 2006. Thubelisha was attached to Servcon so that individual households would be right-sized, by being placed in accommodation they could afford, and Thubelisha was tasked to build houses for those people. That programme had now delivered on its mandate and was being closed. The provision in DHS budget for Thubelisha was a projection for the current financial year, as it would use what was available but cease operations and close in this year. These allocations would be diverted in future. The HDA that came into operation this financial year had a stronger mandate than Thubelisha – as it could acquire, hold, prepare and release land for human settlement.

Mr Leshabane noted that the IGR budget had not been reduced. From 2005 to 2008, the Department funded capacity enhancement of those municipalities prioritised for accreditation to deliver housing. After 2008 this was phased out, as provinces now needed to deliver.

Mr Mziwonke Dlabantu, Chief Financial Officer, Department of Human Settlements, said the provincial transfer dominated this budget. DHS had created a new Housing Development Plan in response to the demand for houses. In future DHS would need more people in provinces to ensure delivery was being facilitated, but until then was sending its own staff out to the provinces to resolve issues. It was still looking at more efficient measures to reduce the cost of travel. The spend for consultants or business advisory services was acknowledged as high but it was linked to the plan to match whatever resources were available within DHS. From 2007 to 2010 there a downward trend of R43 million. As positions were filled within DHS, that figure would be reduced further.

Mr O De Beer (Western Cape, COPE) asked how DHS would deal with the potential conflict around the mandate being spread between different Government spheres, specifically relating to Housing. He asked if there was a mechanism to prevent a recurrence of the challenges experienced at the N2 Gateway Project and the Khutsong Resettlement Project.

Mr de Beer, examining the graph on Expenditure Trends, said that it seemed money was being spent in an unacceptable manner as at the financial year-end in March. He asked if the Budget Implementation Plan should not indicate the phases at which money should be spent.

Mr Leshabane said that even though there had been problems with the projects mentioned by Mr de Beer, DHS had learned lessons from them. If there was political contestation the Constitution and legislation compelled the spheres of Government to observe the applicable rules and to engage and enter a process to resolve disagreements. The necessary mechanisms did exist. He noted that the Expenditure Trend graph alerted the House to spending trends but DHS had introduced procedures to plan better. Housing Development determined that a contractor was paid when a house was erected and inspected. Although the March spike was not necessarily wrong, DHS had tried to get provinces to spread the phases of house construction.

The Chairperson expressed concern, citing examples of informal settlements nationwide, that people continued to settle in unsafe areas. He urged that DHS combat this as a matter of urgency. He questioned the variance in quality between housing developments across SA. Newly constructed units were found to have cracks even before occupants moved in. Thus the quality of monitoring and inspection was questionable. It was widely reported that contractors tendered for, and obtained, Government contracts. They would be paid, partially perform on their contract and then be declared insolvent and he wanted to know what DHS had done about this.

Mr Leshabane said that informal settlements were, by definition, not controlled and DHS needed to double its intervention efforts in this area. He acknowledged the Chairperson’s suggestion to educate these communities and municipalities about the risks specific to Informal Settlements. As to the quality of housing supplied, he said that the contractor was paid on conclusion of the job. This meant that someone had certified that the contractor had completed his or her task, and could be paid. It was now time to look at accountability. Provinces commissioned the housing projects, paid the contractor and must be held to account, and DHS would now be demanding accountability from provinces, right down to the inspector who signed off on the project.

Mr Tau expressed his frustration at the limited amount of time the Committee had with DHS and said more time was needed to engage in-depth with the Department. He questioned the 2009 Estimates of National Expenditure and strongly disagreed with the policy of DHS that provinces and municipalities would be responsible for the provision and delivery of housing. He re-emphasised his earlier question on IGR and said he asked it specifically because of provinces and municipalities now being responsible for housing delivery. DHS had initially intervened in provincial housing delivery as a result of the lack of capacity and commitment in provincial governments. He felt this still existed, and vehemently insisted that DHS still had a very important role to play in assisting provinces and municipalities in all respects. He said the reduction of the budget to assist provinces and municipalities was a precursor to the criticism of provinces at year-end, for their lack of delivery. The cuts also came at a time when DHS Intervention Programme was starting to show positive results. At the debate the Committee needed to urge DHS to recommit itself to the Intervention Programme. If DHS withdrew from provinces and municipalities then he also feared that the amount of theft and corruption would increase once again.

Mr Leshabane said DHS would support the Committee’s urgent recommendation on strengthening the Department’s role in capacity development, as DHS also did not want to regress.

Mr De Beer agreed with sharing services and capacity between the spheres of Government. He felt it to be part of the solution to address the issue of vacancies across Government levels. There was insufficient money to fill these posts but through sharing of services the effect of low staff levels could be ameliorated and in turn could help alleviate the housing backlog. He asked about the effectiveness of inter-Departmental communication that led to people blaming Government for poor communication to them. The needs of the poorest members of society were often ignored, especially in land acquisition, when there was a more lucrative option for that land and the landless were merely shunted around.

Mr Leshabane said DHS would look at what was relevant to it but some of the failures had occurred at municipal level.

The Chairperson thanked DHS, and noted that the Minister, whilst expressing interest in attending this meeting, had been unable to do so because of prior commitments to the Housing Programme. However this was indicative of the strong relationship between the Committee and the Ministry.

Department of Transport (DoT) Strategic Plan and Budget 2009-2012
The Chairperson welcomed Hon Jeremy Cronin, Deputy Minister of Transport, and noted the apology from the Minister of Transport.

Mr Cronin said that the Department of Transport was committed to engaging with the Committee, and could not have successful programmes if there was not an active Committee. The Minister’s written apology stated he was meeting with the National Taxi Alliance, as there were many challenges in transforming that industry.

Ms Mpumi Mpofu, Director General, Department of Transport, noted that the vision of DoT was “Transport: the Heartbeat of Economic Growth and Social Development.” Its mission was to “lead the development of efficient integrated transport systems, by creating a framework of sustainable policies and regulators, and implementable models to support Government strategies for economic, social and international development.” She noted that the Department also had international obligations, including maritime and aviation responsibilities to Government’s programme.

The DoT focus areas included national innovative research to provide economic advice for all transport modes, creating an enabling framework for road, aviation and maritime transport, and managing accident investigations. Matters critical to DoT that were mentioned in the State of the Nation Address (SONA) were highlighted. Seven Cluster Priorities were identified. The Infrastructure Development Cluster focused on speeding up growth in the economy to create decent work. The fifteen Action Programmes included: developing a new infrastructure investment strategy, emergency funding for current build programme, finalising the Integrated Infrastructure Plan and monitoring it to manage cost overruns, and allocating a portion of the budget for maintenance in all areas. The Economic Cluster Priorities represented South Africa’s response to the economic crisis. One of the principal interventions was the Expanded Public Works Programme that looked to creating as many jobs as possible. Another was utilising public transport investment to maximise local production, and hence maximise the amount of jobs, in the automotive Industry. In the Social Cluster the important elements were climate change response, the No-Fault Policy proposal on the Road Accident Fund (RAF) and implementing the Rural Transport Strategy for SA. Capacity of the State was a priority for the Governance and Administration Cluster. Continued prioritisation of the African Continent was important to the International Co-operation, Trade and Security Cluster. The Human Development Cluster focused on strengthening skills and the human resource base. The Justice, Crime Prevention and Security Cluster focused on mobilising SA in intensifying the fight against crime and corruption, and border management. Additional allocations across DoT projects for the financial years 2009/10, 2010/11 and 2011/12 were explained. The largest amounts related to the Public Transport Infrastructure and Systems Grant, and the Bus Subsidies.

The breakdown of the major budgets was provided, with an indication of the main spending areas, notably Metrorail, for refurbishing trains and signalling systems, infrastructure and station upgrading. The allocation for Gautrain would cease by 2011/12 but the Public Transport Infrastructure and Systems Grant (PTIS) increased over time to create a balance between urban and rural public transport after 2010. The provision for “Other” funding of  R916 million, was given in the report and further broken down.

Ms Mpofu named the key budget challenges as including the Bus Subsidy, but noted that there was an intervention in place with the National Treasury to resolve some of the issues, and she noted also that the implementation plans were listed in the report. The principal challenge in the Bus Subsidy was a growth in interim contracts, signed on a month-to-month basis between provincial authorities and bus operators. This should have been minimised, but instead had been the predominant method of contracting, giving rise to a higher monetary demand than provided for in the budget. Other Grants in DoT were noted, including the R18 billion PTIS that facilitated improved transport infrastructure for 2010 and beyond. Another challenge was the increased cost of, and backlog in, road maintenance. Sixteen further challenges were noted (see attached report).

Ms Mpofu then said that given budgetary constraints, the unfunded mandates (which were also listed in the attached report) would be problematic for DoT. Bus subsidies would be the issue that caused over expenditure within DoT, but this was largely due to National Treasury’s initial under budgeting, and allocation of funds later.

Ms Mpofu tabled the DoT organogram, including race and gender representation, employment equity and capacity building.

She further listed the performance highlights of the financial year 2008/09. The Strategic Plan matters were then set out. Noted areas were the National Airports Development Plan (NADP), Rural Transport Services, Shova Kalula bicycle programme, the Rural Transport Mapping Project, the Taxi Recapitalisation Programme (TRP), the refurbishment of commuter rail coaches, and various other areas. She noted that only the planned projects for 2009/10 were discussed in this report, but those for 2010/11 and 2011/12 had been tabled and were available. The strategic objectives of the Transport Policy and Economic Regulation Branch were listed. These included the National Scholar Transport Policy, Non-Motorised Transport Policy, Rail Policy, Public Transport Accessibility Policy, dealing specifically with disabled people’s access, National Transport Co-ordinating Committee Policy, allowing for broader stakeholder participation, Intelligent Transport Systems Policy, Policy Impact Monitoring and Evaluation Framework, Guidelines for Target Setting, Policy Audit and Performance Indicators for all Policy Initiatives. She furthermore mentioned the environmental challenges in transport, and the contributions of this Department to the United Nations Commission on Sustainable Development country report. Proposed Legislation was also listed (see report). It was noted that Black Economic Empowerment (BEE) in this sector was finalised and the BEE Charter was gazetted.

Mr Z Thwala, Deputy Director General (DDG): Transport Regulation and Accident and Incident Investigation, DoT, presented on Programme 3, which dealt with regulations in all forms of transport. Its strategic objectives included reducing accident fatalities, in line with the Millennium Development Goals, ensuring compliance with national and international obligations, consolidating the 2010 strategy, improving relationships and customer service with all, safety investigations, and staff development. The eight outputs relating to the Civil Aviation Regulation were listed (see report). Of specific note was the need to reduce aircraft emissions in line with improving environmental sustainability. The seven outputs relating to Road Transport Regulation were outlined. The main objectives were ensuring road safety and accessibility. The four outputs of Maritime transport regulation were then discussed. There would be a conference of African Ministers in South Africa in October to launch the Maritime Charter.

The Programme 4: Branch for Integrated Planning and Inter-sphere Co-ordination, was divided into three directorates: Integrated Transport Planning (ITP), Integrated Infrastructure Network Development (IIND) and Integrated Development Programme (IDP). The eight ITP outputs were discussed. The National Land Transport Act (NLTA) was passed by Parliament this year, and the National Public Transport Regulator still needed to be created to develop standardised procedures, which must be followed by all Operator Licensing Boards at all levels.  Some of the key priority regulations related to 2010, and these must be put in place so that the Act could come properly into force. The 12 IIND outputs and the 10 IDP outputs were also presented (see attached report). The National Transport Master Plan (NATMAP), with its four outputs was presented.

Programme 5: Transport Logistics and Corridor Development was detailed, and the six Strategic Objectives were outlined (see attached report). The same was done for Programme 6 and its 21 outputs.

Dr Maria Koorts, Deputy Director General: Public Entity Oversight and Border Control, DoT, presented on Programme 7 and the Branch’s Strategic Objectives. She detailed the eleven public entities that were reporting to the Minister and the performance areas that would be addressed by oversight. Some of the entities were highlighted. Airports Company of South Africa (ACSA) had core functions of ensuring airport capacity and the movement of passengers and goods and a key project was the Optimal Capital Structure and Financing Plan. The Air Traffic Navigation System (ATNS) core mandate was to provide safe, orderly and efficient air travel and navigation. Further details of all the entities were outlined in the attached report.

Finally, the Department indicated its preparedness for 2010 by highlighting the achievements of 2008/09. Airport capacity would be met, as shown by the construction statistics, and Metrorail’s achievements.

Discussion
The Chairperson asked how DoT was addressing the outcry by taxi operators against the Bus Rapid Transit system (BRT).

Ms Mpofu agreed that DoT may not have been thorough enough in their consultation process with the taxi industry and took responsibility for that. However, DoT had always understood that the taxi industry would be central to the implementation of BRT. The issue now was around how the industry participated in BRT and DoT may not have received enough information from the industry as to how they wanted to participate, even though at local level there were committees in which the industry was participating, especially operators who would be on the routes where BRT would operate. Regional, provincial and national structures in the industry now also wanted to get involved. Several meetings had occurred with these bodies but DoT needed more time to fully engage to determine their specifics. The same industry currently operating in the BRT areas would continue to do so, as these operators had been licensed.

The Chairperson noted that there had been a problem with recent claims against the RAF by foreigners, paid out in their currency, which had caused problems because of the disparity in exchange rates. He asked what was being done by the DoT about this.

Dr Koorts said that the Road Accident Amendment Act had been implemented on 1 August 2008 to combat the problems that foreign accident victims had previously been able to claim in their own currency. Accidents that occurred after 1 August 2008 would be dealt with under the amended Act, and accidents before that date would be dealt with under the previous Act. The Act covered claims for loss of income, capped at R160 000 per annum. It also covered non-pecuniary loss / general damages, but these were only linked to serious injury. Another challenge to RAF was the long legal delay in proving fault in an accident. This was also dealt with by the amendments to the Act. People would no longer need to prove ‘no-fault’ before receiving treatment or being paid for medical expenses.

The Chairperson noted that FIFA had said that if stadiums were not ready, then some host cities would not be permitted to host the soccer games in 2010, which would obviously negatively impact economic growth. He asked what DoT was doing about this issue.

The Chairperson noted that the President, in his SONA, had promised creation of 500 000 jobs. DoT said that it would be a major contributor to job creation, and so he enquired whether there was any indication of how many jobs it would create this year.

Ms Mpofu said that DoT could not say what percentage of the 500 000 jobs would be created by each Department. However, the programmes dealing with rural roads across all provinces would be committed to contributing to the target.

The Chairperson noted that DoT had been negotiating with SA Taxi Associations, but asked whether this had also extended to Cross-Border Taxi Associations that transported people across the borders of South Africa.

Dr Koorts said that the provinces needed to respect the authority of the Cross-Border Road Transport Agency (CBRTA). There was only one national entity issuing border control permits and anyone wanting to cross into South Africa had to get the permit from CBRTA and not from a provincial authority.

Mr Tau said premiers emphasised rural road infrastructure development and the presentation spoke to grants. However, the Northern Cape was not one of the provinces identified to receive the conditional grants, and so he wondered if the promised money then would come from the province. The monitoring programme was linked to this because some provinces did not have the capacity to spend the grants or spent them incorrectly. He would welcome the assistance of DoT in this regard would be good.

Deputy Minister Cronin responded to the issue of inter-sphere challenges. In the midst of a national debate about the future of provinces he urged the Committee to help DoT contribute to the Green Paper and White Paper Process Discussions around the role of provinces. There had been various lessons learnt about inter-sphere co-operation. DoT had moved to a different bus subsidy dispensation. In the past the subsidies came through the National Department and would be allocated to provinces, which then dispensed the subsidies. Because of problems experienced, this now fell under the Division of Revenue Act, and funding went straight from Treasury to provinces. The amount going to provinces was less than required to sustain their current subsidised services. National Treasury had also said that the interim contracts for bus services could not continue. The entire way that all transport was subsidised needed to change. The Committee Members were asked to look carefully at their respective provinces to find out whether the new bus subsidy allocations were being used to transform public transport to provide a better service. DoT would also look at this matter, as it did not want to see a repeat of the provinces running out of money, as had happened in January.

Mr Tau asked how DoT, in collaboration with the Department of Health, would ensure the H1N1-Flu virus did not scare tourists away.

Mr Thwala said the Department of Health, Airports and operators were dealing with H1N1. The International Air Transport Association had been to South Africa and had given guidelines on how to deal with the issue, mainly dealing with information education.

Mr Tau asked what progress was being made with Kimberley airport.

Ms Mpofu said that Kimberley Airport was owned by the province and not ACSA. For purposes of 2010 the investment would be in Bloemfontein as Kimberley was not a host city. However, NADP provided the basis for moving forward for all the country’s airports.

Ms L Mabija (Limpopo, ANC) asked if a covered walkway was possible between the old and new terminals at Polokwane Airport, as moving between the two during inclement weather was unpleasant.

Ms Mpofu said DoT would discuss this with the Board responsible for the airport and the province, since this airport was also not ACSA owned.

Mr Groenewald asked if there was a timeframe or termination date for TRP. Rail transport, especially in rural areas, was collapsing. If this was addressed it would lighten the burden on South African roads, especially as increased volumes of overloaded trucks were causing serious damage. Weighbridges were not functional across all provinces and this needed urgent attention.

Ms Mpofu said the original time frame for TRP was seven years, but that was based on the assumption that DoT would get the allocated funding for those years to roll out the programme. Two complications had pushed the programme past that time frame. One was that allocations received had been less than expected. TRP was not driven by DoT but rather by the state of unroadworthiness of taxis. Hence it was demand-driven. The second complication was the legalisation process. The original estimate of 100 000 taxis to be covered by TRP had increased 50%, to include more taxi operators who would benefit from the programme.

Mr Groenewald also asked for details of the DoT vision for scholar transport?

Mr Mlenzana asked if tollgates were a national, provincial or concurrent responsibility.

Ms Mpofu replied that tollgates were the responsibility of whoever owned the road being tolled. Generally most toll-roads were owned nationally, since provincial or State tolls were rarely used. However, DoT wanted to introduce State tolls in response to the roads crisis. The problem around provincial roads was that trucks would tend to avoid the national tolls, instead using provincial roads and damaging them. The concern around State tolls was that DoT did not want residents of those areas, or the poor, to be tolled. A solution could be to establish differentiated toll arrangements where residents were charged reduced prices compared to trucks.

Deputy Minister Cronin said there had been many questions about rural transport. DoT was a policy and regulatory body, and not necessarily an implementer. Agencies, provinces and municipalities then became the critical implementers. DoT had plans for rural transport but provinces needed to become the champions. This year’s Financial and Fiscal Commission (FFC) Report noted there was good funding and project management of national road networks through the South African Roads Agency Limited (SANRAL). However, sometimes in provinces the allocation for infrastructure and roads was not spent on infrastructure and roads. Thus this Committee had a very important role to help find the right funding model for road infrastructure in provinces, and to ensure that money allocated for roads was spent on roads. The Commission recommended that provinces set up dedicated Road Agencies so the money would be focused on project management.

Mr Mlenzana asked if there was a timeframe on the reclassification of roads for the implementation of DoT Rural Road Development Programme, and also asked if this would be a once-off implementation or an ongoing process.

Mr T Mahlalela, Acting Deputy Director General: Public Transport, DoT, replied that when the reclassification process began, its aim was to do 20% of the road network annually, and thus be completed by 2011/12. Challenges faced were lack of capacity, especially at municipal level. Provinces had been asked to assist municipalities but progress had been slow.

Mr Montshitsi asked what stage the TRP had reached. There seemed to be many taxi associations at national and provincial level, and he asked if the correct ones were being spoken to with regard to BRT.

Ms Mpofu was confident that the objections to BRT were not popularly supported, as throughout the taxi industry it was now felt that BRT was a good initiative. The institutional arrangements in the industry were not complex. DoT would engage with the South African National Taxi Council and the National Taxi Association. More recently in Gauteng the United Taxi Association Forum had emerged. Challenges around resource and investment allocation could arise due to this fragmentation in the industry.

Mr Montshitsi asked if the legislative changes to the RAF Act had been challenged by victims of accidents.

Ms M Themba (Mpumalanga, ANC) asked when the meeting about Scholar Transport between DoT and the Department of Education would be held, as this was an important issue.

Ms Mpofu said there had been problems transferring Scholar Transport from the Department of Education to DoT. The fear from provincial Education Departments was that they would lose the funding that came with the programme. DoT felt that as this had to do with transport, it was a DoT responsibility, as DoT could provide a better service.

Ms Themba asked when the Mbombela Stadium had been completed, as it was due to have been done 3 days previously, on 23 June 2009.

Ms Mpofu responded that Mbombela had experienced challenges that had led to the deadline not being met. However, in general, all stadiums should be completed by December 2009. There were projects in DoT that had started late where there were concerns about meeting deadlines. La Mercy Airport, for example, was being tightly managed.

Ms Themba asked if Mpumalanga Airport could be returned to Government ownership, as larger flight capacity was needed.  The smaller flights currently were insufficient and inconvenient.

Ms Mpofu noted that in respect of Mpumalanga Airport, the province needed to decide to buy the airport, in which case State money could be allocated to it. Public funds would not be spent while the airport remained privately owned.

Ms Themba asked when the simplified version of NLTA, in its booklet form, would be available in all official languages.

Mr Rajesh Jock, Deputy Director General: Management Services, DoT, said that even if it took some time to be produced, the booklet would be available in all official languages.

The meeting was adjourned.