DEPARTMENT OF TRANSPORT

TO: ACTING DIRECTOR GENERAL Ref: PSI 1/2/2/2

SUBJECT: REPORT TO THE NATIONAL ASSEMBLY ON THE NLTTA

  1. PURPOSE

The purpose of this memorandum is to provide you with the Department’s report on the recommendations made by the Portfolio Committee on Transport regarding the National Land Transport Transition Act, 2000 (NLTTA).

2. REGISTRATION AND OPERATING LICENCES FOR PUBLIC TRANSPORT

    1. NATIONAL TRANSPORT REGISTER
    2. Recommendation by Portfolio Committee on Transport:

      The Committee proposes that the progress with the development of a single National Transport Register be reviewed early in 2003.

      Response by the Department:

      According to the NLTTA, the Minister and MEC’s require a National Land Transport Information Systems (NLTIS) in order for them to monitor and manage the public transport industry. In response to the requirements of the NLTTA, all the provincial databases and systems are currently being integrated at National level thus ensuring a uniform repository of information maintained by the provinces.

      The National Land Transport Information System incorporates the registration data from the Provincial Registrars; permit and operating license data from Provincial Operating Licensing Boards and bus subsidy information from the Provincial Departments. In addition to that the system contains a management system, namely the national transport register.

      The system is fully developed and currently being rolled out to Provinces.

    3. FORUMS FOR OPERATING LICENSING BOARDS, REGISTRARS AND STAKEHOLDERS TO AGREE ON COMMON POLICIES AND PROCEDURES

Recommendation by Portfolio Committee on Transport:

The Department should provide for forums for operating licensing boards, Registrars and Stakeholders to agree on common policies and procedures.

Response by the Department:

The forums are already in place and are attended by delegates from the licensing boards and provincial registrars as well as officials of the National Department of Transport.

In 1996 immediately after the finalization of the National Taxi Task Team (NTTT) investigations, the Registrars Forum was established. All nine (9) Provincial Registrars who had been appointed as per NTTT recommendations are represented in this forum. The main aim of this forum is to address all issues of common interest relating to the registration process. Subsequent to that, in October 2002, the Provincial Chairpersons of Operating License Board’s were constituted into a Forum. The key objective is to address issues affecting all Operating Licensing Boards on a daily basis. Such issues include, the granting of concurrencies mainly for inter-provincial operations as required by the National Land Transition Act No. 22 of 2000 (NLTTA).

Therefore in general, besides communicating and standardizing the manner in which the NLTTA should be implemented, these forums are aimed at developing and consequently implementing a uniform approach on all matters of national concern. They aim to foster consistency not only amongst themselves but also within the taxi industry. In essence these forums constitute a horizontal based network of learning and doing.

2.3 GUIDELINES REGARDING ROUTE DESCRIPTIONS

Recommendation by Portfolio Committee on Transport:

The Committee proposes that the progress with the preparation of guidelines regarding routes descriptions be reviewed in early 2003.

Response by the Department:

In July 2002, the National Department of Transport published the minimum requirements for the preparation of Current Public Transport Records containing guidelines on route descriptions. In addition the Department prepared guidelines for route descriptions and these were circulated to all planning authorities. These minimum requirements and guidelines are currently being used by local authorities to prepare their transport plans.

Furthermore, the National Transport Register caters for route description and is presently being rolled out to all provinces.

2.4 METERED TAXIS

Recommendation by Portfolio Committee on Transport:

The Committee proposes that legislative amendments should be made to the NLTTA to provide for metered taxis.

Response by the Department:

The National Department of Transport has just drafted a position paper on metered taxis, which will be considered by the Ministerial Conference of Ministers of Transport (MINCOM) and COTO (Committee of Transport officials) during March/April 2003 where after consultation with the Meter taxi industry will be undertaken. The position paper outlines the challenges facing the meter taxi industry and the need for the Department to formalize, regulate, democratize, and control the industry. Due to the intensity of the consultation processes, which are still at a very early stage, it is not possible to include this issue as part of the NLTTA amendments because the amendments to the NLTTA are urgent. However the recommendations from MINCOM will be taken forward separately from the NLTTA.

    1. TOURISM SERVICES

Recommendation by Portfolio Committee on Transport:

The Committee proposes that legislative amendments should be made to the NLTTA to provide for tourist services.

Response by the Department:

The National Department of Transport is currently in the consultative process with the Tourist Service transport operators. This process is still at an initial stage. The issue will be discussed at COTO and MINCOM and recommendations on the way forward will be made by June 2003. Due to the fact that the process is still at a very early stage, it is not possible to include this issue as part of the NLTTA amendments due to the urgency and time constraints with respect to the current amendments. However the recommendations from MINCOM will be taken forward separately from the NLTTA review process.

    1. TRANSPORT PLANNING AND FUNDING FOR TRANSPORT PLANNING

Recommendation by Portfolio Committee on Transport:

The Committee proposes that during the first half of 2003, the Department should report to Parliament on progress made in the development of a comprehensive funding strategy for transport.

Response by the Department:

The National Land Transport Strategic Framework (NLTSF), a 5-year strategy and a requirement of the NL TTA, recognises that the Department has to play an indirect role of facilitation, co-ordination support and funding assistance. The Department has incorporated the NLTSF targets into its strategic planning and budgeting cycles. The Department has adopted an incremental, momentum building approach to implementation of the NLTSF.

The National Department of Transport has developed a document for land transport in the form of generic high-level financing principles. Several aspects of the funding strategy are currently being further developed through specifically commissioned studies, so as to deal with specific funding challenges, namely the question of a public transport subsidy study, while the Roads Infrastructure Investment Framework has specific recommendations around road infrastructure funding. With respect to the development of a comprehensive funding strategy for transport planning, a specific study will be commissioned to determine the funding needs as well as the availability of funding at the three spheres of government.

Recommendation by Portfolio Committee on Transport:

The Department must report on the use of funds already transferred to provincial authorities.

Response by the Department:

During 2001/02 and 2002/03 the National Department of Transport made available R1 million and R2 million respectively to all Provinces. These funds are being used for the preparation of Current Public Transport Records (CPTRs) and the Provincial Land Transport Frameworks (PLTFs). It is envisaged that these plans will be completed by the end of March 2003, as gazetted. This is the total funding transferred to local sphere for the implementation of transport planning in terms of the NLTTA.

    1. PLANNING CYCLE
    2. Recommendation by Portfolio Committee on Transport:

      The committee recommends that the planning frequency which is too high to be revised.

      Response by the Department:

      The planning cycle for all plans is 5 years, however on an annual basis the plans at local sphere should be updated, thus being synchronized with the IDP review process, which takes place annually.

      The minimum requirements for the preparation of transport plans published in terms of the NLTTA, will be revised to allow transport plans to be done once every two years instead of annually, but taking into account the IDP review cycle.

    3. ALLOCATION OF PLANNING FUNCTIONS BETWEEN CATEGORY B AND C

MUNICIPALITIES

Recommendation by Portfolio Committee on Transport:

The Department must clarify whether Category B or C municipalities should be designated planning authorities.

Response by the Department:

In terms of the NLTTA, each District Municipality (Category C) is a planning authority and is responsible for preparing the Current Public Transport Records (CPTRs) for its entire area, but this does not prevent an agreement that the relevant local municipalities will assist with such preparation, provided that the agreement is permissible in terms of applicable local government legislation. This requirement is in line with the requirements in the Local Government: Municipal Systems Act. (No. 32 0f 2000)

Current Public Transport Records (CPTRs) should not be prepared at both district and local levels as this lead to duplication. Thus only one CPTR is required for any particular planning area.

Where the CPTR is prepared by a Category B municipality in terms of an agreement between the two categories of the municipalities, it remains the responsibility of the district (Category C) to ensure that the entire area is covered and to submit the total CPTR to the MEC in terms of Section 24(4) of the NLTTA, and to submit to the Minister in terms of Section 28 of the NLTTA.

Between August and November 2002, the Department conducted provincial road shows on the NLTTA and planning rollout. In these road shows the roles between different spheres of local government were clarified.

    1. TRANSPORT AUTHORITIES
    2. 4.1 FUNDING OF TRANSPORT AUTHORITIES

      Recommendation by Portfolio Committee on Transport:

      The Portfolio Committee recommends that the funding of Transport Authorities be addressed in the funding strategy proposed.

      Response by the Department

      As indicated earlier, the Department has developed a framework of funding principles for all aspects of transport in the form of a generic high-level funding framework document. In addition, an investment and funding framework for infrastructure and other transport areas as a whole is being developed, which should assist with the identification of funding needs therein. These outputs are due in August 2003. Further, the Department is presently investigating the concept of assignment, as distinguished in the Local Government: Municipal Systems Act (No. 32 of 2000), in terms of which the Financial and Fiscal Commission is required to make a financial assessment of the assignment of function to local government.

      4.2 STATUTORY DEFINITION OF MUNICIPAL PUBLIC TRANSPORT

      Recommendation by Portfolio Committee on Transport:

      The Committee recommends that a legislative amendment be effected to the NLTTA to provide for a statutory definition of "municipal public transport", as it appears in Schedule 4B of the Constitution of the RSA.

      Response by the Department

      A definition for municipal transport will be included in the NLTTA-amendment Bill. The bill will be finalized by March 2003.

    3. RESTRUCTURING OF THE BUS INDUSTRY

Recommendation by Portfolio Committee on Transport:

The Committee recommends that the overall approach to subsidies for public transport needs to be reviewed to ensure that three major outcomes are achieved:

The Committee further recommends that the subsidy be allocated in a way that prioritizes and focus on all modes.

Response by the Department

In order to address these issues the Department has done a study with National Treasury during 2002 entitled

Optimization of bus subsidies, which recommended inter alia:

Resulting from this document, MINCOM approved amendments to the Model Tender Document, which will start addressing the above issues.

The study also indicated that in areas where the average household income is the highest (urban areas), the subsidy allocation per passenger per day is also high

compared to the areas with lower average household income per month (mostly in rural areas).

Based on the findings in that report on the disparities in the provision of subsidised services between urban and rural areas, the Department has also recently commissioned study on public transport subsidies. The study looks at how to optimize public transport subsidies through targeting, identifying the policy objectives of subsidy provision with respect to poverty alleviation and economic development, as well as investigating how subsidies can be optimized for all modes. The outcome of the study will be a public transport subsidy policy as well as a public transport subsidy strategy, which seeks to deal with the prioritization of benefits to commuters, subsidy for all modes of public transport issues and the adequacy of the levels of subsidy requirements for all modes. It is envisaged that the study will be completed in August 2003.

The following amendments to the Model Tender Document (MTD) were approved by MINCOM on 10 February 2003.

BEE is addressed in detail in section 5.2 and will be incorporated in the MTD

The current escalation formula contained in the MTD be replaced with an adjusted CPI escalation formula that reflects CPI and fuel, although fuel should be a separate and smaller component of the formula.

Subsidised Service Contracts

The duration of subsidised service contract should be extended to 7 years in order to allow potential bidders a longer period for return on their investment.

Negotiated Contract

The NLTTA stipulates the duration of negotiated contract as 5 years. The model negotiated contract document should be amended to allow Provinces to extend negotiated contract related to the operational performance of the operator. The extension of negotiated contracts to 7 years will be address in the NLTTA amendments.

New bus

Registration = 0 years

Maximum age of 15 years where after the bus should either be rebuilt or refurbished.

If the bus is fully rebuilt after 15 years:

The fully rebuilt bus is deemed to be 3 years old and can be used for another 12 years. (=15 years).

If the bus is refurbished after 15 years:

The refurbished bus is deemed to be 8 years old and can be used for another 7 years. (= 15 years).

Frequency of rebuilding and refurbishment

Buses can only be rebuilt of refurbished up to a maximum chassis age of 27 years.

A section shall be included in the MTC that deals in detail with subcontracting and the manner in which subcontractors are managed during the contract period. This section will also include a clause on the monitoring and report back of subcontracting.

Only Class 1 Improvement will be included in the MTD and will consist of the following:

- Use of high-contrast colours on key surfaces, such as grab-rails, seat frames and the edges of stairs, to assist low-vision passengers and all passengers under bad lighting conditions.

- Grab-handles at all seats (where practical), to provide handholds for standing passengers.

- Reserved seating near entrances for disabled, elderly or pregnant passengers, or any others with mobility difficulties.

- Lowered first step: The possibility of lowering the first-step height needs to be investigated as the very high first step into the bus poses difficulty for people with disability.

- Large signage indicating routes and destinations at bus stops.

- Changing of operational practices, for instance training drivers to keep the vehicle stationary until all passengers with special needs are seated, or to call out key stops along the way.

Class 1 improvements will be compulsory for all new vehicles and all existing vehicles will be required to retrofit Class 1 improvements. A period of two years will be allowed for Class 1 be retrofits to be completed and will be prescribed in the MTD.

The South African Bureau of Standards will be required to complete the SABS standards for adherence to Class 1 improvements by February 2003. The NDOT will liase with the SABS to ensure that the code can be easily applied.

Full accessibility

That 1% (approximately R20 million) of the total subsidy budget be set aside for the implementation of fully accessible buses within the tender system. The allocation of these vehicles will be determined through the tender designs in which Provinces will be required to motivate the need for such vehicles.

Model Tender Document (MTD)

The right of first refusal clause shall be terminated from the MTD that means successful tenders appointed in the first round of tendering will have no right of first refusal in the second round of tendering. This would allow bidders to competing on even par with no party having any advantage.

Issues contained in the RTS Strategy with specific reference to public transport should be incorporated in the MTC. The development and implementation of a vehicle maintenance programme should be considered and in order to make this effective a penalty clause should be linked to non-adherence to the maintenance programme.

The above decisions will be implemented through the PDI equity requirements for BEE shall form part of the Model Tender Document and will be a prerequisite for any interested bidder to comply with. Therefore, tendering authorities will not consider tenders that do not comply with the prescribed PDI equity requirement.

In addition the Transport Funding Strategy has recommended the development of a land transport funding/ spending model. This model is expected to contribute towards the formulation of a Transport Infrastructure Investment Framework for land transport. Herein the operational subsidy issues will also be addressed in terms of its impact on infrastructure spending. This study will be available by August 2003.

Further the Department has recently commissioned a dedicated study on Public Transport Policy and Strategy. This study will address the three major outcomes in terms of extending the subsidy system to all modes, the prioritisation and targeting of commuters and other users of the public transport system and the determination of adequate levels of subsidy requirements of all modes. The study outputs will be available by August 2003.

      1. INADEQUATE MONITORING OF SUBSIDISED BUS SERVICES

Recommendation by Portfolio Committee on Transport:

The committee recommends that service monitoring be made more effective and capacity to monitor be addressed.

Response by the Department

The Ministerial Conference of Ministers of Transport (MINCOM) has decided at its meeting held on 9 December 2002, that all interim contracts have to be put out to competitive tendering or negotiated contracts should be concluded within the next financial year, where after all services will be monitored in a consistent manner across provinces.

Parallel to the tendering process, the Department will advertise a tender for the supervision and monitoring of subsidised bus services nationally. This monitoring team will undertake monitoring in addition to the monitoring currently undertaken by the Provinces. The monitoring team will also address capacity requirements at provincial level (contract management and administration) and will submit quarterly reports to the Department indicating adherence to the PFMA and the requirement of value for money.

In addition to the above the monitoring team will be required to design a model for monitoring of subsidised services and this model shall provide a framework that guides Provinces in the appointment of monitoring firms.

5.2 HISTORICALLY DISADVANTAGED OPERATORS

Recommendation by Portfolio Committee on Transport:

The committee recommends that Historically Disadvantaged Operators be given an opportunity for empowerment.

Response by the Department:

The Ministerial Conference of Ministers of Transport (MINCOM) at its meeting held on 10 February 2003 approved the following:

    1. A minimum of 30% of contracted services should be set-aside for companies with at least 50,1% PDI equity.
    2. A clause should be included regarding the remaining 70% of the services to be put out to competitive tendering, prescribing a minimum PDI equity ownership and management of 35%.
    3. The current minimum of 10 % subcontracting should be retained and it will also be applicable on the remaining 70% of the services .

The above decisions will be implemented through the PDI equity requirements for BEE, which shall form part of the Model Tender Document for the provision road based passenger transport and that will be a prerequisite for any interested bidder to comply with. Therefore, tendering authorities will not consider tenders that do not comply with the prescribed PDI equity requirement.

6. RURAL TRANSPORT

Recommendation by Portfolio Committee on Transport:

The Committee proposes that the Department take up this issue with Provincial Departments through the MINCOM structure.

Response by the Department

Subsequent to the various stakeholder consultations (a series of bilateral workshops with relevant sector Departments, e.g. Agricultural, Provincial Departments of Transport and District councils) initiated in 2002 – 2003, on the draft rural transport strategy, the Department is currently finalizing this strategy. Given the realization that specific groups living in rural areas have varying and specific transportation needs (e.g. women, farmers, etc), the rural transport strategy has crafted relevant strategic supporting and/or qualifying action to address some of their transportation needs.

This strategy will be tabled to MINCOM for discussion and way forward for implementation.

The national rural transport strategy will pave a way of facilitating access and mobility to socio-economic activities especially on village-level or intra-farm transportation to provide transport services. This includes the use of non-motorized transport (bicycle, tri-cycles, animal drawn carts), intermediate transport such as tractor-trailers, trucks (adapted to meet the safety requirements) light delivery vehicles (LDVs) push-carts to relieve head loading. Special periodic transport services scheduled for specific days be promoted to facilitate access to markets. Both small volume and bulk freight volumes was emphasized to support agricultural processes.

The rural transport services will be supported by appropriate rural transport infrastructure such as access roads, rural corridor and feeder roads to the main transport networks, off-road infrastructure for non-motorized transport and tractor tracks, foot bridges, etc are crucial for rural development.

The development and maintenance of rural access roads would have multiplier effects for agricultural productivity in terms of improving the accessibilty to markets which would enhance the economic participation of the farming sector.

    1. TRANSPORTATION FOR FARM WORKERS
    2. The Committee proposes that the Department take up this issue with Provincial Departments through the MINCOM structure.

      Response by the Department

      The National Department of Transport recognizes the fact that Light Delivery Vehicles (LDVs) (Bakkies) are not only used for the conveyance of goods but also to a large extent for the conveyance of persons on the back. The Department also recognizes that for many people this is the only means of transport to work, school and to other destinations.

      LDVs are the second highest vehicle type responsible for deaths and injuries. In order to address this issue an initiative was undertaken by the Department to improve safety of passenger standards for the LDVs. The Department has put out and awarded a tender for the improvements of the safety standards for LDVs. Based on the recommendations of the study, improvements will be made and implemented by all provinces. MINCOM is aware of this initiative and the final report of the study will be tabled at MINCOM.

    3. RAIL TRANSPORT POLICY AND RAIL STRATEGIC PLAN

Recommendation by Portfolio Committee on Transport:

The Committee recommends that the Department tables its Rail Transport Policy and Rail Strategy Plan in Parliament during the first half of 2003 with a view, amongst others, to taking forward the extension of land transport legislation to embrace rail transport.

Response by the Department:

Cabinet is currently considering the National Rail Transport Policy and once it has been approved, it will be tabled to the Portfolio Committee where after it will be released for public consultation and comment. The Department will table the National Rail Transport Policy during the first half of 2003 as recommended by the Portfolio Committee.

The supporting Strategic Rail Transport Plan, which will aim to translate the broad policy commitments into concrete action steps along a definite timeline, will only be finalized once the National Rail Transport Policy has been adopted.

8. RECOMMENDATION

It is recommended that this report be noted.

SGM:PSI

DATE:

SGM: PSI

The response to the recommendations made by the Portfolio Committee to the National

Assembly on the implementation of the NLTTA is noted / not noted and or …………………………………………………………………………………………………………………………………………………………………………………………………………………..

ACTING DIRECTOR GENERAL: TRANSPORT

DATE: