Estimates of National Expenditure Department of Transport Portfolio Committee Strategic Plan and Estimates of National Expenditure 2005/06 to 2007/08 4 March 2005

Content of presentation Department of Transport Content of presentation Strategic Plan Estimates of National Expenditure Medium Term Budgets

Strategic Plan Context Key functions Mandate and Aim Key challenges Department of Transport Strategic Plan Context Key functions Mandate and Aim Key challenges Key performance measures Strategic imperatives Key deliverables New structure

Department of Transport Context (drivers of growth) Transport is a key enabler of social and economic growth and development Investment in our people Investment in our physical infrastructure Enhanced industrial capacity Role of Transport: Skills development and training Establishment of strategic transport links (lower cost of production, shorter trade links, enhanced mobility and tourism)

Department of Transport Context (Continued) The DOT strategies will as far as possible be implemented to support government priorities regarding: • Economic growth • Poverty alleviation • Job creation: expanded public works programme • Rural development • Black economic empowerment • Gender equity • Access for people with disabilities • Technical innovation

Key functions Policy and Strategy Formulation: Substantive Regulation Department of Transport Key functions Policy and Strategy Formulation: The Department of Transport (DOT) is responsible for developing transport policy and providing transport infrastructure to support Government’s broader socio-economic objectives Substantive Regulation Leading implementation in other spheres of Government Monitoring implementation by Transport Public Entities and other spheres of Government: The DOT has delegated its service provision responsibility, as well as its regulatory responsibility to a number of public entities.

Mandate and Aim Mandate: Aim: Department of Transport Mandate and Aim Mandate: To facilitate the provision of an affordable, safe and sustainable transport system; which is responsive to the needs of transport users. Aim: The aim of the Department of Transport is to establish a national transport system that enables national, provincial and local provision of efficient, affordable and fully integrated infrastructure and services that best meet the needs of transport users and promote economic and social development while being environmentally and economically sustainable.

Key challenges An efficient public transport system: Department of Transport Key challenges An efficient public transport system: Reorganisation and review of the subsidy system Service levels and infrastructure requirements supportive to public transport - including renewal of rail rolling stock Unblocking freight flows: Speedy and seamless movement of goods Improving the levels of investment in the freight logistics systems to sustain the required levels of service - including investment in ports The need to increase investment in transport infrastructure across all modes. The need to establish a stronger regulatory regime and to strengthen oversight over transport public entities Improved support of regional transport integration under the NEPAD framework Road and rail safety

Key performance measures Department of Transport Key performance measures Competitive transportation costs The development of targeted infrastructure together with appropriate regulation will ensure that various modes of transport can be competitive and can provide an optimal modal mix for transportation in South Africa. Currently, certain commodities are transported by road, while being more suited to rail transport, because of inefficiencies in the rail system Safety improvements Safety improvements across all modes of transport will improve transport efficiencies while reducing the cost of externalities Reduce infrastructure backlog Backlogs in road and rail infrastructure needs to be addressed to create sustainable infrastructure as well as to improve safety on these modes of transport

Key performance measures Department of Transport Key performance measures (Continued) Improved access Access to and the affordability of particularly public transport is essential to facilitate access to economic opportunities and social inclusion Reduce time to transit The reduction in transit times in particularly the freight logistics system will both reduce costs and facilitate a migration to more appropriate modes of transport for the commodities that are transported

Strategic imperatives Department of Transport Strategic imperatives Lead the process to eliminate significant bottlenecks and costs in Freight Logistics Develop and pilot appropriate Public Transport models for the rural and urban poor Lead and accelerate the process to improve Land Transport Safety Overhaul the capacity of the Department to execute on the agreed strategy

Key deliverables Freight Logistics (Competitive movement of goods) Department of Transport Key deliverables Freight Logistics (Competitive movement of goods) National Freight Logistics Strategy Corridor Development Backlog on infrastructure funding (rail and roads) Strategic Road network / Road infrastructure strategic framework Branch line strategy Freight line upgrade Border posts Maritime Strategy Ports Regulator and National Ports Authority Regional integration Overloading control

Key deliverables (Continued) Public Transport service provision Department of Transport Key deliverables (Continued) Public Transport service provision National Travel Survey Local transport plans Simplifying the planning process Supporting local authorities Improving public transport services Public transport infrastructure Safety promotion Transformation of public transport subsidies Taxi recapitalisation Institutional arrangements of passenger rail services

Key deliverables (Continued) Land transport safety Department of Transport Key deliverables (Continued) Land transport safety Road to Safety strategy Rail safety and security – Railway Safety Regulator Operationalise the Road Traffic Management Corporation Implementation of the Administrative Adjudication of Road Traffic Offences Act

Department of Transport Other key priorities Migration to new NaTIS system and creation of a Trading Entity for NaTIS (National Traffic Information System) Road Accident Fund (Satchwell Report) Transport Planning (Integrated Transport Plans) Aviation and Maritime policy review Rural roads Intergovernmental relations An effective regulatory framework for transport public entities King Shaka airport / Dube tradeport Expanded Public Works Programme Developing a broad based BEE strategy Economic regulation across all modes

Estimates of National Expenditure Department of Transport Estimates of National Expenditure Programme purpose and key functions Strategic overview and key policy developments Programme outputs and budgets

Transport Policy and Regional Integration Department of Transport Transport Policy and Regional Integration Purpose: Develop strategic, outcome-focused and innovative policies; monitor the outcomes and impacts of policies; provide economic advice, analysis and intelligence across all transport modes; manage a national innovative research and development programme for all modes; and lead the regional and international transport integration activities in partnership with other African countries and the rest of the world. Key functions: Develop policies and co-ordinate integrated inter modal policies; Monitor the outcome, effectiveness and impact of policies on the performance of the transport system; Provide a research and information support service; Generate economic analysis capability; Facilitate support for regional integration and NEPAD programmes, provide leadership to the Department and the transport sector with regard to international relations, and build and maintain strategic relations between South Africa and the rest of the world.

Transport Regulation and Public Entity Oversight Department of Transport Transport Regulation and Public Entity Oversight Purpose: Create an enabling environment for regulating all transport modes, and develop appropriate mandates and monitoring mechanisms for public entities reporting to the Minister of Transport. Key functions: Strengthen the regulatory and public entity oversight capacity within the Department; Develop an effective performance monitoring framework and put in place effective measures to ensure legal compliance; Improve the current regulatory regimes; Consolidation of all regulators in the medium to long-term; Effective economic, safety, security and environmental regulation of the maritime, aviation, rail and road transport sectors; Strengthen the Department’s capacity with respect to road, rail, aviation and maritime transport regulation; Provide a search and rescue service in the event of air or maritime related disasters .

Integrated Planning and Inter- sphere Coordination Department of Transport Integrated Planning and Inter- sphere Coordination Purpose: Provide leadership in transport planning and in the provision of transport infrastructure that supports equitable economic, social and regional development in line with national strategic objectives. Key functions: Develop a national strategic transport infrastructure framework for all modes of transport; Develop and implement an integrated infrastructure investment plan; Develop transport planning requirements, guidelines and standards for alignment of transport plans with other sector plans; Facilitate the establishment of institutional structures; Develop and roll-out capacity development programmes for transport planning focussing on local authorities; Implementation of the National Land Transport Transition Act and other land transport legislation and policies; Develop and facilitate an inter sphere strategic implementation framework for national programmes.

Freight Logistics and Corridor Development Department of Transport Freight Logistics and Corridor Development Purpose: Develop and implement an integrated freight logistics strategy for South Africa and the Southern African region. Key functions: To unlock the bottlenecks within the Freight Logistics System thus providing customers with a more cost efficient inter-modal transport system. Develop an effective overall supply chain model to increase the efficiency of the freight logistics system. Corridor Implementation Units shall map selected corridors and develop a range of implementation projects that are based on seed funding by the DOT as well as the active involvement of the DOT in infrastructure planning and integration, in order to raise the efficiency of these transport corridors and integrating secondary and tertiary corridors into a seamless logistics system that is targeted at supporting the geographic expansion of economic activity in the country.

Department of Transport Public Transport Purpose: Develop practices and norms that will increase access to appropriate and quality public transport to meet the socio-economic needs of both rural and urban passengers. Key functions: Develop a public transport strategy that will ensure the provision of a safe, reliable, affordable and accessible public transport system in the country; Develop a more equitable system of funding public transport to ensure affordability of public transport, with a particular emphasis on the poor; Pilot public transport delivery models; Manage the taxi recapitalisation programme; Manage the passenger rail integration process; Drive programmes aimed at improving the provision of public transport infrastructure; Manage service provision of public transport through regulating competition amongst service providers.

Strategic overview and key policy developments Department of Transport Strategic overview and key policy developments Overarching objectives The sustainable and efficient movement of people and goods, enabling economic growth, social inclusion, poverty alleviation and the efficient and cost-effective movement of goods Public Transport The chief objectives for a sustainable public transport system are to improve the public transport system, broaden access to affordable transport, and stimulate economic activities Key challenges include: Transforming the minibus taxi industry through the taxi recapitalisation project Investing in passenger rail infrastructure and restructuring passenger rail services Appropriately targeting public transport subsidies Freight The freight logistics strategy will be developed to inform investment in infrastructure and to identify operational improvements to eliminate bottlenecks in the freight logistics system

Strategic overview and key policy developments (continued) Department of Transport Strategic overview and key policy developments (continued) Transport infrastructure (road and rail) The Department will ensure that road development planning and investment is conducted in a strategic and integrated manner through the road infrastructure strategic framework and the roads coordinating body A number of strategic rail branch lines will be revitalised in partnership with Provinces Transport Regulation Continued implementation of the Road to Safety Strategy The regulation of security will be introduced and security strategies will be promoted across all modes of transport The Department plans to expand economic regulation across the transport sector Job creation and BEE Promoting infrastructure investment will include a strong focus on job creation and labour intensive construction methods through: The road infrastructure strategic framework National overload control strategy Rural transport development strategy

Outputs: Administration Department of Transport Outputs: Administration Sub Programme Output R Million 2005/06 Minister Ministerial duties 0,8 Management (Ministry, Office of Director-General, Communications, Internal Audit, ) Conduct overall management of the Department 54,0 Corporate Support Services Human Resources; Information Technology; Procurement; Finance; Legal; Capacity Development; Government Motor Transport Sound Human Resource management Sound Procurement and Financial management Information Technology systems in place Effective Legal services Cost effective management of Government’s motor fleet Capacity Development projects 65,7 Total 120,5

Outputs: Transport Policy and Regional Integration Department of Transport Outputs: Transport Policy and Regional Integration Sub Programme Output R Million 2005/06 Transport Policy and Impact Monitoring White Paper on National Maritime Transport Policy New aviation policy and Aviation Bill 13,2 Transport Economic Analysis Economic performance indicators framework Baseline studies on the competitiveness of transport systems domestically 4,9 Regional and International Integration Transport infrastructure network joint venture projects Regional spatial development initiatives in support of NEPAD and South Africa's foreign policy 4,4 Administration Support Administration: projects, contracts and budgets 4,3 Total 26,8

Outputs: Transport Regulation and Public Entity Oversight Department of Transport Outputs: Transport Regulation and Public Entity Oversight Sub Programme Output R Million 2005/06 Land Transport Regulation Establish National Accident Bureau Annual road traffic offence surveys National traffic information system (e-NaTIS) 176,2 Civil Aviation Transport Regulation Air transport liberalisation in Africa Ratification and implementation of International conventions and protocols 14,0 Maritime Transport Regulation Safety and security at sea, protection from pollution and marine search and rescue capability Maritime Industry development and promotion 17,3 Public Entity Oversight Service level agreements for public entities Financial and risk management and internal control systems for public entities 104,4 Administration Support Administration: projects, contracts and budgets 5,0 Total 316,9

Outputs: Integrated Planning and Inter-Sphere Coordination Department of Transport Outputs: Integrated Planning and Inter-Sphere Coordination Sub Programme Output R Million 2005/06 Transport Planning Transport services and infrastructure based on approved local transport plans Implementation of the National Land Transport Transition Act 24,3 Integrated Delivery Programme Improved public transport facilities Promotion of non-motorised transport 18,1 Integrated Infrastructure and Network Development Road infrastructure strategic framework National overload control strategy 1 786,2 Administration Support Administration: projects, contracts and budgets 4,7 Total 1 833,3

Outputs: Freight Logistics and Corridor Development Department of Transport Outputs: Freight Logistics and Corridor Development Sub Programme Output R Million 2005/06 National Logistics Strategy National freight logistics strategy and scenarios for 2014 7,8 Eastern and Western Corridors Corridor mapping Corridor optimisation strategies 9,3 Administration Support Administration: projects, contracts and budgets 1,9 Total 19,0

Outputs: Public Transport Department of Transport Outputs: Public Transport Sub Programme Output R Million 2005/06 Public Transport Strategy and Projects Public transport strategy and implementation plan Pilot strategic public transport Projects 4,1 Public Transport Subsidy Management Restructured bus operations Safer and more sustainable taxi services Restructured and safer commuter rail service Restructured and consolidated passenger rail services 5 277,1 Administration Support Administration: projects, contracts and budgets 4,4 Total 5 285,6

Medium Term Budgets Overview of medium term budget (allocations) Department of Transport Medium Term Budgets Overview of medium term budget (allocations) Expenditure trends Budgets per programme Breakdown of budgets

Recent allocation history Department of Transport Recent allocation history MTEF Cycle Details R’000 2003/04 R’000 2004/05 R’000 2005/06 R’000 2006/07 2007/08 2003: Bus 150 000 Baseline adjusted Rail 200 000 ^ Rolling stock 100 000 Inflation & Other 85 144 104 942 117 519 Baselines adjusted by 535 144 554 942 567 519 2004: Roads 250 000 300 000 Arrive Alive 50 000 Other 7 872 7 905 7 927 257 872 307 905 357 927 NaTIS (once-off) -

Additional allocations in 2005 MTEF(included in budgets) Department of Transport Additional allocations in 2005 MTEF(included in budgets) Details R’000 2005/06 2006/07 2007/08 Taxi recapitalisation 250 000 315 000 320 000 Passenger Rail infrastructure 100 000 Roads infrastructure 500 000 Public transport policy 10 000 Overload Control Unit 15 000 Freight Logistics 5 000 Public Entity Oversight 6 000 8 000 VAT adjustments – SANRAL and SARCC 243 397 262 193 275 302 Total 523 397 708 193 1 353 302

Expenditure trends Details R’000 Actual 2001/02 2002/03 2003/04 Budget Department of Transport Expenditure trends Details R’000 Actual 2001/02 2002/03 2003/04 Budget 2004/05 2005/06 2006/07 2007/08 Rail 1,856,415 2,227,419 2,360,148 2,498,550 2,718,056 2,981,140 3,275,197 Bus 1,714,796 1,846,724 2,068,500 2,172,740 2,278,523 2,415,235 2,535,997 Roads 1,067,612 1,203,064 1,290,556 1,440,789 1,752,720 1,897,075 2,491,929 Taxi 8,097 6,497 9,898 13,184 260,600 326,236 331,798 Other 290,008 426,321 494,228 643,908 592,260 623,542 630,168 Total 4,936,928 5,710,025 6,223,330 6,769,171 7,602,159 8,243,228 9,265,089 Growth 20.43% 15.66% 8.99% 8.77% 12.31% 8.43% 12.40%

Expenditure trends: Growth patterns Department of Transport Expenditure trends: Growth patterns Other: Initial strong growth flattening over medium term Taxi: Major introduction from 2005/06 Roads: Consistent strong growth pattern, particularly in 2007/08 Bus: Initial strong growth flattening over medium term Rail: Consistent growth

Expenditure trends: Relative Growth Department of Transport Expenditure trends: Relative Growth Other: relatively stable over the period Taxi: Major introduction with effect from 2005/06 Roads: Relative higher growth over the period Bus: Relative decline over the period Rail: Slight relative decline over the period

Expenditure trends: Relative Growth Department of Transport Expenditure trends: Relative Growth Other: relatively stable over the period Roads: Relative increase over the period Public Transport (PT – Bus, Rail and Taxi): Relative decline despite additional allocations for passenger rail infrastructure and taxi recapitalisation

Budgets per Programme (2005/06) Department of Transport Budgets per Programme (2005/06) Admini- stration R 120,5m 1,58% Transport Policy and Regional Integration R 26,8m 0,35% Regulation and Public Entity Oversight R 316,9m 4,17% 0,25% Freight Logistics and Corridor Development R 19,0m Integrated Planning and Inter- sphere Coordination R 1833,3m 24,12% Roads 23,06% Public R 5285,6m 69,53% Rail 35,75% Bus 29,97% Taxi 3,43% Public Transport (rail, bus, taxi) and Road infrastructure = R 7009,9m (92,21%) Other = R 592,3m ( 7,79%) Total R 7602,2m

Budgets excluding Public Transport and Roads (2005/06) Department of Transport Budgets excluding Public Transport and Roads (2005/06) Details R million % Compensation of Employees 111,3 1.46% Road Traffic Management Corporation (incl. NaTIS R 56,261m) 93,6 1.23% Arrive Alive 50,0 0.66% Oil Pollution prevention services 38,4 0.51% Watch Keeping services (Search and Rescue) 23,6 0.31% RSR, SAMSA, SACAA, NSRI and Memberships 42,9 0.56% Special Investigating Unit 16,6 0.22% Administration 74,3 0.98% Transport Policy and Regional Integration 12,8 0.17% Transport Regulation and Public Entity Oversight 33,8 0.44% Integrated Planning and Inter Sphere Coordination 63,1 0.83% Freight Logistics and Corridor Development 12,6 Public Transport 19,3 0.25% Total 592,3 7,79%

Budgets excluding Public Transport and Roads (2005/06) Department of Transport Budgets excluding Public Transport and Roads (2005/06) 1,46% 1,23% 0,66% 0,51% 0,31% 0,56% 0,22% 0,98% 0,17% 0,44% 0,83% 0,25% Personnel RTMC Arrive Alive Oil Pollution Watchkeeping Agencies SIU Administration TPRI TRPEO IPIC FLCD PT R 592,3m R 19,3m R 12,6m R 63,1m R 33,8m R 12,8m R 74,3m R 16,6m R 42,9m R 23,6m R 38,4m R 50,0m R 93,6m R 111,3m Total

Flagship Projects informed by Strategic planning Department of Transport Flagship Projects informed by Strategic planning Aviation and Maritime Policies Restructuring the Road Accident Fund Migration to new NaTIS Establishment of Rail Economic Regulator Restructuring of Airports Company of South Africa Limited Establishment of Ports Economic Regulator National Transport Plan Integrated Rural Mobility Access project Freight Logistics Strategy Dube Trade Port Branch Rail Line Strategy Passenger Rail Integration Public Transport review

Department of Transport Thank you

Abbreviations Department of Transport DOT Department of Transport NEPAD New Partnership for African Development BEE Black Economic Empowerment NaTIS National Traffic Information System VAT Value Added Tax SANRAL South African National Roads Agency Limited SARCC South African Rail Commuter Corporation Limited RSR Railway Safety Regulator SAMSA South African Maritime Safety Authority SACAA South African Civil Aviation Authority NSRI National Sea Rescue Institute RTMC Road Traffic Management Corporation SIU Special Investigating Unit TPRI Transport Policy and Regional Integration TRPEO Transport Regulation and Public Entity Oversight IPIC Integrated Planning and Inter-sphere Coordination FLCD Freight Logistics and Corridor Development PT Public Transport