PUBLIC HEARINGS November 2006 KwaZulu-Natal Department of Transport Conditional Grants and Capital Expenditure

Road Network In keeping with Governments mandate to achieve equity the KwaZulu-Natal Department of Transport is progressively working towards its minimum road equity of 42,025 kilometres. However, despite the budget increases received over the past years and the increases proposed over the MTEF period the department remains woefully under funded for the execution of its mandate.

Road Network cont.. The Department requires additional funding to address the road network equity. The road network has two components:  Restoring the network to its true asset value by increasing the level of maintenance and renewal expenditure.  Providing access to all community facilities and supporting the Provincial Spatial Development Strategy A ten year strategy has been developed which indicates an estimated under funding of R12,8 billion and to implement this would required an annual additional budget of R1,28 billion

Access Access remains the key challenge to service delivery. The demand for pedestrian bridges and access roads is huge particularly in the rural areas of KwaZulu-Natal. ProgrammeTotal Value of Projects 2006/07 Budget Budget Shortfall (R’000) Community Road Upgrading R R R Access Roads R Pedestrian Bridges R R R TotalR R R

Access cont…

Transport Corridor Development Economic development particularly at a local level still remains a focal point in the government agenda. Transport corridor development as a flagship project as outlined by the Premier continues to receive our attention and support as the Department. This project focuses on continued support for the Lebombo Spatial Development Initiative that is linked to the construction of Main Road 700. The revitalisation of the rail link in the area of P700 will lead to spin-offs similar to those seen on the M4 to Mpumalanga. Importantly, the corridor has the potential of linking Richards Bay and Vryheid.

Transport Corridor Development cont.. Indeed there is hope for the weak in KwaZulu-Natal when there is partnership and collaboration amongst the different spheres of government for the general good.

Transport Corridor Development cont.. ProjectsBudget R’millions Sipofu50 Impendle100 Sani Pass240 Cecil Max Pass90 John Ross Highway450 Inanda to Pinetown560 Ulundi to Vryheid200 Dube Trade Port555 Total2,245 In response from business representatives and community based organisations the KwaZulu-Natal Department of Transport is considering for proposals for the upgrading of provincial roads that are of strategic national importance namely:

Cross Border Demarcation The Department has inherited the Umzimkhulu District Municipality from the Eastern Cape in terms of the Cross Border Demarcation changes The Department has conducted a needs assessment study with regard to the road infrastructure which identified a serious shortage of new infrastructure, maintenance and renewal needs in the Umzimkhulu Municipality, at a estimated cost of R1,6 billion.

Government Led Initiatives and Programmes It is of critical importance to ensure that the ideals of a seamless government are upheld. To this end, the Department of Transport pledges its support for all government led programmes as per the mandates of the government of the day. Operation Mbo, Project Consolidate, the Accelerated Shared Growth Initiative of South Africa (ASGISA), Provincial Spatial Development Strategy amongst others are such programmes that this department will advocate for.

2010 Soccer World Cup The success of the 2010 World Cup is at the forefront of our planning in the Department of Transport amidst budgetary constraints. Road Infrastructure development, Integrated Transport Planning, a safe, regulated, affordable and efficient public transport system as well as overall safety on our roads are the critical issues that we have embarked upon a drive to ensure that KwaZulu-Natal and South Africa as a whole is ready to host the 2010 Soccer World Cup. A report has been submitted to the National Department of Transport detailing the road infrastructure needs for the 2010 World Cup which is approximately R3 billion.

Collaboration with the National Department of Transport I would be failing in my duty if I do not acknowledge the contribution of the National Department of Transport to infrastructure development to change the lives of the people of this Province. The John Ross Highway Project, the Isikhwebezi River Bridge, the nKobide Interchange, the Road to eQhudeni, to mention but a few are evidence of this collaboration with the national Department of Transport

Collaboration with the National Department of Transport cont.. Indeed there is hope for the weak in KwaZulu-Natal when there is partnership and collaboration amongst the different spheres of government for the general good.

KwaZulu-Natal Department of Transport Summary of Infrastructure Expenditure Trend Outcome BudgetMedium-Term Estimates Audited 2003/ / / / / / /2010 Capital New Construction288,549128,351341,412347,292416,751429,414486,400 Rehabilitation/ Upgrading509,827598,371614,215670,276846,7321,025,3631,055,398 Provincial Infrastructure Grant200,121282,594315,121348,194448,190479,007 Sub Total Capital 998,4971,009,3161,270,7481,365,7621,711,6731,933,7842,020,805 Current51,190289,790476,976459,728513,792691,853722,986 Total Expenditure1,049,6871,299,1061,747,7241,825,4902,225,4652,625,6372,743,791 % Conditional Grant19%22%18%19%20%18%17%

Slide 1 As can be seen for the attached slides the Department of Transport Infrastructure Budget has grown from R1,050 million since 2003/04 to R2,744 million in the 2009/10 financial year. The Provincial Infrastructure Conditional Grants have increased from R200 million to R479 million which equates to between 17% and 22% as a percentage of the budget.

KwaZulu-Natal Department of Transport Summary of Infrastructure Expenditure 2006/07 Financial Year Capital 2006/07 Budget Cumulative Analysis - Quarter ending September 2006 %of Budget Spent Cash flow projection Actual expenditure Variance New Construction 347, , ,9161,916 41% Rehabilitation /Upgrading 670,276188, ,28413,28430% Provincial Infrastructure Grant 348, , ,2265,22652% Sub Total Capital 1,365,762505,000525,42620,42638% Current 459,728207, ,9004,900 46% Total 1,825,490712, ,32625,32640%

Slide 2 In the 2006/07 financial year the Infrastructure budget is R1,825 million and the Provincial Infrastructure Conditional Grant is R348 million which equates to 19% of the total infrastructure expenditure. I am pleased to report that for this 2nd Quarter the department has spent 40% of the Infrastructure Budget which is above the Cash Flow Projection for the quarter ending September 2006.

KwaZulu-Natal Department of Transport CONDITIONAL GRANT Project Schedule 2006/07 Financial Year Project RegionProject 2006/2007 Cumulative Actuals - Quarter ending September 2006 name details BudgetOutputsExpenditureOutputs Local RoadsEmpangeni RegionNew Gravel Roads17, ,44421 Local RoadsLadysmith RegionNew Gravel Roads10,500358,74830 Local Roads Pietermaritzburg RegionNew Gravel Roads10,000349,33711 Local RoadsDurban RegionNew Gravel Roads10,194359,74921 ARRUP: All Regions Upgrading from gravel 300, ,94813 Projects to surfaced road Total348, ,22696

Slide 3 As can be seen from the slide that 52% of the Provincial Infrastructure Grant has been spent by the end of the 2 nd Quarter, indicating that the Department is well on track to meet its milestones that were set for the financial year with regards to outputs and budgets.

Conclusion In summary the Department requires an additional budget of R18,483 billion. If this is funded over a 5 year period it amounts to R3,670 billion per annum. As can be seen from the figures presented this department, we have enough capacity and appropriate monitoring and evaluation systems in place to deliver on our mandate. If additional funding can be sourced the Province of KwaZulu-Natal will write its own history and it will be a history of Glory and Dignity, as we continue "Defending the Weak" through the provision of more transport infrastructure such as pedestrian bridges, access roads, a safer road environment and an effective and efficient public transport system.

Conclusion cont.. Massification of our rural growth and sustainable economic growth and development is not possible unless it is supported by appropriate transport infrastructure. Transport the world over is seen as a catalyst for change and improved service delivery.

Thank you