Department of Transport Portfolio Committee on Transport Budget Vote March 2006

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

Programme purpose and measurable objectives Strategic overview and key policy developments Other initiatives Programme outputs and budgets Estimates of National Expenditure Department of Transport

Transport Policy, Research and Economic Analysis Measurable objective: Create an efficient transport system by developing policies that improve safety and travel times, reduce delays, and increase predictability, reliability and quality for local, regional and international services. Purpose: Effectively manage a national innovative research and development programme, analyse strategic policies, develop appropriate legislation, and provide economic advice and analysis for all modes of transport.

Department of Transport Transport Regulation and Accident and Incident Investigation Measurable objective: Develop, implement and maintain regulatory frameworks to ensure improved safety, security and environmental sustainability across the transport sector and to ensure efficient transport services Purpose: Create an enabling regulatory environment in the areas of safety, security and environmental compliance, and manage accident and incident investigations in all modes of transport

Department of Transport Integrated Planning and Inter-sphere Co-ordination Measurable objective: Fully established, integrated transport plans that will incrementally improve public transport services and related infrastructure for social and regional development Purpose: Manage and facilitate integrated planning and inter-sphere co- ordination for transport infrastructure and operations

Department of Transport Freight Logistics and Corridor Development Measurable objective: Efficient freight logistic operations that ensure the speedy, cost-effective and reliable movement of goods along a regional network of freight movement corridors, supported by integrated freight infrastructure planning, adequate infrastructure investment, and a national freight information system Purpose: Manage the implementation of the transport logistics strategy and the development of freight movement corridors

Department of Transport Public Transport Measurable objective: Increased provision of safe, reliable and more affordable public transport, that aims to benefit the most vulnerable passengers Purpose: Develop practices and norms that will increase access to appropriate and quality public transport that meets the needs of both rural and urban passengers

Department of Transport Public Entity Oversight and Economic Regulation Measurable objective: Develop, implement and maintain regulatory frameworks in line with the broader economical and industrial strategies to promote improved performance of the transport sector Purpose: Develop appropriate mandates and monitoring mechanisms for public entities. Develop and oversee transport economic regulation in line with broad economic and transport policies

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, and poverty alleviation Key elements of the strategic approach remain: Restructuring public transport subsidies to better target poorer commuters Aligning subsidised transport services to support municipal integrated transport plans Streamlining the freight logistics network along key freight movement corridors Building capacity to monitor and oversee public entities Developing regulatory systems and capacity to ensure that operators in the transport sector meet the required safety and security standards Establishing a single economic regulator for the transport sector.

Department of Transport Public transport infrastructure and operations for 2010 and beyond A new conditional grant was introduced in 2005/06 to fund, initially, public transport infrastructure for the 2010 Soccer World Cup Transport systems and operations must be prepared to accommodate the increased demand for transport during the 2010 Soccer World Cup. This requires co-ordinating and facilitating transport planning and delivery across the spheres of government The Department will consolidate all the 2010 transport plans into one national transport action agenda Strategic overview and key policy developments (continued) Progress with the Public Transport Infrastructure grant Developed a draft “Towards a 2010 Transport Action Agenda” Established an Interdepartmental Adjudication Committee Developed Proposed Adjudication Criteria Separate Guidelines were developed for National Transport Agencies, Cities and Provinces to submit Transportation Management Priority Statements for candidate projects Projects amounting to R241,7 million were approved in 2005/06 Projects over the MTEF period will amount to R3,5bn.

Department of Transport Strategic overview and key policy developments (continued) Progress with the Public Transport Infrastructure grant (continued) Projects shall be evaluated on the extent to which they: Meet the dual objective of long term mobility and support for 2010 FIFA World Cup Prioritise public over private transport. Able to improve public transport infrastructure, systems, operations and non- motorized transport. Reinforce public transport policies The grant provides for accelerated planning, establishment, construction and improvement of new and existing public transport and non-motorised transport infrastructure and systems` Measurable objectives for the grant: Improved public transport facilities, construction of access roads, airport- city links, public transport priority lanes, bus stops, taxi ranks, rail systems transport plans, bicycle lanes, pedestrian lanes, signage, shelters, coaches IT solution throughout the country

Department of Transport Public Transport (rail, bus and taxi) 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 taxi recapitalisation Investing in passenger rail infrastructure and restructuring passenger rail services Appropriately targeting public transport subsidies Strategic overview and key policy developments (continued) Rail Investment will be focused in the passenger rail sector on corridors that have the required passenger volumes to make rail a viable option Rolling stock, signalling systems and infrastructure will be upgraded Rail is the most affordable means of public transport for the poor, carrying 2,2 million passengers per day The Gautrain will become part of a modally integrated transport service in which the current commuter rail network is deployed

Department of Transport Strategic overview and key policy developments (continued) Rail – interim rail plan approach Short term: The rail operator will focus on stabilising and improving services along the busiest commuter corridors by investing in railway infrastructure, upgrading rolling stock, and improving stations and operations Medium term: A broader recovery phase will be implemented, with significant projects to renew the rail fleet, increase services, and improve fare collection Longer term: The focus will be on establishing a rail economic regulator, extending the range of rail operators, and growing the rail share of the public transport market Rail (continued) Passenger rail services will be restructured into a single entity to make passenger rail more efficient

Department of Transport Strategic overview and key policy developments (continued) Rail – Gautrain Cabinet endorsed the project as a key strategic project of national significance, with potential to: stimulate investment in infrastructure and the economy, and facilitate public transport restructuring and transformation Payments will be made by the Province to the concessionaire in terms of the concession agreement according to the agreed milestone completion schedules The Province will draw 50% of the funds for payment from the conditional grant and 50% from the Provincial budget in 2006/07 The Receiving Department’s rights and obligations will be managed by the Gauteng Management Agency The receiving officer will submit quarterly reports to the national transferring officer, detailing payments made to the concessionaire according to the key milestone payment schedules, detailing payments made to the concessionaire according to the key milestone payment schedules The integration exercise was concluded For the Gautrain to operate successfully it must be a part of a modally integrated transport service in which the current commuter rail network is deployed. Additional funding will be needed to upgrade infrastructure links

Department of Transport Bus Bus subsidies will be transformed to public transport subsidies, with the aim of: Addressing modal inefficiencies Targeting the rural and urban poor Providing support for existing municipal bus services Including smaller capacity vehicles where practical or cost effective Facilitating improved services and safer buses MINMEC decided that bus subsidies should be transformed to public transport subsidies (tendered and negotiated contracts over the next two years) Provinces are now empowered to pursue the implementation of the tender contract system: Interim contracts provide no guarantee for improved services – no capital investments (bus fleets) take place, resulting in poor service provision and deteriorating safety A report on the optimisation of bus subsidies (October 2002) indicate an increase of 25 to 30% increase in the subsidy requirements to transform interim contracts – the challenge is to rationalise public transport subsidies by appropriate targeting within the budget constraints Strategic overview and key policy developments (continued)

Department of Transport Taxi The taxi recapitalisation project will be rolled out over a seven year period at a cost of R 7 billion (additional funding will be allocated as the process unfolds) Cabinet approved the following in July 2005: Final vehicle safety Regulations Rollout and implementation strategy Rollout and implementation project plan Conversion of permits to operating licenses A Scrapping Administration Agency will be created Provincial readiness assessment was completed and business plans will be developed to address provincial needs First scrapping allowances will be paid during 2006/07 Anticipated that vehicles will be scrapped over the medium term The regulation of the industry is being finalised with amendments to the National Land Transport Transitional (NLTTA) Act. Strategic overview and key policy developments (continued)

Department of Transport Freight The freight logistics strategy will be implemented over the medium term to guide investment in infrastructure and to eliminate bottlenecks in freight logistics operations The Freight Logistics strategy aims to unblock freight flows in order to Achieve the speedy and seamless movement of goods Improve the levels of investment in the freight logistics systems to sustain the required levels of service - including investment in ports Reduce the cost of freight transport Reduce transit time Key corridors were identified to determine infrastructure investments Developed a branch line strategy for the revival of sustainable branch lines for local economic development Draft National Freight Logistics Strategy approved by Cabinet Initial phase of implementation is being implemented Strategic overview and key policy developments (continued)

Department of Transport Roads – MTEF outlook Implementation of the Strategic Framework for Roads Revamp of institutional structures and service delivery models Reclassification of SA’s road network system Improvement of Road Network Management Systems Assessment of Municipal road network and focus on access roads Conclusion of road transfers to SANRAL Intensification of implementation of Overload Control Strategy Roll out of Freight Logistics and Rural Transport Strategies Strengthening of integrated planning and delivery through Roads Coordinating Body Strategic overview and key policy developments (continued)

Department of Transport Roads – Planned outputs 2006/07 Strategic Secondary Road Network definition and integration with provincial growth plans Access roads development Assessment of provincial and municipal road needs Redefinition of road network in accordance with new road classification system Develop a road information management system Develop a national road network system (border posts, strategic national network and traffic control centres) Strategic overview and key policy developments (continued) Roads – Planned outputs 2007/08 and 2008/09 Improve the Secondary Strategic Road Network to facilitate seamless freight logistics Access roads development Develop a national road network system (border posts, strategic national network and traffic control centres)

Department of Transport Transport regulation The Road Traffic Management Corporation became operational (staff were seconded) The Special Investigating Unit is identifying irregular practices at driving license and vehicle testing centres – the activity will continue over the MTEF The migration to the new National Traffic Information System (NaTIS) is targeted for completion by November 2006 Hardware deployed in Gauteng and Western Cape and continuing in other Province Overall hardware deployment is 70% complete A total of 151 patrol vehicles have been made available to traffic authorities Road safety campaigns and the Arrive Alive campaigns will continue Strategic overview and key policy developments (continued)

Department of Transport Road Accident Fund restructuring The Road Accident Fund Act requires that fault must be proven, leading to high legal costs. No limits are set on claims. Settlement and administrative costs amount to 47% The Interdepartmental Committee recommended a policy change towards a no-fault benefit scheme Subject to a Cabinet decision, work on a no-fault benefit scheme will commence MTEF outlook: 2006/07 - Establish a governance structure; develop a Green Paper; establish programme management capacity; align the strategies for human resources, systems, processes, partnerships and infrastructure 2007/08 – Develop a White Paper; manage the programme and design the components of the new Road Accident Benefit Scheme (RABS) to enable accurate migration planning, budgets and resource requirements 2008/09 – Develop new RABS legislation; manage the programme; design processes; design organisational structure; develop and implement systems; establish infrastructure; establish human resources; establish partnerships 2009/10 – Oversight by Department; administer new RABS Strategic overview and key policy developments (continued)

Department of Transport Rural transport Key strategic projects will be implemented to improve rural access and mobility, such as: Rural transport development programmes through the ISRDP Urban renewal projects Non-motorised transport promotion Development of bicycle management plans linked to SWC 2010 Coordination and facilitation of labour intensive programmes and the replication of the Zibambele labour contract project Implementation of strategic actions in line with the National Land Transport Strategic Framework Develop a viable institutional framework for the transport authorities A Rural Transport Development Programme was developed and will be piloted for roll out to Provinces Other initiatives

Department of Transport Economic regulation Establishment of a Transitional Rail Economic Regulator to: Balance road and rail usage of freight to address the problem of degenerating road infrastructure Move freight into rail Assist with passenger rail consolidation Manage the contracting environment. Establishment of a Ports Regulator Consolidation of economic regulatory capacity in the longer term: To achieve uniformity and consistency in the application of regulations To improve the effectiveness of economic regulation There is a need to build proper foundations of economic regulation at a modal level before the actual consolidation is achieved. The first two years will be dedicated at creating modal regulatory pillars whilst the 3 rd year (2008/09) will see the merger of modal regulators into a Transport Sector Economic Regulator. Other initiatives (continued)

Department of Transport Overloading control Implementation of the overload control strategy, which was developed jointly by all spheres of Government responsible for traffic control Upgrading of existing Weighbridges Construction of the new Weighbridges in the Road Network in all major freight corridors Establishment of a Specialised Overloading Control Unit Other initiatives (continued) Civil Aviation Creation of capacity to take over the functions of Commissioner of Civil Aviation and aviation accident and incident investigation Regional transport network initiative Support construction bridges and river crossings between RSA and Botswana Improvements to the Sani Pass in Kwa-Zulu Natal

Department of Transport Sub ProgrammeOutput R Million 2006/07 Transport Policy Analysis White Paper on National Maritime Transport Policy Environmental policy framework Integrated transport sector BEE charter 6,8 Transport Economic Analysis Economic performance indicators framework 7,3 Legislation New aviation policy and bill New national maritime transport bill 3,8 Research and Development Innovation and advancement of transport through research National household travel survey 5,6 Administration Support 4,8 Total28,3 Outputs: Transport Policy, Research and Economic Analysis

Department of Transport Sub ProgrammeOutput R Million 2006/07 Road Transport Regulation Regulation of driving standards 35,4 Civil Aviation Regulation Air transport liberalisation 15,3 Maritime Regulation Independent port regulator Maritime transport security legislation Monitoring and enforcement of small vessel regulations 52,9 Rail Transport Regulation Rail economic regulator 4,0 Sub Total107,6 Outputs: Transport Regulation and Accident and Incident Investigation

Department of Transport Sub ProgrammeOutput R Million 2006/07 Accident and Incident Investigation Analysis and dissemination of road accident data South African search and rescue (SASAR) manual Multilateral search and rescue agreement on the sub- regional Maritime Rescue Co-ordination Centre Draft search and rescue regulations 40,7 Administration Support 3,5 Total151,8 Outputs: Transport Regulation and Accident and Incident Investigation (Continued)

Department of Transport Sub ProgrammeOutput R Million 2006/07 Transport Planning Municipal transport plans that address transport service constraints and infrastructure backlogs Implementation of the National Land Transport Transition Act (2000) 23,1 Integrated Delivery Programme Provision and integration of public transport services Non-motorised Transport delivery Expanded public works programme implementation plan 47,3 Integrated Infrastructure and Network Development Road infrastructure strategic framework National overload control strategy 2382, Soccer World Cup Co-ordination Planning for transport operations during 2010 Soccer World Cup 702,3 Administration Support 5,9 Total3161,3 Outputs: Integrated Planning and Inter-sphere Co-ordination

Department of Transport Sub ProgrammeOutput R Million 2006/07 National Logistics Strategy National freight logistics strategy 13,6 Eastern Corridor and Western Corridor Corridor mapping Efficiency gains in the movement of freight 10,3 Border Operations and Control Analysis of system inefficiencies in regional and international movement of goods and passengers Operational improvements in public entities responsible for movement of goods and passengers 1,5 Administration Support 2,4 Total27,8 Outputs: Freight Logistics and Corridor Development

Department of Transport Sub ProgrammeOutput R Million 2006/07 Public Transport Strategy and Monitoring Passenger transport strategy and implementation plan Gautrain Rapid Rail Link 3,9 Public Transport Management Restructured bus operations Restructured and safer commuter rail service Restructured and consolidated passenger rail services 8 828,7 Taxi Recapitalisation Project Office Safer and more sustainable taxi services 326,3 Public Transport Business Development Business case for improving public transport 1,3 Administration Support 5,6 Total9 165,8 Outputs: Public Transport

Department of Transport Sub ProgrammeOutput R Million 2006/07 Public Entity Oversight Performance agreements between government and public entity boards Governance and performance management systems New benefit scheme for victims of road accidents 204,5 Economic Regulation Review of the transport regulatory environment and its impact on competitiveness 2,2 Administration Support 2,6 Total209,3 Outputs: Public Entity Oversight and Economic Regulation

Addition allocations in Adjusted Budget 2005/06 Recent allocation history Additional allocations in 2006 MTEF Overview of 2006 budget Breakdown of budgets Expenditure trends Medium Term Budgets Department of Transport

Adjusted Budget 2005/06 Details R’ /06 Rollovers: Development of Aviation and Maritime policies1 884 African Union Conference Oil pollution contract – unpaid invoices4 000 Set up an office in the U.K. for the IMO representative4 000 Arrive Alive – unpaid invoices Complete overload control facilities in Limpopo, North West and KZN4 213 Unforeseen and unavoidable expenditure: Difference in escalation and fuel price for bus subsidies Other adjustments: Public Transport Infrastructure Fund – new Conditional Grant VAT adjustment for the SARCC Reduction in SARCC budget – transfer to Safety & Security(20 000) Road Accident Fund Devolution of funds from Public Works Total

Department of Transport Recent allocation history MTEF Cycle R’ /04 R’ /05 R’ /06 R’ /07 R’ /08 R’ / Baseline 6,159,7096,451,1726,817,5227,226, Additional 307,872307,905357,927 = 2004 Baseline 6,759,0447,125,4277,584,5007,963, Additional 476,732658,7281,301,364 = 2005 Baseline 7,602,1598,243,2289,265,08910,087, Adjusted 3,138, Additional 4,627,2304,334,2235,425,242 = 2006 Baseline 10,741,00512,870,45813,599,31215,513,071 Conditional Grants included in 2006 Baseline: Local Government: Public Transport Infrastructure Fund 241,710519,000624,0001,790,000 Provincial Government: Gautrain Rapid Rail Link 3,241,0002,151,0001,736,000

Department of Transport Additional allocations in 2006 MTEF Details R’ /07 R’ /08 R’ /09 Road Infrastructure Framework Passenger Rail Road Accident Benefit Scheme Transport Regulation Regional Indicative Strategic Development Rural Transport Strategy PTIF: S.A. Rail Commuter Corporation PTIF: Cross Border Road Transport Agency1 000 Devolution of funds from Public Works PTIF: Local Government: Public Transport Infrastructure and Systems Provincial Government: Gautrain Safety and Security(20 000) Total

Department of Transport Overview of 2006 budget Details R’000 Actual 2002/03 R’000 Actual 2003/04 R’000 Actual 2004/05 R’000 Budget 2005/06 R’000 Budget 2006/07 R’000 Budget 2007/08 R’000 Budget 2008/09 Rail 2,227,4192,360,1482,498,5502,844,6773,161,1403,775,1974,502,717 Bus 1,846,7242,068,5002,172,7402,297,7532,415,2352,535,9972,789,596 Roads 1,203,0641,290,5561,440,7891,752,7202,292,0753,041,9293,509,964 Taxi 6,4979,89810,000260,600323,066328,460361,473 PTIF: Local Govt. 241,710519,000624,0001,790,000 PTIF: Other 181,000376,00010,000 RAF 2,700,00014,000 Gautrain 3,241,0002,151,0001,736,000 Other 434,480503,441557,789643,545723,942766,729813,321 Total 5,718,1846,232,5436,679,86810,741,00512,870,45813,599,31215,513,071 Growth15,8%9,0%7,18%60,8%19,8%5,7%14,1%

Major allocations Department of Transport

Breakdown of major other budgets Details R’ /072007/082008/09 Compensation of Employees157,678165,826175,001 Road Traffic Management Corporation (incl. NaTIS and Arrive Alive) 150,120155,427160,643 Administration60,57363,54466,957 Transport Policy13,49516,05016,843 RSR, SAMSA, SACAA, MRCC, MSCC, NSRI and Memberships50,93753,40956,164 Oil Pollution prevention services and Watch Keeping services65,43768,75570,543 Special Investigating Unit16,62517,62519,733 Inspectorates, Road, Rail, Maritime and Aviation regulation31,71938,79246,300 Overloading Control24,7798,2218,796 Rural transport projects38,01938,39839,023 Road infrastructure planning and Sani Pass (KZN DOT)50,00080,00086,400 Transport planning and infrastructure projects32,29037,31240,026 Freight Logistics projects and research18,6049,0339,649 Public Transport, including systems to devolve bus subsidies10,90811,44812,557 Public Entity Oversight and Economic Regulation2,7582,8894,686 Total723,942766,729813,321

Department of Transport Breakdown of major other budgets (2006/07) 20,000 40,000 60,000 80, , , , , , DetailsR’000% 1 Compensation of Employees 157, % 2 RTMC150, % 3 Oil Pollution prevention services and Watch Keeping services 65,4379.0% 4 Administration60,5738.4% 5 RSR, SAMSA, SACAA, MRCC, MSCC, NSRI and Memberships 50,9377.0% 6 Road infra. planning50,0006.9% 7 Rural transport projects38,0195.3% 8 Transport planning and infrastructure 32,2904.4% 9 Inspectorates, Road, Rail, Maritime and Aviation regulation 31,7194.4% 10 Overloading Control24,7793.4% 11 Freight Logistics18,6042.6% 12 Special Invest. Unit16,6252.3% 13 Transport Policy13,4951.9% 14 Public Transport13,6661.9% 15 Public Entity Oversight2,7560,4% Total723,942100% 15

Department of Transport Expenditure trends: Rail 19,9%6,0%5,9%13,9%11,1%19,4%19,3% 2002/03: Growth of 20% due to an additional R146m for rolling stock and rail extensions and an additional R160m for subsidies 2005/06 to 2008/09: Adjustments for VAT and additional allocations for passenger rail infrastructure

Department of Transport 7,7%12,0%5,0%5,8%5,1%5,0%10,0% 2003/04: Additional allocations of R 150m per year in 2003 MTEF. From then onwards, only inflationary adjustments added to baseline. Expenditure trends: Bus

Department of Transport 12,7%7,3%11,6%21,6%30,8%32,7%15,4% 2004/05 and 2005/06: Additional allocations of R200m, R250m and R300m in 2003 MTEF and VAT adjustments in 2004 MTEF of R187m, R203m and R213m. 2007/08: Additional R500m 2006/07 onwards: Additional R400m, R600m, and R900m in 2006 MTEF. Expenditure trends: Roads

Thank you Department of Transport

Abbreviations RABSRoad Accident Benefit Scheme MTEFMedium Term Expenditure Framework PTIFPublic Transport Infrastructure Fund RAFRoad Accident Fund NaTISNational Traffic Information System SANRALSouth African National Roads Agency Limited SARCCSouth African Rail Commuter Corporation Limited RSRRailway Safety Regulator SAMSASouth African Maritime Safety Authority SACAASouth African Civil Aviation Authority MRCCMaritime Rescue Control Centre MSCCMaritime Security Co-ordination Centre NSRINational Sea Rescue Institute RTMCRoad Traffic Management Corporation KZN DOTKwa-Zulu Natal Department of Transport ISRDPIntegrated Rural Strategic Development Programme VATValue Added Tax IMOInternational Maritime Organisation BEEBlack Economic Empowerment