1. Presented by SG Khumalo

2. Presentation Outline Part 1: The Mandate and Strategic Goals Part 2: Review of Performance in the FY11/12 Part 3: Annual Financial Statements and Audit Outcomes Part 4: Challenges and Interventions 2

4. Mandate The C-BRTA was established by the Cross-Border Road Transport Act 4 of 1998 to provide for co-operative and co- ordinated provision of advice, regulation, facilitation and law enforcement in respect of cross-border road transport by the public and private sectors. 4

5. Legislated Mandate The functions as per the legislated mandate are as follows:  To improve the unimpeded flow of freight and passengers in the region;  To introduce regulated competition in respect of cross-border passenger road transport;  To reduce operational constraints for the cross-border road transport industry as a whole;  To liberalize market access progressively in respect of cross-border freight road transport;  To enhance and strengthen the capacity of the public sector in support of its strategic planning, enabling and monitoring functions;  To empower the cross-border road transport industry to maximize business opportunities and to regulate themselves incrementally to improve safety, security, reliability, quality and efficiency of services. 5

6. Core Functional Areas This role is carried out through the following functions:  Facilitation - ensures that consultations and partnerships with other key role players within South Africa and SADC are fostered and maintained  Law Enforcement - monitors the carriers through country-wide inspections and ensures that carriers operate within the prescribed legal parameters  Regulatory - responsible for the issuing and facilitation of all cross border permits  Advisory - advises the Minister of Transport and the DoT on regional road transport imperatives and challenges. This function also monitors and counteracts any restrictive measures that may be implemented by other states in the SADC region. 6

7. Strategic goals  Goal 1: Strategic positioning to enhance organisational sustainability;  Goal 2: Facilitate unimpeded flow of cross-border transport;  Goal 3: Promote regional integration;  Goal 4: Promote safe and reliable cross-border transport; and  Goal 5: Enhance organisational performance. 7

8. Strategic Projects  The following key projects are the key drivers of our strategy and dependent on collaborative partnerships:  Strategic Value Proposition Plan (SVPP);  Industry Partnership Development Plan (IPDP);  Operator Compliance Accreditation Scheme (OCAS);  Business Model for Streamlining Border Management Practices; and  Market Access Regulation (MAR). 8

10. Review of Performance in the FY11/12 Law Enforcement W ORK ACTIVITY 2011/122010/11D IFFERENCE P ERCENTAGE Vehicle Inspections124 62465 40059 22491% Prosecutions11 54915 486(3 937)(25%) Compliance Rate91%76%14% 10

11. Review of Regulatory Permits FY11/12 W ORK ACTIVITY 2011/122010/11P ERCENTAGE Total Permits issued71 10094 133(25%) PERMITS ISSUED PER CATEGORY Passenger transport -Taxi11 95011 979(0.24%) Passenger Transport – Buses2 3673 409(31%) Freight transport54 82776 844(29%) Tourist transport1 9562 358(16%) 11

12. Taxi Permits Issued – per Country 2011/2012 12

13. Table 2: Permits issued for passenger transport (buses) Country2010/20112011/2012% Movement Botswana21136(83%) Democratic Republic of Congo 323667% Lesotho712468(34%) Malawi251207(18%) Mozambique668399(40%) Namibia7311355% Swaziland13817(88%) Zambia8611534% Zimbabwe1 267989(22%) Total3 4092 367(31%)

14. Bus Permits Issued – per Country 2011/2012 14

15. Table 4: Permits issued for tourist transport Country2010/20112011/2012 % Movement Regional2 3281 956(16%)

16. Table 3: Permits issued for freight transport Country2010/20112011/2012% Movement Botswana12 6678 785(31%) Democratic Republic of Congo 4 7794 275(11%) Lesotho6 4694 423(32%) Malawi1 7971 130(37%) Mozambique10 0647 351(27%) Namibia7 9345 680(28%) Swaziland9 3445 899(37%) Zambia8 7278 154(7%) Zimbabwe11 6768 426(28%) Cabotage3 387704(79%) Total76 84454 827(29%)

17. Freight Permits Issued – per Country 2011/2012 17

18. Employment Equity per Race 18

19. Employment Equity per Gender 19

20. Summary of Key Achievements Introduction of performance management system across all organizational layers Industry development strategy was developed and approved. Cross Border Operators Forum was initiated and became operational Visibility of road transport inspectorate was significantly improved resulting in improved compliance Improved fraud and corruption detection and prevention interventions led to the seizure of fraudulent permits and arrests. 20

21. Summary of Key Achievements Establishment of the Project Management Office (PMO) to manage key strategic projects Conducted a Study on the Model for Trade Supply Chain Analysis: This model is part of the development of the business case for border modernization. Conducted a study on the analysis of business processes at the borders focusing on the freight supply chains at the two borders. The study focused mainly on the analysis of business processes, identification of impediments, international benchmarking, compliance checks and requirements, SARS customs modernization programme, etc. Assessment of South African transport corridors focusing on freight flows along the Durban-Lebombo (N4) and Durban- Beitbridge (N1) corridors was conducted 21

22. Summary of Key Achievements Report on the assessment of route utilization and impediments to passenger flow along the Durban-Lebombo and Durban-Beitbridge corridors was finalized:- The report talks to the passenger and driver impediments, route utilization and a model for market access. A report on liberalising market access for road freight was finalized. 22

24. Highlights: Financial Performance 2011/20122010/2011 INCOME Permit IncomeR164.89mR42.50m Penalty IncomeR15.07mR15.76m Other IncomeR 3.15mR0.78m Interest ReceivedR 2.45mR0.59m EXPENSES Employee CostsR70.75mR42.61m Operating ExpensesR44.49mR25.46m (LOSS) / SURPLUSR71.05m(R8.43m) 24

25. Highlights: Financial Position 2011/20122010/2011 CURRENT ASSETS ReceivablesR2,69mR2.15m Cash and Cash equivalentsR84.65mR3.01m NON-CURRENT ASSETS Property, plant and EquipmentR7.57mR6.40m Intangible assetsR1.07mR0.49m TOTAL ASSETSR96.00mR12.06m 25

26. Highlights: Financial Position 2011/20122010/2011 CURRENT LIABILITIES Lease obligationsR0,76mR0.55m PayablesR12.57mR6.30m ProvisionR6.19m- NON-CURRENT LIABILITIES Retirement benefit obligationR1.88mR1.66m TOTAL LIABILITIESR21.40mR8.52m ACCUMULATED SURPLUSR74,60mR3.55m 26

27. Audit Outcomes AUDIT OPINIONBASIS OF OPINION Qualified audit opinion During 2010/11 there were inadequate systems of controls to satisfy completeness of penalty revenue and related receivables for the year ended 31 March 2011. Therefore unable to determine the extent of the understatement of the opening balance of accumulated surpluses and receivables 27

28. Audit Outcomes EMPHASIS OF MATTERSDETAILS Significant uncertaintiesThe increase of permit tariffs which became effective in April 2011 currently under litigation and still on-going as at reporting period Restatement of corresponding figures Comparative figures restated with errors identified during the reporting period – restatement of penalty revenue and related receivables 28

29. Audit Outcomes COMPLIANCE WITH LAWS DETAILS Strategic planning and performance management Revised strategic plan not approved by the Executive Authority Annual financial statements Correction of the annual financial statements subsequent to submission to the Auditor-General (mainly a change in accounting policy for permit revenue and bonus provision) Procurement and contract management Non-compliance with PPPFA and Practice notes in relation to quotations, preferential point system, advertisement of bids, etc. Expenditure management The agency incurred irregular expenditure of R14 million due to non-compliance with procurement prescripts and R456K in fruitless and wasteful expenditure 29

31. Challenges and Interventions KEY CHALLEENGES Normalisation of the Lesotho/South Africa Border Operations – this situation remains unresolved as at year end. However, concerted and renewed efforts were initiated leading to the formation of a Task Team and some progress made. Audit qualification. The agency received an audit qualification for the current year audit. However, there is improvement in that the current year penalty revenue is not qualified, creating an opportunity to break the cycle of historical audit qualification. 31

32. Challenges and Interventions KEY INTERVENTIONS Action plans developed for all the significant audit findings with clear deadlines and responsible persons Developed and managing a dashboard of all the Audit findings to fast track the systematic resolution of these matters. Elevations of business performance, internal control and risk management through capacitation of the function Capacitating Internal Audit function Enhancing performance management systems and in-year monitoring Performance contracts of executives being amended to include key risks and findings identified in the audit report 32

33. In Conclusion The C-BRTA is geared to demonstrate its commitment to adding public value through its strategic interventions. This Agency is also poised to support the National Programme of Action of government of industrialization and job creation. The executive committee is geared towards breaking the cycle of audit qualifications 33

34. i thank you 34