1. SARCC Budget and Strategic Plan 2007/08 Portfolio Committee on Transport 28 February 2007 Presented by SARCC CEO: TL Montana

2. 2 Agenda 1.Background 2.SARCC Mandate 3.Vision and Mission 4.Corporate Objectives 5.Structure 6.Operationalisation of Strategy 7.Financial Plan 8.Key Performance Indicators

3. 3 1. Background Transfer of Metrorail to SARCC 1 May 2006 Consolidation Process –Complex –Challenging Integration Issues –Procurement –Policies –Budget –IT Systems Uncertainty

4. 4 1. Background (Cont.) Increased investment –Rail infrastructure –Operations –2010 FIFA World Cup Mandate of the shareholder –Turnaround and improve services Overall task of Executive Team: –to halt the continuing deterioration of the Passenger Rail Service and –put together a stabilisation strategy

5. 5 1. Background (Cont.) State of Passenger Rail in South Africa –Services on knife-edge –Shortage of technical skills –Decline in availability of rolling stock –Industry not geared to meet growth in demand Strategy of National Passenger Rail Company –Repositioning in the mainstream of Public Transport –Seeks to bring significant improvement in customer services –Passenger Rail Plan approved by Cabinet in Dec 2006 –Turnaround strategy in three years –Long term vision

6. 6 2. SARCC Mandate SARCC continues to draw its mandate from the Legal Succession Act Primary Object –To provide rail commuter service in the public interest –To promote rail as the primary mode of mass commuter transportation Secondary Object –To generate income from the exploitation of assets

7. 7 3. Vision & Mission Vision: An established passenger rail service that is the public transport mode of choice for South Africans. Mission: To ensure efficient and seamless movement of people through the provision of safe, reliable, affordable and sustainable passenger rail services; and to develop rail assets using best practices in the interest of all stakeholders

8. 8 4. Corporate Objectives Boosting Revenue –Ticketing System –Reduce Fare Evasion Increase Patronage –Arrest decline in passenger numbers –Capturing new strategic corridors Investing in Human Capital –Change Management –Performance Management –Salary parity

9. 9 4. Corporate Objectives (Cont.) Customer Focus Improvements –Punctuality, Cleanliness –Efficiency & reliability –COSAS Optimise Asset Value –Focus investment on priority corridors –Property Portfolio –Implementation of the Rolling Stock refurbishment program

10. 10 4. Corporate Objectives (Cont.) Strengthen Corporate Governance –Strengthened Board of Control –Enterprise Risk Management (ERM) –PFMA / Treasury regulations

11. 11 5. Structure : End State

12. 12 6. Operationalisation of Strategy Translation of strategy into day to day actions (What happens when the steel strikes the rail)

13. 13 6.1 SARCC Strategic Programmes Significant improvements in service delivery –Punctuality i.e. reduced train delays and cancellations –Train & Station Cleanliness –Station & train safety & security –Reliability & predictable service –Communication to customers –Station improvement and upgrades Accelerated rolling stock upgrade programme Enhanced operational safety Effective Revenue Management ISO 9000 Quality Management Risk Management Change management.

14. 14 6.2 Key Business Initiatives to Improve Service Delivery Improve train availability Railway police Train cleanliness Security learnerships Extension of services and new services (e.g. Pretoria – Hammanskraal) Station upgrades (e.g. Doornfontein, Durban and Cape Town) Signal and Telecomms upgrade Operational communication initiatives.

15. 15 6.3.Measures of Success ( three year period) Train availability at 96% 50 station upgraded Predictable service at 90% Customer satisfaction level at 65% Fare revenue increase by 6% Fare evasion below 5% Safety levels improved by 30% Crime levels reduced by 15% Effective Quality Management System

16. 16 7. Financial Plan: MTEF Allocation

17. 17 7.1 Financial Plan (Cont.) Operational Budget 2007/08 per MTEF

18. 18 7.1.1 Financial Plan (Cont.) Detailed Budget 2007/08 per MTEF

19. 19 7.2. Five Year Capital Requirement Plan as per Rail Plan and 2010 requirements

20. 20 Rm MTEF Allocation Capital Allocation Subsidy: Capital 1,696.078 PTIF 476.000 Accelerated Rolling Stock Program 1,696.078 Signaling 200.000 Station Upgrades 226.000 Security 30.000 Communication 20.000 2,172.078 7.3 Financial Plan (Cont.) Capital Budget 2007/08 per MTEF Allocation

21. 21 8. Key Performance Indicators Target 2007/08 2008/09 2009/2010 Increase patronagePassenger trips increase1%2%3% ReliabilityTrain delays performance88%89%90% PredictabilityTrain cancellations performance1.80%1.70%1.60% Reduction of safety incidents6% reduction7% reduction8% reduction Reduction of security incidents6% reduction7% reduction8% reduction Reduction of accidents20% reduction25% reduction30% reduction Reduce Crime Index0.420.40.38 Increase in Metro Plus product Metro Plus passenger trips1% increase Optimising asset Value GO’s and Upgrades500700 Rolling Stock Investment New rolling Stock00240 Stations upgrade projects91626 Bridges & structures projects322 Signals projects715 Electrical projects820 Telecommunications projects666 Facilities projects1218 New extensions011 Customer focus improvements Improve safety & security Investment in infrastructure to facilitate growth & development Infrastructure investment Reduction of transport costs to contribute to ASGISA National ObjectiveSARCC Strategic objective MeasureProjections

22. 22 8. Key Performance Indicators (Cont.)

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