1. Click to edit Master subtitle style HRD PLAN AND JOB CREATION WITHIN THE TRANSPORT SECTOR Transport’s contribution to the New Growth Path Prsentation to the Transport Portfolio Committee, 16 August 2011

2. Contents  Purpose  Integrated Skills Development Strategy  Critical skills in the sector (needs & interventions)  Major Transport Sector Job Creation Initiatives  S’hamba Sonke Programme  Shova Kalula Bicycle Programme  Rail Rolling Stock Acquisition Programme  Other Transport Sector Job Creation Initiatives  Conclusion

3. Purpose  To provide an overview of the manner in which the Department of Transport and the Transport Sector responds to the New Growth Path, Job Creation, Service Delivery and Transformation through skills development.  To provide appropriate interventions to address identified scarce and critical skills needed in the transport sector.  To report on major Transport Sector Job creation initiatives that respond to the New Growth Path, namely, S’hamba Sonke, Shova Kalula, the Rail Rolling Stock Programme, etc.

4. JOB CREATION EDUCATION, TRAINING, SKILS DEV CAPACITY BUILDING INITIATIVES MEN TORI NG & COA CHIN G SEMI NAR S, WOR KSH OPS CON FER ENC ES INTEGRATED SKILLS DEVELOPMENT LEGISLATIVE FRAMEWORK and MOUs INTERGRATED SKILLS DEVELOPMENT STRATEGY S A F E, S E C U R E, E F F I C I E N T, A F F O R D A B L E, R E L I A B L E, A C C E S S I B L E T R A N S P O R T S Y S T E M IMPRO VED PUBLI C TRANS PORT SYSTE M THROU GH SKILLS DEVEL OPMEN T IN PARTN ERSHI P WITH PRIVAT E; PUBLI C AND INTER NATIO NAL INSTIT UTION S IMPROVEDRURALACCESS,INFRASTRUCTUREANDMOBILITYIMPROVEDRURALACCESS,INFRASTRUCTUREANDMOBILITY A N E F F I C I E N T, C O M P E T I T I V E, R E S P O N S I V E S O C I O - E C O N O M I C I N F R A S T R U C T U R E ROAD RAIL AIR MARITIME SKILLS I NTEGRATION  PLANNING  PROJECT MANAGEMENT  IMPLEMENTATION  PUBLIC TRANSPORT VISION OUTPUT

5. Road critical skills needs  Engineers: Civil; Mechanical, Electrical  Artisans  Apprentices  Roads Maintenance Officers  Infrastructure network planning and management  Road Traffic Management  Road and Vehicle Inspectors  Traffic officers, Road Incident Managers

6. Rail skills needs  Engineers: Mechanical; Electrical, Civil, Information Technologists and Signaling Experts  Rail Infrastructure Developers  Rail Safety Inspectors  Economists  Logisticians  Monitors, Operators, Yard masters

7. Aviation skills needs  Pilots  Aircraft Maintenance Engineers  Air Traffic Controllers  Aviation Safety and Security Experts  Air Transport Managers  Aviation Infrastructure Managers  Aviation Compliance Managers

8. Maritime skills needs  Pilots  Seaferers  Ship Designers, Builders, Naval Architects  Skippers  Maritime Safety Officers  Maritime Environment Protection Specialists  Marine Engineers  Ports engineers  International Compliance

9. Our approach to skills requirements Policy Making, Regulations,Integrated Planning SKILLSNEEDSSKILLSNEEDS MENTORINGMENTORING LEANERSHIPLEANERSHIP INTERNSHIPINTERNSHIP TECHNICALTECHNICAL R P E R T O I F R E E S D S I O N A L Integrated, coordinated skills development, Implementation, Monitoring and Evaluation BURSARIESBURSARIES SCHOLARSHIPSCHOLARSHIP PROFESSIONALPROFESSIONAL COACHINGCOACHING MANGTDEVMANGTDEV

10. SUSTAINABLE DEVELOPMENT AND POVERTY ALLEVIATION Specific functions related to the job Technical skills Competencies associated with the effective execution of the job The overall training strategy to develop the human resource potential for sustainable development TECHNICAL/ DIFFERENTIATING COMPETENCIES STRATEGIC-GENERIC COMPETENCIES CORE COMPETENCIES WHOLISTIC APPROACH TO SKILLS DEVELOPMENT

11. Interventions  Establishment of Skills Coordinating Bodies for each mode of transport, e.g CAPCO.  Centres of Development (COD), partnership with 13 Universities.  Engineering :Civil, Mechnical, Industrial, Marine etc ( TUT, UP )  Transport Economics ( provided through UJ, UNW,UNISA etc)  Transport and Freight Logistics( UJ, UNISA,UNW, Unizulu )  Maritime studies ( DUT, UKZN)  Transport Management ( UJ, Unizulu )  Transport Planning ( UCT )  Transport Research Activity Centre (TRAC)- support for learners and educators on Maths, Science and Technology- 33 Mobile laboratories.

12.  Transport FET Curriculum and Programme has been approved for introduction in FET Colleges for 2012.  Educational Outreach Programmes  Learnerships and Apprentices (Driven by Teta)  Internships across the transport sector (with rotational options) - Integrate job rotation as part of the job description on the part of the targeted mentors.  Utilization of retired professionals for mentoring and coaching (still to be properly coordinated)  Khaedu and Accelerated Development Programme for Managers is running according to the national programme.  Transport FET Curriculum and Programme has been approved for introduction in FET Colleges for 2012. Educational Outreach Programmes Learnerships and Apprentices (Driven by Teta) Internships across the transport sector (with rotational options) - Integrate job rotation as part of the job description on the part of the targeted mentors. Utilization of retired professionals for mentoring and coaching (still to be properly coordinated) Khaedu and Accelerated Development Programme for Managers is running according to the national programme.

13. Major Transport Sector Job Creation Initiatives

14. S’hamba Sonke Roads Maintenance Programme

15. Why focus on roads?

16. Roads are part of the country’s Gross Capital Stock which contributes to economic development with infrastructure investment influencing GDP levels..... Research shows that there is a correlation (measure of association) between investment in economic infrastructure and economic growth with the effects of investment in economic infrastructure lasting up to 20 years and beyond (with well maintained infrastructure). The latter partly explains S.A’s economic growth irrespective of inadequate investment in infrastructure during the 1980’s. 1616

17. South Africa’s investment in infrastructure since the 60’s peaking during the mid-70 and 80’s and then a gradual decline since then. Fixed capital stock has generally been supported by growth in GDP and in turn supports subsequent GDP growth (with adequate maintenance of the infrastructure). In general the decline in investment on infrastructure during the eighties until the upswing at the start of this decade has thus contributed in slowing of economic growth… 17

18. What is the state of the road network currently?

19. Overall network condition 1919

20. How much do we know about our network: availability of data* Authority PavedGravelTotal LengthDataLengthDataLengthData% Data Received SANRAL16,170 00 100 Provinces - 948,17647,088136,640103,733184,816150,82082 Metros - 951,68240,73714,4611,78966,14342,52764 Municipalities37,69110,866302,1582,124339,84912,9904 Total153,719114,861453,259107,646606,978222,507 % Data Received752437 2020 * Based on information collected from pavement management systems of roads authorities by SANRAL on behalf of DOT: 2009

21. and funding?

22.  Paved  Gravel  Paved Gravel

23. 2323 What is allocated and spent on maintenance? 2004/05 (%) R’000 2005/06 (%) R’000 2006/07 (%) R’000 2007/08 (%) 2008/2009(%) R’000 2009/10 (%) R’000 2010/2011(%) R’000 Pre-audited R’000 (Mainten cance) Eastern Cape 1 282406 (32)1 396424 (30)1 492566 (38)1 615668 (41)1566670 (43)1 605701 (44)1 648735 (45) Free State 322198 (61)333192 (56)801347 (43)743166 (22)962194 (20)1242291 (23)1376379 (28) Gauteng473160 (34)550363 (66)577171 (30)1078246 (23) 1401666 (48)1513747 (49)1418761 (54) Kwazulu -Natal 1 333550 (41)1 682656 (35)1 856821 (44)2360962 (41)29641221 (41)36961483 (40) 38701574 (41) Limpopo952302 (32)1152321 (28)1139328 (29)1445331 (23)1426346 (24)1554384 (25)1 802433 (24) Mpumal anga 607191 (31)723197 (27)688246 (36)993443 (451014443 (44)1137490 (44)1185505 (43) Northern Cape 18787 (47)17780 (45)23683 (35)365113 (31)419150 (36)485170 (35)569174 (31) North West 393210 (53)605253 (42)689267 (39)691218 (32)715251 (35)904380 (42)835251 (30) Western Cape 676405 (60)962573 (60)1285657 (51)1346656 (49)1380554 (40)1538615 (40)1 632728 (45) Total Provinc e 6 1902 508755330588763348510 638380311 888449513 673526014 3345540 (40%) (36%)(38%) (39%)

24. Click to edit Master subtitle style Key sector response S’hamba Sonke Programme

25. Implementation focus areas for S’hamba Sonke Key Programme ComponentsKey Actions Increase investment in maintenance of key arterial routes to support the rural economy Provincial authorities to identify roads for approval by DoT Outline methods of implementation that unbundle contracts to create opportunities for Emerging Contractors and local labor Collect key condition data on such roads Increased focus in the cost efficient use of labor absorptive methodologies in road construction and maintenance; Best practice labor intensive programmes to be rolled out nationally Cost-efficiency is key in the rollout of programmes Pothole patching programme to be rolled out Co-operatives to be introduced on road maintenance Improving Access to Schools and Clinics and other public facilities Provinces to itemise backlogs and progress Business plans that respond to job creation to be submitted Know your network: A focused attention on deployment of local resources to support road network asset management Roads authorities are to retain information on network conditions on a regular basis Collected information must be fed into the asset management system collected condition information must be used to inform investment decisions Delivering a safe Road Environment

26. How these are/have been addressed 2626 Key Programme Components S’hamba Sonke Business Plan Framework Reporting Framework Increase investment in maintenance of key arterial routes to support the rural economy Provinces developed and submitted business plans prioritising key arterial roads with rehabilitation of high volume roads (where commitments were made through IGP); maitenance of high trafficked roads in poor to very poor condition, upgrading and construction of access roads (where commitments were made through IGP), maintenance of access roads, give details of pothole repair programme. Details of Road Asset Management System (Pavement Management systems incl. Extent of roads in various condition category, vehicle operating costs) Contractor development strategy and S3 engineer development strategy/programme. Measure to ensure safe road environment Job creation targets Financial data Part 1: Financial Related Data (ES&PRMG allocations) Part 2: Network Management Data Visual condition assessment information Traffic counting data reclassification Part 3: Law Enforcement/Safety Related Data Part 4 Maintenance and Upgrading Related Data Length or volume of roads in various condition addressed (including pothole patching) Number of drainage and related structures constructed or maintained Routine road maintenance activity Part 5: Job Creation Data Total number of jobs created Breakdown for women, youth and people with disabilities Part 6: Procurement Related Data Value of contracts awarded at different levels of CIDB grading Increased focus in the cost efficient use of labor absorptive methodologies in road construction and maintenance; Improving Access to Schools and Clinics and other public facilities Know your network: A focused attention on deployment of local resources to support road network asset management Delivering a safe Road Environment

27. Contribution to government priorities Key Programme Components Direct or indirect contribution Increase investment in maintenance of key arterial routes to support the rural economy The African Renaissance Road Upgrading Programme (ARRUP) in KZN shows that targeting development of key arterial routes accelerates development of road construction industry and renewal of rural communities. This goal will be accellerated when additional funding materialises in the roads sector to enable targeting of the most vulnerable sectors and put rural economy on a sustainable labor absorptive path. Increased focus in the cost efficient use of labor absorptive methodologies in road construction and maintenance; Labor absorptive programmes provides poverty relief as opposed to alleviating poverty completely. Focusing on cost effective use of such methodologies coupled with linkages with other productive enterprises in communities (e.g LED projects) may in the long term assist in tackling the problem of poverty and create sustainable livelihoods. E.g. in both KZN and EC programmes savings of R12m and R20m have been realised by participants. Proper deployment of such resources may enable participants to graduate from programme into sustainable enterprises. Improving Access to Schools and Clinics and other public facilities Contributes to sustainable livelihoods and allevition of poverty by facilitating access to key government services and interventions and mobility of goods and people in the local productive space as well as linkages with available economic activities 2727

28. allocations….

29. Provincial roads Maintenance Grant Allocations to provinces Vote Name of allocation Province2011/122012/132013/14 Transport (Vote 36) R'000 Provincial Roads Maintenance Grant Eastern Cape 1 034 086 1 215 920 1 312 210 Free State 447 165 525 794 567 433 Gauteng, Includes Coal Haulage 566 917 583 226 625 542 744.40.9 KwaZulu-Natal 1 236 648 1 454 099 1 569 251 Limpopo 934 208 1 098 478 1 185 468 Mpumalanga Includes Coal Haulage 1 016 603 1 253 564 1 449 002 511659808 Northern Cape 308 760 363 053 391 803 North West 501 826 590 067 636 795 Western Cape 411 141 483 437 521 720 Unallocated - - - TOTAL 6 457 939 7 568 301 8 260 032 2929

30. Targets 3030

31. Targets for job creation per province 3131

32. Recorded progress to date on PRMG Prov PRMG Allocation 2011/12 Amount Transferred Spent to date Job Creation Data 13-May-11 Work opportuniti es Full time equivalent WomenYouthREMARKS EC R 1 034 086 R 155 113 R 193 677 1 239512660520 FS R 447 165 R 75 029 R 81 926 1 27379630584 GP R 566 917 R 55 017 R - ---- All projects on tender stage KN R 1 236 648 R 309 162 R 168 225 39 5745 12430 4009 700 LM R 934 208 R 191 016 R 97 817 19 187No figures13 9277 544some data missing MP R 1 016 603 R 150 138 R 220 769 518No figures some data missing NC R 308 760 R 86 085 R 88 472 3 2993232 233959 NW R 501 826 R 57 642 R 21 962 19856No figures some data missing WC R 411 141 R 61 191 No figures 2 056No figures no official feedback/response as yet TOT R 6 457 354 R 1 140 393 R 872 848 67 3446 09447 85019 307 3232

33. 3333 with inadequate capacity at DOT to manage all these, the plan is to source capacity as follows….

34. Key areas for support by DOT- PMU for S’hamba Sonke 3434

35. 3535 Key Provincial Interventions

36. 3636 Free State

37. 3737 The Free State was allocated a total amount of R447,165 under the maintenance fund which has been allocated as follows:

38. Engaging contractors  CONTRACTOR DEVELOPMENT PROGRAMME (CDP).  The budget allocation for the Contractor Development Programme for the 2011/2012 financial year is R80 million. It is estimated that the Department will train 64 Contractors and create an estimated 768 jobs. 3838

39. 3939 Gauteng

40. Job creation  Planned job creation projections is a total of 6000.  42 emerging contractors to be engaged  They employ 121 workers  Create approximately 5091 jobs in the 2011/12 financial year  Addressing road reserve, reactive and routine road maintenance activities.  The balance between the 6000 and 5091  Preventative road maintenance programmes i.e., reseals, light rehabilitation, etc. for the balance of 909 4040

41. Contractor development  Aim to develop contractors over a 3 year period  Contractors at various CIBD levels responsible for:  Road reserve maintenance,  Reactive maintenance wherein work is allocated on a call- out basis.  Routine maintenance wherein work is planned,  Preventative (Medium) maintenance wherein medium scale rehabilitation projects are conducted, and  Preventative (Large) maintenance wherein large scale rehabilitation projects are conducted.  Developmental Feeder system  Developing of contractors from Level 1 through to Level 5.  Level 5+ contractors will be used to provide entrance for Level 1-2. 4141

42. 4242 Reactive Work based on requests Level 2 contractors. Routine Work based on planned routine activities. Level 3-4 contractors. Preventative (Large) Large scale work based on a preventative plan. Level 6+ Road Reserve Road Reserve maintenance Level 1 contractors. Preventative (Medium) Medium scale work based on a preventative plan. Level 5 Bridge Maintenance Level 6 Level 3-4 Traffic Lights & Street Lights Maintenance CONTRACTOR DEVELOPMENT Contractor development…

43. Contracts allocation per region 43

44. 4444 KwaZulu- Natal

45. In support of S’hamba Sonke Programme KZN have identified the following anchor projects  Nongoma – Dabhazi – Hlambanyathi - Hlabisa Corridor  Eshowe – Ntumeni – Kranskop – Vryheid corridor  Vukuzakhe and Zibambele Programmes  Pothole eradication 4545

46. Maintenance Maintenance is undertaken over whole road network:  Conserving the higher order roads  Rehabilitation and reseals  Preventative Maintenance  Routine Maintenance  Safety Maintenance  Special Maintenance 4646

47. 4747 Pothole Programme Strategy  The Department has implemented a 2 year Pothole Repair Contract commencing in the 2011/2012 financial year to address the backlog of pothole repairs.  A database comprising of 134 contractors ranging from Grade 1 to Grade 7, has been created per the following regions.  EMPANGENI  LADYSMITH  PIETERMARITZBURG  DURBAN

48. 4848 Pothole Programme Strategy… This programme will the following benefits of :  A safe road network for the road user;  Reducing road accidents;  Reducing and minimizing the road maintenance backlog;  Maintaining and improving the average road network condition;  Reducing pressure on routine maintenance resources due to improved road conditions;  Considerable savings on vehicle operating costs for road users;  Temporarily reducing overall costs for maintaining the road network;  Reducing claims against the Department of Transport.

49. 4949 Limpopo

50. R693,306m PRMG  29 x Preventative Maintenance Projects to the value of R375,111m are at Award, Contract and SLA stages  Routine Maintenance roads works material, plant and equipment repair amount to R109,627m  Procurement of plant and equipment to the value of R70,834m  R33 (Lephalale) has been allocated R170m and is already at construction stage. 5050 R693,306m PRMG 29 x Preventative Maintenance Projects to the value of R375,111m are at Award, Contract and SLA stages Routine Maintenance roads works material, plant and equipment repair amount to R109,627m Procurement of plant and equipment to the value of R70,834m R33 (Lephalale) has been allocated R170m and is already at construction stage.

51. R242,148m PRMG & R74,141m ES)  25 X Household Projects are already at various stages of construction to the value of R203,636m  7 X Access roads are already at various stages of construction to the value of R60,560m  20 X learner contractors to be appointed by September 2011 to the value of R45m  Householder contractor development  25xHouseholds projects were implemented in 2010/11 FY and are continued in 2011/12 FY. Additional 2 projects to be awarded.  Financially struggling families are indentified and the bread winners are appointed, provided with tools to do maintenance works on road reserves as well as cleaning of drainage structures.  600 job opportunities are created per project and a total of 15 000 people are currently engaged in this programme.  Beneficiaries work 3 days per week (12 days per month), R70 per day, R840 per month 5151

52.  To improve access roads to public amenities, 7 access road upgrading projects will be implemented during 2011/12 where in 24km will be paved.  Access roads will be maintained through a combined effort of the Department and Municipalities  Pothole patching  11 Routine maintenance and Pothole patching projects are being evaluated and Contractors are to be on site by end April 2011.  The province aims to respond to potholes within 72 hours after being reported. 5252

53. 5353 Mpumalanga

54. Area of focus 5454 The 2011/12 Maintenance Grant shall be utilized by the Department under the following programmes in all four (4) regions. 1. Comprehensive Rural Development Programme (CRDP) 2. Emergency Maintenance i.e. Flood damage 3. Periodic Maintenance i.e. light reseal and patch works. 4. Routine Maintenance to include Siyatentela 5. Rehabilitation of coal haulage routes

55. 5555

56. Programme Capacity and Effectiveness  Appointment of District Maintenance Consultants to provide technical assistance, supervision and quality control.  Appointment of sixty-six (66) term contractors from CIDB level 1-3 (majority), 4-5 and 6 and above.  Appointment of a Coal Haulage Implementation Manager to manage the rehabilitation of the coal haulage network  Tracking, monitoring and monthly reporting of programme performance by the Department’s PMU.  An effective and operational Roads Asset Management System (RAMS).

57. Empowerment  General road maintenance has been targeted for Siyatentela with the consideration for up-scaling.  Patch works, crack seal and edge break repairs have been identified for the lower CIDB levels 1-3.  CIDB level 6 and above contractors, also provide technical support to the lower levels.  Maintenance consultants offer induction and training programmes for the contractors.

58. 5858 North West

59. 5959

60. TARGET km Number of jobs to be created Number of contractors to be developed Number of S3 engineers to be trained towards registration Improved access to schools, clinics & other public amenities Rehab of high vol. roads 75 503 65 4 26 Maintenance of high vol. poor to very poor roads 23 41 15 1 6 Upgrade/ construction of access roads 103 1,131 44 7 22 Maintenance of access roads 72 449 16 3 8 Pothole repairs Province wide (250km) 126 8 - -

61. 6161 Northern Cape

62. The Northern Cape Province is allocated R308 760 m with a top up of R 51 090 of equitable share. All the projects are aimed to alleviate poverty in the Northern Cape through S’hamba Sonke program.

63. Click to edit the outline text format Second Outline Level  Third Outline Level Fourth Outline Level  Fifth Outline Level  Sixth Outline Level  Seventh Outline Level  Eighth Outline Level Ninth Outline LevelClick to edit Master text styles Second level Third level  Fourth level  Fifth level Northern Cape Projects Job creation projects  Hotazel – Vanzylsrus  Jooste Eiland  Karakoel Routine maintenance  - Uap Road phase 2 Re-gravelling  RM Regravelling DR3300 Witsand  RM Regravelling MR950 Dithakong  RM Ashkam - Van Zylsrus Reseal  Upington - Ashkam  Reseal of Williston - Calvinia Routine maintenance projects on tender  Kuruman D310 - Dithakong  Kuruman D325 - Mapiniki  Colesberg- Norvalspond  Phillipstown - Hanover  R 600 (Richmond - EC border)  Postmasburg - Kathu  Prieska - Spitskop  Steinkopf Base repair  Williston - Fraserburg  Louisvale - Kanoneiland To further enhance The S’HAMBA SONKE PROGRAMME, Northern Cape will embark on the intensive programme of contractor development which will includes pothole repair programme. 7 – 9 Contractors of CIDB grade 2 - 6 will be appointed for three years programme for routine roads maintenance for 864 km’s. The total kilometers will run through 28 towns with local employment of more than 300 people.

64. 6464 Western Cape

65. Where Monies are invested LocationExpenditure 2011/12 (R’000) Cape Winelands86,000 Eden85,438 Central Karoo26,500 Overberg56,952 Cape Metro10,124 West Coast146,712 Grand Total411,726

66. How Monies are Invested DeliverableTotal Blacktop Patching : Pothole Repairs (m2)22,500 Condition Improvement : Gravel road (km)271 Condition Improvement : Surfaced road (km)37 Job Opportunities (100 Person Day)1109 Regravelling (km)357 Reseal : Surfaced road (km)181 Reseal : Surfaced road (m2)1,545,143 Routine Road Maintenance (km)32,000

67.  Phase 1 Contractor development :  Contractors at CIDB Level 1 – 3 are upgraded to CIDB level 4  Phase 2: CIDB Contractor Development  Contractors at CIDB Level 4 are upgraded to CIDB level 6  CIDB Documentation and COLTO Specifications are used for both Phase 1 and 2 contracts  The appointment of sub-contactors (Level 1 to 4) are part main contractor’s obligations  Unemployed locals are placed on NQF level 2 learnerships  Procurement from local black businesses  Phase 1 Contractor development : Contractors at CIDB Level 1 – 3 are upgraded to CIDB level 4 Phase 2: CIDB Contractor Development Contractors at CIDB Level 4 are upgraded to CIDB level 6 CIDB Documentation and COLTO Specifications are used for both Phase 1 and 2 contracts The appointment of sub-contactors (Level 1 to 4) are part main contractor’s obligations Unemployed locals are placed on NQF level 2 learnerships Procurement from local black businesses

68.  Training providers identified/ funded by Construction CETA  Projects are EPWP compliant.  Department of Public Works pay stipends to learners  Regional Offices manage, finance and supervises the contracts  Steering Committee represented by CETA, EPWP, DRE, SAFCEC, Training Providers and Contractors representatives  Area Managers/Route Managers/Graduates – Provide Supervision and Quality Control, Measuring, Certification of Payment Certificates  Training providers identified/ funded by Construction CETA Projects are EPWP compliant. Department of Public Works pay stipends to learners Regional Offices manage, finance and supervises the contracts Steering Committee represented by CETA, EPWP, DRE, SAFCEC, Training Providers and Contractors representatives Area Managers/Route Managers/Graduates – Provide Supervision and Quality Control, Measuring, Certification of Payment Certificates

69. Roll-out Plans for Zimbambele  Creating employment through  Capital and Maintenance Contracts  3 to 12 FTE’s per million spent  Contractor Development Contracts  12 FTE’s per million spent  Emergency Works/ Tradeworld  4 FTE’s per million spent  Generally good access to these facilities in the Western Cape  Adequate vehicular access, even in rural areas.  Access Roads are maintained as part of normal routine maintenance programme  Access roads are provided as part of regional development programmes.

70. Pothole Repairs Plans  Pothole repairs are done as part of routine Road Maintenance Programs  Reactive Maintenance  Policy is that all potholes are repaired within 24 hours of reporting  Preventative Maintenance Program  Dedicated Route Patrols to identify defects and do on the spot emergency repairs  Crack Seal Program  Edge Break Repairs Program  Rutting Repair Program  Accident Damage  Pothole repairs are undertaken by  District Municipalities as Implementing Agents  Departmental Maintenance Teams  Periodic Maintenance Contracts  Routine Maintenance Contracts  Performance Measurement  Blacktop patching performance measured on an annual basis.

71. Shova Kalula Bicycle Programme

72. Click to edit the outline text format Second Outline Level  Third Outline Level Fourth Outline Level  Fifth Outline Level  Sixth Outline Level  Seventh Outline Level  Eighth Outline Level Ninth Outline LevelClick to edit Master text styles Second level Third level  Fourth level  Fifth level Approach to demand determination  Demand estimation  Nationwide surveys  Interviews  Secondary data  Sample unit: households (all segments included)  Sampling method: Probability-proportional-to- size  Sample size  Sample size: 1 067 households  30 clusters  35 surveys per cluster 7272

73. Spatial distribution of clusters 7373

74. Demand estimation 7474

75. Industry overview  Interviews conducted with local bicycle industry, local manufacturing industry and foreign equipment manufacturers  Bicycle industry:  Bicycle manufacturing industry is not established in SA, but is possible to set up  Possible to manufacture : frame, handle bar, seat post, pedal arms, saddle, mud guard  Before manufacturing, need to establish assembly and distribution channels  Manufacturing industry:  Possible to manufacture: almost everything but tires, chains and bolts  The price would not be as low as imported parts, but would still be competitive  Cost-efficiency could be achieved through small re- design of component  Concept investigated:  Setting up assembly plant/s using imported components and distribution networks  Manufacturing of selected components locally 7575

76. Assembly plant development concept Three assembly plants: Location determinants:  Availability of industrial space land and costs (rental)  Access to basic services and infrastructure  Proximity to labour Set up costs: 76 PlantThroughoutSize of the facilityTotal space KZN plant4 500 bicycles pm3 400 m24 500 m2 Eastern Cape plant3 000 bicycles pm3 000 m24 000 m2 Gauteng plant6 000 bicycles pm3 800 m25 000 m2 OptionsGautengKwaZulu-NatalEastern CapeTOTAL Build optionR 15 437 377 R 13 437 889 R 11 986 343 R 40 861 609 Rent option R 1 549 104 R 949 578 R 898 051 R 3 396 733

77. Financial feasibility – Gauteng plant example Ownership Grant for CAPEXLoan for CAPEX IRR at NPV≥0 NPV at 12% discount rate IRR at NPV≥0NPV at 12% discount rate 10-year period PPP34%R 20.7 ml48%R 37.9 ml Private24%R10.7 ml40%R 24.7 ml 5-year period PPP≤0%- R 4.3 ml14%R 0.9 ml Private≤0%- R7.3 ml≤0- R 2.9 ml 7777  Assembly plant – good business venture if it is a long-term activity  Most profitable – PPP using a loan

78. Manufacturing industry overview  Project-related industries :  Fabricated metal products manufacturing  5.7% of the manufacturing industry  Utilisation capacity – 73.8% and declining due to insufficient demand  Plastic products manufacturing  2.7% of the manufacturing industry  Utilisation capacity – 81.7% and declining due to insufficient demand 7878 Local manufacturing companies have the capacity and capabilities to manufacturer selected components for bicycles

79. Bicycle manufacturing potential 7979

80. Manufacturing: Estimated Start-Up Costs and Employment Benefits 8080 Benefits:  New industry development  Establishment of new SMMEs  Skills development  Poverty alleviation GroupsClusters Estimated set-up costs Job creation potential Expansion of existing facilities Non-tubular steel comp. manufacturingR3 ml – R15 mlUp to 15 Fabricated tubular comp. manufacturingR5 mlUp to 4 Plastic components manufacturingR3 ml – R10 mlUp to 10 Creation of new businesses Frame and weldingR12 ml- R14 mlUp to 18 Powder coatingR2 ml – R8 mlUp to 10 Reflector assemblyR0.1 mlUp to 12 Rims manufacturingR0.7 mlUp to 4 TOTAL local manufacturingR25 ml – R53 mlUp to 73

81. Synthesis 8181  Demand:  Real demand – 1.6 ml bicycles over 10 years  Latent demand – below 8 ml bicycles over 10 years  Development concept (to satisfy real demand only):  Establish assembly and distribution channels  Three assembly plants  Manufacture components locally  Establish new companies for frame manufacturing and powder coating  Use existing companies for components that require machining, pressing or moulding

82. Synthesis cont. Estimated costs and benefits In future, capacity could be expanded to:  Target latent demand  Target other types of bicycles (sport and recreation) 8282 FacilityCostsJob creation benefits Assembly plantsR3.4 ml - R41 mlUp to 280 jobs Manufacturing processes R25 ml – R53 mlUp to 73 jobs

83. Rail Rolling Stock Acquisition Programme

84. Forecast commuter rail volumes & Market engagement indicate: New Fleet requirement 7224 procurement at ~ 360 coaches per year for two x 10 year contracts Creating ~65 000 direct and indirect jobs Total NPV R100bn including maintenance, depots and risk for the 20 year period Medium term procurement will allow local capability to evolve to 65% of the value of a coach produced locally 84 The Programmatic procurement will result in:

85. Context  65 % local content prescribed in the medium term for Opex and Capex expenditure.  Contribute positively towards job creation within the South African economy, amounting to an estimated 65 992 new employment opportunities, over the entire project lifecycle of 20 years  13 226 employment opportunities being created during the Opex phase of the project and 52 766 employment opportunities during the Capex phase of the project

86. Total Job Creation Total economy wide impact of capex and opex on employment OpexCapexTotal Total employment created (no. of jobs) 13 226 52 766 65 992 Direct impact 6 217 21 675 27 892 Indirect effect 2 701 18 083 20 784 Induced impact 4 308 13 007 17 316

87. Skilled and Unskilled Categories Total economy wide impact of capex and opex on employment OpexCapexTotal Total employment created (no. of jobs) 13 226 52 766 65 992 High Skilled 1 1544 312 5 466 Skilled 3 893 17 321 21 214 Unskilled 4 970 19 54324 563 Informal 320911 54014 749

88. OPEX Phase  During the Opex phase more than 40% of employment opportunities are expected to be created within the “Transport” sector. This is closely followed by:  Wholesale and Retail trade “sector (15.8%)  Business services” (11.8%) and  Community, Social and Personal services” (9.6%).

89. Employment sector break-down: Top 20 sectors -OPEX

90. CAPEX Phase During the capex phase the project majority of the 52 766 total employment opportunities are expected to be created within the “Wholesale and Retail trade “sector (21.1%). Other sectors also largely contributing to these employment opportunities includes the following: Catering and accommodation services (20.6%) Community, Social and Personal services (13.8%). Business services (10.4%) and Building and construction (8.6%

91. Employment sector break-down: Top 20 sectors -CAPEX

92. Other Transport Sector Job Creation Initiatives

93. SANRAL Gauteng improvement project to create 20 000 jobs N1/N2 Wine lands project to create 6000 jobs CBRTA Law enforcement,31 Senior Road Transport Officers & 160 Road Transport Inspectors to be recruited. SAMSAS Partnered with industry to place 36 cadets in 4 small vessels, the project is funded by TETA Students coming from the SAMSA Centres of excellence are absorbed by Transnet and International organisations that has their own fleet. Other Transport Sector Job Creation Initiatives

94. Limpopo 2276 people are on the Road sections project, 16200 households conducting bush clearing, PWP project 24 people are trained on public administration programme KZN Province New Venture Creation – 63 people are trained in the Vukuzakhe Association contractors in all KZN regions, service provider by RMA consulting. Training 600 unemployed on road traffic transportation forums Eastern Cape Repair of portholes, road pavement rehab and road markings 126 unemployed graduates with appropriate/ relevant National Diplomas and Degrees are absorbed for period 12 months Other Transport Sector Job Creation Initiatives…

95. Conclusion

96.  In view of the foregoing, it is hereby recommended that the Portfolio Committee:  note the presentation,  note and the skills development plan of the Department,  support job creation initiatives of the Department and the sector as part of the implementation of Government’s New Growth Path, and  note progress made in the implementation of these initiatives.