1. Department of Transport Joint Budget Committee Briefing on the 2008 Medium Term Budget Policy Statement 28 October 2008

2. Contents of presentation Department of Transport Medium term policy priorities Progress in meeting measurable objectives Progress in meeting Millennium Development Goals Medium term expenditure trends Departmental budget bids not agreed Budgeting challenges and and unfunded mandates 2

3. Medium term policy priorities Department of Transport Sector priorities Departmental priorities 3

4. Department of Transport Sector priorities Integrated infrastructure framework Public transport strategy and investment plan World Cup 2010 infrastructure investment plan Massification of EPWP delivery approaches Upscaling provincial access roads Standardise use of labour intensive construction methods in public investment programmes Skills development 4

5. Department of Transport Sector priorities (continued) Creation of integrated rapid public transport networks Transport efficiency – remove freight logistics bottlenecks 5

6. Department of Transport Departmental priorities 6 Public transport: Develop a high quality public transport system to fulfill the transport needs of the 2010 FIFA Soccer World Cup™ event and that will create a lasting legacy and set the agenda for public transport over the next decade Provide quality public transport services along priority corridors, remove duplicate services, and provide integrated mass rapid public transport networks Transformation of the bus and rail services into a public transport system integrated with the recapitalised taxi services. Extensive feeder and distribution networks especially in major cities. Public transport subsidy reform Complete the second phase of the consolidation of rail services by the incorporation of Shosholoza Meyl into the SARCC Address the rolling stock backlog and improve rail infrastructure

7. Department of Transport 7 Departmental priorities (continued) Roads: Implementation of the road infrastructure strategic framework for South Africa (RISFSA) to assess, prioritise and reclassify the road network, transfer roads to the South African National Roads Agency Rehabilitation, maintenance and preservation of roads through the EPWP Intensified road network projects Road traffic management: Continue the implementation of the national road safety strategy through the Road Traffic Management Corporation and provinces to introduce best practice models for registering authorities, vehicle testing stations and driving license testing centres

8. Department of Transport 8 Departmental priorities (continued) Transport planning: The National Land Transport Transition Act (2000) was amended in 2006/07 to streamline the planning regime across all spheres of government and further drafting is underway to refine powers and functions Implement the Rural Transport Strategy to support lower density public transport and freight logistics Freight logistics: Deliver the highest level of transport outputs per unit of infrastructure constructed, by the implementation of freight logistics strategies and improved alignment over the spheres of government Develop a freight monitoring framework

9. Department of Transport 9 Departmental priorities (continued) Civil aviation: Implement the Airports Development Plan and Airlift Strategy Maritime regulation: Facilitate and co-ordinate the process of establishing and improving search and rescue services in Southern Africa Training and welfare of seafarers Empowerment of women and youth Rail transport regulation: Establish a Railway Economic Regulator Public entity oversight: Turnaround of the Road Accident Fund Operationalise the Ports Regulator

10. Progress in meeting measurable objectives Department of Transport SARCC SANRAL RAF CBRTA SAMSA SACAA RSR Credit card driving licenses RTMC 10

11. Department of Transport Progress: Department of Transport 11 Selected performance indicators ProjectedActual 2008/092009/102010/112008/09 Number of integrated rapid public transport network operational plans by metros 12JHB, NMB, CT, Tshwane, Mbombela, have completed Phase 1. Buffalo City has commenced work. Polokwane, Rustenburg, Ekurhuleni, eThekwini, Msunduzi are in the procurement stage. Mangaung has not started due to lack of initiative at local level - which the DoT is currently addressing. Number of integrated rapid public transport networks offering 16-24-hour operations 412JHB, CT, and NMB are on track to be operational by March 2010 at the latest. Tshwane is aiming to make up for lost time due to internal resourcing delays. Number of rural transport networks adopted by district municipalities 33Due to current budgetary focus on 2010 host cities, rural Phase 1 Network projects will commence with planning in the 2010/11 year. Number of scrapped taxis9,1808,6007,9406,833 Number of fatal road accidents 12,50012,10011,900First 5 month = 4150 (reduction 20,32%) Number of bicycles distributed 120,000140,000500,00014,580: Delivering a further 11,520

12. Department of Transport Progress: SARCC 12 Selected performance indicatorsProjectedActual 2008/092009/102010/112008/09 Percentage increase in passenger trips 3%4%5%8.5% Percentage trains on time89%90%-86.9% Percentage trains cancelled1.7%1.6%-1.9% Percentage reduction in security incidents 6%7%--24% Percentage reduction in safety incidents 25%30%--47% Number of crimes per 100 000 passenger trips 0.4000.380-0.373 Percentage increase in Metro Plus passenger trips 3%4%5%26.4% Number of coaches overhauled and upgraded 700 -240

13. Department of Transport Progress: SANRAL 13 Selected performance indicatorsProjectedActual 2008/092009/102010/112008/09 Smooth travel exposure index95 + 97 Low rut exposure index95 + 99 High texture exposure index95 + 96 Bridge condition exposure index90 + 94 Expenditure efficiency index5% or less 3.1% Number of claims paid296,648310,849349,375270418 Ratio cost to compensation46454446

14. Department of Transport Progress: RAF 14 Selected performance indicatorsProjectedActual 2008/092009/102010/112008/09 Number of claims paid269,648310,849349,375115,540 * Cost to compensation ratio46%45%44%37% * The fact that the RAF has experienced cash shortage, especially in the last quarter, had a negative effect on the number of claims finalised. At the end of September 2008, claims totalling R807million were settled with claimants/attorneys but could not be paid and hence, could also not be finalised.

15. Department of Transport Progress: CBRTA 15 Selected performance indicatorsProjectedActual 2008/092009/102010/112008/09 Number of tourist permits issued5,2235,7461,476 Number of passenger permits issued 10,50811,5595,947 Number of freight permits issued14,41315,85426,921 Number of cabotage permits issued 2,0302,233764 Number of vehicle inspections91,868101,05533,638 Number of prosecutions6,3887,0273,543 Number of roadblocks3,000 464

16. Department of Transport Progress: SAMSA 16 Selected performance indicatorsProjectedActual 2008/092009/102010/112008/09 Number of ships on register1,150 1,141 Gross tonnage of ships on register 240,000 254,897 Number of casualties50 26 Number of port state control inspections 720 171 Number of tug utilisations150 90 Number of maritime certificates issued from exams 12,00014,000 4,387 Number of safety surveys of South African ships, including ad hoc inspections 7,500 3,942 Search and rescue operations700 132

17. Department of Transport Progress: SACAA, RSR and Credit Card Driving Licenses 17 Selected performance indicatorsProjectedActual 2008/092009/102010/112008/09 SACAA: Number of inspections100 815 Number of legal frameworks in line with international best practice 4420 RSR: Number of permits issued or renewed 252562478 Number of safety management audits 3303040139 Credit card driving licenses: Number of credit card format driving licenses manufactured and delivered 1,670,0001,755,0001,930,0001,059,946

18. Department of Transport Progress: RTMC 18 Selected performance indicatorsProjectedActual 2008/092009/102010/112008/09 Number of additional patrol cars20--60 Number of drivers participating in Driver of the Year competition 108 123 Number of Driver of the Year manuals printed 5,000 -0 Number of traffic officers graduated at colleges 1,8001,9002,0002,536 Number of vehicle examiners graduated 29530030515 Number of driving licences examiners graduated 420430440357 Number of accident report forms captured 416,000447,000480,00018,659 Number of fatal accidents reported 12,50012,10011,9001,116 Number of special investigations of fatal accidents 48576812

19. Progress in meeting Millennium Development Goals Department of Transport Goals are to eradicate poverty by job creation, ensure environmental stability and improve economic development by providing access: Extended public works programme Regional roads Secondary strategic roads Gauteng freeway improvement scheme Rail branch line revitalisation 19

20. Department of Transport Extended public works programme (EPWP) 20 Over the next five years government will implement the second phase of its EPWP, which provides incentives to use more labour-intensive methods in the delivery of infrastructure and routine services R3 billion was allocated from 2007/08 to 2009/10 An additional R4,1 billion was allocated over the new MTEF period In 2007/08, a total of 75,100 work opportunities were created on EPWP road projects, including 58,913 work opportunities on access roads Projects include: “20T” programme in Gauteng to address road infrastructure backlogs in townships and settlement areas to improve connectivity, access to markets and to create job opportunities Zibambele Road Maintenance Programme in KZN: 38,000 contractors currently employed; 22,000 km of road receiving regular maintenance; R200 million budget per annum

21. Department of Transport Regional roads 21 The Regional Action Agenda prioritises projects to promote regional integration and economic development Projects include: SA – Lesotho: Sani Pass access road: South Africa will improve the access road and relocate the South African Border post and Lesotho will improve the road on its side R25 million already spent by DOT, and R34,3 million in the process of being transferred to KZN SA – Botswana: A joint venture was finalised aimed at the upgrading of bridges and river crossings between the countries Construction commenced on the Ramotswa Bridge Feasibility studies were completed for the Zanzibar, Platjan and Stockpoort borders and an Environment Impact Assessment is underway

22. Department of Transport Secondary strategic roads 22 These are primary feeders to national roads and roads that are the economic backbones of provinces The target is that each household must be able to access a road within 500m by 2014, to link rural communities and rural areas to the major economic hubs and markets, facilitating economic growth and development The full extent of the Strategic Secondary Roads Network was identified and key roads and projects were prioritised Projects include: Tarka bridge to Cradock, which eliminated the high risk Baberskrans Pass section on the N10. Pedestrian crossings and street lighting were completed by employing 196 local people The Roads Coordination body started planning the implementation of the reclassification of the road network

23. Department of Transport Gauteng freeway improvement scheme 23 The goal is to reduce traffic congestion and to promote public transport Intelligent transport systems were piloted, such as variable message boards, cameras, and ramp metering The target date for completion is May 2010 Construction started on the N1 between the R21 and Atterbury intersections Environment impact assessments, feasibility studies and designs were completed, and tenders were awarded for the addition of lanes and improvement of intersections on the N14, N3, N4, R21, and N12

24. Department of Transport Rail branch line revitalisation 24 Rail is regarded as the most cost effective mass mode of transport. The Rail Branch Line Revitalisation Strategy identified previously abandoned rail networks that should be revitalised to link communities to economic hubs and to provide commuters with cost effective alternative modes of transport. Projects include: Nkwalini Rail Line – Completed Belmont Douglas – Phase 1 of construction has been completed Kei Rail – Reconstruction completed and line is now operational for passengers. Province is currently in process of procuring an operator for freight services. Moloto Rail Line – Passenger rail line linking Mpumalanga and Gauteng: Feasibility studies have been completed

25. Medium term expenditure trends Department of Transport Transport sector Provincial and national budgets Provincial expenditure: 2008 vs 2007 Local Government expenditure trends Budget additions in the MTBPS 25

26. Department of Transport 26 Provincial and National budgets Budgets R million (2008 ENE) 2004/052005/062006/072007/082008/092009/102010/11 WC1,2591,7732,2542,3882,6112,9023,106 NW1,0591,4511,6251,5641,6611,9321,903 NC313335372551649728780 MP8179659691,4801,5471,7311,916 LP1,4451,7701,8922,2822,4212,7673,120 KZN1,8102,2792,5393,1203,7554,5334,764 FS7938551,4251,5901,9272,2462,437 GP1,7382,0816,2276,6717,6137,6425,603 EC1,6031,7732,0122,3432,5532,7752,769 Total Provinces10,83713,28219,31521,98924,73727,25626,398 DOT6,68010,41013,36016,32420,50922,41223,730 Total17,51723,69232,67538,31345,24649,66850,128

27. Department of Transport 27 R million Provincial and National budgets (continued)

28. Department of Transport 28 Budgets R million (2008 ENE) 2004/052005/062006/072007/082008/092009/102010/11 Provinces10,83713,28219,31521,98924,73727,25626,398 DOT6,68010,41013,36016,32420,50922,41223,730 Total17,51723,69232,67538,31345,24649,66850,128 Growth year on year: Provinces22.6%45.4%13.8%12.5%10.2%-3.1% DOT55.8%28.3%22.2%25.6%9.3%5.9% Total35.3%37.9%17.3%18.1%9.8%0.9% Growth year on year excluding Gautrain and RAF: Provinces18.7%15.9%18.7%14.5%13.9%5.5% DOT15.4%31.2%31.4%29.7%15.4%17.6% Total17.5%21.7%23.9%21.1%14.6%11.1% Provincial and National budgets (continued)

29. Department of Transport Provincial expenditure trends: August 2008 vs August 2007 29 Budgets and expenditure: August 2008 vs. August 2007 (R’000) Dept of Transport, Roads & PW 2008/092007/08 BudgetPayments 31/8/2008 % PaidBudgetPayments 31/8/2007 % Paid E. Cape3,500,9071,577,75745,1%2,857,0381,009,02335.3% Free State1,926,895764,40339,7%1,589,870575,98936.2% Gauteng7,612,5704,914,56364,6%6,460,9001,978,20830.6% KZN4,488,3692,029,68345,2%3,599,2861,310,17536.4% Limpopo3,070,2961,099,89635,8%2,912,248970,64533.3% Mpumalanga1,976,888814,06141,2%1,775,840539,31130.4% N. Cape648,887296,03645,6%519,128152,35429.3% N. West2,252,418923,84341,0%2,007,243810,01840.4% W. Cape2,620,516771,45229,6%2,206,698912,94341.4% Total28,097,74613,191,69447,0%23,928,2515,258,66634.5% Annual budgets increased by 17,4% and expenditure for the period by 150%

30. Department of Transport 30 Provincial expenditure trends: August 2008 vs August 2007 (continued)

31. Department of Transport Local Government expenditure trends 31 Road infra- structure (R’000) 2003/042004/052005/062006/072007/082008/092009/10 Metro roads infrastructure 1,372,0421,626,1691,440,6551,571,7482,502,5672,890,4562,345,856 Metro roads maintenance 775,7271,004,415958,771929,5241,130,3831,303,7261,450,166 Secondary cities road infrastructure 280,831469,072534,386651,408962,3031,121,392876,346 Secondary cities road maintenance 212,653240,277260,554338,656363,703359,459386,390 Totals2,641,2533,339,9333,194,3663,491,3364,958,9565,675,0335,058,758 Year on year growth 26.5%-4.4%9.3%42.0%14.4%-10.9%

32. Department of Transport Local Government expenditure trends (continued) 32 PTIS expenditure2007/08 (R’000)2008/09 (R’000) Host CityTrans- ferred Spent% Spent BudgetTrans- ferred Spent Q 1 & 2 % Spent Johannesburg329,000163,00 0 49.5%661,171335,30042,53312.7% Cape Town230,00098,83243.0%424,843106,20016,00015.1% Mangaung25,000 100.0%242,61780,0006,8218.5% Tshwane105,00012,00011.4%510,169260,0004,5001.7% Mbombela55,00024,06943.8%170,54456,8482,7094.8% Nelson Mandela132,00046,00034.8%305,484152,74211,7007.7% Polokwane50,00038,45976.9%143,20747,7005,77612.1% Ethekwini125,00076,47061.2%624,949316,00015,5414.9% Rustenburg33,0006,09818.5%68,657 2,4003.5% Non-Host Cities90,00049,33154.8%18,35910,7225104.8% Totals 1,174,000539,25945.9%3,170,0001,434,169108,4907.6%

33. Department of Transport Local Government expenditure trends (continued) 33 Expenditure from PTIS conditional Grants: The rate of expenditure improved significantly in the past three months as more projects reach construction stage The slow take off was because most of the projects were at planning phase while others had to re-align their plans/ design to the National Public Transport Strategy Construction is underway in almost all Host Cities The Department is assisting certain municipalities with technical capacity. Priority is being given to the “FIFA guarantees” Measures to deal with under expenditure: Technical assistance being provided to Mbombela, Mangaung, Tshwane, Polokwane and Rustenburg, with positive results Teams were deployed to assist with design of IRPTN’s and BRT systems

34. Department of Transport Budget additions in the MTBPS 34 SummaryR’000 Original budget per 2008 ENE20 508 528 Adjusted Budget:3 984 312 Funds rolled over from the previous year37 276 Unforeseen and unavoidable expenditure2 235 473 Other adjustments1 711 563 Final budget for 2008/0924,492,840

35. Department of Transport Budget additions in the MTBPS (continued) 35 DetailsR’000 Funds rolled over from the previous year37 276 Arrive Alive campaign5 000 Women and gender audit764 Oil pollution prevention8 270 National Airports Development Plan6 945 Guidelines, standards and monitoring for integrated transport planning 1 800 Alignment of transport sector charters497 Restructuring of Road Accident Fund14 000 Unforeseen and unavoidable expenditure2 235 473 Road Accident Fund1 200 000 Disaster Management Grant1 035 473

36. Department of Transport 36 DetailsR’000 Other adjustments1 711 563 Inflation adjustments246 563 Compensation of employees – Department46 014 Compensation of employees – SARCC46 014 Bus subsidies – fuel costs154 535 Special adjustment - Road Accident Fund1 300 000 Self funding expenditure – NaTIS transaction fees 165 000 Budget additions in the MTBPS (continued)

37. Departmental budget bids not agreed Department of Transport Adjusted budget 2008/09 MTEF Budget submission 37

38. Department of Transport Bids not agreed: Adjusted budget 2008/09 38 DetailsRequested R’000 Allocated R’000 Bus subsidies (shortfalls since 2006/07) 1 342 000154 535 SAMSA (shortfalls for Maritime Rescue Coordination Centre, Government Advisory Services and project management) 13 5320 Railway Safety Regulator25 0000 Total unforeseen and unavoidable1 380 532154 535

39. Department of Transport Bids not agreed: Adjusted budget 2008/09 (continued) 39 Details – Rollover requests turned downR’000 National Land Transport Information system4 400 Policy development projects4 732 Rural transport development programme30 980 Transport Master Plan, National Land Transport Bill, ITP Booklet 4 700 Freight logistics projects9 761 Taxi recapitalisation projects5 000 Rail feasibility study20 000 Infrastructure: Sani Pass and Overload Control38 221 Assistance to SANTACO11 790 Ports Regulator11 144 IMO membership fees210 Total rollovers turned down140,938

40. Department of Transport Bids not agreed: MTEF Budget submission: Summary 40

41. Department of Transport Bids not agreed: MTEF Budget submission: Breakdown 41

42. Department of Transport 42 Bids not agreed: MTEF Budget submission: Breakdown (continued)

43. Department of Transport 43 Bids not agreed: MTEF Budget submission: Breakdown (continued)

44. Department of Transport 44 Bids not agreed: MTEF Budget submission: Breakdown (continued)

45. Department of Transport 45 Bids not agreed: MTEF Budget submission: Breakdown (continued)

46. Department of Transport 46 Bids not agreed: MTEF Budget submission: Breakdown (continued)

47. Budgeting challenges and unfunded mandates Department of Transport Budgeting challenges Unfunded mandates 47

48. Department of Transport Budgeting challenges 48 Exponential increase in the cost of road maintenance and construction Backlogs in road maintenance limit the expansion and maintenance of the road network, and increases road transportation costs Inefficiencies in the rail system caused rail tonnage to decline while road tonnage increased, increasing the burden on roads Freight logistics costs are currently much higher than those compared to South Africa’s trading partners Only a portion of the bus subsidies is either tendered or on a negotiated contract, which restricts the transformation of bus subsidies Rail commuter services is severely under capitalised with most of the rolling stock more than 35 years old. This limits the number of operational rolling stock due to ongoing maintenance and refurbishment Development and implementation of an economic pricing model for the Road Accident Fund

49. Department of Transport 49 Budgeting challenges (continued) Implementation of the Public Transport Strategy and Rail Plan Transport Authorities need to be set up to enable local Governments to undertake localised transportation planning to achieve objectives such as modal integration. Where these Transport Authorities have been set up, problems are experienced with funding Funding constraints for economic regulation for all modes of transport Funding constraints for rail safety regulation Improvement of regional road infrastructure Implementation of the Rural Transport Strategy Freight databanks Overload control

50. Department of Transport 50 Budgeting challenges (continued) Government Service Fees allocated to SAMSA are not adequate for the services rendered by SAMSA Training of seafarers Development of an inter-city bus fleet and training of bus drivers

51. Department of Transport Unfunded mandates 51 Transformation of bus subsidies Law enforcement in the taxi industry Construction of the Moloto Rail Corridor Revitalisation of a number of rail branch lines Transport security for all modes of transport Development of a national road asset management and information system Turnaround of the Operating Licensing Boards Turnaround of the CBRTA Development of a National Freight Information System

52. Department of Transport Thank you 52