Below is this year’s budget as presented by The Minister of Transport, Ben Martins, in parliament outlining how the Department of Transport is going to spend its R42.3 billion.

Approximately 96% of the budget will be spent on: maintaining road infrastructure; upgrading the rail infrastructure and services; and constructing and operating the public transportation infrastructure.

The Budget

The Budget allocation for the Department of Transport for the financial year 2013/14 is R42.3 billion (R42 275 340 000), and this includes allocations to provinces, municipalities, state owned companies and agencies.

Of the allocated amount, R18 billion (R18 850 917 0000) will be transferred to provinces and municipalities towards road maintenance.

Effective co-ordination with provinces and municipalities is therefore needed to ensure that the Department is not only a conduit of funds to the other spheres of government, but that, importantly, it plays a leading role in monitoring and evaluating the implementation of government programmes.

To this end, and in the spirit of co-operative governance, SANRAL will provide a critical supporting role in the implementation of the Maintenance Programme.

Another portion of the budget amounting to R21.9 billion (R21 941 930 000) will be transferred to state owned companies and agencies which are the delivery agents of the Department.

The Department is building the requisite internal capacity in order to better enable it to conduct the necessary oversight over the State Owned Companies and agencies under its remit.

Significant progress has been made to align the strategies and annual performance plans of the State Owned Companies and agencies of the Department.

After distributing the allocated Budget to provinces, municipalities, State Owned Companies and agencies, the Department is left with R921 million (R921 562 000) to carry out its policy development and oversight responsibilities.

It is common that sound economic infrastructure is a precondition for economic growth. It is for this reason that the Department of Transport has intensified efforts to develop and improve South Africa’s transport system to serve as a catalyst for social and economic development.

Accordingly, the spending focus over the next year will predominantly be on:

1.    Maintaining road infrastructure;

2.    Upgrading the rail infrastructure and services; and

3.    Constructing and operating public transportation infrastructure

Expenditure on these three areas will include the following transfers, which comprise an average of 96.1% of the total budget allocation of the Department of Transport over the medium term.

The State Owned Companies that fall under the remit of the Department of Transport will be allocated the following disbursements and grants:

•         The Passenger Rail Agency of South Africa (PRASA) – R 3.678 billion for current operations and R 7.481 billion for capital infrastructure;

•         The South African National Road Agency (SANRAL) – R3.454 billion for current operations and R7.043 billion for capital infrastructure.

And grants will be allocated to:

•         The Provincial Road Asset Maintenance Grant – R 8.696 billion;

•         The Rural Roads Asset Management System Grant – R 52.2 million; and

•         The Public Transport Infrastructure, Operations and Network Grants – R 5.55 billion.

Other transfer payments will include:

•         The Road Traffic Management Corporation – R 167 million;

•         The Railway Safety Regulator – R46. 5 million;

•         The Road Traffic Infringement Agency – R25 million;

•         The South African Maritime Safety Authority – R6.4 million;

•         The South African Civil Aviation Authority – R18.155 million; and

•         The taxi recapitalization programme – R522 million

In line with the perspective of an integrated transport model, the spending focus over the medium term will be on developing and implementing strategies based on a multi-modal national system of transport. Major projects in this regard will include:

i.        The establishment of a single transport economic regulator;

ii.        Establishment of a macro planning framework;

iii.        Implementation of a national corridor framework;

iv.        Finalizing the update of the national freight database; and

v.        The completion and analysis of the National Household Survey

The following over-arching development principles remain cardinal, in relation to the foregoing, namely:

1.    Balancing the development of new infrastructure with the on-going maintenance of the existing infrastructure;

2.    Improving infrastructure links with rural and financial and human resource challenged provinces;

3.    Addressing capacity constraints and improving co-ordination and integration; and

4.    Scaling up investment in infrastructure

Four key sectors remain central to the envisaged developments, namely, transport, water and sanitation, energy and communications.

In this regard, the Department of Transport continues to play a central role in the following two strategic infrastructure projects:

1.    The Durban-Free State- Gauteng logistics and industrial corridor

2.    Unlocking the economic potential and opportunities in the North West Province

The Department further plays a supportive role in other strategic infrastructure projects.

Balanced investment in transport infrastructure will lead South Africa to efficient and sustainable growth, mobility and community access. It is important that the cost of doing business in South Africa is reduced in order to ensure that our economy remains competitive in global markets.

Upgrading the railway infrastructure and services

Within the period under review, the procurement process for the fleet renewal programme of the Passenger Rail Agency of South Africa (PRASA) was concluded in December 2012. The success of the programme will lead to:

•         A new coach building and locomotive assembly plant being established in the Gauteng province;

•         As a result of this, 8 300 direct jobs will be created; and

•         Another 22 000 jobs will be created through localization

The accelerated rolling stock programme has been concluded and has resulted in:

•         579 coaches being delivered in 2012/13 to Metro Rail;

•         3 Coaches to Shosholoza Meyl and

•         9 locomotives upgraded at a cost of more than R1.3 billion.

Furthermore 49 stations were upgraded and improved as part of the National Station Improvement Programme at a cost of R221 million. The total capital spend of R6.2 billion was reached at the end of March 2013.

The conundrum we face is that, whilst the increase in capital subsidy is in line with the strategy to modernize public transport, the operational subsidy is, however, below the levels required to sustain the envisaged growth strategy. The operational subsidy decreased by 1% in real terms between 2010 and 2012.

In the medium term, the focus in rail will continue to be on the upgrade and expansion of the priority commuter rail corridors.

The safety of communities, especially children, who reside very close to railway lines, as a result of poor apartheid spatial development planning, continues to be a serious concern for the Rail Safety Regulator.

Evidential data points to the fact that accidents where persons get struck by trains in Gauteng, Kwazulu-Natal and in the Western Cape, is primarily because of poor spatial planning.

On the other hand, criminal activities such as cable theft, the theft and vandalizing of signalling equipment remains a serious concern, as it results in exorbitant operational costs.

PRASA, the Rail Safety Regulator and the South African Police Services continue to refine and align their systems in order to deal decisively with this problem that amounts to economic sabotage.

South African National Road Agency Limited(SANRAL)

As we mentioned earlier, SANRAL received R3.454 billion for current operations and R7.043 billion for capital infrastructure.

South Africa has a total road network of 750 000 km of which 17 000km is managed by SANRAL.

Non-toll road network accounts for 83.1% of the national road network which is funded by the fiscus, the balance of 16.9% form part of the toll portfolio network of roads.

During the 2012/13 financial year, SANRAL awarded 202 contracts for new works, rehabilitation and improvement, periodic and special maintenance, routine road maintenance, community development, supervision and other activities to the value of R11.6 billion with R9.5 billion being spent on non-toll roads.

SANRAL spent a total of R1.8 billion on contracts with Small Medium and Micro Enterprises (SMMEs) of which R1.2 billion went to black owned firms, for both toll and non-toll roads.

SANRAL will continue to implement non-toll projects during the MTEF period.

Road Traffic Management

The Road Traffic Management Corporation (RTMC) has redefined the National Rolling Enforcement Plan to provide a platform for co-ordinated law enforcement and visible policing in South Africa.

It has exceeded its target of stopping and checking a million vehicles per month, by approximately 1.5%. Its new target is now 1.1 million per month.

Road traffic interventions for the 2013/14 period will include the following three focus areas:

i.        The International Road Assessment Programme, which will assess road safety solutions that relate to the road infrastructure. The aim has been set to pass 4000 km of road in the 2013/14 financial year;

ii.        The establishment of a Crash Information Management System, which will provide the public with statistics; and

iii.        The establishment of a new qualifications framework for traffic officers.

The Deputy Minister will expand further on the work of our road safety agencies and cover other aspects of her delegated responsibilities.

Maritime

In promoting the Maritime sector and to encourage its greater industrialization this year was declared as Maritime Year.

South Africa has a coastline of over 3000km, and is a strategic hub for international merchant ships, connecting the global East and West.

Notwithstanding its strategic location, South Africa does not own a single flag carrying ship, which means that it has to rely on foreign shipping companies to transport its outbound and inbound seaborne cargo, at a direct cost to the economy of approximately R34 billion, according to the 2012 estimates.

We are working closely with SAMSA and maritime stakeholders to unlock South Africa’s maritime potential.

Furthermore, we signed the Djibouti Code of Conduct that empowers South Africa to share resources and information with other countries, in the fight against piracy and other crimes at sea.

This year’s major projects will include:

1.    The finalization of enabling Maritime Transport Policy, the development of a Green Paper on maritime shipping and concluding consultations on the Ballast Water Management Bill;

2.    The finalization and launch of the Inland Waterways Strategy;

3.    The finalization and adoption of the Maritime Transport Broad Based Economic Empowerment (BBBEE) implementation plan, and the appointment of its Council;

4.    Together with the Departments of Higher Education and Training, and Basic Education, we will launch Maritime Education and Training initiatives at no less than ten (10) Further Education and Training (FETs) Colleges countrywide and at least one High School per coastal Province.