department of transport annual report 2006/07 portfolio committee 6 – 7 november 2007

Department of Transport

Annual Report 2006/07Portfolio Committee

6 – 7 November 2007

Contents of presentationDepartment

of Transport

Section 1• Review of 2006/07

Section 2• Audit outcomes for 2006/07

Section 3• Performance information

Section 4• Staff Establishment

Section 1: Review of 2006/07Department

of Transport

• Highlights of Annual Financial Statements:

• Adjusted budget 2006/07• Reprioritisation in 2006/07• Under expenditure in 2006/07

• Highlights of Annual Report

Department

of Transport Expenditure trends for 2006/07:Adjusted Budget

Details R’000Original budget per 2006 ENE 12 870 458

Adjusted Budget:

Funds rolled over from the previous year: 211 500

Capacity development - academic institutions 3 000

Late invoice for oil pollution prevention services 3 300

Integrated rural mobility access project 1 200

Service providers assisting with the taxi recapitalisation programme, and provinces assisting with the permit conversion process

54 000

Scrapping of old taxi vehicles 150 000

Unforeseen and unavoidable expenditure: 45 100

Additional bus subsidies - increases in the fuel price 45 100

Other adjustments: 619 732

Operational costs for the S.A. Rail Commuter Corporation (SARCC) for liabilities for employees transferring from other passenger rail entities

439 732

Operational shortfall of the SARCC following a due diligence report 180 000

Total of Adjusted Budget 876 332

Final budget for 2006/07 13 746 790

Department

of Transport Expenditure trends for 2006/07:Reprioritisation

Details R’000Shifted from savings in Compensation of Employees across Programmes for promoting October Transport Month

14 000

Reduced Transfers and increased Goods and Services to assist Provinces with the taxi recapitalisation process

68 000

Shifted R7 million across Programmes and R7 million within Programme 1 for further October Transport Month projects (renaming of OR Tambo, taxi communications, Remembrance Day)

14 000

Additional funds made available across Programmes for Arrive Alive communications

9 000

Shifted funds across Programmes for Capacity Development 2 400

Shifted funds across Programmes for:• Corporate Support• Human Resource Management• Government Fleet Services

1 000

800

800

Department

of Transport Expenditure trends for 2006/07:Under expenditure

Details of major amounts under spent R’000

Scrapping of old taxis 252 500

Taxi recapitalisation projects 30 400

Rural Mobility and Access projects 28 000

Special investigations into Driver and Vehicle Testing Centres 18 500

Restructuring of the Road Accident Fund 14 000

Vacant posts that could not be filled 14 700

Policy development projects 7 000

Delays in establishment of Rail Economic Regulator and development of legislation for Maritime Security

7 000

Development of the NLTTA and National Transport Master Plan 7 800

Infrastructure and systems for 2010 Soccer World Cup 1 900

Freight Logistics projects 2 700

Other 1 900

Total 386 400

Department

of Transport

New activities undertaken during the financial year include:

• Established the Independent Ports Regulator

• The department approved security plans for ports and ships and also appointed staff to continuously monitor the implementation of these plans

• The maritime Trilateral agreement was concluded between India, Brazil and South Africa

Highlights of Annual Report

Department

of Transport

New activities undertaken during the financial year include: (continued)

• The capital restructuring of the Airports Company of South Africa Ltd. was completed

• Cabinet approved a five-year Airlift Strategy for the regulation of air transport to enhance the air transport sector’s contribution to sustainable growth

• The process of conversion of taxi permits into operating licenses was completed

• A Scrapping Administrator was appointed for the scrapping of old taxi vehicles and the process of scrapping old taxi vehicles was started during the year


Department

of Transport


• A draft Transport ASGISA investment strategy and financing options was completed

• A Public Transport Plan was developed

• New priority statements from provinces and municipalities were considered for continued funding from the Public Transport Infrastructure Fund

• The Performance Indicator Framework has been completed

• The department started to oversee the construction of the Gautrain Rapid Rail Link

• The development of a Transport Master Systems Plan was initiated


Department

of Transport


• Pilot studies were initiated to investigate and recommend Travel Demand Measures in the Cities of Johannesburg, Cape Town and Durban

• A GIS mapping room was established in the Department. Transport Infrastructure and Services maps can now be produced in the mapping room

• The Department, through the S. A. National Roads Agency Ltd., implemented an Intelligent Transport System (ITS) pilot project on the N1 from Johannesburg to Pretoria. Plans are underway to extend ITS to cover all national roads in Johannesburg, Durban and Cape Town


Section 2: Audit outcomes for 2006/07

Department

of Transport

• Emphasis of matter • Other matters:

• Non-compliance with legislation • Matters of governance • Corrections made to financial statements

• Value-for-money matters • Internal control

Department

of Transport Audit outcomes for 2006/07:Emphasis of matter

AUDIT REPORT ACTIONS TAKEN ACTIONS TO BE TAKEN

Previous qualification:

Treasury indicated that the contract for the production of credit card format driver’s licences should be treated as a Trading Account

• Financial statements compiled• Audit being finalised up to 2006• Approval obtained to create a

trading Account• In process of appointing

contractors to operationalise the Trading Account and to ensure compliance

• Operationalise the Trading Account

• Transfer the contract to the RTMC

Matter will notrecur

Department

of Transport Audit outcomes for 2006/07:Other matters


Non-compliance with legislation:

Internal audit plan and three year rolling plan not reviewed and no follow up audits done

• Risk assessment completed• Audit Committee approved the

Internal audit plan and three year rolling plan on 26/9/07

• Follow up audits in process

Follow up audit reports will be tabled at Audit Committee meeting on 22/11/2007

The fraud prevention plan and risk management policy were not officially approved

The plan and policy were approved after year-end and accepted by Audit Committee

Implementation plan was presented to Risk Management Committee on 29/10/2007

Salary reports and payroll certificates not signed off in time

• Signed off for 2006/07• Being followed up monthly

In process of delegating to Budget Controllers to fast track

Irregular and fruitless and wasteful expenditure not reported

Process to deal with such cases developed and circular issued

Cases identified will be reported

Monthly reports in terms of DORA not submitted

• Now receiving confirmations that reports were submitted

Resolved

Resolved

Resolved

Department



Non-compliance with legislation:

No co-ordination between internal audit divisions of DOT and Gauteng w.r.t. Gautrain

Internal Audit are in consultation with Internal Auditors of Gautrain

Co-ordination plan to be implemented

Non-compliance with National Road Traffic Act by Testing Centres

Inspection reports Regulations in the process of being reviewed to enable DOT to suspend Testing Centres

Matters of governance:

Not all SCOPA resolutions were implemented

• Irrecoverable levies due by DLTC’s were written off

• Processes were put in place to fast track filling of vacancies

Audit committee not functioning effectively

New fully functional Audit Committee appointed

Resolved

Resolved

Will not recur

Department



Material corrections made to financial statements:

• Corrections were made to the financial statements emanating from audit findings

• Processes were put in place to deal with irregular and fruitless and wasteful expenditure

• Classification of certain expenditure was resolved with Treasury

• Bank reconciliation process was reviewed

• Misallocations were corrected• Disclosures were corrected and

processes were pt in place to ensure correct disclosure

Processes were put inplace to ensure that similar corrections will notbe repeated

Department



Value for money matters:

Tenders awarded and management of contracts were not always done effectively

In process of appointing a consultant to oversee the management of contracts in DOT

The number of vacancies remained at a high level

Processes were put in place to fast track the filling of vacancies.The vacancy rate did not decline due to the high number of resignations in 2006/07

Internal control:

eNaTIS audits were completed during the preproduction / development stage of the system

Auditors were engaged to commence with the post implementation audit

The post implementation audit report will be separately tabled in Parliament

There was an absence of officially approved policies

Several policies and strategies were approved after year-end

Draft policies and procedures will be tabled at EXCO for approvalWill not recur

Department



Risk assessment: There was a lack of sound practices for fraud prevention and for ensuring compliance with legislation

• The risk assessment was completed and the Internal Audit Plan was based on the risk assessment.

• The reviewed fraud prevention plan was accepted by the Audit Committee

Fraud prevention plan must be fully implemented. Will be presented to Risk Management Committee on 29/10/2007

Monitoring of controls: Review of reconciliation’s, confirmations from external parties and internal audit processes were not effective

• Internal checking procedures were developed and implemented

• Reconciliation’s of suspense accounts are done monthly, and the bank reconciliation process was reviewed

• Internal audit started to function effectively

Resolved

Resolved

Section 3: Performance information for 2006/07

Department

of Transport

• Transport Policy, Research and Economic Analysis

• Transport Regulation and Accident and Incident Investigation

• Integrated Planning and Inter-sphere Co-ordination

• Freight Logistics and Corridor Development• Public Transport• Public Entity Oversight and Economic

Regulation• Administration

Department

of Transport Transport Policy, Research and Economic Analysis

Planned output Actual performance

Draft Maritime Transport Policy Completed

The Merchant Shipping (National Small Vessels Safety) Regulation, 2007.

Developed

National Ports Act, (Act No.12 of 2005) Proclaimed in Government Gazette No 29421.

Amendments to Road Transport Regulation to improve safety requirements of vehicles transporting passengers.

Completed

Transport Economic Analysis The Performance Indicators Framework has been completed. The second phase of data collection has started.

White Paper on National Maritime Transport Policy

Completed

Research and development Innovation strategy completed

Department



Technical research reports Completed for 9 provinces.

Planning for 2008 household survey started. Planning for survey started

23rd Amendment of the Civil Aviation Regulations.

Approved by Minister

Carriage by Air Amendment Act, (Act No.15 of 2006).

Published by Minister

Convention on International Interest in Mobile Equipment, 2007.

Proclaimed on the 24th August 2007 and published in Gazette No. 30213.

National Land Transport Transition Amendment Act, (Act No 26 of 2006)

The NLTTA was successfully amended to accommodate new developments like the taxi recapitalisation programme

Increasing access to social and Public Amenities

Development of school bus transportation strategy

Department



Development of Regulatory Institutions:

Public Discussion Document on Single Transport Regulator for South Africa Discussion document drafted

Integration of the Non -Motorized Transport as Mode of Transport

Policy framework for Animal Drawn Vehicles Developed

Department

of Transport Transport Regulation and Accident and Incident Investigation


Road Transport regulation The K-53 – Practical Driving Test Manuals for Examiners was updated and published in the Government Gazette. Centralised information sessions were held in all provinces. 24000 Manuals were printed

Road Transport regulation Monthly reports and an annual analytical report on road traffic accidents compiled and released

Civil Aviation regulation

Bilateral Air Services negotiations were held with France, Mozambique, Oman UAE, Bahrain and Qatar

Maritime regulation The National Ports Act, 2005 was proclaimed. The draft regulations were published for comment

The Ports Regulator Board Appointed

Draft Merchant Shipping Regulations Published for comment

Department

of Transport Transport Regulation and Accident and Incident Investigation


Rail regulation:

A framework of economic regulatory requirements for the rail sector and a framework for a reformed rail sector

Completed

Search and rescue:

The National Search and Rescue Policy Manual Developed

A Multilateral agreement on the co-ordination of maritime search and rescue services

Concluded between five countries (the Comoros, Madagascar, Mozambique, Namibia and South Africa)

Sub-regional Maritime Rescue Coordination Centre (MRCC)

Commissioned

Draft Search and Rescue Regulations Approved by the Search and Rescue Executive Committee

Department

of Transport

Integrated Planning and Inter-sphere Co-ordination


Transport Planning:

Municipal transport plans Completed for all municipalities

Planning Regulations New planning regulations prepared, which

•distinguish between three types of Planning Authorities (PA’s)•require MEC or Minister to categorize PA’s•has different planning requirement for different type of PA•require reduced frequency for updating plans•has reduced requirements for CPTR, however,•introduces comprehensive Land Transport Register including, (CPTR, Roads, Traffic, Freight & Land Use data)

Department

of Transport



TDM strategies Finalised for cities of Johannesburg, Cape Town & Durban

ITS pilot on N1 Completed – extending signage and rank metering on selected on-ramps

A study of the Transport Authority pilot in Ethekwini

Completed

Integrated Rural Mobility Access Implementation is underway in Sekhukhuni, OR Tambo and Umkhanyakude

1,996 bicycles have been distributed to schools

EPWP implementation plan An investigation report was developed

Department

of Transport



Increase National road network Increased from 12,000km to 15,500km

A study for the identification of the secondary strategic road network

Study was initiated

Upgrade of roads Provinces are undertaking the upgrade of selected roads

Develop national standards for overloading control

Discussions with the SABS are underway

Transport Action Plan for 2010 Finalised and approved

NMT/IMT conference and exposition to profile and raise awareness about NMT/IMT

Successfully held in February 2007. 439 International and local delegates attended.

10 year NMT rollout Communication and marketing plan has been developed to guide the rollout

Department

of Transport Freight Logistics and Corridor Development


National Freight Logistics Strategy (NFLS):

The National Freight Logistics Strategy Approved by Cabinet in September 2005

System requirements for the National Freight Information System

Completed

Railway Economic Regulatory Framework Near completion

Sub-sectoral strategies Being developed

Freight Monitoring Framework Being developed

Roll out of Freight Plans particularly 2010 SWC host cities

Finalising Terms of Reference

Freight Business Intelligence Framework Developing Terms of Reference

Department



National Freight Databank:

Set up of NFD in eight provinces Completed

Identify and assess various national and provincial corridors

Completed

Upload information on the eight provinces on the Department’s GIS platform

Completed

Develop Terms of Reference for National update of NFD

ToRs finalised and submitted for approval

Report on system inefficiencies at all ports of entry

Finalised needs and infrastructure assessment at our top 21 ports of entry

In the process of finalising a feasibility study for a truck stop on the Maputo Corridor (N4)

Department



Freight and Logistics Forums Established 4 Provincial forums (Mpumalang Kwa-Zulu Natal Western Cape North West)

In the process of setting up Provincial forums for the other five provinces

Develop plans to improve the safe movement of heavy vehicles along the Maputo Corridor by introducing truck stops

Feasibility study is being conducted

Revival of the Ressano Garcia to Maputo Rail line

In the Planning Phase

Development of an Intermodal Facility at Cato Ridge

In the Planning Phase

Development of the Durban Freight Plan In the Planning Phase

Development of the Harrismith Hub Finalising the second phase

Department



Revival of Branch Rail Lines Engaged with Transnet Freight Rail (then Spoornet) on identification and transfer of branch lines

Currently reviving branch lines that have potential, funded through DEAT:

Nkwaleni (R10 million) 530 000 tons of sugar cane

Belmont-Douglas (R54 million 550 000 tons of grain)

Kei Rail

Implement Rail plan priority corridors Exceeded the target for refurbishing coaches: 156 finished

Department

of Transport

Public Transport


Public Transport Strategy and Action Plan Approved by Cabinet in 2006

Integration plan for the Gautrain Rapid Rail Link

Completed and approved in 2006

National and Regional Passenger Rail Plan Completed and approved by Cabinet

SARCC and Metrorail consolidation Completed

Next phase of consolidation with Shosholoza Meyl planned over the MTEF

Taxi recapitalisation project Officially launched

Department

of TransportPublic Transport


New taxi vehicle models 32 models of new taxis are fully compliantwith the 2005 safety specifications. Majority midi-buses and 5 mini-buses comply with the 2006 safety specifications (models are with SABS for testing and certification)

41 935 TRP compliant NTV have entered the taxi sector between 2005 and 2007

29 813 TRP compliant vehicles have been recapitalised without the scrapping allowance (normal fleet renewal)

Taxi Scrapping Administrator Launched in October 2006 and is operational

9000 taxi operators registered to exit the taxi industry

2800 taxis were scrapped by March 2007

Establish Provincial mobile service units for the scrapping of old taxi vehicles

Provincial scrapping sites have been established

10 additional Mobile Service Units are deployed in Provinces – 1 unit per province and 2 in Gauteng

Payment of the scrapping allowance is based on a verification process (operating license, engine and chassis numbers, banking details, etc)

Department

of TransportPublic Entity Oversight and Economic Regulation


Corporate Governance Performance agreements were signed with all public entities

All public entities submitted quarterly reports

Regulations for the Port Regulator Draft Regulations published for comment

White Paper on National Civil Aviation

Draft White Paper completed

Implementation Strategy for the Yamoussoukro Decision

Incorporated into the approved Airlift Strategy of 26 July 2006.

Convention on International Interests in Mobile Equipment and Protocol on Matter Specific to Aircraft Equipment

Approved by the National Assembly and the NCOP and the instruments of Ratification were signed by the Minister of Foreign Affairs on 14 November 2006.

Department

of TransportPublic Entity Oversight and Economic Regulation


The Road Accident Fund (RAF) Amendment Act, 2005,

Assented to

Regulations in terms of the RAF Amendment Act

Draft Regulations published for comment to provide for the assessment of serious injuries

Strategy for the Restructuring of the RAF in line with the Comprehensive Social Security System for public consultation

Approved by Cabinet

Consolidated Regulations in terms of the RAF Act (including assessment of serious injury)

Published for public comment

Montreal Convention, 1999 Adopted by Parliament and the instrument of ratification was submitted to ICAO

Carriage by Air Amendment Act, 2006

Published on December 2006

Section 4: Staff Establishment

Department

of Transport

• Turnover rate• Vacancy age analysis• Personnel establishment • Vacancy ratio’s • Employment equity

Turnover Rate per Programme

42

6 18 8 4 0 10

20

40

60

Pgrm1

Pgrm 3 Pgrm5

Pgrm7

Turnover rate

Turnover rate

%

Turnover Rate per Level

1012.66

24

30.37 33

41.78

12

15.18

0

5

10

15

20

25

30

35

40

45

Level 3-5 Level 6-8 Level 9-12 Level 13-16

No.

%

Vacancy Age Analysis

0

20

40

60

80

100

120

140

Stage1

Stage3

Stage5

Stage7

Total PostsStg 1JOB PROFILE

Stg 2ADVERT

Stg 3LINKED TO OTHER POST

Stg 4ADVERT CLOSED

Stg 5SHORTLISTED

Stg 6INTERVIEWS HELD

Stg 7 OFFER MADE

Stg 8HEAD-HUNTING

10 28 23 132 25 12 13 6

Measures to Reduce Vacancy Rate

• Vacancy management strategy implemented as per EXCO directive (Use it or loose it principle)

• Vacancy reduction project incorporated into 2007/2010 strategic plan

• Filling of vacant posts incorporated into managers performance agreements

Measures to Reduce Vacancy Rate

• Prioritized Retention Strategy (At consultation stage with Organised Labour)

• Enhance Training and Development initiatives• Accelerated Management Development Programmes, w.r.t.

scarce and critical skills in the field of transport planning, contract management, project management, maritime/aviation studies, econometrics and transport modeling.

• Increasing Investment in Centres of Development by 36.21% (4.2 Million for the current financial year)

• DPSA to consider minimum period in a post before a person applies for promotion

Equity

Category DPSA Targets Current Status

Black people at senior management level 75% 89,86% (62)

Women at senior management level 30% 30,43% (21)

Employees on SMS level (13+) in terms of National Demographics

Posts filled i.r.o. Race

73,01% (51) 4,35% (3) 11,60% (8) 10,14% (7)

Posts filled i.r.o. Gender

68% 32%33%

67%

62% 38%100%

0%

Department

of Transport

Financial Year: 2004 - 2005The organizational structure expanded from 4 Branches comprising of 482 posts to 6 Branches with 557 posts

Financial Year: 2005 - 2006The organizational structure remained unchanged

Financial Year: 2006 – 2007The organizational structure expanded from 6 Branches comprising of 557 posts to 7 Branches comprising of 1023 posts of which 674 were activated

Personnel Establishment

557 557 674 674848

973 1023

0

200

400

600

800

1000

1200

2004/05 2006/07 2008/09 2010/11

Department

of Transport

Vacancy ratio for the past three years Total posts VacancyFinancial Year 2005 – 2006: 557: 32%Financial Year 2006 – 2007: 621: 41%Financial Year 2007 – 2008: 674: 38%

Vacancy Ratio

0

20

40

60

80

% Filled 68 59 62

% Vacant 32 41 38

2005/06 2006/07 2007/08

Department

of TransportVacancy Ratio

Details Posts Vacant Filled % Vacant % Filled

2005/06 557 178 379 32% 68%

Posts added 64 64

Appointments (66) 66

Resignations 79 (79)

2006/07 621 255 366 41% 59%

Posts added 53 53

Appointments (88) 88

Resignations 36 (36)

2007/08 latest 674 256 418 38% 62%

Current vacancy ratio’s would have been if no posts were added:

In 2007/08 33% 67%

In 2006/07 and in 2007/08 25% 75%

Department

of Transport Employment Equity

Current Employment Equity Status: 30 September 2007

Category DPSA Targets

Current status

Black people at senior management level 75% 88,16%

Women at senior management level 30% 34,21%

People with disabilities at all levels 2% 1,3%

National demographics

African Coloured Asian White

79% 8,9% 2,5% 9,6%

Male / Female M F M F M F M F

Posts filled I.r.o. race

80,43%

(333)

3,14%

(13)

3,62%

(15)

12,81%

(53)

Posts filled I.r.o. gender

48%

159

52%

174

54%

7

46%

6

47%

7

53%

8

38%

20

62%

33

Department

of Transport

Thank you

department of transport annual report 2006/07 portfolio committee 6 – 7 november 2007

Documents

shifted funds

taxi communications

additional funds

final budget

development of legislation

shifted r7

unavoidable expenditure

policy development projects7