department of transport briefing to the portfolio committee on transport first quarterly expenditure...

DEPARTMENT OF TRANSPORT

BRIEFING TO THE PORTFOLIO COMMITTEE ON TRANSPORT

FIRST QUARTERLY EXPENDITURE 2014/15

23 SEPTEMBER 2014

1

Expenditure to 30 June 2014:

Expenditure per Programme and Performance Expenditure per Economic Classification Expenditure per Programme per Economic

Classification and Performance Details of Transfer Payments Monitoring mechanism for transfer payments

2

The Department has a total budget of R48 727 billion. To date of reporting the department has spent R14 414 billion or 30% of the allocated budget.

Expenditure per Programme and Performance

Programme Budget Cashflow

projection 1st quarter

Expenditure Available Under /

(Over) spent % Spent

R'000 R'000 R'000 R'000 R'000

1. Administration 382 860 74 856 103 315 279 545 (28 459) 26.98%

2. Integrated Transport Planning 81 184 21 753 11 409 69 775 10 344 14.05%

3. Rail Transport 15 034 556 7 753 837 7 749 426 7 285 130 4 411 51.54%

4. Road Transport 21 645 287 5 093 184 5 203 740 16 441 547 (110 556) 24.04%

5. Civil Aviation 148 271 52 173 32 126 116 145 20 047 21.67%

6. Maritime Transport 110 589 23 045 19 831 90 758 3 214 17.93%

7. Public Transport 11 323 771 1 425 462 1 294 352 10 029 419 131 110 11.43%

Total Department 48 726 518 14 444 310 14 414 199 34 312 319 30 111 29.58%

3

Total Number of quarterly targets = 80

% Achievement = 66 quarterly targets (82.5%)

% Not Achieved = 14 quarterly targets (17.5%)

4

Compensation of Employees: Underspent as a result of vacant posts.

Goods and Services: Overspending due to eNatis.

Machinery and Equipment: Underspent due to the renovation of the building.

Expenditure per Economic Classification

Per Economic Classification Budget Cashflow


Expenditure Available Under /

(Over) spent % Spent

R'000 R'000 R'000 R'000 R'000

Compensation of Employees 383 381 90 614 83 756 299 625 6 858 21.84%

Goods and Services 584 737 126 022 286 657 298 080 (160 635) 49.02%

Transfers & Subsidies 47 754 194 14 226 116 14 042 975 33 711 219 183 141 29.41%

Machinery and Equipment 4 206 1 558 811 3 395 747 19.28%

Total Department 48 726 518 14 444 310 14 414 199 34 312 319 30 111 29.58%

6

UNDERSPENT

• Transfers & Subsidies; the first quarterly payment to Higher Education Institutions has not yet been paid due to delays in receiving invoices.

Expenditure per Economic Classification: Programme 1Programme Per Economic Classification Budget

Cashflow projection 1st

quarter Expenditure Available

Under / (Over) spent

% Spent

R'000 R'000 R'000 R'000 R'000

Administration


Goods and Services 196 572 31 701 65 517 131 055 (33 816) 33.33%

Transfers & Subsidies 11 182 3 777 95 11 087 3 682 0.85%

Machinery and Equipment 2 300 990 499 1 801 491 21.7%

Total 382 860 74 856 103 315 279 545 (28 459) 26.99%

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% Achievement = 16 quarterly targets (84%)

% Not Achieved = 3 quarterly targets (16%)

7

1st Quarter Targets:

Develop the draft Communication and Marketing Strategy;

Submit the Merchant Shipping Bill to Cabinet to seek approval to table in Parliament;

Submit final draft of the Adjudication of the Road Traffic Offences Amendment Bill to NEDLAC for approval;

Finalise the draft National Road Traffic Amendment Bill;

7


Finalise the draft National Land Transport Amendment Bill;

Develop the draft International Relations Strategy;

Fill 20 vacant positions;

Conduct stakeholder consultations on the development of the Transport Sector HRD Strategy;

Negotiate MoU with SA Graduate Development Association for future graduate placement;

7

KEY NOTABLE ACHIEVEMENTS:

30 vacant positions were filled in the period under review;

The Merchant Shipping Bill submitted to Cabinet and subsequently approved. The DoT currently awaits the date for presentation to the Parliament Portfolio Committee on Transport;

Negotiations conducted with the South African Graduate Development Association (SAGDA) to develop a joint MoU to facilitate graduate placement across all spheres of government and to integrate workplace readiness and learner assessment within the programme. 7

UNDERSPENT

• Goods and Services is under spending due to the following projects: National Transport Planning databank projects, development of National Freight Logistics Strategy, Multi Modal Transport Planning and Co-ordination Act and Regional Corridor Strategy.

Expenditure per Economic Classification: Programme 2

ProgrammePer Economic Classification

Budget Cashflow


Expenditure Available Under / (Over) spent

% Spent

R'000 R'000 R'000 R'000 R'000

Integrated Transport Planning

Compensation of Employees 39 382 9 485 8 924 30 458 561 22.66%

Goods and Services 41 573 12 118 2 438 39 135 9 680 5.86%

Machinery and Equipment 229 150 47 182 103 20.52%

Total 81 184 21 753 11 409 69 775 10 344 14.05%

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9


Develop the inception report for the development of the Multi-Modal Transport Planning and Coordination Bill;

Facilitate consultation with Inter-Ministerial Committee in preparation for the approval of the NATMAP 2050;

Develop the concept document for the gap analysis exercise on the existing National Transport Policy of 1996.

9


Identify priority projects for funding and consult potential funders (Durban-Free State-Gauteng Logistics and Industrial Corridor projects);

Develop the implementation plan for the development of the Regional Corridor Strategy;

Conduct literature review on freight accidents;

Develop technical specifications for the review of the National Freight Logistics Strategy.

9


STER: Finalise the revised Position Paper and submit the Bill to the Minister;

Appoint Transport BBBEE Charter Council members and submit to the Minister for approval;

Conduct rural accessibility index survey for identified rural districts.

9


Energy Consumption Reduction Study: Collect data for the compilation of a Status Quo Report;

Review GreenHouse Gas Inventory Report for Tier 1.

9


Situational assessment conducted and Position Paper finalised for the establishment of the Single Transport Economic Regulator (STER);

Transport BBBEE Charter Council approved by Minister and the shortlisting of Council members finalised;

Rural Accessibility Index Survey carried out in various district municipalities in the Free State, KwaZulu-Natal, Limpopo, Mpumalanga, North West, Northern Cape, and Western Cape.

9

UNDERSPENT• Goods and Services mainly due to the prioritisation on the establishment of Project

Implementation Management Office (PIMO) between the Department and Passenger Rail Agency of South Africa (PRASA) for the Feasibility study on Moloto Rail Corridor, Rail Policy Act and Branchline Strategy.

OVERSPENT• Machinery and equipment is mainly due to office furniture that were purchased during the

renovation of the building for the year.• Transfers and subsidies a total amount of R7 693 billion has been paid to PRASA which

constitutes 51% of the total budget of PRASA for the year.



Budget Cashflow


Expenditure Available Under / (Over) spent % Spent

R'000 R'000 R'000 R'000 R'000

Rail Transport


Goods and Services 15 909 3 966 266 15 643 3 700 1.67%

Transfers & Subsidies 14 997 804 7 744 650 7 744 650 7 253 154 - 51.64%

Machinery and Equipment 73 30 72 1 (42) 98.63%

Total 15 034 556 7 753 837 7 749 426 7 285 130 4 411 51.54%

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11


Conduct stakeholder consultations on the National Rail Transport Policy Green Paper;

Prepare request for proposal to appoint transaction advisers for the development of the Branchline Strategy;

Benchmark international guidelines on regulatory information.

11


Moloto Rail Corridor: Monitor the establishment of the project implementation office at PRASA;

Railway Safety Regulation Gap Analysis:

◦ Conduct literature review◦ Conduct stakeholder consultations.

11


Literature review exercise completed on the Railway Safety Regulation Gap Analysis;

Establishment of the Project Implementation Management Office (PIMO) for the Moloto Rail Development Project on track. The PIMO to be launched during October Transport Month;

11

UNDERSPENT• Goods and Services was underspent on S’hamba Sonke programme and Road Infrastructure

Policy. OVERSPENT• Goods and Services was over spent by an amount of R162 million due to the cost of e-Natis

maintenance and operations.



Budget Cashflow



R'000 R'000 R'000 R'000 R'000

Road Transport


Goods and Services 49 058 10 218 166 081 (117 023) (155 863) 338.54%



Total 21 645 287 5 093 184 5 203 740 16 441 547 (110 556) 24.04%

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13


Rehabilitate 165 lane-km of surfaced roads;

Reseal 450 lane-km of roads;

Re-gravel 450 km of gravel roads;

Patch 121 500 m2 of blacktop;

Blade 70 000 km of gravel roads;

13


Conduct stakeholder consultations and literature review on the development of the Road Infrastructure Policy for SA;

Establish the framework for development of the Road Safety Policy;

Align and Design high-impact Road Safety Programmes in conjunction with the Road Traffic Management Corporation and other road entities.

13


418 lane-km of surfaced roads rehabilitated;

774 km of gravel roads re-gravelled;

337 592 m2 of blacktop patched;

21 997 km of gravel roads bladed.

13

UNDERSPENT• Goods and Services is under spent due to the following projects: National Airports Development

Plan and the National Civil Aviation Policy.• Transfers and subsidies due to payment of foreign membership fees to the African Civil

Organisation, International Civil Aviation Organisation and COSPAS-SARSAT.



Budget Cashflow



R'000 R'000 R'000 R'000 R'000

Civil Aviation



Transfers & Subsidies 36 198 21 529 12 286 23 912 9 243 33.94%


Total 148 271 52 173 32 126 116 145 20 047 21.73%

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34


Develop technical specifications for the permission application process;

Submit first drafts of the ACSA Act and ATNS Act Amendments Bills for internal legal processing;

Develop technical specifications for the National Civil Aviation Policy;

Develop technical specifications for the National Airport Development Plan.

36


Submit draft Civil Aviation Act, 2009 Amendment Bill for internal legal processing;

Negotiate 1 bilateral air service agreement;

Investigate aircraft accidents and release reports;

Review Aviation Industry Transformation Letsema 2013.

37


Review International Civil Aviation Day (ICAD) 2013 and identify the host province to host ICAD 2014;

Visit 27 schools in 3 provinces to promote civil aviation as a career of choice among learners.

Conduct consultation with ICAO on the 1st draft Action Plan on Carbon Dioxide Emission Reduction;

Create industry awareness on the phasing out of the Chapter 2 Aircraft (Advertisements and meetings).

38


31 aircraft investigation reports released and 12 safety recommendations generated;

54 schools visited between April – June 2014 in three provinces. The aviation career awareness campaigns reached out to an estimated number of 750 learners in Limpopo, 996 learners in Gauteng and 684 in Mpumalanga.

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UNDERSPENT

• Goods and Services is due to the following projects: Maritime Transport Policy and Legislation, Feasibility for undertaking the tug boat and Ratification of African Maritime Charter.

OVERSPENT• The membership fees to the International Maritime Organisation and the Indian Ocean

Memorandum of Understanding which has been paid earlier than what was projected.



Budget Cashflow



R'000 R'000 R'000 R'000 R'000

Maritime Transport



Transfers & Subsidies 18 468 4 213 4 998 13 470 (785) 27.06%

Machinery and Equipment 347 40 56 291 (16) 16.14%

Total 110 589 23 045 19 831 90 758 3 214 17.93%

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17


Amended Maritime Security Regulations: Incorporate inputs from stakeholder consultations into the existing regulations;

Conduct site visits as a fact-finding mission on the implementation of conventions;

Cape Town Agreement: Submit the Convention to the State Law Adviser to obtain legal opinion.

17


Submit the African Maritime Charter to the State Law Adviser to obtain legal opinion;

Submit the Maritime Labour Bill to Parliament for approval;

Develop technical specifications for the development of the Salvage Strategy;

Submit MARPOL IV & VI Conventions to Parliament for approval.

17


Site visits successfully conducted as a fact-finding mission on the implementation of conventions and the process of inviting auditors for the mock audit exercise is currently underway;

The Maritime Labour Bill was submitted to Parliament for presentation to the Parliament Portfolio Committee on Transport.

17

UNDERSPENT• Goods and services due to the following projects: National Land Transport Amendment Bill,

Review of the Rural Transport Strategy, Integrated Public Transport Network and National Learner Transport Policy.

• Transfers and subsidies due to expenditure for Taxi Recapitalisation: an amount of R66 million has been spent which was journalised in July 2014.



Budget Cashflow



R'000 R'000 R'000 R'000 R'000

Public Transport





Total 11 323 771 1 425 462 1 294 352 10 029 419 131 110 11.43%

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19


Develop draft public transport planning requirements;

Transport Appeal Tribunal Act: Process 5 appeals;

National Learner Transport Policy: Facilitate inter-Ministerial consultations between DoT and DBE;

Shova Kalula Programme: Conduct provincial consultations.

19


Review of the Rural Transport Strategy: Conduct consultations with two selected provinces (Northern Cape and Mpumalanga);

Development of IPTN plans in district municipalities: Conduct consultations with the two identified district municipalities and develop the MoA;

Public Transport Stakeholder Relations Framework: Conduct consultations with two (2) provinces.

19


Taxi Recapitalisation Programme (TRP): Scrap 1 875 Old Taxi Vehicles;

Public Transport Cooperative Model: Conduct status quo analysis;

Integrated Public Transport Networks: Conduct bilateral project progress meetings with six (6) municipalities;

Place nine (9) interns in municipalities.

19


IPTNs◦ Tshwane receiving buses for the October 2014 launch of

operations. ◦ Nelson Mandela Bay planning to launch Cleary Park

service by October 2014;◦ George also launching in November 2014.

The National Land Transport Amendment Bill approved by Minister to proceed to NEDLAC;

Consultation between DoT and DBE regarding finalisation of the National Learner Transport Policy in June 2014 and draft Policy subsequently amended.

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Transfer Payments (R'000) Budget Expenditure Available % Spent

Conditional Grants:

Provincial Roads Maintenance 9 361 498 2 044 026 7 317 472 22%

Public Transport Operations 4 832 709 1 250 860 3 581 849 26%

Public Transport Infrastructure and Systems 4 968 029 - 4 968 029 0%

Public Transport Network Operations 902 817 - 902 817 0%

Rural Road Asset Management 75 223 - 75 223 0%

Public Corporatios:

Passenger Rail Agency of South Africa (PRASA) 14 946 300 7 693 146 7 253 154 51%

Departmental Agencies & Accounts:

S.A. National Roads Agency 11 916 947 2 979 235 8 937 712 25%

Road Traffic Management Corporation 176 008 - 176 008 0%

Railway Safety Regulator 51 504 51 504 0 100%

S.A. Civil Aviation Authority 19 239 4 809 14 430 25%

Ports Regulator of South Africa 16 852 4 213 12 639 25%

Road Traffic Infringements Agency 15 300 3 825 11 475 25%

Maritime Rescue Co-ordination Centre 6 887 1 722 5 165 25%

Transport SETA 231 - 231 0%

Transfer Payments

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Transfer Payments (R'000) Budget Expenditure Available % Spent

Other:

Taxi scrapping 423 604 - 423 604 0%

Non Profit Institutions 1 606 - 1 606 0%

South African National Taxi Council 18 407 3 000 15 407 16%

Higher Education Institutions 10 790 - 10 790 0%

International Organisations 10 082 6 526 3 556 65%

Leave pay and donations 161 317 (156) 197%

Total 47 754 194 14 043 183 33 711 011 29%

• Conditional Grants to Municipalities are paid in the second quarter (01 July) inline with municipal financial year.• A total of R7 693 billion has been paid to PRASA which constitutes 51% of its annual budget.• The total budget for the Railway Safety Regulator was transferred as per the payment schedule as they receive

their permit fees in July onwards.• The transfer payments to the South African Civil Aviation Authority and the Marine Rescue Coordination Centre

were delayed due to late invoicing and receiving of compliance certificate.• Taxi scrapping expenditure will reflect in the next report after the journal been processed.• The first quarterly payment to Higher Education Institutions has not yet been paid due to delays in receiving

invoices.• The membership fees to the International Maritime Organisation and the Indian Ocean Memorandum of

Understanding were invoiced and paid earlier than what was projected.

Transfer Payments (Continued)

54

Province Budget Transfer Spent by Province

R'000 R'000 R'000 %

Eastern Cape 1 294 279 281 682 108 759 8.40%

Free State 1 025 682 215 126 61 385 5.98%

Gauteng 514 903 104 101 139 360 27.07%

KwaZulu-Natal 1 788 158 392 192 556 600 31.13%

Limpopo 1 127 310 249 342 145 581 12.91%

Mpumalanga 1 594 840 341 858 409 136 25.65%

North West 690 005 140 431 16 344 2.37%

Northern Cape 640 472 156 054 97 688 15.25%

Western Cape 685 849 163 240 191 188 27.88%

Total 9 361 498 2 044 026 1 726 041 18.44%

PRMG paid according to the approved payment schedule.

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Province Budget Transfer Spent by Province

R'000 R'000 R'000 %

Eastern Cape 195 282 50 960 50 960 26.09%

Free State 215 900 56 600 55 319 25.62%

Gauteng 1 819 854 464 100 422 522 23.22%

KwaZulu-Natal 904 783 237 100 257 607 28.47%

Limpopo 291 852 72 100 73 613 25.22%

Mpumalanga 491 418 126 800 121 224 24.67%

North West 90 318 23 900 18 432 20.41%

Northern Cape 43 937 11 300 9 879 22.48%

Western Cape 779 365 208 000 189 473 24.31%

Total 4 832 709 1 250 860 1 199 029 24.81%

Public Transport Operations Grant (PTOG)

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Approved cash flow projections (drawings) Approved payment schedule for provinces and

municipalities aligned to cash flow projections (DORA) Compliance Certificate in terms of section 38 of the PFMA

and DORA Memorandum of understanding Monthly financial reports in terms of section 45 of the

PFMA Quarterly financial and non-financial reports to the

department and National Treasury

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department of transport briefing to the portfolio committee on transport first quarterly expenditure...

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