Department of Transport

Department of Transport

Portfolio Committee on Transport

Annual Report 2009/10

Director-GeneralMr George MahlalelaDate: 12 October 2010

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Section 1: Performance Highlights

Section 2: Highlights of 2009/10 Financial Statements

Section 3: Human Resource Management & Development

Contents

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Detailed Programme Performance in 2009/10

• Programme 2: Transport Policy, Research and Economic Analysis

• Programme 3: Transport Regulation and Accident and Incident

Investigation

• Programme 4: Integrated Planning and Inter-sphere Co-ordination

• Programme 5: Freight Logistics and Corridor Development

• Programme 6: Public Transport

• Programme 7: Public Entity Oversight and Border Operations and

Control

• Programme 1: Administration

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Programme 2Transport Policy, Research and Economic Analysis

KEY HIGHLIGHTS

Significant strides made in terms of refining policy and closing critical gaps identified in the process in the following areas:

• Scholar transport

• Rail economic regulation

• Road safety

• Passenger transport

These gaps necessitated a review of the approach to law enforcement resulting in proposed amendments to the National Road Traffic Act, 1996 and passage of Maritime transport Security Act, 2009 and the Merchant Shipping (Civil Liability Convention) Act, 2009

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Programme 3:Transport Regulation and Accident and Incident Investigation

KEY HIGHLIGHTS

Vehicle Registration, Traffic Management conducted through eNatis

CONTEXT:

• This is a shared responsibility among the three spheres of government and the RTMC

• Institutional chaos resulting from inadequate systems to manage interfaces drives poor management in this regard

• Revenue flows remain a pervasive challenge. The revenue sharing arrangements are not working as they should. The conveyor belt is simply not working properly. Municipalities are not passing on what is due to Provinces, Provinces are not passing on what is due to national.

• eNatis

• The eNatis contract was for the development and deployment of the system. At no stage was there ever a plan to issue another tender for eNatis.

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Programme 3: (cont…)

KEY HIGHLIGHTS

• Based on the contractual arrangements, once the system was operating optimally at the end of the contract period, Tasima was required to transfer the eNatis to government. Agreement was reached to delay this transfer based on a number of consideration:

• Agreement was that the system should be transferred to the RTMC, who will then assume custody of the eNatis on behalf of the state. Given the magnitude of its challenges, the RTMC was not in a position to take over the system and does not have the management infrastructure in place to support a mission critical system like eNatis.

• The system has been classified as a national key point, which demands compliance with onerous security requirements.

• The Department has since extended the Tasima contract based on these considerations and to enable the Department to build the requisite capacity to take over the system.

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Programme 3: (cont…)

KEY HIGHLIGHTS - AVIATION

• A number of security related issues were dealt with during the reporting period, which include aircraft accidents in Durban and George, leading to the grounding of the Airlink fleet by the Civil Aviation Authority.

• Challenges were experienced with the approval of ACSA Tariffs by the Regulating Committee. New permissions were granted by the Committee both for ATNS and ACSA, but ACSA challenged the decision. The Regulating Committee has since been replaced by a Ministerial Task Team to review the ACSA decision, among other tasks.

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Programme 4: Integrated Planning and Inter-sphere Co-ordination

KEY HIGHLIGHTS

• Considerable time was spent shaping debates around infrastructure funding and engaging on issues around a dedicated maintenance fund for the secondary road network. Post year end, significant progress has been made in these engagements with the National Treasury which may result in a more sustainable approach to the maintenance of the secondary network.

• To date the Shova Kalula project has distributed over 21,000 bicycles to deserving learners. Government has invested R15million in the project over a period of 4 years. A revised Non-Motorised Transport implementation plan targets to roll out the distribution of 1 million bicycles by 2015.

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Programme 6:Public Transport

KEY HIGHLIGHTS

• Through PRASA, we have extended the rail network in Khayelitsha

• The Railway Safety Regulator (RSR) approved all relevant safety standards and evaluated the level of compliance with safety prescripts and the technology, resulting in the issue of a safety permit authorising the operation of the OR Tambo Airport – Sandton link of the Gautrain post year-end;

• As part of preparations for the World Cup, significant investments were made on infrastructure both in rail and road transport (BRT projects rolled out in Johannesburg and Cape Town, and work got underway in Nelson Mandela Bay);

• There has been significant focus on building capacity of Operating Licensing Boards and streamlining of regulations for lincensing public transport operations and advance enterprise development. We have established the National Joint Working Group to address challenges facing the taxi industry and continue to engage with the small bus operators.

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Programme 7: Public Entity Oversight and Border Operations and Control

• Pervasive challenges remain in the corporate governance of public entities. A specific focus to improve corporate governance challenges in all our entities is in place.

• We continue to address the challenges experienced by the RTMC;

• We formulated the draft no-fault policy for Road Accident Benefits, consulted the policy and tabled the policy to Cabinet. Various constitutional and other legal challenges were dealt with successfully.

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Programme 1: Administration

KEY HIGHLIGHTS

• The current establishment of the Department has 677 posts, but only 627 posts have been filled. This is primarily due to serious budget constraints.

• We started an exercise in the last year to review the effectiveness of the structure. We have come to the conclusion that the way the Department is currently structured poses a challenge and the fragmentation of functions compromises accountability and proper strategic focus.

• Our emphasis is to shift the department from policy focus to implementation co-ordination.

• We further need to place emphasis on skills development, support for the disabled, women and youth.

• Highlights of Annual Financial Statements:

• Adjusted budget 2009/10 • Reprioritisation in 2009/10 • Under expenditure in 2009/10

Section 1: Review of 2009/10

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Expenditure trends for 2009/10:Adjusted BudgetDetails R’000

Original budget for 2009/10 23,734,829

Funds rolled over from the previous year: 25,576

Policy and economic regulation projects 4,683

Transfer to the S.A. National Roads Agency Ltd. 13,100

Performance management system 681

No-fault policy for the Road Accident Fund 1,112

Legal services for the Road Accident Amendment Act and Regulations 6,000

Unforeseeable and unavoidable expenditure: 272,343

Higher salary increases 5,214

Office of the Deputy Minister 3,000

Disaster management grant for flood damage in the Western Cape 116,900

Gautrain Rapid Rail Link: inflation and foreign exchange adjustments 144,029

S.A. Maritime Safety Authority: Long range identification and tracking system

3,200

Details R’000

Other adjustments: 205,769

Unspent funds of the Urban Transport Fund to meet its remaining liabilities

6,934

Self financing expenditure for the maintenance and development of eNaTIS

198,835

Total of Adjusted Budget 503,690

Final budget for 2009/10 24,238,519

Expenditure trends for 2009/10:Adjusted Budget (continued)

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Expenditure trends for 2009/10:ReprioritisationProg Details Shift from

R’000Shift to

R’000

1 Server for contract management system 510

2, 3, 5 Savings (R3,79m; R2,5m; R2,34m ) 8,630

3 Fund the African Union Maritime Conference 8,120

First virement: AU Conference 8,630 8,630

1 Presidential inauguration, information technology contracts, upgrade of offices and compensation of employees

21,518

2 Savings 567

3 African Union Conference and Regulating Committee

9,533

6 Project management office and cost of scrapping agency for taxi scrapping

20,140

7 Delays in the process of restructuring the Road Accident Fund

10,344

Final virement: Avoid over expenditure 31,051 31,051

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Expenditure trends for 2009/10:Under / (over) expenditureDetails of major amounts under / (over) spent R’000

Compensation of employees over spent due to: New dispensations for all levels Additional dispensations for officials in the legal profession Job parity adjustment for levels 9 and 10 to levels 11 and 12

(12,108)

Bus subsidies over spent due to court orders in 2008/09 (367,734)

Over spent by Integrated Planning and Inter-sphere Co-ordination mainly due to technical support provided to host cities to prepare for the 2010 Soccer World Cup

(30,596)

Write off of overpayments, “no shows”, irregular expenditure and thefts

(425)

Transfer payment stopped because a roads project could not proceed after an environmental impact assessment

100,559

Under spent due to the delay of non-critical projects to counter the over expenditure on 2010 Soccer World Cup projects and on compensation of employees

41,201

Under spent on scrapping of taxis 5,110

Other 673

Net over expenditure for 2009/10 (263,320)

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• Emphasis of matter

• Unauthorised, fruitless and wasteful & irregular expenditure:• Unauthorised expenditure

• Fruitless and wasteful expenditure

• Irregular expenditure

• Other legal and regulatory matters:• No quarterly reporting on performance information

• Internal control

Audit outcomes for 2009/10

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Emphasis of matter

Audit Report Actions taken Actions to be taken

Financial statements are prepared on the modified cash basis of accounting determined by National Treasury

Complied with Treasury guidelines

None

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Unauthorised expenditure


Unauthorised expenditure of R362,4 million was incurred as over expenditure of the budget for Programme 6, as a result of over expenditure on bus subsidies amounting to R367,7 million.

Over expenditure of bus subsidies in 2009/09: R844,980 million.

Total R1,207,374,000

The bus subsidy budget was moved to a conditional grant under the Division of Revenue Act to avoid future over expenditure on bus subsidies.

The conversion of Interim Contracts from ticket based claims to kilometer based has been completed in all Provinces

An equitable formula for future allocation of subsidies has been developed and implemented.

Parliament to consider the unauthorised expenditure to decide whether it should be either approved with or without funding, or whether it should not be approved

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Fruitless and wasteful expenditureAudit Report Actions taken Actions to be taken

As at 31 March 2009:

39 cases amounting to R169,653-67

Recovered R30,822-95Reversed R31,311-81Written off R4,671-00Being recovered R15,117-91Outstanding: 5 cases amounting to R87,730-00

Continue legal action in two cases amounting to R80,181-00

Representations requested for “No Show” Committee to consider other cases

Interest on late payment of bus subsidies R2,173 million

Include in request for approval with funding in the Finance Act

Incurred in 2009/10:

23 cases amounting to R103,076-73

Credited 2 cases R2,742-00Transferred to debt 8 cases R37,594-70

Outstanding 13 cases R62,740-03

Representations requested for “No Show” Committee to consider

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Irregular expenditure


11 cases were reported in 2009/10 amounting to R951,350-94

Cases are reported6 cases were condoned R262,771-08

In 4 cases, the Bidding Committee requested legal opinions

For one case, the component was requested to provide an explanation and to submit a case to the Bidding Committee

Disciplinary steps taken in 4 cases

Affected components will be requested again to request legal opinions and to consider disciplinary steps before requesting the Bidding Committee to condone the cases

7 cases reported in 2008/09

3 cases condoned

Disciplinary steps taken in 2 cases

Disciplinary steps requested for 2 cases

2 cases under investigation

- ditto -

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Other matters: Performance informationAudit Report Actions taken Actions to be

taken

No quarterly reporting on performance information:

The fourth quarterly report was not prepared

For the sub-program 2010 World Cup Coordination no quarterly reporting was done for the entire period under review

The first quarterly report was requested

Quarterly reports are checked to the Strategic Plan to ensure that all the sub programmes provide reports

A fourth quarterly report will be finalised, separate from the Annual Report

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Other matters: Performance information (continued)


Internal control:

information is not used in a form and timeframe that support the achievement of reporting objectives.

Monitoring and supervision are not undertaken over reporting on predetermined objectives

Actions are not taken to address risks relating to the achievement of complete and accurate financial and performance reporting.

An official was given the responsibility to oversee quarterly reporting until the post of Director: Strategic Planning and Monitoring can be filled

Programme Managers will be required to sign off on quarterly and performance reports

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Personnel Establishment Vacancy Management Employment Equity Figures Organisational Development and Employee

Health and Welness Human Resource Development & Capacity Building

Human Resource Management

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• Total Establishment: 677 posts

627 posts filled (92.61%)

50 posts vacant (7.38%)

• Vacancy rate is 7.38%: (including 98 contract

employees)

7.38%

Filled

Vacant

92.61%

Vacancy Rate 31/03/2010= 7.38%06/09/2010=7.83%

Personnel Establishment

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Vacancy Rate 31/03/2009=7.38%06/09/2010= 7.83%

• Concurrent headhunting with normal recruitment process has been introduced and implemented;

• Retention Strategy was approved and implemented, (Counter offer targets women, people with disabilities, rewarding of above average performance, people development and capacity building, empowerment of managers on Labour relations matters);

• Appointment of second appointable candidates who are women or people with disabilities;

• All vacant Office Administrators posts (PA/Secretaries) have been advertised and the interviews are in process;

• Approval has been granted to access & advertise identified posts on Job Access to accelerate the appointment of persons with disability;

Measures that were introduced to reduce the vacancy rate

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Vacancy Rate 31/03/2009=7.38%06/09/2010= 7.83%

• Branch Managers have been given quotas that they are expected to meet on people with disability and women at SMS levels as well as guidelines;

• The pro forma submission for the filling of posts has been improved to include Branch EE status updates;

• SMS Members will be assessed in terms of meeting the EE targets under the People Management and Empowerment CMC which carries a weighting of 20% ;

• HR Interventions/Outreached with DDG’s with a view to assist amongst others the fast tracking of the filling of the posts, signing of PAs, Performance assessment process and other outstanding HR Matters.

• Contract employees have been temporarily placed against vacant posts as per EXCO directive.

Measures that were introduced to reduce the vacancy rate (continued)

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Africans

Coloured

Indian

White

(A) Req 79.2% Act 94.61%

(W) Req: 9.2%Act: 7.30%(I) Req: 2,6%

Act: 3.03%

(C) Req: 9%Act: 2.36%

Race Representation:627 Filled Posts

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Directors

CDs

DDGs

DG

Directors=75Women=41.33%Male=58.67%

DDGs:6Women=33.33%Male=66.67%CDs=18

Women=44.45%Male=55.56%

Total SMS: 100 Women = 41 (9.41% Under represented)

Gender Representation on 100 SMS Posts Filled

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Total filled posts

Women Male Variance(Women)

Transfers & Terminations(April 09–Mrch 10)

Level 16 1 0% 100% 0% 1 (100%)

Levels 15 6 33.33% 66.67% 16.67% 0

Levels 14 19 42.10% 57.89% 7.90% 0

Levels 13 74 41.89% 58.11% 8.11% 6 (8.11%)

Level 12 111 44.14% 55.85% 5.86% 7 (6.31%)

Level 10 103 48.11% 51.89% 1.89% 7 (6.80%)

Levels 3-8 215 65.12% 34.88% -15.12% 39 (13.04%)

Total 529 54.63% 45.37% -4.63% 60 (9.79%)

Gender Representivity & Turnover at all levels (only on permanent filled posts excluding contract employees)

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Appointments & Internal Promotions: 78

Service Terminations: 60

Lateral transfers: 4

STAFF MOBILITY01 APRIL 2009-31 MARCH 2010

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National Requirements -

DOT Status

Filled: 529

Total DOT

Establishment : 677

Action Required: Total

Africans (79.20%) 71.93% (451) 79.20% (536) Internal promotions targeting women – (Add 85)

Coloured (9%) 2.30% (13) 9% (61) Add 48

Indians (2.60%) 3.18% (18) 2.60% (18) Target reached

Whites (9.20%) 6.94% (47) 9.20% (62) Add 15

Women (50%) 42.69% (289) 50% (339) Add 50

Disabled (2%) 1.48% (10) 2% (14) Add 4

Employment Equity Status31/03/2010

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CHALLENGES:

• Africans, Indians and Whites are over-represented whereas Coloureds and People with disabilities are under-represented.

• More attention is now being given to under-represented groups when appointments are made.

• Although women are over-represented by 0.07% based on national demographics, this group is still under-represented as Senior Management level.

• DPSA’s target for women at SMS level is 50% and the department is at 41%.

• National target for People with disabilities is 2% and the Department is at 1,83%.

INTERVENTIONS:

• SMS members are held responsible for ensuring and achieving EE in their components,

• Job Access has been appointed to assist the Department to recruit people with disabilities.

CHALLENGES AND INTERVENTIONS

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Job Evaluation (Table 4) Health Promotion & HIV and AIDS

Programme (Table 12)

ORGANISATIONAL DEVELOPMENT AND EMPLOYEE HEALTH AND WELNESS

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Salary Band Number of posts as on 31 March

2010

Number of jobs

evaluated

% Posts evaluated by salary bands

Posts upgraded Posts downgraded

Number

%of posts evaluated

Number %of posts evaluated

Salary levels 1-2 0 0 0% 0 0% 0 0%

Salary levels 3-5 62 4 6.45% 2 50% 0 0%

Salary levels 6-8 206 1 0,49% 0 0% 0 0%

Salary levels 9-12 271 2 0,74% 0 0% 0 0%

Senior Management Service (Band A)

91 1 1.10% 0 0% 0 0%

Senior Management Service (Band B)

35 0 0% 0 0% 0 0%

Senior Management Service (Band C)

10 0 0% 0 0% 0 0%

Senior Management Service (Band D)

1 0 0% 0 0% 0 0%

Total 677 8 1.18% 2 0.25% 0 0%

Job Evaluation

Table 4.1 Job Evaluation, 1 April 2009 to 31 March 2010

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Total number of employees absorbed in an upgraded post

Beneficiaries African Asian Coloured White Total

Female 0 0 0 0 0

Male 2 0 0 0 2

Total 2 0 0 0 2

Employees with a disability

0 0 0 0 0

Job Evaluation

Table 4.2 Profile of employees absorbed in an upgraded post, 1 April 2009 to 31 March 2010

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The department addressed issues of scarce and critical skills as follows:

◦ Achieved partially the Integration of Transport studies within the FET ◦ curriculum for level 2-4◦ 17 students sent to Prague to pursue transport-related careers◦ -Sourced R1, 84m from UNDP for placement of scarce & critical skills ◦ Interns including COD graduates. Fouty-five (45) transversal interns were

placed within the department◦ The department has prioritised bursary funding for transport related

qualifications for employees.◦ Outreach programmes have been conducted to address transport related

scarce and critical careers

CAPACITY DEVELOPMENT & GDYC ANNUAL ACHIEVEMENTS 2009/10

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2010 World Cup Skills Development project was conducted with the assistance of R1,8 m from UNDP.

A Human Resource Development Strategy for 2009-2013 was developed that addresses capacity development initiatives for the department.

Registered and funded 533 COD students during 2009. Completed Gender Audit that was presented at EXCO for adoption

and approval. Capacity building & GDYC policies were developed, reviewed and

sent for approval Mainstreaming of GDYC programmes was conducted

CAPACITY DEVELOPMENT & GDYC ANNUAL ACHIEVEMENTS 2009/10

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Areas of Intervention for 10-11

• Policy for public transport access in SA• Energy efficiency framework for the transport sector• Modal split analysis• Capacity for evaluation of new rail proposals• Development of the Rail Policy• Framework for single transport regulator• Consolidation of aviation economic regulator• Transport Aviation security service not established• Implementation of best practice model (re: licence

management)• Facilitate job creation and employment in maritime sector

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• Development of Rural Public Transport Network plan• Road Infrastructure Recovery plan developed • Institutional arrangements for effective roads

development and interface with industry effected• Non-motorised transport policy completed• Transport Disaster Response strategy• High speed rail plan for priority areas finalised• Regional master plan for SADC drafted

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• Implementation of taxi EFC pilot• Programme management of TRP• Taxi subsidy framework reviewed• Continue with the implementation of the electronic

performance management system• Turn-around strategy to improve performance of CBRTA• Absence of a culture change strategy• Provision of better working environment through new

office campus

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Thank you

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Documents

Department of Transport