PUBLIC HEARINGS

November 2006

KwaZulu-Natal

Department of Transport

Conditional Grants and Capital Expenditure

Road Network

In keeping with Governments mandate to achieve equity the KwaZulu-Natal Department of Transport is progressively working towards its minimum road equity of 42,025 kilometres.

However, despite the budget increases received over the past years and the increases proposed over the MTEF period the department remains woefully under funded for the execution of its mandate.

Road Network cont..

The Department requires additional funding to address the road network equity.

The road network has two components: Restoring the network to its true asset value by increasing the

level of maintenance and renewal expenditure. Providing access to all community facilities and supporting

the Provincial Spatial Development Strategy

A ten year strategy has been developed which indicates an estimated under funding of R12,8 billion and to implement this would required an annual additional budget of R1,28 billion

Access

Access remains the key challenge to service delivery. The demand for pedestrian bridges and access roads is huge particularly in the rural areas of KwaZulu-Natal.

Programme Total Value of Projects

2006/07 Budget

Budget Shortfall (R’000)

Community Road Upgrading

R 1 175 000 R 67 500 R 1 107 500

Access Roads

R 574 300 R 574 300

Pedestrian Bridges

R 173 750 R 17 500 R 156 250

Total R 1 923 050 R 85 000 R 1 838 050

Access cont…

Transport Corridor Development

Economic development particularly at a local level still remains a focal point in the government agenda. Transport corridor development as a flagship project as outlined by the Premier continues to receive our attention and support as the Department.

This project focuses on continued support for the Lebombo Spatial Development Initiative that is linked to the construction of Main Road 700. The revitalisation of the rail link in the area of P700 will lead to spin-offs similar to those seen on the M4 to Mpumalanga. Importantly, the corridor has the potential of linking Richards Bay and Vryheid.

Transport Corridor Development cont..

Indeed there is hope for the weak in KwaZulu-Natal when there is partnership and collaboration amongst the different spheres of government for the general good.

Transport Corridor Development cont..

Projects Budget R’millions

Sipofu 50

Impendle 100

Sani Pass 240

Cecil Max Pass 90

John Ross Highway 450

Inanda to Pinetown 560

Ulundi to Vryheid 200

Dube Trade Port 555

Total 2,245

In response from business representatives and community based organisations the KwaZulu-Natal Department of Transport is considering for proposals for the upgrading of provincial roads that are of strategic national importance namely:

Cross Border Demarcation

The Department has inherited the Umzimkhulu District Municipality from the Eastern Cape in terms of the Cross Border Demarcation changes

The Department has conducted a needs assessment study with regard to the road infrastructure which identified a serious shortage of new infrastructure, maintenance and renewal needs in the Umzimkhulu Municipality, at a estimated cost of R1,6 billion.

Government Led Initiatives and Programmes

It is of critical importance to ensure that the ideals of a seamless government are upheld.

To this end, the Department of Transport pledges its support for all government led programmes as per the mandates of the government of the day.

Operation Mbo, Project Consolidate, the Accelerated Shared Growth Initiative of South Africa (ASGISA), Provincial Spatial Development Strategy amongst others are such programmes that this department will advocate for.

2010 Soccer World Cup

The success of the 2010 World Cup is at the forefront of our planning in the Department of Transport amidst budgetary constraints.

Road Infrastructure development, Integrated Transport Planning, a safe, regulated, affordable and efficient public transport system as well as overall safety on our roads are the critical issues that we have embarked upon a drive to ensure that KwaZulu-Natal and South Africa as a whole is ready to host the 2010 Soccer World Cup.

A report has been submitted to the National Department of Transport detailing the road infrastructure needs for the 2010 World Cup which is approximately R3 billion.

Collaboration with the National Department of Transport

I would be failing in my duty if I do not acknowledge the contribution of the National Department of Transport to infrastructure development to change the lives of the people of this Province.

The John Ross Highway Project, the Isikhwebezi River Bridge, the nKobide Interchange, the Road to eQhudeni, to mention but a few are evidence of this collaboration with the national Department of Transport

Collaboration with the National Department of Transport cont..

Indeed there is hope for the weak in KwaZulu-Natal when there is partnership and collaboration amongst the different spheres of government for the general good.

KwaZulu-Natal Department of TransportSummary of Infrastructure Expenditure Trend

Outcome

Budget Medium-Term EstimatesAudited Audited Audited

2003/2004 2004/2005 2005/2006 2006/2007 2007/2008 2008/2009 2009/2010

Capital              

New Construction 288,549 128,351 341,412 347,292 416,751 429,414 486,400

Rehabilitation/ Upgrading 509,827 598,371 614,215 670,276 846,732 1,025,363 1,055,398

Provincial Infrastructure Grant 200,121 282,594 315,121 348,194 448,190 479,007 479,007

     

Sub Total Capital 998,4971,009,31

61,270,74

81,365,76

21,711,67

31,933,78

42,020,80

5

Current 51,190 289,790 476,976 459,728 513,792 691,853 722,986

             

Total Expenditure 1,049,687 1,299,106 1,747,724 1,825,490 2,225,465 2,625,637 2,743,791

% Conditional Grant 19% 22% 18% 19% 20% 18% 17%

Slide 1

As can be seen for the attached slides the Department of Transport Infrastructure Budget has grown from R1,050 million since 2003/04 to R2,744 million in the 2009/10 financial year.

The Provincial Infrastructure Conditional Grants have increased from R200 million to R479 million which equates to between 17% and 22% as a percentage of the budget.

KwaZulu-Natal Department of TransportSummary of Infrastructure Expenditure

2006/07 Financial Year

Capital

2006/07Budget

Cumulative Analysis - Quarter ending September 2006

%of Budget Spent

Cash flow projection

Actual expenditure

Variance

New Construction

 347,292

 142,000 143,916 1,916

 41%

Rehabilitation /Upgrading

670,276 188,000  201,284 13,284 30% 

Provincial Infrastructure Grant

348,194  175,000  180,226 5,226 52% 

Sub Total Capital 1,365,762 505,000 525,426 20,426 38%

Current 459,728 207,000  211,900 4,900  46%

Total 1,825,490 712,000  737,326 25,326 40% 

 

Slide 2

In the 2006/07 financial year the Infrastructure budget is R1,825 million and the Provincial Infrastructure Conditional Grant is R348 million which equates to 19% of the total infrastructure expenditure.

I am pleased to report that for this 2nd Quarter the department has spent 40% of the Infrastructure Budget which is above the Cash Flow Projection for the quarter ending September 2006.

KwaZulu-Natal Department of TransportCONDITIONAL GRANT

Project Schedule 2006/07 Financial YearProject Region Project

2006/2007

Cumulative Actuals - Quarter ending September

2006name

details

   

Budget Outputs Expenditure Outputs   

Local Roads Empangeni Region New Gravel Roads 17,500 59 14,444 21

Local Roads Ladysmith Region New Gravel Roads 10,500 35 8,748 30

Local RoadsPietermaritzburg Region New Gravel Roads 10,000 34 9,337 11

Local Roads Durban Region New Gravel Roads 10,194 35 9,749 21

ARRUP:

All Regions

Upgrading from gravel

300,000 55 137,948 13Projects to surfaced road

             

Total 348,194 218 180,226 96

Slide 3

As can be seen from the slide that 52% of the Provincial Infrastructure Grant has been spent by the end of the 2nd Quarter, indicating that the Department is well on track to meet its milestones that were set for the financial year with regards to outputs and budgets .

Conclusion

In summary the Department requires an additional budget of R18,483 billion. If this is funded over a 5 year period it amounts to R3,670 billion per annum.

As can be seen from the figures presented this department, we have enough capacity and appropriate monitoring and evaluation systems in place to deliver on our mandate.

If additional funding can be sourced the Province of KwaZulu-Natal will write its own history and it will be a history of Glory and Dignity, as we continue "Defending the Weak" through the provision of more transport infrastructure such as pedestrian bridges, access roads, a safer road environment and an effective and efficient public transport system.

Conclusion cont..

Massification of our rural growth and sustainable economic growth and development is not possible unless it is supported by appropriate transport infrastructure. Transport the world over is seen as a catalyst for change and improved service delivery.

Thank you