Chikunga says reforms at Transnet will improve performance

Minister of Transport Sindi Chikunga said they are implementing reforms at Transnet. Picture: Ayanda Ndamane/Independent Newspapers

Minister of Transport Sindi Chikunga said they are implementing reforms at Transnet. Picture: Ayanda Ndamane/Independent Newspapers

Published Apr 15, 2024


Minister of Transport Sindi Chikunga said the department is implementing a broad range of reforms in the port and rail sectors to improve the performance of Transnet.

The Presidency, National Treasury, her department and the department of public enterprises were all working together to ensure that the roadmap that was adopted by Cabinet was fully implemented.

Chikunga said that as far back as last year, President Cyril Ramaphosa directed Transnet to implement reforms to improve its efficiencies. This follows a decline in Transnet's performance over the last five years.

On top of their agenda is to move cargo back from road to rail.

Over the last five years there has been a drop in the goods transported on the rail network. This led to unions in the mining sector to complain to government and urged it to intervene as this was having a direct impact on the mining sector.

“In addition to the reforms such as the establishment of the Transport Economic Regulator, development of the National Rail Masterplan and the development of the Private Sector Participation Framework, the Department of Transport has also developed an integrated Freight Road to Rail Migration Plan (FRRMP), the purpose of which is to ensure the effective and seamless road/rail modal shift, in an attempt to ensure a good equitable land surface transport split. The FRRMP has been extensively consulted on to ensure both government and private sector by-in and participation in this landmark road to rail split,” said Chikunga.

She said they vow bring more cargo back on the rail network and improve the infrastructure.

Minister of Public Enterprises Pravin Gordhan recently said that thousands of kilometres of railway lines have been destroyed in the last few years and damage to rail infrastructure has cost the economy billions of Rands.

Chikunga assured the measures that were being taken would improve the performance of the freight logistics company.

“In March 2023 President Cyril Ramaphosa directed Transnet to implement reforms swiftly and completely to turn around the crisis in South Africa’s logistics system. This followed the President’s announcement in the 2023 State of the Nation Address that government would develop a Freight Logistics Roadmap that would translate policy commitments into reality, including the restructuring of Transnet Freight Rail to create a separate infrastructure manager and the implementation of an open access regime for the freight rail network,” said Chikunga in response to a written parliamentary question from Inkatha Freedom Party member Petros Sithole.

She said because the poor performance of Transnet was caused by various factors their strategy to intervene would be able to get to the bottom of the challenges faced by the company.

The roadmap that was approved by Cabinet would be overseen by four departments.

Chikunga said part of the structural reforms was to set up an Infrastructure Manager for the rail network.

“The roadmap aims to to ensure a level competitive playing field in ports and rail, an independent Transport Economic Regulator (TER) will be established. The TER will be empowered by the Economic Regulation of Transport Bill. This legislation is an important enabler for private sector participation and third-party access in the rail sector.”

Additionally, they will allow the private sector to participate in the rail network.

Chikunga said private sector participation was approved by Cabinet last December, and they were now busy developing its implementation plan.

Chikunga said the private sector participation programme should not be viewed as privatisation of the rail network.

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