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2 March 2010
Creamer Media

The South African National Roads Agency Limited (Sanral) has raised a further R837-million under its Domestic Medium Term Note Programme in the second auction for this year, bringing the total funds raised for its road upgrade projects to R15,9-billion.

The agency again tapped into its two bonds with maturities in 2020 and 2034, as well as issued a new 2023 inflation-linked bond, for this auction, for which it received overall bids totalling R1,1-billion. Sanral has, to date, raised R9,95-billion without guarantee, and a further R5,95-billion under guarantee from the South African government.

The funds were being used to fund the expansion and upgrade of toll roads, particularly its R20-billion Gauteng Freeway Improvement Project  (GFIP), which was planned to be substantially completed before the 2010 FIFA World Cup.

In February, Sanral GFIP project manager Alex van Niekerk reported that the first phase of the project was, on average, about 70% completed.

March 2, 2010
Donwald Pressly, Business Report

The national roads system is top notch and repairs can be swiftly made, according to Transport Minister S'bu Ndebele, but the provincial and municipal road maintenance programme is severely wanting.

To overcome this, road allocations from the fiscus could be "ring-fenced" to ensure the funds "for tar" were spent, Ndebele said yesterday. At a parliamentary briefing on the government's infrastructure programme, Ndebele said there was "no maintenance backlog on the national network". However, he said "we need to move towards a provincial emphasis where we replicate the systems that at national level" allow for world class maintenance and repairs. The SA National Roads Agency Limited (Sanral) is responsible for 16 000km of national roads, including 3 000km of toll roads. Ndebele noted that nationally there was a system in place to repair potholes in 48 hours.

He acknowledged that other roads received annual funding of between R8 billion and R9bn, whereas an estimated R13bn a year was needed over the next five years to avoid underfunding. On resolutions to the underfunding problem, running at about R5bn a year, Deputy Transport Minister Jeremy Cronin said applying the Sanral example at provincial and municipal level was instructive, but he noted problems of corruption at a similar agency formed in Limpopo. "There are some challenges in that provincial road agency," he said, noting that the roads agency contracted the road works to private companies but it had to keep a tight rein on monitoring the work. He noted that Sanral would soon take charge of another 4 000km of the road network, some of which was now the responsibility of the provinces.

He said road funding would shift away from the metropolitan cities hosting World Cup events to other roads in future. "Spending will shift to smaller towns and rural areas and hopefully we will get a little bit more out of the Treasury," said Cronin.

Linda Ensor, 2 March 2010

Business Day

The Department of Transport is in talks with the Treasury about the possibility of setting aside dedicated funds to address backlogs in the construction of national, provincial and municipal roads. The backlog of funding road infrastructure amounts to about R64bn, and the transport department hopes that more funds will be made available for infrastructure development in smaller towns once preparations for the Soccer World Cup have been completed.

The money will be made available through the use of grants which have been used successfully for the development of the bus rapid transport system. "Even though this year we are investing R18bn on roads (nationally) and R23bn on the Gauteng freeway improvement scheme, this is not enough," Transport Minister Sibusiso Ndebele told a ministerial cluster briefing in Parliament yesterday.

From 2001 to 2008 aggregate expenditure on roads grew from R8,2bn to R9,2bn but the investment required was calculated to be R64bn over five years starting with the 2003-04 medium-term expenditure framework. "This means that we have been underfunding our own requirements and projections," Ndebele said. Over the next three years R70bn had been earmarked for road development and upgrades. "We are gathering information on the extent, condition and investment requirements of all roads authorities in the country so that a composite picture can be drawn and effective plans and strategies implemented." Ndebele was briefing the media on the transport-related aspects of the government's R846bn infrastructure programme.

He noted that in the next five years Transnet would invest about R93,4bn in ports, rail and pipelines infrastructure and operations to improve efficiencies. In the last five years to 2009 -10 it had invested R75,3bn. Ndebele was also questioned about collapsing bridges in Limpopo, allegedly built by a company partly owned by African National Congress Youth League president Julius Malema. He said the matter was serious, and his department would investigate.

2010-02-24
www.news24.com

About R5.5bn has been committed towards the construction and upgrading of roads in Gauteng, the provincial department of roads and transport said on Wednesday. MEC Bheki Nkosi said in a statement that his department had entered into a partnership with its private sector partners, in which the money was committed to road works over the next five years. "This plan will yield the construction and maintenance of 1 500km of provincial roads," he said. By the end of this financial year, the department would have upgraded 80km of roads in Sharpeville, Refiloe, Mamelodi, Atteridgeville, Kagiso, Katlehong, Mohlakeng and Orlando.

The roads in these areas had been upgraded from gravel to tar, with the installation of storm water drainage systems. Nkosi said the department will also construct pavements on high volume pedestrian roads within the 20 prioritised townships. New number plates The department also intended ensuring that at least 200 000 vehicles had the new aluminium number plates with security features by the end of October 2010. This would partly involve a roll call of all vehicles in Gauteng to ensure that they were properly registered and licensed. Nkosi said plans to root out corruption in driver's license testing centres were also underway with the installation of high-tech testing systems across Gauteng to reduce the dominance of human factors in test outcomes.

The department also planned to expand its centres for service delivery by entering into service level agreements with the South African post office on driver's license renewal sites. Roads ready by April 2010 Meanwhile, Nkosi said the key strategic road network for smooth travel during the 2010 Fifa World Cup would be ready by the end of April. These roads included the K29 Malibongwe Drive upgrade, which links Lanseria Airport with Johannesburg and Pretoria.

The upgrading of the Albertina Sisulu highway, which is a crucial gateway into the province from OR Tambo International Airport, would also be completed by the end of April 2010. Nkosi said the department would complete the beautification of this route at the same time as the upgrading. He also mentioned that the Gautrain project's phase one, which is the link between Sandton and the OR Tambo International Airport, was expected to be completed by June 2010. "This presentation becomes our 2010/11 service delivery map for each of the programmes highlighted by the premier during her state of the province address on Monday," Nkosi said.

Business Report
1/3/2010

The slow destruction of South Africa's roads network by heavily-laden trucks came under the spotlight at Parliament on Monday.

"A key problem on our roads is the massive migration of freight, very heavy freight, onto the road system. That's freight that should be on the rail system," Deputy Transport Minister Jeremy Cronin told journalists at an infrastructure development cluster media briefing. Cronin said his department was working closely with public enterprises on the matter. "Because we've really got to improve, very significantly, the Transnet freight rail system... We need to get much, much, much more freight back onto rail. It's the main cause... for damage to our road systems," he said.

According to a briefing document distributed to journalists, the rail freight system is "fraught with serious performance challenges". It says the single-most important cause of these is "historical under-investment in infrastructure, rolling stock and operating equipment". As a result, the system was unable to meet current freight demand. Transnet had embarked on "massive" infrastructure and operational investments to improve service levels. "Transnet will in the next five years invest about R93.4 billion into ports, rail and pipelines infrastructure and operations to improve efficiencies in these areas of the freight logistics sector," the document states. Over the past five years -- between 2005/06 and 2009/10 -- it had sunk R75.3 billion into these areas.

Cronin said maintenance of South Africa's roads network posed a "major challenge", but the problem did not lie with the country's SA National Roads Agency-managed national roads. "The problems tend to occur at a provincial and municipal level," he said. There were several reasons for this, including under-funding to the tune of about R60 billion. "That's steep, and as you fall back from one year to another, the condition of the roads gets worse and they deteriorate quite rapidly." Cronin said that after the 2010 Soccer World Cup, the focus would shift from roads infrastructure in the host cities, towards those in small towns and rural areas. "Hopefully we can begin delivering some of the spend in that direction, and... we can get a little bit more out of Treasury," he said. According to the briefing document, South Africa's "estimated total proclaimed road network" stretches 535 000km.

The document also acknowledges that the R18 billion earmarked for spending on roads this year -- not including the R23 billion to be spent on the Gauteng Freeway Improvement scheme -- is "not enough". Meanwhile, tyre manufacturer Continental on Monday warned motorists to beware of potholes. "The weather over recent months has caused potholes of all sizes on many roads, including motorways, so motorists need to take extra care when driving to avoid damage to their own car," it said in a statement. Road repairs were not likely to be made soon. "Local councils will probably not be able to carry out all the road repairs straight away -- so motorists might need to get used to the idea of living with potholes for a while," it said. - Sapa

2010-02-24
www.news24.com

About R5.5bn has been committed towards the construction and upgrading of roads in Gauteng, the provincial department of roads and transport said on Wednesday. MEC Bheki Nkosi said in a statement that his department had entered into a partnership with its private sector partners, in which the money was committed to road works over the next five years. "This plan will yield the construction and maintenance of 1 500km of provincial roads," he said. By the end of this financial year, the department would have upgraded 80km of roads in Sharpeville, Refiloe, Mamelodi, Atteridgeville, Kagiso, Katlehong, Mohlakeng and Orlando.

The roads in these areas had been upgraded from gravel to tar, with the installation of storm water drainage systems. Nkosi said the department will also construct pavements on high volume pedestrian roads within the 20 prioritised townships. New number plates The department also intended ensuring that at least 200 000 vehicles had the new aluminium number plates with security features by the end of October 2010. This would partly involve a roll call of all vehicles in Gauteng to ensure that they were properly registered and licensed. Nkosi said plans to root out corruption in driver's license testing centres were also underway with the installation of high-tech testing systems across Gauteng to reduce the dominance of human factors in test outcomes.

The department also planned to expand its centres for service delivery by entering into service level agreements with the South African post office on driver's license renewal sites. Roads ready by April 2010 Meanwhile, Nkosi said the key strategic road network for smooth travel during the 2010 Fifa World Cup would be ready by the end of April. These roads included the K29 Malibongwe Drive upgrade, which links Lanseria Airport with Johannesburg and Pretoria.

The upgrading of the Albertina Sisulu highway, which is a crucial gateway into the province from OR Tambo International Airport, would also be completed by the end of April 2010. Nkosi said the department would complete the beautification of this route at the same time as the upgrading. He also mentioned that the Gautrain project's phase one, which is the link between Sandton and the OR Tambo International Airport, was expected to be completed by June 2010. "This presentation becomes our 2010/11 service delivery map for each of the programmes highlighted by the premier during her state of the province address on Monday," Nkosi said.

Stuart Farrow, Democratic Alliance
21 February 2010

Deterioration of R50 demonstrates need for road maintenance overhaul
A major cause of the potholes that riddle South African roads is overloading and the transportation of freight on roads, instead of the utilisation of the rail network. A study by the CSIR Transportek revealed that the annual damage to the network of provincial and national roads caused by overloading was estimated in the mid 1990s to be R450-millon per annum. At today's prices, this figure would be between R700 and R800-million per annum. A salient case in point is the deterioration of the R50 provincial road between Leandra and Standerton in Mpumalanga - an area where a Sasol Petrochemical plant is located as well as numerous coal mines.

Photographs sent to the DA of the R50 road reveal that is in a state of advanced decline. The road is riddled with potholes that have occurred as a result of a substantial period of neglect. This road is used for the transportation of coal between coal mines and a Sasol petrochemical plant. The transportation of these bulk goods has undoubtedly accelerated the rate of deterioration. However, had restrictions been put in place to limit the weight of goods these trucks can transport, been put in place, and maintenance been carried out timeously, this road would almost certainly not have deteriorated to the current dire state it is in.

The solution to overloading and the ancillary damage to the road network is twofold - the creation of a dedicated road maintenance fund and the imposition of strict restrictions on the maximum permitted axle weight and length of heavy vehicles be reduced to meet international norms.

It is a matter of concern that between 1988 and 1999, the percentage of the road network in good or very good condition fell from 75% to 33%. A more recent report emanating from the AA in November 2008 indicates that about 60% of national or provincial roads are in poor or very poor condition compared to 22% in 1998. Not only has the ANC-led government neglected to ensure that South African roads are adequately maintained, but the costs of effecting such repairs has also been allowed to rise exponentially. The typical cost of maintaining a road, when maintenance is done timeously, is R100 000 per kilometre. If the road is left for three years, the costs rise to R600 000, and if the road is left for a further five years, it will rise to R1.8-million per kilometre.

The cause of this deterioration is neglect and poor planning by the national and provincial governments in allocating funds from budgets for road maintenance. For example, the City of Johannesburg utilised only 2% of its operational expenditure on repairing and maintaining the city's roads over the last 5 years.

The move by the Minister of Finance to increase government's spending on transport projects to nearly R30-billion over the next three years is one to be welcomed. However, it is still a matter of concern that the Minister made no mention of a fund specifically dedicated to the maintenance of South Africa's road infrastructure. The DA has repeatedly called for the establishment of a dedicated road maintenance fund to be sourced from the fuel levy, public-private partnerships and state-guaranteed money-market loans.

Furthermore, in order to encourage a move of the transportation of goods from roads to railways, the DA will be writing to the Minister of Transport proposing that:

. The maximum permitted axle weight and length of vehicles be reduced in conjunction with international norms
. More weighbridges be allocated to local municipalities and provinces A punitive tax be imposed on freight en-route where rail services exist
. Heavier punishment for habitual overloading offenders
. The introduction of legislation that certain hazardous and bulk goods should go by rail as opposed to road.

Irma Venter
19th February 2010
Engineering News

On average, phase one of the Gauteng Freeway Improvement Project (GFIP) is around 70% completed, says South African National Roads Agency Limited (Sanral) GFIP project manager Alex van Niekerk.

However, he adds that this is a general figure, with some early-starter projects further advanced, and those which broke ground only recently below this mark. Also, one can measure a project's advance by the money you have spent or the time that has elapsed, but as we are doing some high-cost finishing work only at the end of some contracts, these two aspects are not necessarily in sync. The R15,1-billion first phase of the GFIP aims to upgrade 185 km of freeway network in Gauteng, through, for example, improved lighting, upgraded interchanges, and the widening of freeways through the addition of new lanes.  Construction started in 2008.

The R21 and the World Cup
The abnormally high rainfall seen in January has definitely had an impact on the project's progress, says Van Niekerk. Some of the work sites had 440 mm of rain, and days where the contractors could not work at all. Van Niekerk says Sanral will do an assessment later this month to determine whether GFIP first phase work is running according to schedule. The full first phase, the open-road tolling system included, is to be operational in 2011. In December, things looked good, but this may now have changed, he adds. He says Sanral will use the assessment to determine whether the agency and the various contractors active on the project should make special arrangements to complete certain projects in time for the 2010 FIFA World Cup.

The R21 airport road and the N1 between Soweto and the 14th Avenue exit, near Soccer City, are two projects which have to be completed in time for the June kick-off, as well as certain new lane additions to other stretches of freeway, and work on some of the interchanges. For now, Van Niekerk says the assessment is that the R21 will be open for traffic in time for the World Cup, but that some final touch-ups will remain to be done in the south-bound lanes following the sports event. But the public won't even notice anything amiss, he adds. The R21 is being upgraded from a four-lane freeway to an eight-lane freeway.

The N1 also currently remains on schedule for completion before the World Cup. Further phases of the GFIP will include 223 km of upgrades, and new roads of 158 km. The final GFIP scheme will encompass 561 km.

Lindsey Berry
19 February 2010
Engineering News

Africa has been pegged as one of the key hubs for development in the future and the availability of engineering skills will be critical in the implementation of much-needed new infrastructure on the continent.

South Africa, in particular, is experiencing a period of booming infrastructure develop- ment with projects such as State-owned power utility Eskoms new power stations, the soccer stadiums for the FIFA World Cup, the Gauteng Freeway Improvement Project and public transport infrastructure development, such as the Gautrain, the bus rapid transit system, in Johannesburg and the City of Cape Towns integrated rapid transit system. Institution of Civil Engineers (ICE) president Professor Paul Jowitt, speaking at the recent International Development Conference, in Cape Town, summarised the role of the engineering profession in economic growth and social development: engineers should contribute to resolving the issue of demand for an infrastructure platform in an increasingly urbanised world, which will help to uplift a large portion of the worlds growing population from poverty. But to achieve that aim, there is the requirement not only that youth are attracted to the profession, but also that the systems are in place to train, mentor and register engineers. This, in turn, requires both demand for engineers and respect for the status of engineers in a society.

The good news, in the local context, is that the demand for engineers in South Africa is strong and will continue to increase. In fact, the fundamentals are such that few would probably contradict the assertion that engineering could well be poised to emerge as the profession of the next decade, if not the next century. University of the Witwatersrand (Wits) Dean of the Faculty of Engineering and the Built Environment Professor Beatrys Lacquet tells Engineering News that the environment is now such that engineering graduates find employment with ease, while the appetite for their skills is so strong that companies seeking to secure engineering graduates do so through offering attractive bursaries. This assertion is supported by Professional Assignment Group (PAG) MD Vicki Marais-Swanepoel, who reports that there has been steady growth in demand across disciplines. She says that PAG, a division of comprehensive employment services provider the Kelly Group, has also noted a significant pick-up in the demand for engineers in developing countries outside South Africa, particularly in the rest of Africa and in the Middle East. Marais-Swanepoel says that clients regard experience as a requirement when looking for employees and this is a challenge for new graduates. However, she says that the outlook for graduates is positive and there are few well-trained qualified engineers coming out of university who cannot find employment.

Job-Hopping Temptation
She cautions, though, that graduates entering the working environment should make careful decisions about career moves and should not change jobs too frequently in pursuit of a higher salary. Research-based executive search consul- tancy Woodburn Mann CE Dr Trevor Woodburn says that one of the challenges facing engineers is the temptation to advance their salaries by changing jobs too quickly without establishing their skills set. Woodburn Mann consultant Andrew Woodburn says that this is particularly relevant for previously disadvantaged graduates owing to South Africas historically skewed skills set, which has created an artificial minority of black engineers, whose services are now highly sought after. His advice, though, is for young engineers to aim to stay with a company for 24 months to 48 months to develop a solid skills base for the rest of their careers before changing jobs. He adds that the company has also noted an increased demand for engineers from developing regions, such as the Middle East, Africa, South America and the old Soviet bloc, as this is where many major engineering projects are under way. Demand in these regions is particularly focused on engineers that have experience in megaprojects, senior technical engineering or project management.

Changing Landscape
But the buoyant employment landscape for engineers in South Africa has also shifted towards an increased focus on specialised project component work and contract employment in place of permanent jobs. Andrew Woodburn says that a number of factors have contributed to the increase in contract-type employment. Many senior technical engineers exited the industry when black economic empowerment requirements were introduced in the engineering sector about ten years ago. The senior technical engineers were then employed on a contractual basis in order to retain their skills in industry without negatively impacting on transformation statistics. He adds that the rising popularity of contracting has also contributed to an increase in the number of specialist contracting companies that have a focused area of work and are contracted to projects in a specific area of expertise. The growth of these types of companies shows that there has been an increase in the awarding of larger specific contracts to organisations. Contracting has definitely become an art in the engineering environment, he adds. Marais-Swanepoel believes that South Africa has been relatively more conservative in its approach to business than the rest of the world, which has influenced the trend towards contract employment in engineering. As a result, there is tension between the project-based nature of the engineering sector and people wanting the security of permanent employment. It is coming through in debates about the labour industry, where there is a drive for people to be permanently and not temporarily employed, which does not always support flexible business practices, she adds. There has also been a shift in the remuneration of engineers over the past ten years as the discrepancies between the salaries of managerial engineers and those that remain technical engineers have been significantly reduced. Andrew Woodburn says that senior technical engineers are better remunerated and have better career prospects than they did ten years ago.

Futureproof
The growth in demand for engineers is not restricted to current infrastructure projects, as the long-term development of South Africa will mean that there is a steady supply of job opportunities for engineers well beyond the current decade. Lacquet says that engineers are able to generate growth as they tend towards entre- preneurial endeavours if work is not readily available. The more engineers we have, the faster the economy will grow, she says. The World Competitiveness Yearbooks annual report on the competitiveness of nations, which ranks countries according to how their environments create and sustain the competitiveness of enterprises, says that South Africa improved its 2009 rating to forty-eighth position. In 2008 and 2007, it was ranked fifty-third and fiftieth respectively. University of Cape Town (UCT) Dean of the Faculty of Engineering and the Built Environment Professor Francis Petersen says that the popularity of particular engineering disciplines at university is often out of sync with demand. School leavers are encouraged to study engineering when they see major projects under way, without considering the lag of about four years to five years before graduates will be in a position to enter the workplace. Lacquet says there are, however, a number of future-focused engineering sectors, where students are being trained in anticipation of growth in demand for such disciplines. A notable example is the aerospace industry a field in which many prospective engineering students are already interested, but which has received further impetus as a result of government having identified it as a growth area in which South Africa has a competitive edge. Other forward-looking programmes that are increasing in popularity include nuclear engineering and biomedical engineering. The biomedical engineering programme at Wits has been running for over five years and each year has a consistently high number of applications for the course. It is a future-orientated programme and, as we continue to mature in engineering in South Africa, I think that this is one of the areas that we can grow into, says Lacquet. However, while these newer disciplines are experiencing increased interest from students, Lacquet says that, at Wits, chemical engineering remains a consistently popular course. Petersen says that the two most popular courses at UCT are chemical engineering and civil engineering, and that chemical engineering also has an even mix of applications from women and men. University of Pretoria (UP) Dean of Engineering, Built Environment and Information Technology Professor Roelf Sandenbergh says there is consistent interest across the disciplines but that, over time, chemical, civil, electronic, industrial and mechanical engineering have remained popular. Sandenbergh adds that the smaller courses are also fully subscribed and the number of graduates being produced in mining engineering, in particular, is favourably comparable with numbers at overseas institutions.

Capacity Constraints
While there is a high demand from industry for engineers and a significant interest from school leavers in the discipline, capacity constraints do hinder the increased supply of engineering graduates into the workplace. Wits reports up to 14 applications for every place available across its engineering courses, and UCT and UP also have high numbers of applicants wishing to study engineering. Sandenbergh says that this year, for the first time, the university had to turn away students who qualified for admission to study engineering. He adds that this is evidence of a significant need for local tertiary institutions to increase their capacity. UP has a R400-million capacity increase programme in place and the long-term aim is to double the universitys facilities, which currently cater for about 5 000 students, to achieve an internationally competitive capacity figure and encourage South Africans to study in the country. The initial construction for the expansion programme is scheduled to be finished at the beginning of 2011. Sandenbergh hopes this will eliminate the possibility of having to turn away applicants who qualify to study engineering. UP enrolment statistics for the past decade indicate that the number of undergraduates studying engineering more than doubled between 1999 and 2009. About 1 125 first-year students enrolled at the university in 2009, compared with about 600 new undergraduates in 2002. This increase has been distributed evenly across disciplines. Petersen points out that human-resource planning at tertiary institutions needs to be revised and effectively implemented; current expansion planning programmes are not sufficiently comprehensive and do not always effectively measure the projected growth patterns for the demand from industry for engineers. Sandenbergh believes that, in the long term, it would be preferable for tertiary institutions to produce an excess of engineering graduates to stimulate entrepreneurship. Lacquet concurs that engineers are trained to be resourceful and ingenuity is encouraged so that they are able to start their own businesses and contribute to economic growth. Marais-Swanepoel says that the need to develop a broader base of engineers is a significant concern and business needs to continue to support students through bursaries. Further, once graduates enter the workplace, they also need to have support to establish their careers and remain in the engineering industry. Andrew Woodburn agrees that new graduates need support from their companies to consolidate their skills when they enter the workplace. Woodburn Mann has carried out research on the significant components that companies need to understand to assist career management. These include effective induction and performance management. He says that where these two practices are in place and well managed, employers contribute positively to the success of employees careers with their company.

School Curriculum
The quality of the maths and science knowledge of matriculants applying to study engineering at university is another area of concern but tertiary institutions are working with schools to improve the quality of teaching in these subjects at school level. Petersen says that UCT aims to partner with teachers to improve their knowledge and teaching skills. However, of the students who qualify to study engineering, the success rate of first-years who end up completing their degrees is 65% to 70%, which Sandenbergh says is not out of line with international trends. Nevertheless, the fundamentals are in place: the demand for engineering skills is robust; interest among secondary school leavers is stronger than it has been for years; companies are prepared to invest in engineer development; and there are relatively good prospects of a strong project pipeline for some years to come. That said, South Africa will have to deal with some of the key constraints, from poor maths and science teaching through to a lack of educational and training capacity and mentorship to ensure that this new wealth of talent is truly converted into a national asset.