Business spells out rail privatisation formula

Any discussion about the future of the SA rail network has to include some form of privatisation, according to Keith Brebnor, CEO of the Johannesburg Chamber of Commerce and Industry (JCCI). This he said in his reaction to the letter from Brian Molefe, group CEO of Transnet, complaining about the media exposure of the department of transport (DoT) master plan suggesting the separation of the rail operation from Transnet (see page 16). Looking at this concept of vertical separation, Brebnor added: “As a principle, the involvement of the private sector is certainly a must.” He told FTW that this involvement could take different forms – with the originally governmentproposed public/private partnership playing a major role in his thinking. Brebnor envisaged two possible scenarios. A split as proposed by the DoT, or a mixed approach where the private sector would be a partner of Transnet at each level of: • Infrastructure: construction and maintenance; • Rail operations; and • Network management In line with other commentators, Brebnor rejected the current government policy – also part of the DoT proposal – to privatise only certain of the branch lines. He agreed with other executives who told FTW that these mostly obsolete lines were unlikely to attract any private sector investment. But he stressed that he was supportive of the role that rail could play in SA’s overall transport network. “Transnet Freight Rail, the present rail operators, have lost most of the freight to the road mode,” he said, “but this trend must be urgently reversed as rail is cheaper and safer.” However, he questioned whether Transnet could tackle this challenge on its own. “Its track record over the last two decades offers an obvious response,” Brebnor added, “definitely not!” He also rejected Molefe’s “rather unwarranted” condemnation of the rest of the world’s experience of rail privatisation. “Regarding the shortcomings of the European experience, for example,” he said, “one could learn from it without rejecting the concept altogether.” Brebnor reserved other comments until he had made himself familiar