Call for industry to help fund Ports Regulator

Calls have gone out for
industry to rally its support
to help address the funding
deficit facing the Ports
Regulator.
Andrew Pike, a partner
with Bowman Gilfillan,
told the Exporters’ Club
Western Cape last week that
navigating any kind of change
in the port regulatory system
in South Africa would require
widespread industry support
and funding.
“One could for example
introduce a funding model
of some sort or charge a levy
on cargo of several cents that
would be ring-fenced for the
Regulator.”
And since the Ports
Regulator SA (PRSA)
has saved industry some
R5 billion over the past
five years, Pike believes
a case can be made for
more industry support in
addressing some of these
challenges, including
funding.
“In the past
five years
tariff increase
requests have
ranged from
4-19%. The
Regulator has
allowed for
an average of
around 4%.
In the latest
application
for 2016/17
there is a
zero percent
increase on
cargo dues.
The Regulator has without
a doubt saved industry large
sums of money,” he said.
But, said Pike, the
regulator faced real
challenges in fully delivering
on its mandate – including
hearing appeals and
complaints, considering
tariff
applications,
promoting
regulated
competition,
and
regulating
port services.
“The
Regulator
does not have
the capacity
to fulfil this
mandate,” he
said. “Firstly
it is made
up – with the
exception
of the CEO – of part-time
members, making decisions
very difficult. Processes
are slow and drawn out as
getting 12 people together
who all have other jobs
and responsibilities to hear
an appeal or complaint is
sometimes near impossible.”
He said this was why
it was essential for the
Regulator to have more
permanent members on
board, but this immediately
brought up the other
challenge – funding.
“The Regulator is
apportioned funds
by Parliament which
compromises its independence
as it is beholden to the
Treasury and the Department
of Transport,” he said. “It
only receives a fraction
of the budget of Transnet
National Ports Authority
(TNPA) which it is tasked to
mandate. A sustainable and
independent funding model is
imperative.”
To achieve this, however,
would require an
amendment to the Ports
Act.
“But we need an
amendment to this Act
anyway as the PRSA does
need to be given more
powers of enforcement
to make it more userfriendly.”
He said at present
the office simply did
not have the resources
available to carry out its
mandate, while enforcing
its decisions was near
impossible.
“Currently one would have
to go to court to make orders
against TNPA enforceable,”
he said, but added that “the
recent ConCourt Nkandla
judgment was instructive
as a parallel could probably
be drawn between the
powers and enforceability of
the decisions of the Public
Protector and the Regulator”.
INSERT & CAPTION
One could introduce
a funding model of
some sort or charge
a levy on cargo of
several cents that
would be ring-fenced
for the Regulator.
– Andrew Pike