DoT mulls national economic rail regulator

The Department of Transport (DoT)
is exploring the option of establishing
a national economic rail regulator,
according to Hlengiwe Sayd,
departmental director of rail policy
and strategy development.
Speaking at the Special Interest
Group (SIG) Transport Forum in
Johannesburg last week, she pointed
out that this would form part of the
DoT’s new National
Rail Policy which
would be drawn up
once the Draft National
Rail Policy White Paper
– expected to go to
Cabinet by March next
year – was approved.
“Once the National
Rail Policy bears
fruit by increasing
investment and
possibly the number
of train operators, the
proposed industry
model will call for
more decisive governance of rail
access – and what is needed therefore
is a national economic rail regulator,”
Sayd said.
She pointed out that in the absence
of state-driven regulation, the
state-owned entities (SOEs), such as
Transnet, had been self-regulating.
“The rail industry, and the wider
logistics industry, are concerned that
current practices relating, amongst
others, to setting of fares and tariffs
are not transparent and might impact
negatively on customers’ businesses,”
Sayd commented.
She added that even when
self-regulating, the SOEs had
not achieved the
required efficiencies,
profitability and service
levels, noting that
they had either been
cross-subsidised from
profitable businesses
or had been subsidised
from the fiscus.
“In addition,
prospective new players
entering the rail sector
have discovered a
dearth of fair and
transparent economic
regulatory practices
with no recourse to an independent
regulatory body. With the envisaged
increase in rail services, clear and
appropriate regulation and access
arrangements for all operators need to
be established,” Sayd said.
INSERT & CAPTION
In the absence
of state-driven
regulation, the stateowned
entities such
as Transnet have
been self-regulating.
– Hlengiwe Sayd