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SANRAL CEO Nazir Alli tells Tim Modise that the decision to introduce e-tolls in Gauteng was taken by the provincial government itself. He reveals that his agency has built 14,000 kilometres of roads since 1998 and the quality of roads is ranked in the top 5 globally. He attributes proper governance to his longevity in his job and advises public sector colleagues not to compete with their political principals. – Tim Modise
Mr Nazir Alli, the outgoing CEO of the South African National Road Agency, thanks again for talking to me here on our Biznews Transformation section. It’s been a long ride for you, with Sanral but the past few years have been very hectic with protests marches in Gauteng against e-tolls and being taken to court in Cape Town. Is that a disappointment or a lesson of sorts?
Firstly, Tim thank you very much for the opportunity to talk to you this morning. There are always lessons, which we learn in life. To me, that wasn’t a disappointment. It was showing our new democracy (our very young democracy) in action and that it is working. The disappointment for me has been in the sense that once the courts have ruled – for instance, on the issue of e-tolls, which by the way is only a matter of collection. It’s not the principle of tolling. We can come back and talk about the principle of tolling, which has also been affluent in our NDP. The disappointment for me is the disrespect that people then showed at the time for our judiciary. As the decision had gone against them six times (twice in the highest court in our land), they just wouldn’t accept it – to say that we followed a legal process, the courts have spoken on it, and that we should get [inaudible 01:26].
That’s been the disappointment. The disappointment hasn’t been the fact that we’ve been taken to court. The other disappointment for me is the continued misstatements by politicians and how people deliberately want to mislead the public, and not always stick with the facts.
On the political front, in Gauteng for instance, we have COSATU still opposed to the e-tolls. The ANC Chairperson here, who said that the ANC would not accept e-tolls and then it had to take National Government to intervene and revise the toll rate for that to be re-imposed, there’s still a lot of confusion around that. Explain.
Firstly, what our Premier did in Gauteng was that he exercised his particular democratic right and he then appointed the advisory panel over there. We of course, participated in the advisory panel together with our Minister and the submissions we made were all available on the website. We are the ones who insisted that the hearings from our side…that our submission must be made in public. We made sure that the media was invited to it as well. We’ve gone through that particular process and a result has come out of that. The result has been to say that we had to relook the tariffs that we’ve done. If you look at what we’ve done (with the announcement by our Deputy-President) as far as the new dispensation is concerned, we now have a uniform tariff for the different classes of vehicles. The 30c/km for the Class A2 vehicle, which was always there, has remained.
We’ve taken away the alternative tariff, so there’s no confusion in terms of what an alternative tariff is and what the actually tariff is, which people will now be paying. That’s what we’ve basically done in terms of bringing in a uniform tariff for the different classes of vehicles.
What I want to touch on here is the misunderstanding (if any) or the confusion between Sanral (represented by yourself) and the ANC Government in Gauteng. Their argument is that e-tolls are not sustainable and that they will affect the economic wellbeing of citizens in Gauteng.
This is the sort of confusion, which has been arising. If you look at the history of this particular project, the Gauteng Government (as a province) were the ones who actually, initiated this project. Sanral did not initiate this project.
It was the Gauteng Government…
Yes. If you look at it, they initiated the whole project.
Well, the initiated it because they did a study. They did the initial study in terms of saying, “How do we deal with the congestion, which is taking place? How do we increase the capacity of our roads, given that we all know that congestion has a major impact on the economy of the province and that the economy of the province was being choked because of the time spent being stuck in traffic, as opposed to being used for productive purposes?” They initiated this study. Of course, the project was large enough where they invited us to become part of it because we have the ability and the mandate in South Africa – through our legislation – to toll roads. There’s a legislative process, which one has to go follow. Together with our province, we did all the feasibility studies. As I said, it was initiated by them. They got various studies done. We then did our studies on our own to check the feasibility.
We did some joint studies, etcetera, so the project was never initiated and furthermore, we also need to understand that the project, before it was implemented, it was announced to the public by the (then) Minister. If memory serves me correctly, it was back in 2007 that we’d announced that the tariff would be 50 cents before discounts for a Class A2 vehicle, per kilometre. If you look at what we’ve done today, the tariff is even less than it was when it was announced in 2007. In addition, it has to be noted that the project was taken to cabinet. It’s not something that Sanral unilaterally imposed on anybody or even started the project, and cabinet had approved the project. We, at Sanral, do not make policy. We implement Government policy and our mandate is derived from an Act of Parliament and from Government itself. We do not get our policy through a particular individual or group of individuals.
How do you feel, that the Gauteng Government turned around and made it a Sanral problem (probably even made it a personal problem) – that it’s Nazir Alli who wants the e-tolls?
That is unfortunate and it’s regrettable – let me be upfront with that, Tim – that a project, which they had initiated; that they’d forgotten that. Perhaps it was because there’s been a change of leadership in the province as well and the handover of the change of leadership etcetera wasn’t done in an orderly fashion. I hope that will never happen in Sanral on my way out, and that we will do it in an orderly fashion. That’s where the misalignment came – with the National Policy and what the province wanted.
You know how people see these things. They’ll say, “If that is the case, then that was dishonest.”
No Tim, I don’t think it was dishonest. I’d probably put it differently. They didn’t understand the implications of what was happening and there was a huge misunderstanding in terms of the broader implications for funding of infrastructure in South Africa.
Let’s talk about your career at Sanral. You’ve been a public servant for 17 years.
Yes, that’s true.
You’re one of the longest-service public servants. What do you attribute that to, that stability and the long-term service that you’ve provided?
Firstly, I’d like to thank our Government for having given me this opportunity to be of service to our country and I’d like to believe that we’ve done this to the best of our ability. More importantly, we need to look at the team that I had around me; both at the non-executive board level and at the political level of course, with the Ministers that we had. Then of course, my colleagues in Sanral itself. This has never been a one-man band operation at Sanral. This has always been a team effort where there are three components forming the triangle with the Minister being at the top of the pyramid, and then management and the board coming in at the other two corners of the triangle. That is what I attribute it to. Secondly, we’ve always delivered on our mandate. If you look at it in terms of how the quality of the National Road Network has improved, then that’s [inaudible 09:06] that the National Road Network has improved.
We mustn’t forget that Sanral was deliberately set up by Government at the time when they started to look at it in 1994, when we became a democracy, as to ‘how do we deliver services to the country as a whole and not only to a certain portion of our society’. We mustn’t forget we had the home learners. We had the self-governing provinces/states and each one had their own standards. Each one had their own way of doing it and we had to bring all of this under one roof, and no longer have this fragmentation that existed prior to 1994. They accepted that we are a Constitutional Unitary State in South Africa, so we had to relook at Government in terms of how it deliver its services. Many agencies were created between 1994 and when Sanral came into being in 1998. In 1998, when Sanral was established through an Act of Parliament, one other thing we did was that Sanral was also registered as a company. It wasn’t because it needed to trade, etcetera.
We didn’t have the PFMA at the time, because that only came into being in 1999. Government didn’t always have the tools and the instruments to be able to apply sanction for non-performance of its agencies. That instrument lay in the Companies Act and that’s one of the reasons why you see that Sanral is registered, in terms of the Companies Act. If there’s poor performance or non-performance or any kind of mismanagement by Sanral, there is a legal route for sanctions to be applied. We started off with about 7,000kms of road in terms of the National Road Network, which has now grown to 21,403kms of road, and that is it. The significance of the National Road Network is that 80 percent of the long-distance freight, which moves on the surface in South Africa, moves on those national roads so we can see the significance of the National Road Network. I want to assure you that they are pothole-free.
It’s three times the length/extent of national roads that Sanral was able to build under your leadership during that time. Can you share some of your highlights of your time at Sanral with me?
There are a couple of things. We sat down with our provinces and our metros etcetera, and we convinced them about the importance of a good quality road network. Then we sat down with them and we divided this into what we call the economic arteries of South Africa. That’s how we identified which of the roads should form part of the National Road Network, and that Sanral would be responsible for the National Road Network. Of course, a process was followed that time, before Sanral was formed, in about 1996/1997 when the Act was being discussed and the discussions that Government then had with the communities, businesses, and of course, the provinces and the metros, and the identification of what we call ‘the Strategic Road Network’. That’s the one thing. The second thing is that I told you earlier that the team I had with my colleagues; we made it very clear from the word ‘go’ that we are going to have qualified people. We’re going to have people there who have the necessary knowledge in our agency, to be able to do the work. That has also been proven with the peer reviews, which were done about two years ago – independent peer reviews. In some of the methodologies, that we’ve introduced in terms of our asset management, for us, one of our core components of the business was ‘how do we preserve the assets of South Africa’. Our road network is probably the largest entire road network, and not just the National Road Network, is the largest single asset of South Africa. We had to make sure that we preserved that asset in a condition that contributes to the wellbeing of the country. The wellbeing of the country: by means of making sure that the work goes out, the roads are maintained, we reduced the cost of transport, together of course, with keeping the civil engineering industry alive by creating jobs. I just want to make one other point. This was also founded on good governance principles. There was no compromise in terms of governance as far as Sanral is concerned.
Good governance principles. Those seem to be plaguing the state-owned enterprises (at least in recent times). We have so many acting CEO’s now and boards fighting management. Why is that the case?
Look Tim, I can’t speak for my other colleagues in the other state-owned companies because I don’t know their intricacies, the details of how they function, the relationship with management on the one side and the board on the other side and of course, with the Minister. As I said to you earlier, we’ve always made it very clear that Sanral derives its mandate from Government, and not from a particular individual or a group of individuals. We as management have always made sure that we have a good relationship with our board and there’s a clear understanding that we signed a contract (or compact, in our parlance) between the board and the Minister. That is a three-year rolling contract, which we signed and we’re measured every quarter where we report on that. We have KPA’s and that particular compact that we signed with the Minister is a direct reflection of my agreement with the board.
We are held accountable at three different levels. My colleagues, directly to management and then us as management, to our board, and our board to the Minister. I think there’s a clear demarcation over there of the different roles that each one plays over there and what the oversight role is (1) in terms of risk-management of the board and then, the oversight role is of the Minister. The Minister ensures that we are meeting Government’s objectives and that we are carrying out the mandate that we received from the Government. Of course, Tim, I’d like to believe that over the years, we’ve always done it to the best of our ability and that has been shown by both the awards we’ve won – national and international awards.
Lessons learned over the period of time as it has probably not been an easy ride. There are certain things, which you regret and there are certain lessons you’ve learned and that you may want to share with your colleagues in the public sector.
Look, there are always lessons to be learned. If we don’t learn as we go along…in my opinion, that is when people just stagnate. We should never be afraid to learn and ask the questions when we have to ask the questions, and not be arrogant about it at all. Never do that. We do this because it’s given us great pleasure as a company (as Sanral) to serve the public. That’s the first lesson we’ve learned. We’ve also learned that you have to make sure you’re always in tune with what the public wants. If we just look at ‘who is our customer’… We make no bones about that and you can see that in our policy documents that we’ve come up with Sanral that we’ve always regarded the people we serve as our customer. A customer has a particular right to make sure that they get the service they require. Every registered vehicle that we have on our road; the owner of that registered vehicle is a customer of Sanral.
We have just over six-million registered vehicles now in South Africa and we accept that it’s going to be very difficult for us to be able to satisfy six-million owners. At some stage or another, they would have used our roads. Whether it is in private transport, long-distance hauling, or even commuters using our taxis: each one has a different view. I believe that we have set up sufficient mechanisms within the agency, to be able to listen to what people are telling us and making sure ‘what do people want’. Understanding what people want and making sure that we understand what they want. At the end of the day, what do people want? They want a road, which is smooth, pothole free, and not congested. They can have certainty in their lives to say, “I can get from point A to point B within 10 minutes, half-an-hour, or one hour” – whatever the journey time is, depending on the distance – “and that if something goes wrong on that road, I know that as a user of the road, there will be assistance provided for me by this agency.”
I think those are the kinds of things that we had put into place. We have many arrangements for instance, with the sectors we serve – both as individuals or with groups and of course, with organised business. We meet regularly with organised business. We also meet regularly with our service providers because we can’t be doing something over here such as making demands on our service providers, which they won’t be able to meet as well. We’ve had all of this put into place over a number of years. One of the other things that we did in Sanral…when we first started off (and I think we all recognise that the record-keeping in Government as far as its properties etcetera are concerned, is in a chaotic state), it took us about seven years to make sure that we have a proper inventory of everything that Sanral owns. We started to take transfer of the roads into Sanral claims and make sure that fair compensation was paid to the people. We have an inventory where we can truly say that our asset base is about R356bn.
Well, if there’s one lesson, as we end this interview, that you’d like to share with your colleagues who serve at your level in the public sector, what would that be?
It’s simple. Don’t ever think that you’re in competition with your Minister. Ultimately, the Minister is the one who carries the can on behalf of that entity. Show the necessary respect for the Minister and for the policies of government.
Mr Nazir Alli, thank you very much for talking to us.
My pleasure, Tim.
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