Transforming the Rail Sector: Transnet’s Privatisation Proposal
Transnet is taking a significant step towards transforming the rail sector with its draft Network Statement issued for public comment in March. The proposal aims to privatize its rail network, in line with the National Rail Policy and Freight Logistics Roadmap. However, certain aspects like the minimum access fee, security measures, and capacity allocation methods have raised concerns among industry stakeholders.
The statement outlines the application process for private train operator companies (TOCs) to access Transnet’s rail network, emphasizing the Infrastructure Manager’s role in overseeing operations. TOCs must meet specific requirements, including obtaining regulatory permits and licenses, and adhering to development plans.
One major point of contention is the proposed minimum access fee of 19.79 cents/gross ton per kilometer, which some industry players find unaffordable. Security issues, such as theft and vandalism, are also addressed in the proposal but lack detailed mitigation strategies.
While the privatisation initiative holds promise for increased investment and improved efficiency, significant amendments are necessary to address industry concerns and ensure a smooth transition. Interested parties are urged to provide feedback on the proposal by 20 May 2024.
Authors: Vivien Chaplin, Director, and Gaby Wesson, Associate, at Cliffe Dekker Hofmeyr