impact of which may not be felt right now, as the international price of crude oil has continued to drop (although we now import finished product due to our refineries having gone offline), so that may be temporary in nature. State run logistics In his Budget Speech of 25 February 2026, the Minister of Finance noted : “In logistics, we are dismantling bottlenecks in rail and ports that have throttled exports and raised the cost of doing business. Our intention is to bolster public-private investment in rail operations while retaining state ownership of rail infrastructure. The objective is to move goods faster, cheaper and more reliably.” There are several hurdles with this approach – not the least as to whether moving freight by rail will be less expensive than by road (we know that in most cases, there will still be road (freight) legs before and after the rail links. In addition, with Transnet still owning the infrastructure (oh yes, an arm’s length SoE with a fancy name) AND still operating (trainsets) on the same rail routes: how will the private sector be guaranteed a fair chance when it becomes obvious they are out-performing Transnet? If we quote the phrase “Operation Vulindela” enough – will that ensure efficient implementation and operation? Just like the unbundling of ESKOM, the time has come (as the association has said for the past two decades) for Transnet to be privatised (or have route concessions just like toll-roads) for any real change to occur. Transnet cannot be the referee and a competitor at the same time. Recently, there have been some opinions in the media about the actual profitability (and real cost savings) of rail transport. The clincher is consistent volumes across a reliable and dependable rail system ie. continuous volumes, reliable scheduling, sustainable train capacities (volumes in a trainset) and secure cargo across the whole rail offering. Public-Private Partnerships It is clear from the budget proposals that government is placing more and more responsibility on traditionally tax-funded infrastructure projects at the doorstep of private business – albeit through the medium of Public Private Partnerships (PPPs. Some of these projects – high speed (passenger) rail links between Gauteng and Limpopo and KwaZulu-Natal, and even within the Gauteng “mega-metropolis” concept – are not what the country needs right now. Are these vanity
Transnet is working to dismantle bottlenecks in rail and ports that have throttled exports and raised the cost of doing business.
transported and warehoused” and parking and special use areas (within local authorities). The problem is the word “general”. The levy goes more to other aspects of government expenditure than to the infrastructure “used” by the purchasers of fuel. Is that not what it is – a “user levy”? In the main, allocated funding from the “general fuel levy” has been reported to not being used for road infrastructure, but for other “more urgent” / priority issues such as education, water and electricity and health requirements. Perhaps not (in themselves) incorrect – but the deterioration of general road networks not under the domain of SANRAL has been noticeable. The association notes that the wording of the levy is important: “general fuel levy” as opposed to “road fund / levy”. Perhaps that is where it has all gone wrong! Thus: here we go with an increase in the “general” fuel levy. It is being raised again (R0.21 cents per litre for diesel) – the
The logistics network needs direct investment.
April 2026 | www.modernminingmagazine.co.za MODERN MINING 29
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