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CONTENTS

1. INTRODUCTION

1.1 Announcement of the Project ...........................................................................1

1.2 An important Project .........................................................................................1

1.3 Appointment of Consultants .............................................................................3

1.4 Structure of this Inception Report ..................................................................... 4

2. BACKGROUND

2.1 Previous Provincial Studies ..............................................................................6

2.2 Events leading to the Project............................................................................6

2.3 Pre-Feasibility Study......................................................................................... 7

3. IMPORTANT DEPARTURE POINTS AND CONSIDERATIONS

3.1 Gauteng Provincial Spatial Development Initiatives (SDIs) ............................. 9

3.2 Gauteng Spatial Development Framework..................................................... 10

3.3 Government Policy, Legislation and other Requirements............................... 18

3.4 Strategic Objectives........................................................................................ 21

4. PROJECT CONCEPT (SCOPE)

4.1 Purpose of the Gauteng SDI Rail Link............................................................ 22

4.2 The Study Area............................................................................................... 22

4.3 Market Segmentation (market to be served) ..................................................24

4.4 Relationship and Compatibility with existing rail systems............................... 26

4.5 Alternative route alignments and station locations.......................................... 28

4.6 Station Development Concepts and surrounding Land Use ........................... 31

4.7 Feeder and Distributor systems at stations ....................................................33

4.8 Technology.....................................................................................................35

4.9 Safety and Security ........................................................................................35

4.10 Light freight..................................................................................................... 36

5. IMPLEMENTATION CONSIDERATIONS AND PARAMETERS

5.1 Feasibility and Bankability..............................................................................37

5.2 Risks ..............................................................................................................39

5.3 Legal Aspects, including obtaining Right-of-Way ........................................... 42

5.4 Role of Government and the Private Sector, including PPPs ........................ 43

5.5 Implementation Programme...........................................................................44


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6. BUSINESS PLAN AND STUDY DESIGN

6.1 Introduction ....................................................................................................48

6.2 Study Goals and Deliverables ........................................................................49

6.3 Study Objectives ............................................................................................49

6.4 Study Approach and Method.......................................................................... 52

6.5 Study Programme ..........................................................................................59

6.6 Project Management Structure....................................................................... 63

6.7 Internal Project Management Structure.......................................................... 68

6.8 Consultative Programme................................................................................68

CONCLUSION................................................................................................71

EXECUTIVE SUMMARY ........................................................................... (i)-(v)


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1. INTRODUCTION

1.1 ANNOUNCEMENT OF THE PROJECTIn his address at the opening of the Gauteng Legislature on 14 February

2000, Premier Mbhazima Shilowa announced an exciting venture, which will

link Pretoria, Johannesburg and Johannesburg International Airport by rail,

namely the Gauteng SDI Rail Link. He announced it as one of the ten SDI

initiatives of the Gauteng Provincial Government. The Premier said that

following a pre-feasibility study, which was concluded last year; a

comprehensive study would be commenced with early this year, with the aimto put out a Request for Proposals next year.

1.2 AN IMPORTANT PROJECT

This project is much more than only a transport project. It must be

approached in the light of the three strategic priorities of the Gauteng

Provincial Government, namely

! Accelerated economic growth, development and infrastructure delivery,

with emphasis on job creation

! Quality service delivery

! Good governance.

As will become clear in this document, this project has the potential to fully

meet the requirements of these three priorities.

Secondly the project is one of the ten Spatial Development Initiative (SDI)

Projects of the Gauteng Provincial Government, which, inter alia, have as goal

to promote and enhance economic growth, development and job creation.

When the Premier announced the Gauteng SDI Rail Link as one of the ten

SDI initiatives, he said that all of them have a positive economic meaning for

all the people in the Province. He added that the SDIs will help to reverse the

de-industrialisation process, and that the provision of bulk infrastructure will

assist with the rebuilding of the economy.

Gauteng SDI Rail Link Inception Report, 15 June 2000


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This project will further provide opportunities for SMMEs, for more labour

intensive project designs, for creating opportunities to build the partnership

between the public and private sectors, and for assisting and promoting

tourism all goals of Government.

But then it is also a very important transport project. When he announced the

project, the Premier said that it is part of governments commitment to ease

congestion on the roads, improve the movement of goods and persons, and

promote easy connection between some of the cities in Gauteng.

The area between Pretoria and Johannesburg is one of the fastest growing

areas in the country, and the potential for further growth is excellent.

Additional transport capacity is urgently required, as is evident from the

severe traffic congestion on the freeways and main roads passing through the

area. Such additional capacity should not only be provided through building

more roads. It is the explicit policy of Government to promote public

transport, inter alia by ensuring the provision of adequate infrastructure,

facilities and services. This project can be a very forceful illustration of

Governments commitment to promote public transport.

This project has the potential to assist in improving the image of public

transport in Gauteng and South Africa, of increasing accessibility levels, and

of giving structure to development in the area through the integration of land

use and transport. A rail link such as this cannot be successful if proper

collector distributor services are not provided at the different stations. Modal

integration, which includes through ticketing, integrated scheduling, integrated

information systems and proper transfer facilities, will be an important part ofthe project.

In this project the co-operation between the different spheres of government

will be extremely important and will be an integral part of the study design and

execution. Similarly co-operation with all other stakeholders are considered to

be essential, including representatives of the different modes of transport and

public transport.



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1.3 APPOINTMENT OF CONSULTANTS

A consortium of consultants was appointed on 26 April 2000 to assist the

Gauteng Department of Transport and Public Works with the execution of this

project. These consultants are:

! Khuthele Projects

! Arcus-Gibb

! Lebone Engineering.

The consultants have extensive experience with public transport and rail

projects, and transportation planning in general. Arcus-Gibb, a Law-Gibb

Group member, will also involve Gibb-Rail, a leading international railwayconsultancy based in the UK, in the project. Khuthele Projects will undertake

the project leadership and management amongst the consultants.

The multi-disciplinary nature of this project is fully recognised. The appointed

consultants are to a certain extent multi-disciplinary, and where it is not the

case, other consultants will be appointed as sub-contractors to the main

consultants, with the approval of the Department. Two such consultants have

already been appointed, namely:

! APS Plan Africa, Town and Regional Planning Consultants, who are also

the consultants for the Gauteng Provincial Government in the development

of the Gauteng Spatial Development Framework. APS Plan Africa will

work in close collaboration with the town planners of the appointed

consultants.

! Equinox Communication who will assist with public relations,

communication and consultation. They have had extensive experience in

transportation projects, also within the study area.

The consultants are organised in an effective team, as can be seen from the

Business Plan and Study Design later in this document. The complexity of

the project and the very tight and limited time frames in which the study must

be completed, require extremely well managed, effective and efficient

teamwork.



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Gautrans itself will be very involved in the execution of the project. The Head

of the Department, Mr. Jack van der Merwe, assisted by a number of his

senior officials will lead the project and will be directly involved with the project

on a continuous basis.

Regular progress reports on the project will be submitted to the MEC for

Transport and Public Works, Min. Khabisi Mosunkutu, who will report to the

Provincial Cabinet and the Premier on a regular basis.

It should also be recognised that this Gauteng SDI Rail Link is one of ten SDI

projects. The whole SDI programme falls within the Gauteng Department of

Finance and Economic Affairs who has appointed an SDI co-ordinator to

undertake the necessary co-ordination between the SDI projects. This project

will therefore be undertaken in close collaboration with the Department of

Finance and Economic Affairs and its SDI-Co-ordinator.

As mentioned before, the Gauteng Province and its consultants will execute

this project in close co-operation with all roleplayers. The Metropolitan and

Services Councils, the National Department of Transport, and the South

African Rail Commuter Corporation are a few of the institutions that will be

fully involved.

1.4 THE PURPOSE AND STRUCTURE OF THIS INCEPTION REPORT

The purpose of this Inception Report is twofold, namely:

Firstly to focus the scope of the study, by providing an understanding of the

following aspects of the study:

! The project concept in terms of purpose and function

! The Study scope

! The points of departure

! Assumptions and pointers accepted by the Study Team

Secondly to provide the Business Plan and Study Design of the project,

containing the deliverables, the approach, the programme and the projectmanagement and consultation structures.



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This report consists of six chapters. Following this introductory chapter, the

other chapters deal with the following:

! Chapter 2 provides some of the background leading up to this study. It

refers to previous provincial studies and provides a very brief summary of

the outcome of the pre-feasibility study.

! There are a number of important departure points and considerations

which will influence this study and which are discussed in Chapter 3.

! Chapter 4 discusses a number of key issues in order to get clarity on the

project concept and to narrow the scope of the project.

! In Chapter 5, some of the considerations and parameters affecting

implementation are discussed.

! The last chapter of this report deals with the Business Plan and Study

Design, providing the goals and deliverables, objectives, methodology,

programme, organisational structure and consultation process.



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2. BACKGROUND INFORMATION

2.1 PREVIOUS PROVINCIAL STUDIESA number of previous studies emphasised the need for this corridor between

Pretoria and Johannesburg to have an effective mass transportation system.

The original PWV-Transportation Study done during the mid seventies,

planned route K73, a major north-south arterial route to the west of Ben

Schoeman (N1), to be suitable for a possible future rail line. In the early

nineties the Vectura Study highlighted this corridor as one of the ten most

important provincial transport corridors in Gauteng.

The Gauteng Toll Road Strategy also refers to the need for public transport in

this corridor. The intention is that public transport will augment the additional

road capacity, and will ensure that Gauteng develops to its full potential

2.2 EVENTS LEADING TO THE PROJECT

For the past few years the Johannesburg Pretoria corridor, and to a lesser

extent the corridor to the Johannesburg International Airport, has been the

fastest growing development area in South Africa. It has assisted Gauteng to

grow economically faster than the other provinces. It clearly demonstrates the

interaction between transport capacity, accessibility and mobility on the one

hand and, land-use and economic development on the other hand.

However, recently two observations became very evident:

(a) Although many companies have located in the corridor and the area under

consideration, the area is not adequately served with public transport for

the people who cannot afford cars or private transport.

(b) The increasing road traffic congestion is acting as a limitation to further

development, and may soon start to strangle the development rate.

The Gauteng Cabinet recently adopted a toll road strategy. This would

provide part of the road capacity required. Notwithstanding this, thepromotion of public transport in this corridor, and also the need to ensure that



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all people can access this corridor, is of extreme importance, particularly for

business, for tourists, and for commuters.

A number of international government and private sector representatives have

indicated their willingness to be involved and to support the development of a

rail transport system in this corridor. Representatives have approached

Gautrans from countries such as Germany, France and Japan, who all

indicated that a rail system in this corridor appears to be feasible, and that

they would like to investigate the opportunities that such a rail system would

offer.

2.3 PRE-FEASIBILITY STUDYWhen the first Premier of the new Gauteng Government visited Germany a

number of years ago, a Twinning Agreement between Gauteng and the State

of Bavaria was signed. During the first meeting, the Gauteng Rail Link was

identified as one of the first opportunities for co-operation. At a discussion

late during 1998 between representatives from Gauteng and the Bavarian

State Government, it was agreed that the Bavarian Government would

appoint independent German consultants to undertake a Pre-Feasibility Study

of this project. This was done in terms of the Twinning Agreement.

The main aims of the pre-feasibility study were to determine:

! whether or not the implementation of a new rail system in this corridor is

justified and feasible, and

! whether further investigations on the basis of a comprehensive feasibility

study need to be done.

In addition, the need was expressed to determine whether it was financially

and economically worthwhile to fund this feasibility study, and to explore

alternative means to do so.

The pre-feasibility study was completed during September 1999, and the

following were some of the most important conclusions:



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! Even the construction of a new toll road in this corridor (the PWV-9 road

between Johannesburg and Pretoria, west of the N1) would not solve the

transport problem for the future. It is, therefore, indispensable to

complete the existing transport system by means of a public transport

system that would be independent from the existing road network.

! As shown in the pre-feasibility assessments, Alternative 3 (a route from

Sandton to Pretoria) is likely to yield coverage of the total operating costs

and part of the investment costs of a new rail system by fare revenues,

whereas implementation of Alternative 2 (a route from Sandton to Pretoria

plus a link to JIA) would presumably result in coverage of a high portion of

the operating costs only.

! taking into account the economic and environmental benefits accruing

usually from implementation of mass transit systems in highly loaded

corridors (savings in travel time, accident cost, private vehicle operating

cost, air pollution, noise) the rough financial evaluation of Alternatives 2

and 3 indicates that in all probability the railway project is feasible in

economic terms.

! Moreover the anticipated railway project would strongly support

individual economic zones in the context of the Spatial Development

Initiative .

! The afore-mentioned results of pre-feasibility study led to the conclusion

that further investigations are necessary and justified. It is therefore

recommended, to carry out the next step, a more comprehensive

feasibility study



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3. IMPORTANT DEPARTURE POINTS ANDCONSIDERATIONS

3.1 GAUTENG PROVINCIAL SPATIAL DEVELOPMENT INITIATIVES

The Gauteng Provincial Government decided on a Spatial Development

Initiative (SDI) strategy in order to change the economic profile in Gauteng,

enhance economic growth, promote development and create employment

opportunities.

Ten Spatial Development Initiatives had been identified. (See Figure 1 on the

following page.) They are:

! Newtown Precinct Redevelopment and Metro Mall

! City Deep Industrial Development Zone

! Johannesburg International Airport Industrial Development Zone

! Alrode/Wadeville Industrial Regeneration Corridor

! Rosslyn Auto Cluster / Urban Port

! Pretoria Innovation Hub! The Big Five Game Reserve

! World Heritage Site at the Sterkfontein Caves

! Constitutional Hill in Johannesburg

! Gauteng SDI Rail Link.

It will be important for the Gauteng SDI Rail Link to ensure that its SDI

objectives are met and that, where possible, alignment with the other SDIprojects is achieved.



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LOCATION OF SDIS FIGURE 1


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3.2 THE GAUTENG SPATIAL DEVELOPMENT FRAMEWORK

3.2.1 Critical factors

Five critical factors were used to direct the Gauteng Spatial Development

Framework (GSDF). These factors are the guidelines or principles that will

inform the future growth path of the province, and their implementation will

produce a particular spatial development pattern. Four of the five critical

factors are discussed below, whereas the fifth one, being rural development

beyond the urban edge, is not directly applicable in respect of the Gauteng

SDI Rail Link.

! Resource based economic development

In order to ensure Gautengs advancement internationally, and to achieve

balanced development in the province, economic development based on

the key resources offered by the province, should be promoted. Thus,

the three strategic thrusts as outlined in the Gauteng Provincial

Governments Trade and Industrial Strategy 1997, should be pursued.

Strategic Thrust 1: The re-alignment of the manufacturing sector away

from traditional heavy industry input markets and low value-added

production, towards sophisticated, high value added production, as well

as the development of other high value added production activities in the

agriculture and mineral sectors.

Strategic Thrust 2: The development of the province as the smart centre

of the country with specific emphasis on: information technology,

telecommunications equipment, research and development and bio-

medical industries.

Strategic Thrust 3: The development of the finance and business

service sector with specific emphasis on: financial services and

technology, auxiliary business services and technology, corporate head

office location and business tourism.

Important locational criteria for the market include aspects such as high

visibility, optimal accessibility, proximity to airports and rail, increased

security largely in the form of security estates or parks, and the focus ofthe commercial property market as directed by investors and developers.



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! Contained urban growth

The notion to contain urban growth is embedded in government

legislation and policy, and is largely supported by all sectors of the

province. This is supported by the fact that peripheral urban

development is costly and particularly so for local government, which is

the provider of bulk infrastructure and services. There is general

consensus in the planning arena that unlimited urban sprawl should be

contained.

! Re-direction of urban growth

A necessity exists to re-direct urban growth. The aim is to densify the

existing urban areas, stabilise and limit growth in the economically non-

viable areas, and achieve growth on vacant land within the economic

growth sphere, as contained by the urban edge, in order to develop a

functional and sustainable urban system.

! Mobility and accessibility

Mobility is the ability to move people and goods from point A to B and is

associated with the use of vehicles for transport. Linked to this is the

issue of accessibility, and access to mobility in particular. This is a

matter of concern, due to the fact that a limitation to access, limits access

to job opportunities, social facilities, etc.

In order to implement the four critical factors, which structure the

development of the province, mobility and access need to underpin the

principles of development. Hence, road and rail development should be

geared at implementing the proposals contained above. However, sinceit will take major intervention to re-direct the growth pattern, the

development of road and rail should equally facilitate the current situation

and growth path.

Hence, mobility and accessibility will have to focus on two critical

development paths. Firstly, they will have to support the existing urban

pattern, by improving access to the townships in particular and increasing

mobility to job opportunities, and secondly, will have to provide improved



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infrastructure within the core economic focus area to cater for the

projected growth in those areas. Hence, rail and road infrastructure will

have to be improved in the core area to cater for enhanced movement

and access.

3.2.2 The final spatial development plan

The Final Spatial Development Framework is illustrated on Figure 2a and

provides the proposed development focus of the province.

! Interventions

The GSDF draws definite conclusions on the development trends that

dominate in Gauteng, and with respect thereto, makes certain

development proposals that indicate a way forward for the development

of the province. They are based on the critical factors discussed earlier.

- Containing and compacting the City

- Economic Growth

- Growth in New Areas

- Rural areas

! Access and mobility

With regard to access and mobility, the GSDF states that we will always

be highly reliant on transportation owing to the dispersed structure of our

cities. However, there is an undeniable need for an improved public

transport system, which will become increasingly important and urgent

in the compact city. Intervention in this regard is required, in order to

bring people closer to opportunities and into the mainstream of theeconomy. Access is essential and mobility is constrained due to the

cost thereof.



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3.2.3 Summary of Spatial Development Framework

Fundamentally the Final Plan proposes that:

! Gauteng should acknowledge the pivotal role the economy is playing in

allowing the province to provide for its people, and that without economic

growth such provision will decrease and poverty will increase, whilst

health conditions worsen and education levels decline. Thus it is vital that

economic growth and development be motivated and encouraged by

accessing the particular resources Gauteng offers.

! Urban sprawl and peripheral growth be contained, and hence, that an

urban edge be delineated which would determine the outer perimeter of

urban development. This is not only sound spatial planning, but makes

financial sense, owing to the cost savings achieved by not having to

extend services, infrastructure and facilities to the periphery.

! People should be brought closer to their job opportunities, and hence, to

the economic focus areas, while their displacement from the core urban

environment should be halted. Thus, urban growth should be re-directed

to allow for a more efficient and effective settlement pattern to be

established.

! Mobility and accessibility are very important given the fact that Gauteng is

a highly mobile society and reliant on movement. It is deemed that far

greater integration between land use and transportation planning needs to

occur to optimise accessibility and mobility in the province.

3.2.4 Specific Spatial Development Considerations

3.2.4.1 Points of departure

! The Gauteng Spatial Development Framework suggests that the

Gauteng SDI Rail Link could and should play an important role to

achieve a more sustainable spatial development structure in

Gauteng.



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! With this in mind, the following points of departure should form the

basis for the spatial considerations related to the project.

- The rail should assist in supporting economic development.

- It should assist in improving accessibility and mobility.

- It should serve as a catalyst for sustainable land development.

3.2.4.2 Main considerations

In order to achieve a focussed approach to the project the main land

use considerations for a possible alignment of the rail are the following:

! Location of main population concentrations.

! Location of main areas of employment.

! Main movement patterns.

! Natural environment.

! Development trends related to residential areas and employment

areas

3.2.4.3 Development concept

The above considerations have indicated that the Gauteng SDI Rail

Link should be a component of an integrated system, which will

contribute in the following manner as regards spatial development.

! Regeneration of CBDs.

! Development of new town core areas.

! Strengthening of existing vibrant nodes.

It therefore suggests that the system will consist of a main line (the

Gauteng SDI Rail Link) and a system of link lines.

The main line will link the major areas of job opportunities and higher

density residential areas, while the link lines will serve to link lower

density residential areas to the main line (refer Figure 2b).



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3.2.4.4 Main nodes

If the above concept is pursued then the following nodes are

considered as important in the main line development.

! Johannesburg CBD

! Pretoria CBD

! Johannesburg International Airport

! Sandton CBD

! Midrand CBD

! Tembisa

! Centurion

The following nodes, although falling outside the direct main line

development, will also play an important role, with possible extensions

to be considered now or in the future.

! Soweto (Bara Link) ! Menlyn

! Rosslyn (Urban Port) ! City Deep area

! Fourways/Woodmead ! Eastgate

The above concepts and nodes will be the subject of further spatialdevelopment models to be developed in support of the Gauteng SDI

Rail Link.

3.3 GOVERNMENT POLICY, LEGISLATION AND OTHERREQUIREMENTS

3.3.1 Policy and Legislation

Current government policy directives clearly indicate the necessity of

promoting public transport. This is evident from all the main policy documents

of government. These main policy documents were analysed to ensure that

this project addresses the most important requirements in this regard.

The following relevant national and provincial policy documents were

analysed, with a view to identifying the most significant government objectives

applicable to this project.



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National

i) Reconstruction and Development Programme (RDP), 1994.

ii) Growth, Employment and Redistribution Policy Documentation (GEAR).

iii) ANC Manifesto 1999.

iv) White Paper on National Transport Policy, 1996.

v) Moving South Africa (MSA), 1999.

Provincial

i) Gauteng White Paper on Transport Policy, 1997.

ii) Gauteng Spatial Development Initiatives (SDIs), 1999.

iii) Gauteng Rail Development Strategy, 1999.

The table below distinguishes between extremely high priority and high

priority objectives. Further, the relevance of each objective in terms of the

Gauteng SDI Rail Link is provided.

RELEVANCEOBJECTIVE

TOTAL SIGNIFICANT

A. EXTREMELY HIGH PRIORITY OBJECTIVES

1. Building the economy and creating jobs #

2. Reconstruction and development #

B. HIGH PRIORITY OBJECTIVES

3. Building a better living environment #

4. Integration and sustainability #

5. Customer satisfaction #

6. Effectiveness and efficiency #

7. Effective land use planning #

8. Optimal deployment of modes#

9. Integrated transport and land use planning #

10. Improved safety #

11. Human resources development #

12. Delivery of basic needs #

13. Combating crime and corruption #

14. Transformation #

15. Minimised negative side effects #

16. Regulation and control #

17. Sustainable funding #



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It is expected that the National Land Transport Transition Act will be

promulgated soon. This legislation contains a number of provisions where

MECs and the future Transport Authorities (currently the planning authorities)

will be required to promote public transport and display measures put in place.

The Development Facilitation Act is important land-use development

legislation to be considered in this study.

The responsibility for implementing public transport infrastructure and service

improvement projects is mainly that of local government, as these are mostly

of a local nature. At a provincial level, the focus is mainly on the services that

cross the metropolitan council boundaries and on co-operation between

metropolitan areas.

This project is an ideal opportunity for Province to be involved in a visible

public transport project, and to implement government policy noticeably.

3.3.2 Requirements for integrated transport planning

At the provincial level, the first edition of the Provincial Land Transport

Framework and Gauteng Transport Co-ordination Plan were completed in

1998. While large parts of these planning documents are still relevant today,

they primarily deal with broad policy issues and not with the practical

provincial-wide responsibilities of Gautrans. What is required is a refocus on

the Provincial Land Transport Framework in order to include present planning

initiatives of the Province including, for example, the Gauteng Bus Master

Plan, the Gauteng Modal Integration Strategy, etc. The Gauteng Rail Link

Project should likewise be included in the next revision of the Provincial Land

Transport Framework. In this manner the Provincial Land TransportFramework will, in practical terms, guide and direct the preparation of

Integrated Transport Plans at the metropolitan level. The refinement of the

Provincial Land Transport Framework is currently being considered.

The preparation of the first ITPs by each of the six metropolitan transport

areas in Gauteng is generally well advanced. One area (EGSC) has already

submitted its plans to Gautrans, whilst most of the other plans are expected to

be completed by September 2000.



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The next round of ITP refinement will probably start during 2001 and should

clearly be guided by the Provincial Land Transport Framework, which will

include the Gauteng Rail Link Project. The further development of the

Gauteng Rail Link Project at the metropolitan level in terms of its integration of

the local public transport services, should be detailed in the relevant ITPs and,

should in this manner, become part of the metropolitan transport system.

3.4 STRATEGIC OBJECTIVES TO BE ADDRESSED

The following are some of the most important strategic objectives that have

been identified:

3.4.1 Broad strategic objectives

! To determine how this project can facilitate development in the Province

! To assess its contribution to job-creation (direct and indirect)

! To assist in unlocking the economic development potential of the Gauteng

SDIs

! To improve accessibility and mobility in this development corridor

3.4.2 Specific objectives of the implementation project

! To promote the use of public transport

! To develop an integrated public transport system, inter alia through the

feeder and distribution systems

! To integrate land-use and transport planning in the corridor

! To identify station precincts with development potential, and use of the

concept of value capture.



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4. PROJECT CONCEPT AND SCOPE

4.1 PURPOSE OF THE GAUTENG SDI RAIL LINK

The Gauteng SDI Rail Link Project deals with the planning and provision of a

modern rail link between Pretoria, Johannesburg and Johannesburg

International Airport. These three areas are the main centres to be included

in the project, but the study will investigate the inclusion of other important

centres, mainly between the above main centres, but also outside the

backbone system and even the Study Area, if found to be appropriate.

This project will investigate the utilisation of appropriate and tested state-of-

the art modern technology, that can provide an excellent and acceptable

service to the passenger, at competitive travel times and speeds, and

affordable to both the passenger and government. Comfort, safety and

security, and accessibility are some of the aspects that will be given high

priority.

As an SDI project it will also have the strategic objective of promoting

economic growth, development and employment creation.

4.2 THE STUDY AREA

The Study Area broadly comprises the triangular geographic area between

Pretoria, Johannesburg and Johannesburg International Airport (JIA), as

graphically shown in Figure 3.Apart from the three main centres mentioned

above, the Study Area includes important nodes such as Sandton, Alexandra,

Kempton Park, Midrand, Tembisa and Centurion. It contains 4 SDIs, of which

the SDI Rail Link is one. There are therefore 6 SDIs outside the Study Area.



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In Figure 3, arrows indicate other areas, nodes, and activity centres outside

the Study Area, which will have to be considered for linkage now or in the

future. This includes in the South-West, Soweto and the FNB-Stadium, which

will be very important if the 2006 World Soccer Cup takes place in South

Africa. South of JIA it is the fast growing East Rand. North of Sandton it is

the fast developing Sunninghill Area connecting to the large developments in

the areas of Fourways and Kaya Sands. North-east of Centurion it is the fast

developing Menlyn area and north of the Pretoria CBD it is the developments

north of the Magaliesberg, such as the Automotive Cluster and Wonderboom

Airport, which deserve attention.

4.3 MARKET SEGMENTATION

The purpose of market segmentation in this study is to determine who will or

should use the proposed service, in other words, which market segments.

This will then indicate which areas should be served. The setting of fare

levels in order to maximise the income will also be addressed. For example,

with low tariffs higher volumes may be achieved, and with high tariffs low

volumes.

The following departure points are important:

! Although the rail line will pass through certain areas and have stations in

specific areas, the collector distributor systems at stations will ensure that

most of the larger surrounding areas are covered and made accessible.

! There could be different needs on different parts of the network. The

needs on the JIA Sandton link would, for example, be quite different fromthe needs on the Johannesburg-Pretoria link.

! Cognisance must be taken of certain trip characteristics, including trip

purposes, the time the trip is made and the direction of travel. In order to

make the system more viable and optimise the patronage, it would be

important to target both commuting and non-commuting passengers, peak

and off-peak passengers, and also passengers travelling in both

directions.



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! A service cannot be provided that suits everybody. The choice at the end

of the day will be that of the user, whether he/she can use it, want to use it

and can afford to use it.

The following pointers provide an indication of what the possible market

segmentation could be:

! The project is essentially aimed at economic development. The system,

the service and the customers/passengers must in some way promote

economic activity.

! Many potential passengers are currently car users. The type of service,

including its tariffs and travel time, must be such that the car user would be

willing to consider changing to rail. The new rail system must therefore be

markedly better than the existing rail commuter services. Door-to-door

travel time, including speed is important. In the peak period, when many

of the roads are congested, it must be substantially better than the car

alternative, and in the off-peak period it must be at least comparable.

! The bias therefore seems to be towards commercial users who can afford

the trip and would be willing to pay for a good service.

! Although it currently seems that there should only be one class, the fare

structure could have some flexibility, providing for example for cheaper

weekly and monthly tickets and allowing a slight differentiation in fares

from different areas.

! Provision should be made for tourists and for airline passengers with

baggage, especially on certain routes and during certain periods.

! Fares would be higher than on the existing system. The choice would be

entirely that of the user.

! The market research and demand calculation will focus more specifically

on the different trip purposes.

! To summarise, the study should determine market indicators that will

make the project commercially viable and that will attract foreign

investment.



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4.4 RELATIONSHIP AND COMPATIBILITY WITH EXISTING RAILSYSTEMS

This issue deals mainly with institutional governance and also the integration

of the new system with the existing network and technology. The respective

roles of Government and the private sector, or public private partnership

options, could have been discussed here, but is discussed in a later section.

4.4.1 Institutional Structures

With regard to institutional governance, cognisance must be taken of the

development of passenger rail services over the years in South Africa,

together with the respective institutional structures. Currently the South

African Rail Commuter Corporation, falling under the National Minister of

Transport is the owner/regulator, with Metrorail being the operator. Metrorail

is a division of Transnet, falling under the National Minister of Public

Enterprises. With the future concessioning of commuter rail services in the

country, the institutional framework will undergo further changes, but a final

structure has not yet been decided upon.

Alternative institutional structures for the Gauteng SDI Rail Link will be

developed and investigated in this study. The relationship of the SDI Rail Linkstructures with the future commuter institutional structures (currently the

SARCC) can be determined when more clarity and finality is available on the

latter. The current intention is that the Gauteng Provincial Government will, at

least initially, own the rail infrastructure and that the rail services will be

provided by the private sector. The relationship with the future Transport

Authorities is considered to be very important and will also be investigated.

4.4.2 Integration with existing network and technologyGauteng has an existing commuter rail network and services, divided into two

operational management areas, namely the Pretoria Metrorial region and the

Wits Metrorial region. For many years it has provided good rail services for

the people it served. It has, however, not kept up to date with modern rail

development in many ways. No new rail lines have been built in the last 15

years and the rolling stock is on average more than 30 years old. The

question in this study is what the integration and co-ordination of the new SDI

Rail Link would be with the existing network and services.



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Some of the more important characteristics of the current technology are:

! The existing gauge is 1067 mm as compared to the international standard

of 1435 mm. The minimum horizontal curvature is normally 600 m.

! Train control with colour light signalling and a maximum speed of 90 km/h.

! Electrical supply is 3 KV dc overhead.

The broad approach and some of the possible pointers are:

! It should be possible to integrate and co-ordinate the new system with the

existing system. Whether or not it would be a direct linkage onto the

existing lines, or just a transfer at a station, so that passengers would have

to change trains, would depend on a number of aspects, which will be

investigated in the study.

! One of the most important aspects would be to determine whether the

existing South African gauge would be used or whether the standard

international gauge would be used. There are many advantages and

disadvantages to be considered.

! Although the possibility of good second hand rolling stock will be

investigated, the indications are that most private sector investors would

not be very keen to consider it, inter alia because of possible future

maintenance problems and costs. The chances are therefore good that

the study will focus more on proven new technology. That would also then

determine such aspects as minimum horizontal curvature, maximum

gradient, maximum speed, etc.

! Life-cycle costs and economies of scale would, however, be taken into

consideration, and will to a large extent determine the most appropriate

approach.

! Although there are many factors influencing door-to-door and total travel

time, speed is important. A train speed of 180 km/h or slightly higher at

this stage seems to be applicable to the anticipated type of service. Using

the term high speed is therefore not appropriate, as it is normally

associated with the TGV, ICE, Bullet-type trains that can travel at speeds

beyond 300 and even 400 km/h. This is definitely not the type of train that

will be used here.



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! A new unique image is necessary in order to maximise patronage. This

will therefore also influence what type of equipment and service that can

be used, when co-ordination and integration with the existing system is

being considered.

! It also seems most probable that new railway lines will be required for the

whole or most of the new route or network. If that is the case, it could also

have an influence on the decision with regard to gauge and other factors.

! Compatibility or not, as well as integration, will be determined by a large

number of factors, including gauge, signalling, electrical power supply,

rolling stock, implementation time, etc. and will be decided upon at an

appropriate stage of the study.

4.5 ALTERNATIVE ROUTE ALIGNMENTS AND STATIONLOCATIONS

The following diagram indicates the interaction between market segmentation

and route determination, as well as the process to be followed to identify

alternative alignments.



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Although the instruction is to link Pretoria, Johannesburg and Johannesburg

International Airport, different possible alignments and networks will have to

be investigated in order to select the best alignment. The following are some

of the factors to take into consideration.

! Provincial planning, such as the Spatial Development Framework,

Economic Development Framework, the Housing Strategy and the

different Transport Plans.

! The land use to be served, directly and through feeder services. The

choice of station location would largely dictate the rail network and route

alignment.

! Specific spatial development objectives that will be taken into

consideration include the regeneration of Central Business Districts, the

strengthening of existing vibrant development nodes as well as new town

development.

! Service requirements, including travel time, transfer requirements and

integration with feeder and distributor modes.

! Rail network concepts (e.g. lattice and radial), single line concepts (e.g.

linear or circular) and its integration with the existing rail network.! Alignment options, influenced by design criteria, land-use constraints and

opportunities, topography, and existing rights-of-way such as rail and road

corridors.

! Environmental constraints.

! Cost implications with regard to high cost aspects such as land

procurement costs and construction costs with elevated or below ground

level sections. The high density of development as well as topography ofthe area between Johannesburg and Pretoria limit the possible feasible

alignments of the alignment.

! Phased implementation, as well as potential future extensions.

! The rail alignment is influenced by operational considerations including the

maximum gradient ( 2.5%), minimum curve radius ( 1 200 m) as well as

station spacing. To achieve maximum benefit of the high speed of

operation, stations are expected to be spaced at 6-10 km intervals.



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The proposed methodology for network and route alignment, as discussed in

the study design, provides for a process whereby approximately three to six

possible alternatives will be identified and taken through an evaluation

process. One or two final networks/routes will then be proposed by the end of

August, in order to undertake the more detail planning and analysis on them.

The following aspects will be of importance in the route/network

determination.

! First indications are that the broad corridor between Pretoria and

Johannesburg, within which alternative alignments will be investigated, will

most probably have as western boundary the Ben Schoeman N1 Freeway

and as eastern boundary the existing railway line. The Mabopane

Centurion Development Corridor and the K73 route, which has one of the

best vertical alignments, are both to the west of Ben Schoeman and all

indications are that they will not generate enough passengers to make the

SDI Rail Link feasible. A further rough evaluation will, however, be done

on them before a final decision is taken.

! A link to the Sandton CBD area has been specifically identified as an

important market for the rail link.

! Where possible existing road and rail corridors will be utilised.

! The concept of providing a backbone system onto which secondary lines

and spurs can be attached would be investigated further.

! Even though the intention is to have stations at the largest passenger

generators along the line, proprietary feeder distributor systems at the

stations, acting as modal integration transfer stations, are considered an

essential part of the main line-haul system.

! The possibility of accommodating multiple type services on the main line

will be investigated. This would, for example include express trains not

stopping at all stations, with other trains stopping at all stations. It will also

be investigated whether such an approach would make further secondary

stations possible.

! At Johannesburg International Airport, the Airports Company of South

Africa (ACSA), will be consulted as to how the SDI Rail Link can beintegrated with the development of the airport, also whether it would link to



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a western location of the terminal complex, and/or a mid-runway location.

The different possibilities around value capture, associated with the

terminal station at the airport, will be investigated.

! The CBD to CBD connection between Pretoria and Johannesburg, and the

positive influence the SDI Rail Link could have on the revitalisation of the

two CBDs, will also be considered in the planning and evaluation.

! The process envisaged for the recommendation of a preferred alignment

would consider the following criteria:

# Strategic development considerations

# Economic and other development impacts

# Implementation barriers, e.g. environmental constraints# Travel demand and revenue forecasts

# Capital cost

# Operational cost (e.g. number of train sets)

# Travel time

# Quality of service

# Consider total development focus within province

# Preliminary market segmentation

# Identify development nodes to be linked by project

# Identify primary residential areas

# Prioritise nodes/stations

# Confirm market segmentation

# Identify alternative alignment

4.6 STATION DEVELOPMENT CONCEPTS AND SURROUNDING

LAND USE

The location of stations is one of the most important aspects in the planning of

the routes and networks. Also of great importance is the concept of the

station development itself. A station in the right location would normally

stimulate development at and around the station, and if some of the added

value can be captured in such a way that the SDI Rail Link can directly benefit

from it, it can improve the feasibility of the project.



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But then the Rail Link owner/manager must be able to control some of the

development or the process. The well-known example of excellent value

capture at rail stations is Hong Kong. Very few other rail systems have been

able to achieve the same value capture as Hong Kong. Therefore, although

value capture at stations would be an objective, it is realised that it has its

limitations.

Station location would primarily be determined by existing development, or

finally decided upon and committed new development. Patronage must be

proven to ensure bankability of a project like this.

The station location and development will also provide an important interface

with the local authority. They would have to be fully involved in the location of

stations and the development concept at and around the stations. Matters

like the rezoning of land at and around the stations, as well as the possibility

of bulk service contributions allocated to the station development, must be

investigated at each station.

Depending on whether a station is located at or next to an existing

development, or at an approved new development, would determine whether

there would be developable land, which can be controlled by the project.

Ownership and/or partnerships of development would have to be considered.

The legal implications for government to get involved in such development

would have to be investigated. The possibility of having the developer funding

or providing the station should also be investigated as the station would have

direct advantages for the development its located at.

Value capture on the trip itself, such as baggage book-in, or through services

provided at stations (e.g. parking) will also be investigated. The station

design is therefore also important.

Although it will not affect the direct bankability of the project, the longer term

policy of government regarding the land use in the areas surrounding stations

are very important for the longer term success of the project. Densification at

nodes (and corridors) is essential for increased usage of public transport andthe economic and financial feasibility of public transport projects.



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Such densification would include all types of land use, including residential, to

ensure trips in both directions during the peak periods. Both provincial and

local government would have to actively support such an approach of land

use and transport integration. Government has an obligation towards the

promotion of public transport, in terms of the new National Land Transport

Transition Act. Such obligation can only be successfully dispensed with if

public transport supporting land-use restructuring takes place in the study

area.

4.7 FEEDER AND DISTRIBUTION SYSTEMS AT STATIONS

As mentioned before, the feeder and distribution systems forms a criticallyimportant part of the SDI Rail Link project.

Based on existing passenger profiles in the corridor, the larger group of

potential customers of the SDI Rail Link will either be:

! captive to public transport, but can afford to choose the "best option, or

! people who owns a private car, but will opt to use public transport of a high

quality

Their needs, requirements and perceptions are such that they will as a rule

not be satisfied (in terms of quality of service and image) by the public

transport system in its existing form, for travel to and from stations.

The question arises whether the existing public transport system and modes

can be adapted or restructured to provide the feeder/distributor services? It is

believed not to be desirable, because:

! It may not be cost effective to change the quality and image of these

services to a level acceptable to the potential market of the new system.

! The focus of these services may not primarily be on feeding the stations,

but also to capture other markets and satisfy other demands and desire

lines

! The rail operator may not be able to control or directly influence key issues

related to the feeder/distribution services, which may harm its potentialmarket share.



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It is thus concluded that the current public transport services (even if adapted)

cannot fulfil the primary role of transporting the larger group of customers to

and from the Rail Link stations.

Primary public transport feeder/distribution systems should be dedicated,

generally of a higher quality than most of the existing public transport

services, and the Rail Link operator must be able to control or significantly

influence operational decisions (i.e. frequencies, area coverage, etc.). It is

proposed that the dedicated public transport feeder/distribution systems

should be operated by the Rail Link operator or in an integrated manner by

operators commercially contracted to it.

The choice of the modes to be employed for the primary dedicated public

transport feeder/distribution systems should be based on demand per

corridor, modal niches and may be a combination of modes.

The Rail Link may have to compete directly with high quality taxi type services

for the same customer base, e.g. the current 25-seater vehicles being used

between Johannesburg and Pretoria and the new "recapitalised" vehicles to

be phased in during the next five years. It is proposed that mechanisms be

pursued to bring these operators into an integrated system, to provide

feeder/distribution services to stations and not operate in competition.

Some of the passengers will find it more convenient and will be prepared to

use existing public transport services as feeders/distributors. Attention should

therefore be paid to the integration and restructuring of such existing bus and

rail transport services to support this project. However, it is proposed that this

be dealt with more extensively a part of other processes (e.g. rail

concessioning, bus contracts and permission strategies).

It is proposed that dedicated public transport feeder/distribution services

primarily be focused on high-density employment, retail and commercial

nodes. A secondary focus may be higher density residential areas, as well as

satellite park-and-ride sites in lower density areas. In the lower density

residential areas many of the potential passengers would use park-and-ride

facilities at the origin station. The feeder/distributor services to these areas

would thus be of lower coverage and intensity.



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Integrated-ticketing and information services, as well as integrated schedules,

will be essential between the rail service and the public transport

feeder/distribution services.

Depending on the percentage of infrequent (i.e. business people, social

travellers and tourists) travelling customers and the costs related to providing

such services (or profit to be made from), attention should be given to

providing the following at all or certain stations, probably through quality

controlled concessions:

! Metered taxi services,

! Dial-and-ride services, and

! Car hire.

Given the profile of the potential customers, park-and-ride facilities will have to

be provided at most if not at all stations. This must include integrated pricing

between parking prices and fares. The operations of park-and-ride facilities

may also be contracted out by the SDI Rail Link management.

Surrounding land uses to stations must be such that it reduce

feeder/distribution requirements over time and optimise walking access to the

rail system.

4.8 TECHNOLOGY

The technology to be utilised on the proposed rail network will have to be

aimed at achieving firstly the project objectives, but also the specifications in

travel times and passenger comfort levels.

From a fundamental viewpoint, the technology to be used will comprise the

most appropriate modern but tested technology that would result in a

sustainable and effective system from a life-cycle cost perspective.

4.9 SAFETY AND SECURITY

It is important that the necessary actions are taken to positively influence the

passengers perception of commuter rail as a safe and secure transportmode.



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Some of the considerations to be taken into account, includes

! Target market perceptions

! Communication and public liaison

! Safe design of system;

- Ticketing

- Rolling stock

- Stations and Station precinct

- Parking

Planning and design principles and specifications will have to be

developed.

Costing implications will have to be determined.

4.10 LIGHT FREIGHT

The Gauteng SDI Rail Link will not accommodate any of the Spoornet freight

trains. However, an investigation will be done on the conveyance of parcels

and containerised high-value goods.

If appropriate, off-peak trains with such freight may be accommodated.

However the focus will remain on public passenger services, and freightservices will only be allowed if beneficial from a life-cycle-cost perspective,

and if no negative impacts are experienced on the passenger services.

The study will consider the needs of passenger luggage on the Airport Link

elements of this project.



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5. IMPLEMENTATION CONSIDERATIONS ANDPARAMETERS

5.1 FEASIBILITY AND BANKABILITY

The Gauteng Cabinet has already accepted the SDI Rail Link as one of the

ten SDI projects to be implemented if at all possible. Its willingness to

implement has therefore been illustrated and was based on a number of

considerations. This is the reason why this study is not only a feasibility

study, but also a planning and implementation study leading to a Request for

Proposals. Therefore it is not only the feasibility for Government that is

important, but even more so the feasibility and bankability for the private

sector, as they would have to become fully involved.

Feasibility can be considered firstly as the general factors that should be

present to make the project possible (in terms of the broad description of

feasibility), and secondly, those criteria that have to be met for by any specific

body to accept the project as feasible.

Investors will require a comprehensive feasibility report, stating clearly

Governments viewpoint on the feasibility of the project, and indicating project

viability with sufficient information to judge for themselves the feasibility of the

project.

Feasibility implies that the project can be implemented. This is judged in

terms of:

! Technical Feasibility

Technical Feasibility means that all the criteria are met which will indicate

that it is technically possible to implement the project.

! Economic Feasibility

A project is considered economically feasible, if the benefits accruing to

the broad community (usually measured in monetary terms) is higher than

the cost of undertaking the project. This, in other words, implies that

consideration be given whether it is worth it?



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For this purpose, the benefits (even the value of life and travel time

savings) have to be quantified and put into monetary terms in order to

compare these with the project costs. In addition, the future value of

money must be determined in order to compare future benefits with

current construction costs. This is calculated by discounting the future

costs and calculating nett present values. Taxes and subsidies are

ignored (as these entail cross allocations within the community being

considered which are not applicable for economic feasibility assessments).

! Financial Viability

Financial analysis concerns the financial position of a person, or

organisation, so that both cost and benefits are measured in terms of

money spent or received, regardless of whether the prices are a good

reflection of true value. This kind of analysis includes taxes and subsidies.

For this project financial analysis should be done for:

- The Operating Company / BOT Concessionaire, who will invest,

maintain, operate and manage the rail transport system. This analysis

is largely related to the bankability of the project, which is very

important to ensure private sector interest and competition in the

tender process.

- Government (Gauteng Provincial Government and the Transport

Authorities) who will be responsible for some investment, and possible

subsidy, burdens.

- The passengers using the system, who will decide whether or not to

use the proposed system.

! Socio-political acceptability

This measure of feasibility considers the acceptability of the project by the

affected communities. It would include aspects such as whether or not the

project meets government objectives and goals. These could include

goals such as job-creation, transformation, and creating opportunities for

SMMEs



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The following aspects will have to be studied further:

! Acceptable travel fares

! What constitute a sufficient number of passengers

! Acceptable profit and risk levels for the investors and operators,

! Acceptable investment levels

! Acceptable and affordable government subsidy levels. This needs to

be investigated further, but at this stage, all indications are that the

requirement may be a very high cost coverage from the fare box costs,

with regard to operational costs.

! No fatal errors as pertaining to the environmental considerations.

5.2. RISKS

It is extremely important to identify the risks that may impact on this project as

soon as possible. This is firstly important with regard to the feasibility and,

secondly to enable the project planning and design tasks to address these

risks. The latter may be with the view of eliminating the risks, or at least to

introduce mitigating measures and to limit the impact of the risks.

In addition to the identification of the risks involved, it is important to also

consider the allocation of those risks to the appropriate body responsible who

is in the best position to deal with such risks.

The following risks have provisionally been identified:

5.2.1 Patronage Risks

A number of factors outside the control of the operator and investors of the

proposed system may impact on the patronage of the proposed system.

These include:

! Permits given to parallel road-based public transport operators

! Subsidies given to parallel road-based public transport operators



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! The congestion levels on the parallel roads. The impact of the introduction

of new roads and additional capacity to existing parallel roads (as part of

the Toll Road Strategy) should be considered.

!

The level of development (or decay) in the vicinity of stations.! Other land-use related risks.

5.2.2 Financial Risks

Financial risks may include the following:

! Risks pertaining to the inflation rate

! Risks pertaining to the exchange rate (for those components that have to

be imported)

! Risks pertaining to land taxes

! Risks pertaining to interest rates

! Risk resulting from changes in the unemployment rate or factors impacting

on affordability

! The fares charged by parallel public transport

! The cost of fuel vs the cost of electricity

! The toll fares charged after the toll strategy is introduced.

! The accuracy of the cost estimates.

5.2.3 Public Acceptance and Rejection

The public generally accepts public transport improvements. However, public

transport in South Africa does not have a good record, which may result in

substantial resistance to accept the positions of the stations and the railway

lines from the adjacent land owners.

5.2.4 Environmental Risks

There are a number of environmental risks that may impact on this project.

These should be identified and managed.



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5.2.5 Pre-implementation Risks

These risks pertain mostly to the feasibility, and the ability of Government to

negotiate successfully with the preferred bidder. (If not well managed, it may

be possible that delays may be encountered.)

Any project has internal risks, that may be controlled, and external risks,

outside the control of the project. It is important that these risks be identified

at an early stage, so as to eliminate risks, even from the planning stages of

the project. The responsibility for the risks should be carefully considered, so

as to determine which party is in the best position to control or limit such a

risk.

The above list of identified risks will be investigated further during the study,

with the aim of limiting the risks. The risks for government will be studied

carefully, and considered how this would impact on the feasibility of the

project.

The risks that will receive special attention include the following:

- Permits given to parallel public transport services. (Consider the

possibility to limit parallel permits)

- Subsidies given to parallel public transport services. (Obtain an

undertaking to limit parallel subsidies and other forms of financial and

economic support to public transport services by government.)

- The taxi-recapitalisation process, and perceived possibility of subsequent

changes to public transport supply and demand. (Clarifying to investors

that this would not entail unlimited additional supply.)

- Acceptable feeder and distributor services

- Development controls by government. (Introducing such controls to

facilitate densification at the station nodes.)

- The implementation of the Toll Road Strategy and similar impacts on

parallel private transport. (This is needed to clearly indicate the relative

advantages to the investors.)



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5.3 LEGAL ASPECTS INCLUDING OBTAINING RIGHT OF WAY

The proposed rail link will require a rail reserve along the alignment which will

be determined as part of this planning and implementation study. This

alignment will cross different metropolitan authority areas. It will also cross

different types of land uses of which some will be open and others developed.

Some will be very high valued and others cheaper. Existing servitudes for

services such as electrical supply, telecommunication and pipelines will also

be crossed.

Due to time constraints on the implementation on this project, the only

practical way to obtain the required rail reserve, would be through

proclamation of the railway line and the expropriation of the required land,

which allows for a fair compensation process for land owners. As was

mentioned before, it seems at this stage if the ownership of the infrastructure

would be in the hands of the Provincial Government, at least for the initial

periods.

Provincial Government has concurrent legislative competence for publictransport, including rail, in terms of the Constitution of RSA Act. Previously

provincial governments were mainly responsible for roads and much of the

existing legislation, therefore, deals with roads, including the right to

expropriate land. Gautrans is currently busy drafting a Gauteng Transport

Infrastructure Bill which includes in the definition of transport infrastructure,

facilities for the use of trains and its passengers. It provides powers to the

MEC to plan, design, construct, control, manage, develop, maintain, protect

and rehabilitate transport infrastructure, as well as to expropriate land for

transport infrastructure. The Gauteng Provincial Government will thus have

the power to expropriate land for the construction of railway lines and stations.

What is however important, is that the above Bill should be completed as

soon as possible and passed by the Gauteng Provincial Legislature. Should a

problem arise with the above process, it can be considered to utilise the

existing SARCC legislation.



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In the planning and implementation of the Gauteng SDI Rail Link different

pieces of legislation will have to be considered. It will also be necessary to

identify legislative obstacles for the project through conducting a legal due

diligence. This is necessary in order to avoid unnecessary delays.

5.4 RESPECTIVE ROLES OF GOVERNMENT AND THE PRIVATESECTOR, INCLUDING PPPs

It is the intention of the Gauteng Provincial government to fully involve the

private sector in the Gauteng SDI Rail Link implementation. Therefore the

intention is to end this study with a Request for Proposals from the private

sector, probably in the form of some sort of BOT process.

In essence the approach will be to allocate ownership of assets,

responsibilities and roles to Government and Private Sector respectively in

order to:

! Reduce life cycle cost to Government;

! Attract private sector interest create a bankable deal;

! Satisfy public transport needs and enhance economic development;! Transfer risk to the party who can best control it.

Aspects which will be considered, include the following:

! The different ownership options in respect of land and property, fixed rail

infrastructure and rolling stock, including the implications of the different

ownership options on matters such as contract duration, risk transfer,

competition, control, subsidies, etc.

! The different types of risks that can be financed and transferred, including

operating, interest/renewal and capital investment risks, on operating

costs, interest/depreciation, short term assets, rolling stock and fixed

infrastructure.

! The different options where the revenue would be sufficient to cover, for

example, the operational costs plus a reasonable profit, the operational

costs plus depreciation, or the operational costs plus some capital

investment.



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! The length of a concession in terms of the type of risk transferred and the

typical pay-back periods.

Some of the pointers at this stage which will be considered are the following:

! Transfer only those risks that the concessionaire can control

! Transfer only those risks which the concessionaire can fund

! Match concession length to pay-back periods

! So far international experience has shown that it may be possible to cover

operating costs and possibly some asset renewal

! It may therefore be necessary to free access to assets, but there will be an

obligation to return assets in good condition at end

! The possibility that government would have to fund the infrastructure or

part of it, will have to be investigated.

5.5 IMPLEMENTATION PROJECT

The proposed targeted date for commissioning of the rail service by 2005, and

the proposed deadline (to be operational by the 2006 Soccer World Cup)result in an extremely tight implementation programme. This implies that

there cannot be any time wastage. Government and other roleplayers will be

made fully aware of the critical constraints so that there can be no wrong

expectations.

It is important that from the commencement of the Planning and

Implementation Project the time consuming tasks are known, so that the

planning can address these from the onset.

In addition, it is important to get an early estimate of the time to complete

these tasks, in order to commence with the scheduling thereof. It is, therefor,

the intention to get input from international experience on these tasks, once all

agree with the list of identified tasks. A best case scenario and a worst case

scenario will be developed.



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The following tasks critical to the implementation have provisionally been

identified:

! During or straight after the Planning and Implementation Study

- Legislation (new legislation if required)

- Land-use zoning / reservation

- Land procurement and expropriation

- Advertise project / project briefing

- Pre-qualification

- Bidding period

- Negotiations

- Contract closure

! During or Part of the Bidding Process

- Project approval

- Budget approval

- Legislation (small amendments to existing legislation)

- Decision on government role and private sector involvement

- Decision specifications (broadly)

- Detailed project planning (by bidders)

- Prepare detailed project specifications

- Prepare tender documentation

! As part of the Construction and Implementation Phase

- Consortium Formalisation

- Detailed Design / Redesign of important elements

-

Land procurement / expropriation- Earthworks / bridge construction / tunnelling

- Permanent way and overheads

- Signalling and control systems

- Procure and building of rolling stock

- Equipment and systems design and commissioning

- Testing of systems

- Employment of operating personnel

- Final commissioning



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The previous list of obvious tasks will have to be refined and the Study Team

will then attempt to obtain examples and other input to estimate the time

requirements. The duration for implementation will be a key element, which

will be included in the Request for Tenders, and will be used to adjudicate the

tenders in order to meet the required deadlines. When the Request for

Proposals is developed, finality on whether the soccer World Cup will

influence it will be known. Figure 4 provides an indication of the

implementation of the Project.



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6. BUSINESS PLAN AND STUDY DESIGN

1.1 INTRODUCTIONThe Business Plan and Study Design is primarily aimed at ensuring that the

scope of the project, as discussed in the preceding chapters, is achieved within

the framework of the needs of the Gauteng Government.

Some of the contents of this chapter were provided in the original brief of

Gautrans to the consultants, and the remainder is based on the investigations

undertaken during the first phase of the study.

The relationships between the various elements are illustrated in Figure 5.

Issues

Objectives

Deliverables

Process

Programme

ConsultantTask

Consultative Structure and Process

Project Management Structure

Envisioning

ConceptualPlanning

ScopeStudy Design

Identify

Accept

Budget allocation

Resource allocation

Budget (R) Task

Envisioning

Figure 5: Relationships



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1.2 STUDY GOALS AND DELIVERABLES

1.2.1 Study Goals

The Study Goals are:

To Confirm Feasibility, and to determine what would be necessary to

make the project more feasible and to attract private sector investment;

To Planthe implementation project, including:

Broad Technical Planning: e.g. station positioning and spacing, routing,

fares, technology, etc.

Business Case: e.g. determine PPP Model to be used, funding, etc.; and To Prepare a Request for Proposal to prospective bidders on the

implementation project.

1.2.2 Deliverables

In addition to this Inception Report, the project will have three main deliverables,

namely:

! Feasibility analysis to confirm the findings of the pre-feasibility study, with

the focus on Financial Viability and to facilitate Bankability;

! Description of the proposed system and the design parameters of the

proposed implementation project; and

! Request for Proposals from prospective bidders.

1.3 STUDY OBJECTIVES

The Study Objectives are categorised into two groups, namely the primary

study objectives, and other secondary more-specific objectives, as required to

achieve the deliverables and as requested specifically by Gautrans and the

Project Review Committee.



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1.3.1 Primary Study Objectives

The primary study objectives are:

(1) To undertake the conceptual planning of the project;

(2) To confirm the findings of the pre-feasibility study and determine what

is required to make it acceptable and attractive for private sector

investment.

(3) To determine the project specifications to be implemented and included

in the Request for Proposals for the Gauteng SDI Rail Link, including:

! Conceptual Planning

! Market Segmentation

! Land-use Perspectives and Projections! Route Determination

! Travel Demand and Patronage Projections

! Location of Stations

! Track Alignment

! Technology Specification

! Modal Integration

! Capital Investment and Operational Cost Estimates

! Economic and Financial Ev

Gauteng SDI Rail Link

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