Submission on Economic Regulation of Transport Bill, 2020

July 29, 2020

There are three broad issues underlying the proposed Economic Regulation of Transport Bill, 2020, that the Free Market Foundation regards as problematic.

The first is that the Bill unnecessarily and unjustifiably intrudes on the private sphere, by expanding the extent and potential scope of government interference in the transport sector. The second is that the Bill, like many other pieces of legislation enacted by Parliament, vests executive officials, primarily the Minister of Transport as well as the proposed Regulator, with discretionary powers that are not restrained by any guiding criteria on how they must exercise those powers. Thirdly, the Bill is clearly aimed at centralising governmental power away from civil society and away from independent institutions, in the hands of the Department of Transport and its minister.

It is an imperative under the Rule of Law, which is enshrined in section 1(c) of the Constitution, that Parliament refrains from assigning unrestrained discretionary powers to the executive in the legislation it enacts. Yet the Bill is riddled with provisions empowering the Minister and the Regulator to do certain things, appoint certain functionaries, and direct certain people to do things, all based on their own whims, without any of these decisions being restrained by legal principles or criteria. Certain vague provisions in the Bill, because of their lack of clarity, also lend themselves to being applied in any way the Minister and Regulator may see fit. In other words, the quality of legislative drafting as regards this Bill leaves much to be desired.

The Bill is fundamentally at odds with economic reality and with the legal-constitutional paradigm in South Africa. Price controls, which are the main feature of the Bill, are detrimental to a healthy economy and will at all times lead to distortions of market forces and incentives. The Free Market Foundation enjoins the government to abandon the Bill and to instead remove regulations within the transportation industry so as to encourage and incentivise free enterprise and economic growth.