COMMISSIONER Tembinkosi Bonakele says the government needs to subsidise minibus taxis the same way it does buses and commuter trains.     David Ritchie African News Agency (ANA)
COMMISSIONER Tembinkosi Bonakele says the government needs to subsidise minibus taxis the same way it does buses and commuter trains. David Ritchie African News Agency (ANA)

‘State should subsidise minibus taxis

By Siphelele Dludla Time of article published Feb 20, 2020

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JOHANNESBURG – The Competition Commission has called for sweeping changes to the administration of the public transport system, including government subsidies for minibus taxis and the creation of a special SAPS unit to police the industry.

Commissioner Tembinkosi Bonakele yesterday said during the preliminary findings of the commission’s market inquiry into land-based public passenger transport, which started in June 2017, that there was a skewed relationship between ridership levels and subsidy funding.

Bonakele said the government needed to subsidise minibus taxis the same way it did with buses and commuter trains.

He said taxis transported about 66.5 percent of commuters, while buses and trains were responsible for 23.6 and 9.9 percent respectively.

“Government currently does not have a subsidy policy which provides justification for some modes of transport being subsidised, while others are not,” Bonakele said. “The minibus taxi industry (should) be subsidised through increased funding for the Taxi Recapitalisation Programme.”

The commission said that the government needed to change laws in order to enable healthy competition in the taxi industry.

It recommended the complete removal of area restrictions imposed by section 66 of the National Land Transport Act.

The graft agency said the restrictions encouraged route rivalry between taxi associations, as well as metered taxi services and e-hailing services.

“Area restrictions reduce competition and their rationale is incompatible with the evolving nature of the markets. Retaining area restrictions may constrain both e-hailing operators and metered taxi operators (when they fully embrace e-hailing technology).”

The rivalry over routes and turf wars has escalated in recent years over regulatory challenges.

The commission said a specialised division within the SAPS needed to be created to deal with all public transport related matters.

SA National Taxi Council president Philip Taaibosch said the taxi industry believed that the scope of the recapitalisation and subsidy programmes should be broadened.

“We are saying that the transport mode where the commuters use should be subsidised. You should not look into whether you are subsidising the taxi industry or what; you are subsidising the commuters,” Taaibosch said.

“The commuters should be given the right to choose the kind of transport mode to utilise, but let the subsidy be the same to each and every commuter.”

The commission has invited stakeholders to make further submissions on its findings and recommendations before the end of March.

It also recommended that the Passenger Rail Agency of SA (Prasa) be separated from its troubled bus subsidiary Autopax.

Prasa is the sole owner and manager of intermodal terminal facilities in South Africa.

The commission believes that Prasa was charging excessive prices to the bus operators for the use of Park Station - the only intermodal terminal facility in Johannesburg.

It also found that Prasa favoured Autopax in space allocation and had restricted or denied access to competing bus service operators to Park Station.

Bonakele said the relationship between Prasa and Autopax - the operator of Translux and City to City long-distance buses - raised several concerns for the interprovincial bus industry.

“It is recommended that Autopax be separated from the Prasa Group and become a separate entity,” Bonakele said. “As a separate state entity, Autopax will manage its business activities independent of Prasa Group and report directly to the government and not through the Prasa Group.”


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