Calls for probe into spending allocated to Red Dot transport service
Share this article:
CALLS have been made for scrutiny into the R37 million paid to a company that operates the Red Dot taxi service which accounted for over half of the provincial transport’s total spend over three months.
According to the latest Western Cape procurement report, for the third quarter of 2020, the Department of Transport and Public Works paid Umanyano Transport Service R37.1m , which was over half of its total spent of R62.1m from October to December. The company, wholly owned by the SA National Taxi Council (Santaco), provides the province with a fleet of taxis to transport health workers and people in isolation or quarantine sites to and from their homes.
The project was introduced at the height of the Covid-19 outbreak last year.
Umanyano was paid R25.7m for running the project, and another R6.7m was paid to other service providers for managing the project. However, the report showed Umanyano as the department’s biggest service provider, spending at R37m
The company’s chief executive, Junaid Peters told Weekend Argus operators are paid R42 000 per taxi on a monthly basis and a managing fee of R400 000 a month to pay at least three staff mrmbers per office scattered across Santco’s eight regions.
At its peak, the project used 257 vehicles, which would have cost the department R10.7m per month.
Peter said at its inception the project was meant to last for six months but the service was now expected to last until June.
This means provision will have to be made in the upcoming provincial budget speech as the province is expects a third wave of Covid-19 infections.
“In terms of negotiations it was tough; they proposed an amount that was not feasible and we ended up with a middle ground which made it feasible for operators to come on board,” said Peters.
“Vehicles are receiving R42 000 per month for the period and as the management company, Umanyano receives a management fee of R400 000 to pay staff and other activities. When you look at it, it is broken down so that the operator receives more from the process.”
Asked what modelling was used to determine the fee structure during negotiations, spokesperson for the department Jandre Bakker said the major component of the cost was around the vehicle availability fee which also included payments for the driver.
“The fee was based on the daily income that the taxi operator was forfeiting in order to dedicate his/her vehicle to the Red Dot service. The modelling is a standard public transport methodology combined with an innovative solution requiring a service on a quick turnaround time basis,” he said.
According to some drivers and owners who spoke to Weekend Argus, drivers on a daily basis are required to hand over anything from between R800 to R1 000 to owners while operating on busy routes in the metro. At most, owners are probably collecting a maximum of R30 000 if their taxis are working on a daily basis.
Good Party’s Brett Herron questioned the lack of transparency on the part of the provincial government in how it structured its procurement report which does not show how money was spent.
“This applies to the Red Dot transport service. The lump sum disclosure does not allow us to interrogate whether value for money was received,” he said.
“The Red Dot Transport Service appears to be a good initiative responding to a unique need at a time of crisis. But we do not know how many health-care workers received access to the service in total. This is important but absent information. It may have been cheaper just to buy a small car for each user.”
The ANC’s Lulama Mvimbi also called for transparency on the project.
“The amount so far that has been expended by the government in the Red Dot service in a period of three months needs a careful scrutinisation to see whether it benefited the industry, drivers and commuters. We will interact with the department to assess and scrutinise whether this money has been effectively used for the empowerment of this industry,” he explained.
At the launch of the Blue Dot taxi service this week, Peters said 1 300 operators taking part in the pilot project would be paid R10 000 a month by the department if they stuck to predetermined rules and regulations to help pay off their vehicle instalments.
MEC Bonginkosi Madikizela said was budgeted at R150m was budgeted for the pilot project. Madikizela said the project was a means of ensuring passenger safety and quelling taxi violence.
“A certain number of vehicles remain on permanent standby in each region. The Covid Command Centre is able to call on these vehicles to transport the families of Covid-positive people to and from quarantine or isolation facilities,” added Bakker.
“Vehicles are also still being used to transport 200-plus hospital staff daily to and from Brackengate Field Hospital in the morning and evening, due to the lack of access to public transport near the hospital. While there is a per trip component in respect of the transportation of hospital staff, it does not constitute the entire (complement).”
Bakker said between October and December, almost 4 000 people were transported to and from isolation facilities in the province and just more than 107 000 health-care workers from 25 hospitals and clinics in the metro were transported to and from work.