Civil Engineering May 2021 | Vol 29 No 4

Civil Engineering May 2021 49 socioeconomic divide in the society, as public transport is now catering for dif- ferent classes,” explains the report. The report compares the provision of rail services by both Metrorail and Gautrain in Gauteng as an example of lack of integration. International experience suggests that rail operations exhibit natural monopoly characteristics, and therefore should not be duplicated. Both Metrorail and Gautrain are subsidised, resulting in an inefficient utilisation of limited govern- ment funding. The Commissions notes that Metrorail is operated at a national level and Gautrain at a provincial level, and ideally commuter rail should be provided by one entity to derive economies of scale and foster integrated planning. PROBLEMS WITH THE IRPTN SYSTEM A total of 13 cities have implemented or are in the process of implementing BRTs or an Integrated Rapid Public Transport Network (IRPTN). This was influenced by, among other things, capital grants by national government to municipalities for infrastructure spending for IRPTNs, of which BRTs were a significant component. Due to the availability of funding, many smaller cities did not conduct fea- sibility studies to identify the need for an IRPTN in their municipalities. According to the Commission, this has resulted in some IRPTNs being implemented on routes where there are existing public transport providers, resulting in a duplica- tion of services and inefficiencies, as ex- perienced by the Cities of Johannesburg, Tshwane, and Cape Town. These inefficiencies have resulted in several problems, including increasing under-recovery of revenue, low ridership due to poor selection of routes, unneces- sary infrastructure roll out, and lack of operational capacity and mismanagement. SUBSIDY CHALLENGES According to the report, government does not currently have a subsidy policy which provides justification for some modes of transport being subsidised while others are not. There is also a skewed relationship be- tween ridership levels and subsidy funding. Commuters still prefer minibus taxis – an unsubsidised mode of transport – over bus and rail. Despite being the only mode of public transport that does not benefit from any form of operational subsidy, the minibus taxis industry is responsible for transporting 66.5% of South African households that use public transport. Although the industry is substantial, it faces many challenges, including massive backlogs in applications for route alloca- tion and high costs of finance. The taxi industry has been resilient despite limited support from government, and has managed to expand in the market partly due to the shortcomings of the subsidised bus and Metrorail services. With 150 000 minibus taxi owners/ operators operating an estimated 200 000 to 250 000 minibus taxis in the country, the minibus taxi industry is estimated to be worth between R60 billion and R90 billion. Minibus taxis are estimated to convey around 15 million commuters daily and the industry is responsible for employing 300 000 drivers, 100 000 rank marshals, 100 000 car washers, and 150 000 informal traders at taxi ranks. TRANSFORMATION The Commission further found that there is no or limited transformation within the public transport industry across the value chain. In particular, upstream levels of the value chain such as financing and manufacturing are not transformed. At an operational and ownership level, minibus taxi businesses are majority black owned. Unfortunately, longstanding bus subsidy contracts between government and large commuter bus operators limit the ability of historically disadvantaged persons and small bus operators to participate competitively within the com- muter bus industry. RECOMMENDATIONS Having considered the input from stake- holders, the Commission made several recommendations. To promoter integration and im- proved coordination, the Commission recommends, among others, that dedi- cated transport authorities to be estab- lished at provincial, metropolitan, district or municipal level, where appropriate. National and provincial government should also work with SALGA to create capacity at local government level to en- sure that transport planning is prioritised by municipalities. The Department of Transport (DOT) is currently in the process of developing a government subsidy policy. The Commission recommends the subsidy policy consider, among others, addressing fragmented subsidies, correcting the skewed distribution of subsidies between urban and rural areas, providing equitable allocation of subsidies to the taxi industry and rural bus operators, and prioritising infrastructure grants. The Commission further recommends that municipalities, with guidance from the DOT and National Treasury, undertake a complete review of the BRT/IRPTN model considering long-term fiscal and financial sustainability, suitability of the model in smaller cities, and the inclusion and par- ticipation of the minibus taxi industry. In terms of rail, it is recommended that the DOT develop a policy that ensures efficiency and integrated planning in commuter rail services which may include, among others, integration of Metrorail and Gautrain in Gauteng. The DOT and National Treasury should also explore alternative funding sources to deal with infrastructure backlogs and new rail infra- structure investments.  This article only covers some aspects of the Market Inquiry into the Land Based Public Passenger Transport Sector. The full report can be accessed here: http://www.compcom. co.za/wp-content/uploads/2021/04/PTMI- Non-Confidential-14-April-2021-FINAL.pdf Duplication of rail services in Gauteng is considered highly inefficient