South African public transport operators need “to do more with less” as the economy contracts and the national fiscus faces increasing financial pressure, says National Treasury intergovernmental relations deputy director-general Malijeng Ngqaleni.
She notes that the current system of public transport subsidies is “clearly not sustainable”. This system largely subsidises the middle-class through subsidies for train and bus services, such as Metrorail and Gautrain, and not the poor, who primarily use the unsubsidised minibus taxi system.
She regards the minibus system as “very efficient”, as it services 67% of public transport users, collecting 71% of public transport fares in South Africa.
She adds that South Africa’s current public transport system is “by and large very costly and not very efficient”, especially as private car use continues “to accelerate”.
“We are not doing enough to help the poor. In our current fiscal environment, there must be a better way.”
Ngqaleni says the South African government has spent R167-billion on public transport infrastructure and operational subsidies (excluding the road network) over the last ten years, at an average yearly growth rate of 18%.
This growth rate may, however, be lower in future, owing to lower economic growth, she adds.
Quoting figures from the 2014 National Treasury Expenditure Performance Review of South Africa’s Public Transport and Infrastructure Systems, she notes that the municipal bus service received between R16.75 and R24.36 in operating subsidy per passenger per trip (during the time this report was compiled), while conventional bus services, such as Putco, received between R11.40 and R16.89.
Bus rapid transit (BRT) systems received between R11.76 and R15.12. The operating subsidy for Metrorail was R3.73 per passenger per trip, and R60.30 for the Gautrain, which she regarded as “a huge subsidy”.
The Gautrain, however, recovered 57% of its costs through the fare box, with Metrorail at 39%, BRTs at between 28% and 44%, conventional bus systems between 31% and 44% and municipal bus systems between 13% and 31%.
Ngqaleni is not, however, opposed to public transport subsidies.
“We need to subsidise public transport systems. Public transport systems the world over are almost always subsidised.”
She says Taiwan and Hong Kong recovered around 100% of their costs through fare income, with the US at between 26% and 56%. Fare box recovery in Europe is between 40% and 91%.
Ngqaleni suggests that public transport spending in South Africa should increasingly be linked to land use planning and integration between public transport modes, for example.
“We should use the fiscal system to drive integration.”
It is also possible to use subsidies to create a safer, more convenient minibus taxi system, without surrendering any of the system’s current efficiency.
She emphasises, however, that there is no time-frame yet for the provision of subsidies for the taxi industry.