Name and Location
Taxi recapitalisation programme (TRP), South Africa.

Client
The Department of Transport (DoT).

Project Description
The project aims to replace about 135 000 of the country's 16-seater taxis with 85 000 new minibus taxis.

In 2004, when Transport Minister Jeff Radebe announced the way forward for the TRP, he discarded the previous project, which favoured a more high-specification product, and opted for a programme where taxi operators could buy any vehicle they chose, as long as it adhered to a new, but less strict, list of specifications pertaining to safety.

The key elements of the revised programme include the introduction of a R55 000 scrapping allowance to legal operators to scrap their vehicles. The scrapping allowance will be rolled out over a period of five years and will be applied regardless of the age or condition of the vehicle.

Government will also introduce ranges for vehicle-seating capacity – instead of the original requirement that new taxi vehicles have a seating capacity of 18 or 35 – with the ranges governed by the demands of a particular route.

Government has said that the reason for the recapitalisation project is not the vehicles but the operating environment, in which taxis speed and are overloaded.

The long-term solution is to bring the taxi industry into an integrated, formalised, government-sponsored public transport service, as is the case with the Rea Vaya bus rapid transit system, which will then also allow for the industry to be subsidised.

Value
The programme will cost an estimated R7.7-billion, up from the original budget of R4-billion to R6-billion.

Duration
The TRP was initiated in 1999. In 2004, it was promised that the scheme would take seven years to complete (to 2011).

Latest Developments
The TRP will come to an end in September, says Deputy Transport Minister Sindisiwe Chikunga.

The TRP aimed to replace South Africa's minibus taxi fleet with new vehicles, adhering to stricter safety standards. The programme allowed for a scrapping allowance to be paid to assist taxi operators in buying replacement vehicles.

However, many older taxis without the new safety features, such as seat belts for every passenger, are still operating on South Africa’s roads.

Apart from the scrapping allowance, taxi operators do not receive subsidies from government, while other public transport modes, such as Metrorail, the Gautrain, and bus companies, receive financial assistance.

The DoT is “assessing different options as a way forward” for the programme.

“We are reviewing and evaluating the process. Our view is now that we should possibly give a subsidy that would benefit the [taxi] commuter. This could be the best way to go. We’ll make an announcement as soon as we have finished this evaluation,” says Chikunga.

She notes that a commuter-based subsidy could be similar to the one provided for bus operator Putco, where the company is granted funding according to the number of passengers it transports on a specific bus route.

She emphasises, however, that the process is still in an exploratory phase.

Key Contracts and Suppliers
Siyazi consortium, comprising Siyazi Transportation Services Gauteng, Neo Solutions, Tshalata & Tshalata Associates and Tirhani Auctioneers (preferred bidder for the Scrapping Administration Agency).

On Budget and on Time?
The project is between R1.7-billion and R3.7-billion over the initial budget and behind the original schedule.

Contact Details for Project Information
Department of Transport, tel +27 12 309 3000 or fax +27 12 328 3194.
Neo Solutions, tel +27 11 484 2833, fax +27 11 484 2899 or email info@neoafrica.com.
Santaco, tel +27 12 321 1043, fax +27 12 321 7299 or email info@santaco.co.za.
Tirhani Auctioneers, tel +27 861 847 4284, fax +27 88 554 7417 or email info@tirhani.co.za.