State to chop travel costs
Bill sets limits on transport revenue raised in bid to control maximum passenger fares
“Definitely there would be protests, as we have already agreed in principle that there will be a three-day national stoppage on all these issues, such as unemployment, poverty and austerity,” Craven said.
He said that a date for the threeday national protest was yet to be decided, “but we will be announcing it shortly”.
Sadtu deputy general secretary Nkosinathi Dolopi accused Mboweni of punishing lower-level public servants for wastage done by senior government officials.
“We cannot fold our arms when there is a campaign to reduce the number of lower-level public servants. Ordinary public servants are not the cause of the bloated structure. We have too many ministers and their deputies.
“Too many perks, including cars, two offices – one in Cape Town and another one in Pretoria. Directors-general and deputy directors-general are earning a lot of money,” he said.
Cosatu said it was not workers who caused the fiscal crisis. “Government does not have a coherent plan of reducing the ballooning Cabinet headcount. We do not hear the government talking about imposing a freeze on salaries of state-owned enterprise CEOs and management. We hear nothing about how they will reduce the massive wage gap in the public sector,” it said. THE GOVERNMENT IS proposing wide-ranging changes to the law to drastically reduce the costs of using all forms of public transport, including land, rail, sea and air travel, and to control prices paid by passengers.
If passed into law, the Economic Regulation of Transport Bill will introduce price control as a method for setting the maximum price that can be charged, or revenue that can be earned, by operators for the use of or access to its assets, facilities or services.
Among the bill’s goals is the regulation of prices “to ensure that normal levels of profit are achieved by regulated entities”.
Price control will include tariffs, charges, fees, tolls or other amounts that may be imposed for the use of any transport service or facility, a limit on the total amount of revenue it may raise, and on the returns it may derive from the assets used to provide its services.
The department hopes this will ensure that levels of profit which keep entities providing public transport services are sustainable, and will continue to encourage investment, but do not reflect monopolistic pricing or inefficiency in operations.
The proposed new law would apply to any market, entity, facility or service in the transport sector – unless Transport Minister Blade Nzimande grants an operator an exemption.
The proposed new law would allow Nzimande, in consultation with a new regulator, to declare that it applies to any market, or any entity, facility or service, irrespective of whether it is privately or state-owned, within the transport sector.
It would apply if Nzimande has determined that either a single operator controls more than 70% of the market or the preconditions for competition do not exist in the market.
Operators would be required to submit a proposal to the soon-to-be-established Transport Economic Regulator to request approval of price control for the facilities and services offered.
The regulator will be the primary enforcer of the proposed new law.
National Taxi Alliance spokesperson Theo Malele said although he welcomed the government’s current proposals, he hoped the department was not covering its tracks and pulling the wool over the eyes of the taxi industry over its complaints that it was allowing municipalities to operate buses and issue operating licences, therefore becoming referee and player.
He told Independent Media that the taxi industry was not charging market-related prices, but travel fares.
Price control, according to Malele, would also ensure that passengers in all modes of public transport were subsidised. FINANCE MINISTER Tito Mboweni has warned that South Africa should avoid going to the International Monetary Fund (IMF) if it fails to reduce its mounting debt.
This was after MPs also said yesterday they backed Mboweni to reduce the debt, which is close to reaching 60% of the Gross Domestic Product (GDP).
Mboweni said if it reached that situation, it would lead to South Africa going to the IMF – and this would result in surrendering the country’s public finances to the IMF.
Mboweni was appearing before the joint committees on finance and appropriations to explain his Medium-Term Budget Policy Statement delivered on Wednesday.
Debt is the fastest growing expenditure item in the budget. It has been increasing over the past few years, but the National Treasury says it will stabilise in the 2023/24 financial year.
Mboweni said something needed to be done urgently to reduce the debt.
“If we don’t do anything (soon) we will reach a (debt to) GDP ratio of above 60%. If that happens, you are close to having discussions with the IMF. They will come to run your finances. Let’s do whatever we can to avoid that situation,” said Mboweni.
President Cyril Ramaphosa also warned a few months ago that they would not want to go to the IMF to seek money.
He said the conditions the IMF imposed made it difficult to prioritise spending, and it would force (the government) to cut their social spending budget.
Chairperson of the standing committee on appropriations Pinky Phosa