Ailing bus sector blames government
Fleets cut down, tax and licence bills to pay
THE STATE’S inaction has been blamed for the shedding of thousands of jobs in the bus industry, which costs operators hundreds of millions of rands as a result of the Covid-19 pandemic and the strict lockdown regulations.
The companies are concerned that while their fleets have been reduced to almost half, due to lesser demand and those on the road were strictly regulated to each carry almost 50% of its passenger capacity, the companies were left with huge expenses, including tax and licence fees. The finger-pointing followed the announcement that the decades of operation of the luxury intercity and cross-border bus fleet Greyhound and Citiliner would come to an abrupt end on Monday.
The bus fleet of Public Utility Transport Corporation (Putco), which operates in Gauteng, Limpopo and Mpumalanga, will retrench 214 of its employees.
Transport Minister Fikile Mbalula’s office said: “The precarious position in which some bus operators find themselves is unfortunate and is a source of concern for the Ministry of Transport.”
Mbalula’s office also said President Cyril Ramaphosa had from the beginning of the lockdown regulations, announced “various sector-specific grants to assist businesses in distress”, which the bus operators were encouraged to apply for. He urged financially distressed bus operators to approach the Credit Guarantee Scheme, which provided loans to qualifying businesses.
“In addition, as a concerned stakeholder, the ministry has engaged public and private entities on behalf of the operators, seeking further means of supporting long-distance bus operators,” said Mbalula’s spokesperson Ayanda Allie-paine.
But Putco and the Southern African Bus Operators Association (Saboa) have accused the government of ignoring their plea for relief funds, saying they tried in vain to engage the government to obtain relief funds.
Unitrans Passenger declined to comment and referred Independent Media’s investigations unit to a statement, issued on February 3, announcing the closure of Greyhound and Citiliner services.
Putco has disclosed that it had lost R220 million in revenue, which started with the loss of R160m between March and July, which was the hard lockdown period when commuters, except essential services providers, stopped going to work. The bus companies had to dig deep into their pockets to pay for the disinfection of each of their buses after every trip, provide masks for the drivers and sanitise each commuter boarding.
The companies’ revenue was also affected because its fleet was no longer hired for private events such as funerals, weddings, church trips and school excursions. Putco and Saboa had, on numerous occasions, approached the Transport Department, requesting to be compensated through the Public Transport Operations Grant (PTOG), but that was denied.
Saboa executive manager Bazil Govender said PTOG had about R337m, which he believed the government should use to assist the financially distressed bus companies.
“To date, very little or no relief has been forthcoming,” he said. Govender said the sector had shed about 2 000 formal and informal jobs.
He said Saboa had, on many occasions, pleaded with the government and even written open letters to Ramaphosa, requesting an engagement, but “no progress has been made”.
Putco spokesperson Matlakala Motloung expressed disappointment that Mbalula had reneged on his pledge to assist the bus industry, which he made when he visited Putco premises in Roseville on June 2.
“He acknowledged that the bus industry is not properly subsidised, and that they are in distress and that he is willing to engage and assist them, simply because they are compliant from the registration point of view and they are paying tax,” she said.
She said the company had engaged with the Gauteng and national departments.
“They are given an allocation, which is ring-fenced for public transport but, unfortunately, they cannot do a deviation without concurrence from the National Treasury.
“We basically requested loss of income, but only between the hard lockdown, which was March 27 up to around June, July, which was level 5 and level 4. Even if we were to get 50% of what we have lost in revenue. If we have lost R150m and we get about R50m or even R70m it would have alleviated a lot of hardship,” she said.
Solidarity Fund chief executive Tandi Nzimande said the fund, which had received R3.22 billion in donations, allocated R2.75bn and disbursed R2.02bn, did not have the mandate to assist financially challenged companies and “will not be in a position to assist any of the companies you mention”.