2023: Tough on bus operators

This year has not been an easy one for bus operators in South Africa. SHARMINI NAIDOO reflects on the evolution of the bus industry – and the many challenges it faces today.

The first public bus – or omnibus – was launched in France in 1662. It was a system of horse-drawn carriages that operated on schedule through the streets of Paris. These rides were only available to the nobility and were often utilised out of curiosity and as a frivolous novelty/pastime. 

Today, buses operate purely on need and play a valuable role in offering commuters safe, comfortable, and affordable transport. 

Bus design and manufacturing have also undergone tremendous changes due to technological advances and the need for less noise pollution and cleaner air. Accordingly, we have seen an evolution from “horse” power to motorised machines to traditional internal combustion engines, compressed natural gas (CNG) vehicles, hydrogen fuel cell buses, and more recently, electric vehicles.

Buses have also played an interesting role in politics and civil rights actions against many inequitable causes. Sadly, these days, buses have become the target of intimidation and violence, preventing many of them en route – in virtually every province – from delivering on their value proposition. 

Not so long ago, we saw a multitude of buses torched, stoned, damaged, and stopped from operating. Unfortunately, many lives were lost, and many drivers were also injured during these senseless attacks. 

Be it an expression of frustration, anger, or the need for sensationalism and attention, burning a bus is nothing short of criminal and violates and impinges the rights of others. This is not unique to our country: the burning of vehicles has become a norm in emerging economies that are riddled with socio-political issues. However, the authorities need to put an immediate end to these destructive acts, not only to preserve our public transportation system, but also to protect the rights of citizens.

Reflecting on the past year, it is clear that 2023 has not been an easy one for bus operators. Litigation, legislation, regulation, and negotiation became the themes of the year.

Operating challenges such as delays in payments and the timeous issuing of operating permits saw many operators being forced to halt services. Under-recoveries in subsidies, underutilisation, contractual hurdles, high fuel prices, and reduced margins were just some of the many issues with which operators had to grapple. Fortunately, some progress was made on the tendered contracts and Bus Operating Company Agreement (BOCA) negotiations. Operators have been engaging with the contracting authorities in the hope of a speedy expedition of the contracts.

The basic tenet of a successful tender process is to ensure that all your costs – both direct and indirect – are considered in your bid. The bus industry is no different. Costs are considered when bids are placed based on published or open tenders. Any new cost or legislation resulting in additional costs will see operators out of pocket if they have to absorb these costs and are unable to recover them. If the draft road accident fund legislation goes ahead in its current form, proposed legislation for systems such as account-based ticketing and public liability claims are two such pieces of legislation that will result in additional costs to operators, as these have not been included in the current contract negotiations.

In South Africa, we are governed by three spheres of government: national, provincial, and local. National government makes laws, sets policies for the country, and provides services that fall under national competencies. Each province has its own legislature and can make provincial laws. The role of local government (municipalities) is to provide basic services such as water, refuse removal, and sanitation, as well as promote a safe and healthy environment and community development.

In terms of the National Land Transport Act (NLTA) 2009, the national sphere of government is responsible for the formulation of national transport policy and strategy, national strategic transport planning, and the preparation and coordination of a National Land Transport Strategic Framework.

The provincial sphere of government is responsible for the formulation of provincial transport policy and strategy, as well as the planning, coordination, and facilitation of land transport functions in the province. This includes coordination between municipalities to ensure effective and efficient execution of land transport in the province. 

One such example of the function of the province is the Integrated Transport Master Plan for Gauteng. This will map out key transport projects and is planned for rollout over the next 25 years in an attempt to deliver a world-class, sustainable transport system that supports Gauteng’s economic, social, cultural, and environmental goals.

KwaZulu-Natal’s new licencing numbering system to address the issue of running out of available numbers is another example of the province exercising its powers – albeit at a cost to operators and an administrative burden to align documents, rank permits, and so on. 

The municipal sphere of government is responsible for:

• developing land transport policy and strategy within its
area based on national and provincial guidelines,

• the preparation and implementation of transport plans,

• financial planning with regard to land transport,

• monitoring and administration,

• the rehabilitation and maintenance of public transport infrastructure and facilities, and 

• the management of the movement of persons and goods on land, which includes concluding subsidised service contracts and commercial and negotiated contracts.

At present, the contracting functions of the municipal sphere of government are managed by the provincial sphere of government (except for the BRT and municipal services that are found in the metro areas). In the future, we can expect to see the Department of Transport’s subsidised bus transport function being devolved to the municipal sphere of government, in line with the requirements of the Constitution and the NLTA. We will wait to see how this impacts the industry, as the municipalities have not had the best track record when it comes to the management of finances and administration…