Another difficult year for the bus industry looms

February 25, 2025

Sharmini Naidoo writes that although Brand South Africa has heralded 2025 as “South Africa’s year of transformation and global leadership”, more challenges await the bus industry this year.

This year, South Africa assumes the G20 presidency and will showcase its progress at the World Economic Forum. “The year ahead marks a defining moment in the nation’s trajectory as it seeks to lead transformative dialogues and create pathways for progress… the nation finds itself at a critical juncture, embracing both challenges and unprecedented opportunities,” says Brand South Africa, the country’s official marketing agency.

A month into a very busy new year, much has already happened – and there are more challenges than opportunities for the bus industry.

Gauteng negotiated contracts

Towards the end of last year, the Gauteng Department of Roads and Transport (GDRT) took a decision to apply to the courts to set aside the negotiated contracts that were concluded in 2023. In January this year, the GDRT served documents on all parties who intended to oppose the application. We await the outcome of the legal proceedings.

The reduction in services implemented by the GDRT last year has already inconvenienced commuters, who must now find alternative transport and pay more (in some cases, even pay again, if they already have a ticket or card) if the routes are no longer being serviced.

Should the judgement not favour operators, commuters will be further impacted. It will be a move even further away from government’s objective to reduce transport costs and make public transport more affordable and accessible to poorer households.

The Expropriation Bill

Towards the end of January, President Cyril Ramaphosa signed into law the contentious Expropriation Bill with nil compensation. The Bill underwent a five-year process of public consultation and parliamentary deliberation; its main objective is to ensure that expropriation laws are in line with the constitution. The Bill will clearly outline how expropriation can be done and on what basis.

According to the Constitution of South Africa Section 25 (4)(b), “property is not limited to land”, thus any property – movable or immovable – may be expropriated. Expropriation may not be exercised unless the expropriating authority has, without success, attempted to reach an agreement with the owner or holder of a right in property for the acquisition thereof on reasonable terms.

The bus industry will have to see if it will be impacted by this legislation if the draft public transport subsidy policy (DPTSP) goes ahead in its current form. The DPTSP is proposing a policy that includes a separation of asset ownership from the delivery of services. In such an arrangement, the state owns the fixed assets, supplemented by rolling stock provided by competitively selected suppliers, with only services being provided by operators. Due to the high-level nature of the policy, it is unclear whether existing depots or property of operators will be expropriated in line with the Bill.

Road safety

Road safety remains a serious concern. As a country that has a very well-developed road infrastructure, South Africa has one of the worst records in terms of road safety. The loss of life can never be justified – every life is precious and even one life lost on the road is one too many.

Provisional figures released by Barbara Creecy, the Minister of Transport, indicated that there were 1,200 road accidents over the festive season that resulted in 1,502 deaths – a 5.3% increase, or 70 more deaths, over the four weeks compared to the 2023 festive season, “a reversal of incremental strides made in recent years”. This was despite the efforts undertaken by the Department of Transport (DoT) to increase law enforcement to change driver behaviour.

All nine provinces reported fatalities. KwaZulu-Natal, the Eastern Cape, and the Free State recorded increases in fatal crashes of 54, 70, and two, respectively, while the Western Cape, Mpumalanga, and Gauteng recorded decreases of 23, 14, and 76 fatalities, respectively.

The provincial fatal crash statistics are as follows:

KwaZulu-Natal: 304 fatalities in 247 crashes
Gauteng: 235 fatalities in 224 crashes
Eastern Cape: 231 fatalities in 168 crashes
Limpopo: 180 fatalities in 140 crashes
Mpumalanga: 143 fatalities in 118 crashes
Western Cape: 140 fatalities in 124 crashes
Free State: 106 fatalities in 81 crashes
North West: 100 fatalities in 87 crashes
Northern Cape: 63 fatalities 45 crashes

Creecy revealed that traffic law enforcement officers conducted more than 997 roadblocks throughout the country during the festive season. “Our law enforcement officers issued 711,184 fines for various traffic offences across the country. Some 23,607 fines were issued to drivers who failed to wear seatbelts, while another 16,925 motorists were fined for using cell phones while driving,” she reported.

A total of 16,527 vehicles were found to be unroadworthy and issued with traffic fines, as well as having their motor vehicle licence discs removed, particularly in areas where vehicles couldn’t be impounded due to lack of impoundment facilities. “In total, 8,917 motor vehicles were impounded in areas where facilities were available. To clamp down on drunken driving, speeding, and other moving violations, our officers arrested more than 9,550 motorists, with 3,840 individuals arrested for drunken driving,” Creecy added.

A total of 414 drivers were arrested for driving at high speed, five of whom were driving at well over 200km/h. The worst speedster was arrested in Gauteng, near Honeydew, on 18 December 2024, driving at 245km.

The association strongly condemns any negligence and reckless behaviour on the roads, including the operation of unroadworthy and poorly maintained vehicles. SABOA has a Code of Conduct, as well as a Road Safety Code of Conduct, to ensure that members adhere to the highest standards of professionalism in terms of regulations and legislation, ethics, vehicle roadworthiness, road safety and standards, and customer service in South Africa.

In December last year, SABOA signed a road safety pledge after the launch of the Gauteng “Fatela” Road Safety Campaign (meaning “we care”) in full support of the province’s initiatives. The association remains committed to ensuring the safe transportation of commuters.

SABOA also supports road safety initiatives around the country, including the “Isipho Sami (My Gift)” campaign in KwaZulu-Natal (KZN). This is done through the Road Safety Foundation, which promotes road safety during the festive season. Our KZN constituent also made a financial contribution to support the initiative over the past two years.

Scholar transport

With the start of the new school year, scholar transport once again came into the spotlight.

The Legal Resources Centre, acting for the Khula Development Project in Peddie and numerous schools across the Eastern Cape (EC), welcomed a judgement that declared the EC Department of Education (DoE) and the EC DoT’s failure to provide all qualifying learners with scholar transport to be unconstitutional and invalid. Judge AJ Molony directed the EC DoE and EC DoT to take multiple and concrete steps in order to ensure that all qualifying learners (approximately 40,000) will receive scholar transport for the 2025 academic year.

Operators in the scholar transport sector have often been criticised for not providing safe, reliable transport or properly maintained vehicles. While this is imperative, it warrants a deeper dive into possible causes.

Depending on the province, scholar transport can fall under the auspices of either the DoT or the DoE (and sometimes both). This creates its own set of challenges in terms of jurisdiction, policy, and budget.

Traditionally, scholar transport has provided an opportunity for SMME operators to enter the bus industry due to its relatively low barrier to entry. However, operators in this sector have had to grapple with numerous challenges and are often forced to operate on a hand-to-mouth basis to survive.

Most scholar transport operators are often paid late by the provinces – either due to process issues, late submissions, or in most cases a lack of sufficient funding. We know that the Public Finance Management Act (PFMA) prevents any accounting officer (authorised government official) from committing a department, trading entity, or constitutional institution to any liability for which money has not been appropriated. Section 38(1)(f) of the PFMA also requires accounting officers of departments to settle all contractual obligations and pay all money owing, within the prescribed or agreed period.

Treasury Regulation 8.2.3 further provides that unless determined otherwise in a contract or other agreement, all payments due to creditors must be settled within 30 days from receipt of an invoice. This came into effect after Cabinet resolved in 2009 that departments must implement mechanisms to ensure that invoices are paid within 30 days from the date of receipt, because of the high level of government non-compliance.

Irrespective of the legislation, this problem still occurs and there does not seem to be any government accountability or respite for our SMMEs, who do not have the cash flow resources to operate under these conditions. In addition, in some provinces certain awarded contracts have been tainted by corruption, with operators forced to “pay” for subcontracts awarded.

In other provinces such as the Western Cape, new tenders have not been published due to apparent manpower and cost constraints. This has resulted in existing contracts being extended year after year without being escalated with inflationary increases for fuel, maintenance, wages, and other running costs. Operators choosing to request higher rates stand to lose the work, and so continue to provide the services. This naturally places a deep strain on operators, who are forced to cut costs to keep running.

To date, we still await the national scholar transport policy. In 2009, the DoT acknowledged that transportation of scholars to educational institutions has always been a key challenge confronting government in modern day South Africa. It also noted that most scholars have difficulty accessing schools in both urban and rural settings. The development of the scholar transport policy was supposed to be one of the DoT’s interventions towards reversing challenges of accessibility and mobility.

The policy sought to address the challenges faced by scholars and affected stakeholders on a daily basis, including (amongst others) walking long distances to schools, the high cost of transport, lack of business opportunities for SMMEs, late payment of service providers, high accident rates, and the safety of scholars. This policy further recognised the need to bring a uniform approach to the transportation of scholars and the fulfilment of the constitutional mandate of the DoT to provide a safe, reliable, and efficient transport system. We hope that all efforts are made by government to fast track this policy.