It is indeed a humbling experience to open our 2009 provincial October Transport Month Campaign with such a big announcement that is going to mark a turning point in the management and operation of the government fleet in the Eastern Cape.
This is an annual campaign instigated by government to highlight:
* achievements of the transport sector
* progress made in infrastructure development-based service delivery that enhances economic growth and social development.
The campaign brings the spotlight projects to exhibit the government’s commitment to poverty eradication, skills development, infrastructure development and economic development.
This year’s campaign will focus on dealing with promoting partnerships in development especially rural development and showcasing our state of readiness for the FIFA 2010 Soccer World Cup. The theme is, “transport the heart beat of South Africa’s economy and social development.”
Before I proceed with the announcement of the new service provider for the management of provincial government fleet, please take note that the evaluation of this R3,2 billion tender over five years has been done in accordance with the terms and conditions as stipulated in the request for proposal document as issued to all the bidders. This is required by public private partnership legislation and the whole process was managed by National Treasury.
Based on the outcome of the tender evaluation process, successful finalisation of negotiations and approval by the Public Private Partnership (PPP) Unit of National Treasury, I wish to announce that Phakisa Fleet Solutions (Pty) Ltd was the successful bidder to provide the fleet and fleet related services through a Public Private Partnership.
The tender is for a period of five years with an implementation period of six months and has a fleet size of 2 888 with various types of vehicles. The implementation period includes the transfer period from the current service provider to the new service provider and the most important essential services of service delivery would be emergency medical services and traffic vehicles and to ensure this area has a smooth transition. The Head of the Department of Transport is chairing the transfer committee.
Services
The services are the provisioning of long term fleet vehicles, a management information system, a call centre and the financing, management and operation of the fleet solutions, which includes maintenance, insurance and a base kilometres usage.
Finance
The service provider will be required to finance the fleet solutions at its own cost and risk. This includes the financing of lifecycle costs for provision of the fleet solution. The budget for the fleet solutions, including fuel costs, is R505 million for the first year of the PPP Agreement. The budget will be escalated by CPI inflation rate annually.
Risk transfer
Transfer of risk forms an important consideration for both the service provider and the Eastern Cape Provincial Government (ECPG). The ECPG seeks to transfer substantial financial, technical and operational risk to the private party accordingly.
The following are just a few areas in fleet management which have a risk attached to it for example: the ownership, interest rates, inflation, maintenance, fuel fraud, accidents, incidents and so forth.
Specialised vehicles namely Emergency Medical Services (EMS)
The Department of Health’s Emergency Medical Services (EMS) needs have been taken into account as this is a specialised service. The health EMS fleet includes the following types of vehicles:
* ambulances
* rescue vehicles
* disaster trucks
* rapid response vehicles
From lessons learnt this service will be closely supported and monitored by the department to ensure both partners comply and that service delivery is achieved.
Staffing and local economic development
There will be local employment and empowerment. It is therefore imperative for us to take into account the current staffing requirements and be sensitive towards such a situation. There are 45 direct job opportunities and more than 200 indirect job opportunities. There will be empowerment and development opportunities ranging from tyre fitment, car wash, glass fitment, panel beating workshops.
The company will provide the training for such downstream opportunities with the emphasis on the empowerment of youth and women from rural areas in line with the provincial growth and development strategy and the priorities of government as highlighted by the President of South Africa.
Turn around strategy
The new company is expected to provide a minimum of 2 888 vehicles over a period of five years. Its service offering will be based on:
* listening to our customers
* tailor made service to meet customer expectations
* consideration of local dynamics to inform our service offering in terms of delivery
* visibility and creation of constant communication channels
* promotion of partnerships with government
We are in the process of engaging the current service provider to iron out dynamics of seamless take over to avoid loss of service delivery during the transfer process.
Enquiries:
Ncedo Kumbaca
Cell: 082 442 2388
Issued by: Department of Transport, Safety and Liaison, Eastern Cape Provincial Government
1 October 2009
