Programme Director
President of South African National Taxi Council (Santaco)Santaco Mr Arthur Mthembu
Secretary General Of Santaco Mr Phillip Taiboosch
Representatives of the taxi industry
Public Transport Operators
Distinguished guests
Members of the Media
Ladies and gentlemen
Ten years ago we said, in South African terms, public transportation virtually denoted horror. It painted gory pictures of minibus-taxi road crashes, taxi violence and bodies of our loved ones scattered on our roads. But we also said, on the other hand, the taxi industry represented, and still does, a great model of successful Black economic self-empowerment. It is the only sector where Black people control an entire sector through their ownership of the taxi mode of transportation.
There are already 50 million of us in South Africa today and our roads can accommodate only so many. The aspiration of a car in every garage is simply untenable. Public transport therefore represents the future and black people are already in it. The question was therefore back then to make public transport safe, efficient and affordable. Today you are pronouncing yourselves that, as a national structure, you want to play a part in the development of our economy. We therefore congratulate you on the strides you have taken.
We are ready to work together with the industry to identify opportunities. Over the past ten years we have seen an increase towards investment by the taxi industry in the transport sector. Today the industry owns garages, dealership networks such as Taxi Choice, partnerships with Toyota - all of which have seen serious returns for you as the taxi industry.
Today the taxi industry consists of mini-buses and midi-buses and is a major player in our economy:
- public transport by taxis accounts for 65% of the transport total, 20% by bus and 15% by rail
- consists of approximately 150 000 public mini- and midi-bus taxis
- has an estimated turnover of more than R16,5 billion.
The initiatives of the Department of Transport on the economic empowerment of the taxi industry commenced as far back as 1996. Today in November 2010, more than ten years later we are here to recommit ourselves to a new taxi development agenda. We have both the objective and subjective factors which are conducive for a major, giant leap forward. The main objective factor is that public transport is on the rise and defines the future of mobility in South Africa, in Africa and the world.
We cannot afford to continue building more roads and parking bays in cities as this simply encourages more traffic over the medium term to long term. No city in the world not even London, Chicago, Venezuela, Paris or New York has solved urban mobility challenges through private car use.
Switching car users to public transport, walking and cycling will make a major contribution to our global responsibilities of protecting the environment. Public transport provides a greater level of safety and stress free travel than private transport.
To reposition public transport government has made massive investments in the sector and particularly in the development of the public transport infrastructure and services. Over the past five years we have invested R48 billion in our Bus Rapid System (BRT), rail and the Taxi Recapitalisation Programme. This expenditure pattern is going to continue over the next ten years.
We have spent over R9 billion rolling out the Integrated Public Transport Networks in four cities. Already, in the Rea Vaya BRT in Gauteng, the taxi industry owns and is involved in the operation of the BRT. There are concrete plans to extend these Rapid Networks into other cities. Secondly, we are about to develop new long-term contracted services in all provinces.
This will be completed in all provinces over the next two years. These contracts will vary between seven and 12 years at an average of R5 billion a year as subsidy from government. This constitutes 40% of the revenue streams for the contracted services. This means that there is an additional potential revenue stream of R12 billlion flowing into the sector if you include commuter fares.
We have plans to upgrade the Moloto Corridor into a Rapid Rail system. At the moment we are paying R300 million per annum for one service which is again 40% of the total revenue stream. We also have plans to develop a high-speed train between Durban and Johannesburg. All these projects are not a threat but represent a massive opportunity for the industry. We have plans to develop high-capacity corridors serviced by bus or rail transport, supported by taxi distributor routes serviced by taxi or bus transport. At the centre of our strategy is to provide transport that is safe affordable and reliable.
Our strategy is to provide the greatest convenience to the commuter with the aim of providing a round the clock means of moving from point A to B in all parts of our country whether rural or urban. In addition to opportunities created by government, there are also many opportunities in the private sector for the industry. Opportunities exist in finance, vehicle manufacturing and fuel among others.
We need to look beyond just the obvious opportunities and look at the entire value-chain. Again our view is that there are massive opportunities in vehicle manufacturing. There are massive opportunities in the local manufacturing of buses, taxis and also rail coaches and locomotives. These opportunities are about deriving economic benefits through the entire value-chain. The industry must reposition itself to become a major investment stakeholder in all these developments.
We have already defined part of the value chain which is: transport finance, fuel, spare parts, tyres or even the manufacture of vehicles. Furthermore we are saying the taxi industry must move and partake of the opportunities in rail, freight transport, maritime, aviation and infrastructure development. With regard to fuel there are big opportunities which are occasioned by our country and the world’s commitment to a cleaner environment over the next decade or so.
The sector is the biggest polluter through the use of fossil fuels. Let us turn this negative situation of climate change into a positive business opportunity. We are faced with an urgent need to retrofit all our vehicles in order to reduce our total carbon emissions as a country, continent and the world. The taxi industry must take advantage of this and many other opportunities. The taxi industry must play an important role in the roll-out and operation of these projects.
The challenge for the industry therefore is about
- the creation of corporate structures
- skills development
- unity and cohesion within the industry.
We guarantee government support. We want the industry to take this giant leap through the training of owners and drivers, maintaining unity and becoming investment partners in the public transport system of our country.
New dawn in taxi industry
Today marks the launch of the Taxi Industry’s Strategy for 2010- 2020 and the Taxi Academy. These two achievements are the fulfillment of our vision applied through our three-pronged approach which involves:
- The creation of a structured engagement on all matters between government and the taxi industry.
- The development of a structural framework to enable the taxi industry to engage collectively in economic activities.
- The setting-up, within the environment of a solid structural framework, of actual business ventures aimed at turning the taxi industry into a serious economic force.
The taxi industry is moving forward with the entire country towards the development of world class public transport in South Africa. We are not moving backwards but forward together to move the people of South Africa with safe, reliable and affordable public transport system. Our focus as the Department of Transport is to place transport at the centre of moving South Africa from being a developing country to being a developed country.
The TR3 2020 strategy redefining, restructuring and repositioning
We welcome the strategy particularly how you see the evolution of the industry till 2020. We agree that we need to Redefine, Restructure and Reposition the industry.
Flowing from this let me outline our terms of engagement and support for the industry:
- Firstly, we want to adopt your TR3 2010-2020 Strategy as the basis for our partnership with the industry.
- Let us move with speed with the establishment of the Taxi Academy.
- We will redirect the budget we have set aside for taxi training which is R5.5million to ensure that the Taxi Academy is up and running latest by the beginning of the next financial year.
- Let us strengthen our partnership for the development of public transport co operatives and other legal entities critical for the growth of the industry.
- Let us give ourselves three months to consolidate the strategic partnerships with key private sector partners including banks, vehicle manufacturers, technology and other relevant partners
For us to be able to drive this ambitious programme, the department is establishing a Project Management Unit with sufficient resources and skills to implement this programme. I encourage the industry to build that project management capacity as well, so that we can ensure that there are dedicated teams from both government and the industry to manage these projects. All of us are speaking about the opportunities for the industry. The challenge for us now is to put in place people, infrastructure and systems in order to ensure that these identified opportunities are turned into viable and bankable businesses.
Conclusion
To conclude, a vibrant taxi industry that shares the vision of transformation in improving public transport in addition to bus operators and passenger rail operations is what is needed in this country. We have faith in South African National Taxi Council (SANTACO). SANTACO has the mandate to lead efforts to unite the taxi industry.
It is only through working together, the taxi industry, government and the private sector, that our endeavor to implement our much needed integrated public transport networks can be achieved.
I thank you.
