The taxi industry is, for the first time, set to benefit from the public transport subsidy.
Transport Minister Barbara Creecy made the announcement during a National Press Club appearance in Midrand, adding that the move is part of a bigger plan to make public transport safer and more affordable.
Subsidisation of the taxi industry has been on the table for years, and Creecy believes it will happen this time around.
“We want to set up transport operating companies together with the taxi industry, and we are going to pilot this new approach, one in each province. Of course, part of what we are working on together with the industry and considering is that some routes are currently oversubscribed. So the question would be what other activities can transport generate so that those who might currently be operating taxis would have alternative forms of livelihoods,” said Creecy.
Statistics show that taxis ferry the majority of the country’s workforce and are the only large-scale transport mode that is not subsidised.
The taxi industry, through umbrella body SANTACO, welcomed the announcement, saying it is long overdue.
“The taxi industry has wanted to be subsidised for decades, and the conversation for a long time was often to say, ‘But you are not corporatised, you don’t pay tax in accordance with the right regime.’
“At the back of 2020, something miraculously occurred in that we then came to collaborate with government through the taxi technical task team. What then happened is we started to work with institutions such as SARS as to how we formally form companies and move from operating as sole proprietorships to start operating as companies. So the industry has already been doing that,” said SANTACO spokesperson Rebecca Phala.
Phala said SANTACO is also pleased with the commitment made by the minister to de-risk the taxi industry to help reduce the cost of buying a minibus.
“So we are optimistic because we understand that the subsidy issue is not going to materialise immediately. They, as the government, can start talking to financial institutions on the question of de-risking the taxi industry because the money we are paying now for a 16-seater or 32-seater is incredibly hefty,” she said.
The Minister also gave an update on efforts to improve PRASA’s capacity to carry more people.