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The complete Phase 1A of Cape Town’s MyCiTi bus rapid transit system commenced operation in mid-May. It was originally planned to open in April 2010, but only the airport and stadium links were operational in time for last year’s World Cup. The BRT corridor and stations between Cape Town Civic Center and Table View were completed by this past January, but contentious negotiations with minibus taxi and bus operators led to a series of delays.
The political clashes and strikes leading up to MyCiTi’s implementation have their roots in historical difficulties regulating the informal minibus taxi industry:
In deregulating the minibus taxi sector in the late 1980s, and subsequently aiming to return to regulation through formally structured interventions such as the Taxi Recapitalisation Programme and the creation of a government-sanctioned representative structure (ie SANTACO), government has not created conditions conducive to the formalisation of minibus operating or business practices. Past interventions have, rather, contributed to the entrenchment of informal operating practices, the creation of ‘warlord’ figures fervently opposed to a loss of control of the sector; representative structures and operator associations well organised to violently disrupt the transport system and threaten public safety; and fluid loyalties within the industry. [Herrie Schalekamp, ACET Research Officer, in Mobility Magazine]
In one of the meetings I had with Herrie, he described the city as attempting to use BRT as an “infrastructural solution to a social issue.” Attempting to address transportation regulatory and governance issues by building dedicated rights of way and BRT stations would clearly lead to the “imbalance in work streams” characteristic of the project, with physical infrastructure delivered far earlier than operational and organizational structures. Further complicating the efforts to formalize and regulate the taxi industry (which receives no operating subsidies but generally pays no taxes) were unrealistic promises made by politicians and the lack of reliable data on existing operations.
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These two factors combined to confound the process of compensating existing minibus operators. At a national level, politicians promised that existing operators would not suffer any “legitimate loss of revenue” due to the implementation of BRT. Yet in most South African cities, revenue from legitimate minibus taxi operations is difficult to calculate accurately, especially considering the industry’s marginalized origins in the apartheid era. In Cape Town, transportation officials do not know accurately how many minibuses operate, or on what routes they operate, since so many minibuses are unlicensed. Given the promise to compensate existing operators for business taken by the BRT system, Cape Town officials must either offer jobs or monetary compensation to a growing list of (licensed and unlicensed) minibus owners whose routes will be affected. Officials agreed to compensate owners with unlimited permits for seven years of lost income, owners with limited permits for three years of lost income, and owners without licenses for one year of lost income. In agreeing to compensate unlicensed taxi drivers, they undermined earlier government attempts to negotiate only with legitimate taxi owners associations. The industry’s ongoing fragmentation has been a significant cause of delays to BRT implementation. As Herrie summed the situation up, “it’s a mess trying to regulate without the data.”
Cape Town’s private commuter bus operator, Golden Arrow, receives a R630 million subsidy annually, and has been another agent delaying MyCiTi’s inauguration. Golden Arrow was registering their concerns with BRT plans as early as 2008; in a 2010 speech at the South African Bus Owners Association Annual Conference, Golden Arrow’s General Manager FE Mayer objected:
The first and probably most important issue we have with BRT is that the concept was sold to Government on a false but convenient promise. The promise was that BRT will not need any operating subsidies. We say this is not possible and it will require more subsidy than current services require. In the recent past, Government has mainly held a negative view on the current bus subsidy system, and in most discussions it becomes evident they believe they are not getting good value for money. When they therefore heard that such a good system as BRT does not require subsidy, it was obviously an answer to their prayers. In itself it was enough for Treasury to buy into the concept.
Golden Arrow was clearly reluctant to give up their monopoly on subsidized road transport in the Western Cape. After two years of negotiations, they were able to pressure the City of Cape Town into letting them remain an independent operating company within the MyCiTi setup, instead of integrating with minibus operators to form a joint operating company as was originally planned. The Cape Times reported on the taxi industry’s displeasure at the city’s February capitulation to Golden Arrow:
This plan has annoyed TransPeninsula Investments [run by minibus leaders], which provided post-World Cup IRT services for the city. The company has already earned R1.5 million and R42.3m in two separate deviations from the city for the service. A senior executive of TransPeninsula said taxi operators concur about a third operator. “This will become evident soon. They want to give Golden Arrow their own company even though they’ve been having a monopoly for the last 150 years,” said the executive, who asked not to be named.
Transpeninsula threatened litigation, leading to further delays. Their recalcitrance is explained partly by the benefits they received from delays. As the provisional World Cup operator, Transpeninsula only was supposed to have contract for airport shuttle and special event operations (such as shuttles for the Cape Argus Cycle Tour) until October. Delays to BRT implementation meant extensions of their contract.
As late as April, officials were not confident that negotiations would be complete by May. The persistent effort of local and national government leaders eventually achieved success, and contracts were signed one day before the beginning of a phased rollout. The system has received generally positive publicity. With so many regulation and negotiation hurdles cleared, the implementation of future phases will likely be much easier.