The South Africa National Taxi Council (Santaco) in Gauteng says it will embark on a shutdown on Monday.
Transport Minister Fikile Mbalula announced the relief for the sector to the tune of R1-billion.
But Taxi associations say the amount is insufficient and that government must find more money.
Minibus taxi owners aren't happy with the conditions attached to accessing the funds, such as registering with Sars and opening a business bank account.'
Taxi owners had asked for a minimum of R20000 each.
But the government is offering R5000 and wants the taxi sector formalised.
Mbalula says taxi bosses have already told him they're not happy.
He warned against any planned shutdown by the industry.
"Shutdowns will not work. It will be detrimental to the industry itself and its survival. But equally, we would be misunderstanding the whole situation we are in, which is fighting COVID-19. And the taxi industry has come to the party in a big way. And we appreciate that."
Santaco says R1.1-billion in relief is not enough.
It's still unclear if the shortfall will be passed on to commuters, through drastic price hikes.
From Tshwane to the Vaal and from Ekurhuleni to the West Rand, taxi commuters across Gauteng will have to find alternative transport tomorrow as operators plan for a province-wide shutdown tomorrow.
The shutdown is in protest of government’s R1.135 billion relief fund announced on Friday, which operators describe as a “pittance” that would not address the affects of the Covid-19 national lockdown regulations on the industry.
While national taxi body Santaco confirmed that other provinces would not take part in the shutdown, Gauteng taxi associations were yesterday and today holding extensive discussions to make the shutdown effective.
Two weeks ago, taxi operators issued a directive that taxi fares would increase from R11 to R30 for a single trip from Alexandra to Sandton. However, the increases – which were scheduled to come into effect on June 15 – were put on hold after interventions from government and national operators. The new fare increases, which will be capped at R7 across the country, will kick in on July 1.
Gauteng taxi operators had long been complaining about unjustified impoundment of their vehicles by law enforcement officers, which is one of the issues that led to a decision to embark on a shutdown, national Santaco said.
While taxi associations have rejected government’s relief fund, national bodies have indicated that they want to engage with Transport Minister Fikile Mbalula.
However, local associations in Gauteng have chosen the militant
approach of shutting down public transport. Most people who rely on public transportation have been forced to use taxis during the lockdown as trains are still not running.
Yesterday, several local taxi bodies – affiliates of the Top Six Taxi Management task team and Santaco – met in Midrand to finalise the logistics for the planned shutdown tomorrow. Both of Alexandra’s local taxi bodies – Armsta and the Alexandra Taxi Association – confirmed that operations would be put on hold tomorrow.
Other associations at the meeting included the Nancefield Dube West Taxi Association, the Dobsonville Roodepoort Leratong Johannesburg Taxi Association and the Birchacres Oakmore Taxi Association.
George Maleke, spokesperson for the Top Six Taxi Management task team, said that the industry felt undermined by government’s relief offer because taxis had been operating at a loss throughout the lockdown.
Social distancing regulations mean taxis are allowed to carry only 70% of their maximum capacity.
“This offer to us is just a slap in the face. Remember that, when the lockdown began, we were the only industry operating at a loss, while government-owned buses like Putco are operating at a loss but receiving subsidies,” said Maleke.
Motlanalo Tsebe, spokesperson for Armsta, said the shutdown, although it was painful for passengers, had to be done so government could realise the seriousness of the impact of the pandemic on operators.
“Even if we can say buses should help [transport commuters], that will be a big problem. We do not want them. We can only agree if people just walk to work,” said Tsebe.
Xolani Ximba, who speaks for the Alexandra Taxi Association, said: “As things stand, we are at a deadlock with the minister. It does not even seem like Mbalula and his people know that we have been running at a massive loss for three months.”
The United Taxi Front (Utaf), one of the biggest taxi structures in the Joburg region, will meet today to decide on its participation in the shutdown. Sipho Nkwanyana, public relations officer of Utaf, said they regretted the outcome of the negotiations between the industry and Mbalula.
“It is sad that government gave us the offer that we do not appreciate. We hope the minister will go back to the president and return with a better offer,” said Nkwanyana.
NTA and Santaco have given Mbalula until Tuesday to come back with a revised offer.
Mbalula’s spokesperson, Ayanda Allie Paine, said that the minister had always told the taxi industry that he wanted peaceful negotiations to problems affecting the sector, and that he remained resolute in avoiding any confrontation with industry leaders.
She did not comment on the planned shutdown, but said Mbalula was opposed to any shutdown as he believed that such a move would be bad for the industry and passengers.
National spokesperson for Santaco, Kagisho Molelekwa, said: “Some of our provinces have been wanting to do the same – embark on a shutdown – but we felt that, even though we’re not happy with what government is offering, we need to find alternatives and make proposals to government, and can only get to that if all efforts are not fruitful.”
Mbalula said on Friday that government had considered the impact of the lockdown regulations on the taxi industry due to, among other things, the 30% reduction in loading capacity and a ban on interprovincial travel.
“This meant that the taxi industry was operating less than 60% of its fleet size, and carried 30% less of its licensed carrying capacity. Almost 20% or more of the taxi industry experienced total loss of income. This is particularly true of the long-distance and cross-border operators, who are directly affected by the closure of land borders and the prohibition of interprovincial travel,” Mbalula said.
TAXI’S VEHICLE PAYMENT HOLIDAY OVER
Molelekwa said things were going to get worse for operators as the payment holiday for financed vehicles stops at the end of the month. He said that, despite the payment holiday, some drivers, queue marshals and administration workers in association offices were not paid due to the limited movement and loading capacity that came with lockdown regulations.
“We enter July still broke and still not making any profits, and the banks will be breathing on our necks demanding payment for vehicles. It has been tough. Since lockdown began, we have been operating on about 15% of our total operating fleet and doing it at no profit given the decreased loading capacity due to Covid-19 restrictions … this has resulted in the industry losing about R25 million daily,” Molelekwa said.
“We are asking government to help the industry through this tough time. If there is no solid intervention soon, about 30% to 40% of operators could lose their vehicles to repossession by banks.”
The relief package could see each operator getting about R5 000 per vehicle, which the industry said was too little. Molelekwa said they were asking for “at least R20 000 for each taxi to give them the breathing space to cover operational costs”, but were “open for persuasion and we could go down to R15 000”.
APPRECIATIVE, BUT MORE NEEDED
Mbalula explained on Friday that the industry’s relief package was one of the largest for any economic subsector provided by government.
“Most of the special relief funds for subsectors provide on average maximums of about R350 million in comparison to what’s on offer to the taxi industry.”
Molelekwa said they were highly appreciative of Mbalula’s efforts to secure more money in comparison with other subsectors, but the reality on the ground demanded even more intervention.
“It should not be as if we do not appreciate the effort by the department … but the reality is, there is no other means of mitigating the current difficult situation for taxi operators and the industry in general.”
Molelekwa said they were also not happy with the conditions announced by Mbalula, which include that, to qualify for the grant, the taxi operation must be formally registered as a business entity with a bank account, and must be registered for income tax and other applicable taxes.