The city council wants control all public transport in Cape Town - and as part of this wants to take over the lucrative Golden Arrow contract.
|||Cape Town - The city council has applied to control all public transport in Cape Town - and as part of this wants to take over the Golden Arrow contract and the R700 million subsidy which the bus company receives annually from national government.
The city and Golden Arrow are currently involved in a high court dispute over their failed negotiations on how much market share Golden Arrow is entitled to when MyCiTi expands and some Golden Arrow buses become redundant. Golden Arrow says that more than half of its income comes from government funding.
Last year the city applied to the Department of Transport to become the transport authority which will see the city take control of all modes of transport and take responsibility for rail and bus subsidies.
Golden Arrow, which has been operating in Cape Town for more than 150 years, transporting 53.6 million passengers annually, says 55 percent of its income comes from the government funding.
Golden Arrow spokeswoman Bronwen Dyke said in the last financial year, R696 236 000 was allocated to the Western Cape Department of Transport as a Public Transport Operating Grant to subsidise the provision of public transport services.
Dyke said the subsidy was granted by the government to assist commuters as many citizens cannot meet the true costs of daily commuting.
She could not say how future subsidies would be affected as MyCiTi expands, but added: “We anticipate that some of Golden Arrow’s existing routes will be cancelled as MyCiTi Phase 1 is rolled out. The company will, in consultation with the provincial Department of Transport, propose to redeploy these buses in other areas where there is currently a dire need for additional buses to supplement existing services.
“It is very important to note that it is not the company that is subsidised but the passenger who benefits from discounted travelling costs.”
Siphesihle Dube, spokes-man for the provincial Transport Department, said currently Golden Arrow was the only company that was paid a subsidy by the provincial government. The funding came from national government to province to allocate to Golden Arrow in terms of its contract. Province only managed the Golden Arrow contract, and Dube said they were not aware of any decommissioning of Golden Arrow’s fleet or the mothballing of its assets when MyCiTi expanded.
The city applied to the Department of Transport to assign the responsibility for the contracting authority function in respect of the Golden Arrow contract to the city.
“After the transfer of the contract for the Golden Arrow function, the subsidy amount will be reallocated… to the City of Cape Town. The city will then determine how the funds will be used,” Dube said. The integration of Golden Arrow with the MyCiTi expansion will be the city’s responsibility.
zara.nicholson@inl.co.za
Cape Times