Taxi Industry Transformation Strategy: briefing by South African National Taxi Council (SANTACO)

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21 February 2011
Chairperson: Ms N Bhengu (ANC)
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Meeting Summary

The South African National Taxi Council (SANTACO) and the Department of Transport were working closely to transform the state of public transportation in South Africa. SANTACO was founded after government’s intensive consultation process with taxi operators countrywide in a move to have an umbrella body governing the industry and act as the principal mouthpiece for the taxi industry.

The strategy from SANTACO was to restructure the taxi industry to make it an empowered and self-sustaining industry, which was a leader in mass transportation providing affordable, safe and reliable transport to South African citizens. Safety campaigns and training of drivers and taxi rank officers was also on the agenda to make the taxi industry safer. The Hlokomela campaign was such a safety campaign to reduce the number of road accidents through checking and monitoring of taxi vehicles at different check points. SANTACO was interested in exploring energy supply options for the industry which would benefit members as well becoming part of the economic mainstream.

Members asked questions about the plans SANTACO had for the future. They wanted to know how the implementation of some the systems would take place. Members suggested that the taxi industry needed a charter which drivers could adhere to, as many people found public transport unreliable as a means of transportation. Members also wanted to know how women would be incorporated into the taxi industry as this was one area of empowerment which needed more attention. 

Members were satisfied overall with the presentation but requested that the Department be a constant monitoring entity in the workings of SANTACO. They encouraged the economic development of the industry but warned that plans should remain realistic. There was a general warning from members that the industry was very competitive in other modes of transport such as buses and aviation. The Department should also stay involved in what was happening within SANTACO and bring to the Committee what was needed to make this organisation successful.

Meeting report

Opening remarks:
The Chairperson outlined the purpose of the meeting. She said it was an opportunity for the Portfolio Committee to get a clear understanding of the strategy of SANTACO with regards to the taxi industry as a whole. She highlighted that Parliament had passed a number of Acts that was relevant to the taxi industry. If one took a look at the industry, there was no broad-based structure. She said that the Department needed to work with the taxi industry in order to achieve transformation. Strengths from both the Department and SANTACO were needed to bring the taxi industry into the mainstream of the economy. This industry had travelled throughout apartheid without assistance from government. As Parliament, the Committee wanted to explore what conducive environment was needed for further development and implementation, as well as hindering factors preventing further development. She suggested that both the Committee and the Department needed to find solutions without in-fighting.

SANTACO presentation to the Portfolio Committee on Transport
Mr Phillip Taaibosch, Secretary General, SANTACO, explained that it had taken South Africa a very long time to bring taxi associations together. Lawlessness was rife in associations, and thanks to government, in September 2001 SANTACO was founded, born out of 34 taxi federal organisations and 3 national bodies. Since 2001, the eradication of violence in the taxi industry started to happen. Violence was still occurring, but these were cases where it was not taxi-related. The biggest hurdle was the economic emancipation of the taxi industry.

Mr Taaibosch said that the birth of SANTACO had changed the country. A milestone was the national conference held in May 2010 where the leadership was endorsed, and Mr Jabulani Mthembu was elected as president, unopposed. A complete acceptance by government was now needed. This, however, was not easy.   

Mr Bongani Msimang, CEO, SANTACO, gave a brief history of the organisation. SANTACO was founded after government’s intensive consultative process with taxi operators countrywide in a move to have an umbrella body governing the industry and act as the principal mouthpiece for taxis. This was guided by the National Taxi Task Team’s recommendations of 1996 which rested on the three pillars of formalisation, regulation and empowerment under the auspices of one taxi body, as SATACO was not seen as exclusively representative. The National Conference Preparatory Committee (NCPC) was consequently formed to facilitate a national conference to initiate a new body with elections conducted at local, regional, and provincial levels.  

In September 2001 SANTACO was formally established and remained the principal representative body of the Taxi Industry in South Africa. In line with its mandate, SANTACO adopted President Mthembu’s vision and strategy to transform and empower the Industry called the Taxi Restructuring 3 (pillars) (TR3 2020) at their elective conference in May 2010. The TR3 2020 was the brainchild of Mr Mthembu and had to do with issues of change, in consultation with the public. SANTACO found serious problems in the taxi industry, but these were issues created by the industry itself. The TR3 2020 vision was to develop a self sustaining industry which was a leader in the mass transportation service, moving all South Africans in a continuously improving transport service that was affordable, safe and reliable by the year 2020.

There were three pillars to the TR3 2020 vision which was a strategy to help develop the vision. SANTACO had tried firstly to redefine the taxi industry and move to a bigger scope, by not just being involved with the operation of taxis. They also focused on how commuters were being treated. This would not happen without the second pillar, which was to have restructured the industry, by developing the capacity to develop nationally. The third pillar was to reposition the industry in the broader scope of the economy. This would be done by looking at problems and solutions in a practical and innovative manner. Mr Msimang highlighted that leadership was a core aspect of their vision, as the correct leadership was needed at every level; national, provincial as well as regional, making sure all levels were functioning effectively.

Mr Jabulani Mthembu, President, SANTACO, noted that 50 million people used the taxi industry every day. The taxi industry had been forgotten by government, although it played such a major role in the transportation of commuters. Simple and practical plans were needed instead of huge research projects and surveys. SANTACO’s strategic plan included capacitating people, such as the taxi drivers and rank marshals; therefore a training academy was established. In communications and the media a lot had been said, therefore the industry needed a voice as well by means of advertising. Customer care had not fared well and had become a key focus in the industry.

Mr Msimang explained the initiative to improving customer care. The Hlokomela campaign was established as an initiative to increase consumer awareness. Hlokomela was a component of customer care and it included Road Safety and Social Responsibility projects. It was a response from SANTACO and the taxi industry to have reduced and eliminated unnecessary road accidents and to show love and care for the community through various social programmes.

A key objective of the Hlokomela campaign was to reduce the road accidents through checking and monitoring of taxi vehicles at different checkpoints. It was also designed to give commuters the confidence of a safe, efficient, reliable and affordable service. Hlokomela strived to work hand in hand with traffic officials to promote road safety and to eliminate bad elements and improper conduct from our taxi drivers and operators. Hlokomela was also used as a mechanism to receive and provide feedback to the commuter on their experience of the journey and the conduct of drivers, especially in long distance routes. Mr Msimang spoke about the key elements of Hlokomela. These included vehicle inspection at the ranks, driver condition monitoring, check points on major routes and driver support in cases of emergencies.

Mr Taaibosch spoke about the role of women in the industry as one of their strategic focus areas. He said that the only way women came to be involved in the industry was through the deaths of their husbands, leaving the taxi operations for them to then take over. These women needed to plan for the future keeping the family business sustained. He wanted to involve women in a more active manner to improve gender equity.

Mr Mthembu noted the call centre that was currently operational. This was a format where people could voice their concerns. Some feedback received was that drivers were rude to commuters. This was a common complaint. He thought that soft skills and capacity building was needed to address this issue.

Mr Msimang spoke about the training academy which was also part of SANTACO. It was established to provide a platform for the advancement of critical skills within the taxi industry. It was founded to develop a pool of resources and personnel that were competent and professional in executing their functions at all operational levels. The main purpose of the training was to improve service delivery and create a customer orientated service within the transport industry. The training academy would also create employment opportunities for various segments of the community within the transport industry, especially women.

The training approach that would be adopted by the academy would encompass both theory and practice. Co-operation would be developed and sustained with relevant agencies to provide practical training on specific areas. Training programmes would be customised in order to reflect and address the needs of each target group. Mr Msimang highlighted that mobile training units would be used to bring learning to the ranks and where it would be most convenient for the operators and drivers. Training would be conducted using participatory methodologies, simulation and practical models to ensure better understanding and interest.

SANTACO also focused on enterprise development and empowerment. This was done by corporatisation and the development of co-operatives to explore the value chain within the industry at a local level and to empower local communities. There was the development of a proposal to launch a low cost option for flights to carry previously disadvantaged groups, mainly within the taxi industry’s market, Fly Standby and SANTACO Express. This was presently in negotiations with South African Airlines (SAA) for the allocation of distressed stock. SANTACO would also explore energy supply options for the industry which would provide a benefit for the members both at the cost level and equity ownership. Another major project for SANTACO was to pilot an Electronic Management System (EMS) system to improve the efficiency in the collection of fares and running taxi business operations.

Mr Mthembu elaborated more on these enterprise development and empowerment initiatives. He said that the reason many people could not utilise airlines as a mode of transportation was because airports were usually inaccessible. The transportation to the airports was a problem. With the implementation of using SANTACO in the transportation to airports, SAA would be utilising a transport system which was already in existence. Airplanes were not always full, and excess seats could be used by SANTACO to transport long distance commuters. This was a critical component of enterprise development and empowerment.

Mr Mthembu then spoke more around the EMS payment system. This was proposed with the function of taking access money from taxi ranks. SANTACO wanted to run a cashless system within the taxi ranks. With the correct data and pattern of movement system, it created the ability to plan well and therefore government could calculate subsidies effectively.

Mr Msimang concluded the presentation by outlining strategic interventions that SANTACO had planned. It was focused to assist the unlocking of legislative barriers to effective empowerment of the taxi industry. A main strategy was to positively influence government to consider the taxi industry in the allocation of resources and subsidies to improve consistency from province to province. The taxi industry remained the only broad based industry within the transport sector and assistance was required for the industry to be considered for Broad-based Black Employment Equity (BBBEE) transactions in all government initiatives in the transport sector, including bus contracts, rail and aviation. SANTACO wanted to become the voice of the most marginalised grouping within the transport sector and affect a mind shift in dealing with the challenges facing the taxi industry.

Mr Mathabatha Mokonyama, Deputy Director General, Department of Transport, briefed the Committee on the view from the Department on the transformation strategy for the taxi industry. He said that the expectation for the Department was to remain open and supportive of the industry initiatives. Some roles were not clear yet as the relevant stakeholders needed to be identified. The key concern was depicted in the three pillars of the TR3 strategy, and the role of the Department was to manage, regulate and control transport services nationwide. The Department was very supportive of SANTACO but it still lacked the support of other sectors of government. SANTACO represented almost all formations of the taxi industry but there were still smaller splinter groups threatening to disrupt development. The Department was working on a complete amalgamation of these associations. Engagement was needed for one big group formation and this group should be all-inclusive.

Mr Mokonyama explained that there could be a possible change of name as the industry moved from the taxi industry to the larger transport industry as a whole. In South Africa, public transport was highly subsidised and the Department needed to find a mechanism to ensure that taxis also participated in the process.

Mr S Farrow (DA) said that he had been refreshed by the presentation and thanked both the Department and SANTACO for the information. He said that he was happy to see the taxi industry thinking out of the box. He wanted the change principles to be taken into consideration. He was wary of the goal to have buses and rail integrated into the system, as it was a very competitive industry out there. He hoped for unification to have everyone on the same level and to have public transport safe and reliable overall. He wanted to know how recapitalisation would impact this organisation and would funding then be enough.

Mr Mokonyama said that the rate of recapitalisation was currently slow, and the Department needed more funds from Treasury to make this an effective strategy. The scrapping allowance that drivers were receiving was not sufficient, and this caused drivers to be reluctant to be involved in the recapitalisation process. He agreed that funding was a major problem.

Ms N Ngele (ANC) thanked SANTACO for their interesting presentation. She welcomed the 2020 vision and mission because it would help make public transport affordable, safe and reliable. She noted that in some areas, taxi drivers were too old and constantly drunk, and this made taxis an inconvenience to some commuters. She noted that there was still a lot to be done, and suggested that training should include that drivers exercise more patience with commuters. She wanted to know whether women were included into the organisation only as wives of taxi drivers or whether the organisation was open to all women.

Mr Msimang said that more engagement with communities was needed but women empowerment was also on the agenda for SANTACO. This included not only the wives of taxi drivers, but all women. When the training academy would open in the near future, the first 1000 participants would be women to be trained as drivers.

Mr J Maake (ANC) congratulated SANTACO on the election of their new leadership. He said that it seemed the tasks at hand would be completed. He thought that soft skills training was an absolute necessity as the behaviour of taxi drivers still left much to be desired. He said that the Hlokomela campaign would yield positive results, even though it was still in its early stages.

Mr M De Freitas (DA) said that the presentation showed a bold move in the right direction. He wanted to know who would be carrying out inspections on taxis as shown in the key elements of the presentation. 

Mr Mthembu said that there was already an inspection sheet available as developed by Toyota, which was the largest manufacturer of minibuses in South Africa. This was focused on the visual condition of the vehicles. The inspections would be done by rank marshals and other available officers.

Mr Farrow wanted to know how the Department was planning on giving bursaries to students to obtain their K53 driving permits as mentioned by the Minister.

Mr Mokonyama replied that the Minister had alluded to the fact that Grade 12 certificates and a drivers licence go hand in hand towards finding employment. This needed to be incorporated in conjunction with the Department of Basic Education. However, this plan was far from finalisation, but the Department of Transport was ready to roll out the plan.

Mr De Freitas wanted to know more about the energy supply options as outlined by SANTACO.

Mr Mthembu said that SANTACO would like to have participated with already existing structures in energy in our country and focus more on sharing ideas and innovations.

Mr Farrow asked whether the call centre responses had been positive and wanted more clarity on how it functioned. He said that a taxi charter was needed which commuters were aware of and which drivers needed to adhere by as there had been many complaints in the past about taxi drivers.

Mr Msimang said that the intention of the Hlokomela campaign was to create a regulatory framework for the taxi industry. This was a good place to start for setting up a charter. SANTACO needed more support in developing the correct criteria as the industry had taken the oversight responsibility upon itself. They were in participation with Metropolitan which was supporting and paying for the call centre as an oversight function currently.

Mr De Freitas asked how drivers felt about a cashless system and how this impacted on them. Drivers were usually afraid that they would now have to pay taxes on their income.

Mr Mthembu responded that drivers were not opposed to the cashless system. Part of the training component would be corporatisation, which include teaching drivers about the tax system. Drivers were no longer afraid of tax issues and they are starting to accept this positive change.

Mr Farrow wanted more clarity on the EMS system and wanted to know who would run it. He said that an intermodal form of transport would be a good idea and suggested this should be piloted.

Mr Mokonyama said that the EMS system was not easy at a technical level. The Department was still a long way from exploring intermodal technologies, but within a single mode, such as the taxi industry, it was possible. The ownership of the EMS system was still under discussion but, as government, the Department could only set the standards and regulations to such a system. The approved guidelines for the EMS system existed, but the implementation was difficult.

The Chairperson thanked SANTACO for their presentation and the Department for their responses. She said that there were still a few issues that were important to take forward. For the first time, the taxi industry was taking advantage of the post-1994 situation and had grasped the intention of democracy. She said that they were becoming masters of their own destinies by asking the Portfolio Committee to create a conducive environment for change and transformation. Government had the responsibility towards the taxi industry by helping people to see the positive side of public transport, as shown by the Hlokomela campaign. The change in the manner in which the industry was viewed depended on the actions of the Portfolio Committee.

She said that it was an important call to make as the taxi industry provided transport to the poorest of the poor. The taxi industry was the largest consumer of minibuses, tyres and fuel but was kept at a consumer level. This needed to change as the taxi industry needed to become shareholders in larger companies. The taxi industry needed to be a key player in economic transformation strategies. The Department needed to loom at the presentation carefully and responded effectively to become an enabling tool to have facilitated positive change. She suggested that the taxi association had redefined itself by starting out as a small business, then moving on to establish local associations and now it had become a national council. The taxi industry needed to become more involved in the larger economic scene, by investing in a tyre manufacturing plant for example. The Chairperson said that in the insurance industry, for example, it was normal for insurance companies to own their own buildings, which facilitated financial growth. The same model should be adopted in the transport industry.

The Chairperson also highlighted that true transformation used capacity and strengths to recognise financial resources and used them to expand. She suggested that the Department use taxi industry models from other countries and think outside the box to increase effectiveness. She wanted the Department to come up with a response to the presentation by SANTACO, and only then would the Portfolio Committee decide what action needed to be taken. She said that publicity was an important factor as it was needed to deal with the negative perceptions about the taxi industry and its drivers. The Department had the responsibility to rewrite history and change the image of public transport.

The meeting was adjourned.


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