Jaspreet Kindra
The Gauteng government’s proposed multibillion-rand fast train project linking Pretoria and Johannesburg to be funded largely by the private sector has a catch.
Should the project fail to achieve its expected target of 60 000 passengers a day, the government will have to compensate the losses of the private sector operator in terms of a “ridership guarantee”. Questions have been raised about whether the “elite” rail project will attract enough passengers to make it viable.
Gauteng Premier Mbhazima Shilowa this week presented his Gauteng Rapid Rail pet project, which he hopes will be up and running by 2006, to international investors at a conference in Sandton. The project is aimed at the upper end of the market commuters who now use private cars. The idea is to attract at least 60 000 of the 300 000 commuters who ply the route between Pretoria and Johannesburg daily.
Jack van der Merwe, head of the provincial Department of Transport, says the ridership guarantee is the “only risk” to the state and the taxpayer. He maintains that the department has confidence in the results of its own feasibility study: “We are sure the situation will not come to that.”
But Pretoria University’s Professor Romano del Mistro, who presented a paper on the project at a recent national transport conference, asks the critical question: “Will the patronage really materialise? Shouldn’t we develop a public transport culture before we launch this train initiative?”
Del Mistro has also raised concerns about how much of the capital burden estimated to be about R7-billion will be borne by the taxpayer. He suggests a high-quality, high-speed bus service operating on dedicated lanes passing motorists delayed in rush-hour traffic will provide a very visible public transport alternative.
Jane Barrett of the South African Transport and Allied Workers’ Union voices similar concerns.
“Is this the best allocation of transport resources?” she asks, pointing out that subsidies to buses have been reduced and allocations to provinces for bus services have been reduced.
Barrett also asks if provinces should be allowed to embark on such projects outside the framework of a national transport strategy. She feels the establishment of a dedicated bus and taxi service would probably go a longer way in dealing with traffic volumes in Gauteng, currently growing at 7% a year.
However, Van der Merwe is adamant that no costs besides the potential subsidy arising from the ridership guarantee will be borne by the taxpayer. He says when private sector proposals are called for at the end of the year, the consortium asking for the smallest contribution from the state will win the bid. Some newspapers have reported the provincial government has already pledged R1,2-billion to kick-start the project.
Del Mistro says there is very scant detailed information available on the project.
“This is probably due to the political process of approvals [and] the need for fair competition between future private sector bidders. Nevertheless, there is a need for some public debate on a project of this scale.”
Peter Copley, transport analyst with the Development Bank of Southern Africa, says the decision not to disclose the cost of the project was a “conscious one” to get the best bid. He says he feels “fairly bullish” about the project even if it is “elitist”.
Copley says that one must take a long-term view.
“We have to get started somewhere.” Taking into consideration the enormous funding that the infrastructure will require, the project can only get started as a mainly private sector initiative, he argues.
“Targeting the upper end of the market was the way to get the private sector interested.”
Van der Merwe argues that if the project were not feasible, it would not have evoked the interest of the world’s largest rail manufacturing companies such as Alstom, Siemens, Bombardier, Skoda and Nisho Iwai (who represent Mitsubishi and Hitachi), all present at the investor conference this week.
Some representatives at the conference were enthusiastic. Bombardier’s John Cartwell said it was one of the best presentations he had attended. Bernard Gantois from Paris’s Transport Authority said his organisation would want to be a part of the project but wanted the Gauteng government to provide an exchange rate guarantee.
The new track connecting the existing Pretoria and Johannesburg stations and the airport will wind through 11km of underground tunnels and for 5km over bridges with branches to Johannesburg International airport and Hatfield outside Pretoria. The train will travel at speeds of more than 160kph.