Bombela promised millions in 'patronage guarantee'

Millions of rands were promised as a subsidy—termed a “patronage guarantee”—for the Gautrain if there are not enough commuters, the Star reported on Tuesday.

The Gauteng Department of Roads and Transport’s budget for 2011/12 includes R259-million in “patronage guarantee costs” for the Gautrain project.

This is what Gauteng promised to pay Gautrain concessionaire Bombela if there were not enough passengers.

Next year’s guarantee was expected to be R360-million, as this year’s payment takes into account that the Gautrain would only be fully operational from July.

On Monday, Deputy Minister of Transport Jeremy Cronin said such a guarantee had been on the cards but said he had not been aware of the size of it.

“We were never told at what level they were guaranteeing ... We certainly asked that question a great deal.

“Let’s hope it’s ‘in case’, or at worst, transitional,” he said.

Cronin said a huge guarantee would “absolutely not” be considered for other projects.

The provincial department referred queries to the Gautrain Management Agency (GMA).

The GMA on Monday confirmed to the newspaper that the R259-million quoted was for part of the year but would not say how much the full annual guarantee was. - Sapa


Client Media Releases

MTN Business IoT Conference & Awards finalists announced
Junk status: Where we're at
Fun things to do in Port Elizabeth
Housing Consumers Protection Bill submission deadline looming
UKZN students develop taste for 3D food printing
Call for papers opens for ITWeb Cloud, Data Summit & DevOps Summit 2020
The world awaits Thandi Hlotshana