eThekwini commuters pay for council’s contracts

The eThekwini municipality and a group of taxi bosses have not stitched up a cosy R27-million consultancy deal to divvy up city routes. “There’s no deal,” said Thami Manyathi, who heads the Ethekwini Transport Authority (ETA). 

Not yet.

Manyathi was responding to information leaks about a contract the ETA wants to award without putting it out to tender. It is one of a number of issues that have created simmering discontent about public transport in Durban. A member of the KwaZulu-Natal legislature has called for a commission of inquiry into Durban public transport, describing it as “shambolic”.

Some taxi operators are livid over a proposal the ETA has submitted to establish the eThekwini Metro Taxi Council (EMTC) Investment Company. The ETA proposed in June last year that the company be appointed without tendering to provide “change management advisory services” to taxi operators affected by the much-vaunted GO!Durban people mover.

Late last year, disgruntled taxi operators leaked documents related to the proposal, expressing anger at the ETA’s unwillingness to engage with them on the issue. They claimed Manyathi was ducking them and questioned how the company was identified for the work. 

Public transport in Durban, bedevilled by two successive crony contracts, is regarded as wide open for corruption, taxi bosses said, echoing councillor concerns and the call for a commission of inquiry. The ETA was flagged by the auditor-general in 2018 for irregular spending relating to the R3-billion GO!Durban integrated public transport network. 

The ETA has come under fire for delays associated with the construction of bus stations and negotiations with taxi associations. The ETA’s EMTC proposal envisages a payment of R27 million over three years to an investment company with five shareholders, each with a 20% stake in it. In its motivation to appoint the company, the ETA admits it has wasted money on previous advisers, though it doesn’t say how much. 

The EMTC company was set up exclusively for the purpose of the contract. It has never traded before and has no financials, according to city documents. Manyathi said the company is needed as a legal entity with which the city can engage.

Consultants proved ineffective

The ETA’s motivation to appoint more advisers has drawn fire because the entity admits in its EMTC company proposal that previous efforts by consultants to advise on the taxi industry have flopped. This is because taxi bosses want to operate “as individuals because of mistrust between the government and the industry”.

To mitigate against this, the city had appointed technical advisers but they had not given “value for money and often proved ineffective”. Advisers were compensated while the industry leaders did the work, the ETA proposal states.

Manyathi said EMTC company shareholders would be the heads of regional taxi associations based on South African National Taxi Council (Santaco) structures. He said the contract could not be put out to tender because “not anyone can do this work; it requires expertise”. 

A previous contract with a company called Siyazi, worth about R36-million over five years, was flawed because industry leaders weren’t involved, said Manyathi. The EMTC proposal, he added, will remunerate taxi bosses who sacrifice time from their private businesses. It will also draw on outside expertise, including legal services. 

Manyathi was asked why the city needs advisers to deal with taxi operators, who have a reputation for being savvy entrepreneurs and making money. He said taxi operators are “astute” businessmen but their informal background means they need help navigating complex legal agreements.

Individual references submitted to the municipality as part of the EMTC proposal show the company’s so-called experts have experience in mining and teaching. Manyathi said the municipality was initially not convinced of using the EMTC company or its capacity to deliver, but he hopes the new city leadership is “coming around” to his motivation.

The ETA’s proposal envisages paying EMTC representatives between R1 400 and R2 000 an hour, which Manyathi said is a nationally set rate. The EMTC’s costs of R27-million, the proposal says, is budgeted at R10-million a year for the first two years and R7.6-million for the third year. The spend includes R2-million for project management; R4-million for business restructuring; R4-million for data collection and business plans; R5-million for change management advice; R2-million for capacity building and training; and R3-million for specialist consultants.

“It is far from a cosy deal to benefit a few,” Manyathi insisted. “We hope to have allayed concerns so it [EMTC] can proceed.”

He said the company is critical to get the GO!Durban network going. It will create a model for engaging taxi operators by dealing with stakeholders in the city’s western passenger corridor, from the city centre towards Pinetown and beyond. Manyathi denied that taxi operators are unwilling to deal with the city. 

Violent taxi competition kills many 

GO!Durban promises to reduce violent taxi competition, Manyathi added. More than 100 taxi drivers and taxi bosses have been assassinated in the Durban west region in recent years, according to the provincial department of transport.

Violence monitor Mary De Haas has already flagged the 2015 murder of two Durban Santaco members, Charles Khuzwayo and Azarius Sangweni, from Clermont-KwaDabeka in the west. Both men were shot dead after they criticised taxi-related agreements, leading De Haas to ask who legitimately represented taxi stakeholders.

National Taxi Alliance (NTA) spokesperson Theo Malele accused the government of being in “cahoots” with Santaco and excluding the alliance. He said the EMTC could not claim to be either representative or have a monopoly on industry knowledge.

“Who are they? It is a matter of time before this blows up in the government’s face. We will watch this like a hawk. It is taxpayers’ money,” said Malele. 

Last week, KwaZulu-Natal transport MEC Bheki Ntuli said he has set up a task team to address the taxi violence in the west. The team, he said, will draw in his department, Santaco and the ETA. Santaco’s Durban West chairman, Mathula Mkhize, said the killings are caused, by, among other things, organisational challenges.

Calls for Durban transport inquiry  

Manyathi said communication about city transport isn’t optimal. If it were, he added, people wouldn’t be asking as many questions or “making up stories”.

This concession coincides with a call for a commission of inquiry into public transport in Durban. 

Themba Mthembu, the KwaZulu-Natal secretary of the South African Communist Party and a member of the provincial legislature, said at the weekend that he would be asking Premier Sihle Zikalala to institute such a commission.  

Ongoing taxi killings, bus fare increases, city contracts and service disruptions showed public transport in Durban is “a shambles”, Mthembu said. “We are highly disturbed by the handling of transport matters in eThekwini. It is a nightmare and we need to ask who has benefited [from] decisions. Is it the commuters of Durban or some individuals?”

The municipal bus system in Durban has been beleaguered since the ANC sold it to a party benefactor in 2003 for R70-million, only to buy back the city fleet in 2008 for R405-million. A year later, there were howls of outrage when the bus service was outsourced without being put out to tender to Tasnat, a company owned by Mandla Gcaba, former president Jacob Zuma’s nephew.

In 2015 the city tried to liquidate Tasnat, alleging that Gcaba had taken over the company bank accounts and was using them as his own, a claim he hotly denied. In a June 2019 report to the council’s exco, treasury officials said Tasnat owed the city R371 million. The legal action between the city and Tasnat has been referred to an adjudication process that is still ongoing. 

Manyathi described the service Tasnat provided as “very good”, barring disruptions relating to an ageing fleet. Now the city is in the process of buying 150 new buses, each worth about R3-million. Previous reports put the city fleet at 450 buses, employing 900 people and transporting about 600 000 people a day. 

Tasnat’s service has experienced repeated disruptions because of disputes with the municipality that led to fuel shortages and drivers parking their buses on the freeway in protest against not being paid. In September last year, the eThekwini municipal bus fares increased 8.85%.

Mthembu said: “This now requires intervention. We can only unravel it through a commission of inquiry. The most affected are the poorest of the poor, who have to travel long distances to work. The service disruptions, the fare increases and the vulnerability [of] passengers is actually violence against the poor.”

This article was first published by New Frame.

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Greg Ardé
Greg Ardé is a writer interested in issues of equity, entrepreneurship and how cities function. He lives in Durban and has a diploma in journalism. He started his first media job in 1990 and has since worked for a variety of newspapers and magazines, and written three biographies.

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