Last week members of the ANC Gauteng uMkhonto weSizwe Military Veterans Association (MKMVA) marched to Luthuli House in Johannesburg, demanding the arrest of Transport Minister Fikile Mbalula, who they accuse of doing nothing about the severely crippled and vandalised Metrorail system run by the Passenger Rail Agency of South Africa (Prasa), a state-owned entity.
We are not interested in the political overtones of the march. What worries us, though, is the virtual collapse of Metrorail operations in the country and the untold harm this is doing to public transport.
It is alarming that as the Department of Transport celebrates Transport Month in October, commuter rail – which should be the backbone of public transport in metropolitan areas – is largely dysfunctional due to rail infrastructure being vandalised by criminal elements and neglected by Prasa. The stringent Covid-19 lockdown over the past few months all but halted public transport operations, adding to the woes of Prasa.
Today most rail corridors in Gauteng, for instance, are not operational. Railway tracks, overhead power cables, signalling systems and station platforms and buildings have been damaged and destroyed and will require billions of rands to get them back into a fully functional condition. The biggest losers are the working class, the unemployed and the poor, who depend on rail as the cheapest mode of public transport for daily commuting.
Metrorail ridership has declined from about 700 million passenger trips annually in the 1990s to around 100 million passenger trips before Covid-19. This is a massive drop in ridership that spells financial doom for Prasa. Adding to the bitter brew are the corporate governance failures at Prasa and startling claims of State Capture of the entity at the Zondo Commission. Prasa still does not have a duly constituted board to oversee its affairs.
Prasa is in serious trouble – of that there can be little doubt. The central question is what are policymakers going to do about it? Prasa is facing a perfect storm, which is a good time for the entity and government to rethink its rail strategy as well as the Metrorail operating model.
International experience since the 1990s in both the developing and developed countries suggest that it is an opportune moment to consider granting rail concessions to operators, at least in metropolitan areas. Let us be clear about it: We are not advocating wholesale privatisation of the commuter rail system in the country. The experience of British rail cautions against such an approach. That also will not be politically palatable in South Africa.
Rather, we are calling for a mutually beneficial partnership between the government and the private sector to rebuild and revitalise commuter rail. We do not believe that the government has another option. It does not have the fiscal resources to invest in rail infrastructure and the billions needed to repair the seriously vandalised system. At the same time, Prasa does not have the institutional capacity to properly govern and administer commuter rail.
Rail concessions in South Africa were first accepted as government policy in the 1996 White Paper on National Transport Policy. This policy resulted in high levels of enthusiasm and debate as it was clearly felt by policymakers and transport stakeholders at the time that commuter rail services would benefit from private sector involvement to the benefit of the system’s users. Unfortunately, the political will to implement the policy faded over time.
With the demise of commuter rail services throughout the country, now is the time to reopen the debate on concessioning. The Department of Transport is drafting a new White Paper on National Rail Policy that foresees rail – freight and passenger services – as the backbone of the transport system. This draft policy supports the National Development Plan and seeks to encourage competition on the existing network via an access regime and unlock private sector participation in the broader rail system. Rail concessions could foreseeably form part of this rethink.
Rail concessions are now commonplace throughout the world: They typically include targets that the concessionaire should achieve such as passenger growth, operational punctuality, cleanliness of trains and stations, safety standards on trains and platforms, high levels of customer satisfaction and sound passenger information. The services rendered are compared to benchmarked objectives and penalties applied when the operator does not achieve the contractually agreed standards.
The duration of concessions will depend on whether the operator provides the train sets. In cases where trains are leased from rolling stock companies, concessions could be shorter in duration. The rail rolling stock that is being built by Gibela in Nigel could typically be transferred to a rolling stock leasing company owned by the state, from where potential concessionaires could lease their rolling stock for the duration of their concessions. This will allow for more competition for such concessions and probably also involve larger bus companies that envisage synergy between their operations and that of commuter rail in their operating areas.
There are growing examples in our country of successful public-private partnerships such as Gautrain; the co-operation on our national roads that have resulted in a world class interprovincial road network and the Independent Power Producers’ Programme for clean energy.
We believe the expertise exists in South Africa to design commuter rail concessions and that the private sector will be a willing player in this field, as it has shown elsewhere in the country’s transportation sector. It’s time to rethink our commuter rail strategy. DM