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BUS SERVICES IN JEOPARDY AS GOVERNMENT FAILS TO ABIDE BY COURT ORDER

26 Jan Transport

Following the State’s refusal to comply with an Order of the Court in which it was ordered to pay monies due to Golden Arrow in terms of the interim contract, the company has once again had to approach the High Court to seek an urgent order which will force the State to comply with the initial High Court order. The matter is extremely urgent and has been set down for 28 January 2009 in the Cape High Court.
Failure to comply with the 16 January 2009 court order and, consequently, the non-payment by the State of more than R92 million in unpaid passenger subsidies due to Golden Arrow will have a crippling effect on the public transport system in the Cape Town metropole. Unless Golden Arrow receives the funds due on or before the end of January 2009 its capacity to continue rendering passenger services will be severely damaged and it can not guarantee that it will be in a position to continue operating beyond that date.

In the application the company seeks an order declaring that the State is not entitled in law to frustrate, block or refuse to render the necessary assistance to implement and effect the said payments which it by settlement, agreed to pay as per the court order handed down on 16th January 2009. The delay in effecting the payment appears to be as a consequence of rifts between National Treasury and the National Department of Transport, where it is apparent that despite the court order, the former has refused to release funds.

Golden Arrow’s capacity to provide public bus services would be severely compromised if the company does not receive the outstanding monies by close of business on January 30th. Golden Arrow employs approximately 2 800 employees and operates its public transport system on in excess of 900 routes throughout the Cape Metropole. All employees will be in danger of losing their jobs and in this eventuality; hundreds of households and many thousands of household members will be detrimentally affected and seriously disrupted. This will also have a devastating effect upon the approximately 260 000 passengers making use of bus services on a daily basis and it will result in a transport crisis in the metropolitan area as there is no readily available transport alternative as the remaining transport services available to the public are simply not adequate to deal with the need that will arise.

Issued by: B W Gie, Executive Director

Media enquiries: Vuyisile Mdoda

(021) 507 8819 or 083 279 4818

Date: 26 January 2009