The Cape Metropole will face a public transport crisis if the government does not pay Golden Arrow about R92-million in subsidies it owes the company by the end of this month, the company warned.
Golden Arrow’s 2 800 employees could lose their jobs and 260 000 bus commuters on about 900 routes would have to find alternative transport if the company was not paid, executive director Barry Gie said on Monday.

“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,” said Gie.

“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.

The remaining public transport services available are simply not adequate to deal with the need that will arise.”

In August the SA Bus Operators Association was informed by the department of transport that its funding had a shortfall of about R1,3-billion, its passenger subsidy for the 2008/09 financial year would be depleted by November 2008 and that this would have a knock-on affect on the operators’ subsidies for the last four months of the financial year ending March 2009.

Golden Arrow approached the Cape High Court after talks proved fruitless.

On January 15 the parties reached an out-of court settlement which was made an order and which said Golden Arrow should be paid.

Now Golden Arrow has returned to court to force the government to honour the agreement. The company’s urgent application will be heard on Wednesday.

Gie said the court application sought an order that the government not frustrate or block the payment.

Provincial department of transport and public works spokesperson Koketso Sachane said: “There is no question that the money will be paid. The issue is whether the money will come from National Treasury or the national department of transport.

“The provincial department has done all in its power and will continue to try and resolve the matter, as we understand the pressure on Golden Arrow and would want to avoid a disturbance for bus commuters.”

Commuters purchase subsidised clipcards. Tickets sales are verified by independent auditors and submitted to the provincial transport department before the department pays the bus operator what it would have charged if the passengers paid cash.

Source: Business Report – Aziz Hartley