In a tangible demonstration of economic transformation, KwaZulu-Natal Premier Sihle Zikalala celebrated with the Mthonjaneni Taxi Association as it diversified its business operations by entering into the bus transport sector.
Premier Zikalala, joined by the MEC of Transport, Community Safety and Liaison Neliswa Peggy Nkonyeni, MEC for Economic Development, Tourism and Environmental Affairs Ravi Pillay and Ithala Development Financial Corporation (IDFC) executives witnessed the empowerment initiative that will result in taxi owners talking significant shares of the bus sector.
Today, 26 May 2022, marks the official signing of the Memorandum of Understanding (MOU) between the KwaZulu-Natal Department of Transport, Ithala Development Finance Corporation (IDFC) which is under the Department of Economic Development, Tourism and Environmental Affairs. The event took place at the Mthonjaneni Bus Depot, in northern KwaZulu-Natal.
The move is in line with the Provincial Government’s economic transformation goal to have at least 70% of the subsidised bus transport industry being in the hands of the previously disadvantaged individuals or groups.
Speaking during the MOU signing ceremony which was attended by beneficiaries in the bus and taxi industry, Premier Zikalala said today will go down in the annals of history as the citizens of the province witness government’s commitment to expand and transform subsidised public transport for the benefit of all the people.
“It is not a secret that the KwaZulu-Natal economic empowerment goal is to have at least 70% of the subsidised bus transport industry in the hands of previously disadvantaged individuals or groups. This must be seen as part of Operation Vula Umnotho. It is part of our overarching strategy of Radical Socio-Economic Transformation (RET) which seeks to fundamentally change the patterns of ownership and management of the economy in favour of blacks in general and Africans in particular. The Memorandum of Understanding between IDFC and the Department of Transport provides the clearest indication of the Provincial Government’s commitment to bringing more African players into the public transport system, especially the bus transport sector,” said Premier Zikalala.
The transformation of subsidised public transport service contracts is based on the “Strategy for transformation of subsidised Public Transport contracts” which was approved by the Executive Council in April 2012. As indicated earlier, it seeks to achieve 70% participation of previously marginalised groups.
The conclusion of the negotiated contracts was done as per the provisions of section 41 of the National Land Transport Transition Act, Act 5 0f 2009.
Premier Zikalala said the government of KwaZulu-Natal takes immense pride in seeing men and women in the taxi industry and other black South Africans participating in the bus transport industry.
“It is our responsibility as part of government to support them through the Provincial Department of Transport and EDTEA and Ithala Development Finance Corporation. As part of this strategic collaboration, IDFC has been able to provide financial support to the mentioned co-ops to the value of R71,5 million, which consisted of purchasing 32 buses, 4 quantum mini buses, 9 tickets machines, land and building for the construction of a depot for Mthonjaneni Bus Services. Through this collaboration at least 72 permanent jobs have been created. In total newly negotiated empowerment contracts for 11 companies for a period of seven years amounts to more than R 285-million,” said Premier Zikalala.
All the beneficiaries underwent a compulsory incubation programme which covered, amongst other things, the following:
•Understanding the clauses contained by the contract document;
Management of bus operation;
•Fleet acquisition, management and maintenance;
•How to manage a bus business in an effective and sustainable way.
Representatives of the KZN South African National Taxi Council as well as the Mthonjaneni Transport Services, said commended the move by the provincial government adding that the MOU signing is an important instrument for deracialising the bus transport industry and ensuring that it reflects the demographics of the people of KwaZulu-Natal, the majority of whom are Africans.
Issued by the KwaZulu-Natal Provincial Government