Outa calls for ‘open cards’ amid Gautrain changes

As the Bombela Concession Company’s contract for the Gautrain ends next March, the Organisation Undoing Tax Abuse (Outa) has called for absolute transparency in the tender process, a possible extension of the Gautrain routes, and the appointment of a new operator.

With the Gauteng government plans in full swing to find a new service provider, the provincial executive council has granted the Gautrain Management Agency (GMA) approval to advertise a new delivery partner for the Gautrain. Underscoring the importance of absolute transparency, Outa CEO Wayne Duvenage said corruption thrived “when there is a lack of transparency”.

“And we’ve had our fair share of corruption within the ANC-led Gauteng government.

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“The public requires the best possible costs of these contracts without compromising the quality of services.

“For this to happen, excellent governance is required,” said Duvenage.

Bombela: Scandal-free…but Gautrain running at a loss

In partnership with the provincial government, Bombela was awarded an initial R25.2 billion contract in 2006, approved by the National Treasury.

Despite Bombela’s scandal-free operation, Duvenage pointed to “the problem of Gautrain’s high prices -never having achieved its original target of 100,000 passengers per day, meaning it has run at a loss since inception.”

R20bn shortfall

“Estimates are that the Gauteng government will have paid around R20 billion to cover the shortfall guarantee required to operate the service over the past 15 years, which is now costing us around R1.5 billion per annum.

“That fee will escalate if the service is to be extended to other stops,” said Duvenage. Levels of service should also be “maintained at a high standard”.

“If the service level standards drop, they will not be able to charge the high fees.

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“While they may get some additional passengers, it will not be sufficient to cover the shortfall.

“Authorities need to be extremely transparent about their plans, routes, expected fees and costs of construction, if they are to proceed with new tenders,” said Duvenage.

According to GMA chief executive William Dachs, the agency was ready to undertake the process to find a new operator.

“Gautrain is the first and only rapid rail network of its scale in South Africa. It is a strategic asset valued at R45 billion.

“Once the current concession expires at the end of its 19.5-year term in March 2026, costs of establishing this long-term asset will have been paid off.

Post-2026 Gautrain project

“This will allow the post-2026 Gautrain project to reap the economic benefits,” said Dachs.

As a transport project, Dachs said Gautrain was “an economic development project focusing on reaching objectives of stimulating growth and job creation, promoting investment and new development”.

He was bullish about the post-2026 Gautrain project “further unlocking economic potential and opportunities”.

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“It will also present an opportunity to build on a highly functional, world-class system and rethinking of the Gautrain business model – ensuring the system not only responds to the current challenges but further cements operational and financial sustainability in the long term.

“The Gautrain will become an even more integral part of people’s daily lives and a catalyst for economic development, growth and economic recovery in the province.

“Kick-starting a procurement process for a new delivery partner will ensure a smooth and timeous transition from the existing delivery partner to the new contract, with no service disruption after
March 2026, said Dachs.