Article by: Natalie Müller
Transport Minister Fikile Mbalula has this afternoon held a virtual meeting with MECs responsible for transport, to discuss the recently announced R1.135billion Taxi Relief Fund. This following threats made by Taxi Associations to shut down operations due to dissatisfaction of Relief Fund offer.
The Coronavirus Pandemic Outbreak in South Africa and across the globe, has had a negative impact on many industries and has caused a financial collapse in many businesses.
Equivalent to other industries the South African Taxi Industry has also suffered a loss of income, due to the lockdown regulations imposed by the President in an attempt to stop the spread of the deadly virus.
As per lockdown regulations Transport Minister, Fikile Mbalula had to rescind his decision to allow minibus taxis to carry 100% capacity of passengers – saying that taxi operators must now ensure they only carry 70% of commuters per vehicle at all times during the lockdown period.
Mbalula announced earlier this week, A massive R1.135billion Taxi Relief Fund that government is availing to the industry in an effort to mitigate the impact of the COVID-19 outbreak on the sector. Members of the sector voiced their dissatisfaction with the offer, which led to the proposed Taxi Relief Fund being met with rejection by senior members of the taxi industry, saying they want more.
Since the announcement of the relief fund, Taxi Associations across the country have released notices to commuters, that they will be embarking on a National strike as of Monday 22 June 2020 and none of their vehicles will be operating on this day.
The taxi industry contributes largely to the GDP of the country. Economic data indicates that the transport, storage and communication sector contributes 9.3% to South Africa’s GDP, whilst transport alone contributes about 6.5%.
The Minister said reaching an agreement within government for this relief support for the taxi industry was a difficult process, which involved extensive lobbying and convincing the relevant authorities on the importance and need for this fund.
“Most of the special relief funds for sub-sectors provides on average maximums of about R350 million in comparison to what’s on offer the taxi industry,” he said.
Mbalula confirmed in his address this afternoon that increasing the amount that has been availed to the taxi industry as a relief measure, is not an option.
He said that the door is still open for the industry and government to engage on different ways to maximize value for the industry during this lockdown period.
Our collective effort and focus must be on directing resources towards the long-term sustainability of the industry. We reiterate our commitment to introducing subsidy as part of the long-term empowerment model of the taxi industry. – Fikile Mbalula
“We have achieved unity in the taxi industry but we have not achieved formality in terms of its operations” – said Mbalula
We have equally made a firm commitment that we are moving towards a funding model that will ensure that the taxi industry is subsidized.
This is part of the long-term commitment government is making to the industry, which must be underpinned by an accelerated process said Minister Mbalula.
This is a developing story, please refresh page for updates.
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