'Bus firms teeter on bankruptcy'
Jan 27 2009 22:03
Cape Town - Thousands of employees in the bus industry could lose their jobs if government fails to pay operators millions of rands in subsidies owed to them, MPs heard on Tuesday.
Briefing the National Assembly's transport committee, Southern Africa Transport and Allied Workers Union (Satawu) representative Jane Barrett said many bus operators would close shop unless the government paid all outstanding subsidies within a week's time.
"If payment is not made within the next week, 26,000 bus workers are in danger of losing their jobs.
"All indications are that if government fails to pay up the subsidies by the end of January, most affected bus companies will have to close," she said.
The Southern Africa Bus Operators Association (Saboa) had embarked on a court action against the department of transport as well as other relevant government departments in a bid to force the state to pay close to R1.2bn in subsidies owed to its members.
Provincial transport departments are said to have told operators in their respective provinces in November 2008 that subsidies would not be paid from December to March, until Finance Minister Trevor Manuel outlined the new budget in April.
Barrett, who said SATAWU was fully behind SABOA's court action, blamed treasury for the crisis.
"The department of transport has been motivating to treasury for an increase in the baseline allocation for bus subsidies since 2004," she said.
Transport committee chairman Jeremy Cronin said while government had all the rights to defend the matter in court, it had a duty to come up with emergency measures to save the industry.
"As a committee we urge treasury and the national department of transport to urgently make, at the very least, some contingency arrangements regardless of what the court findings are," he said.
The committee would invite the two departments to appear before it next week.
- Sapa
