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IOLProperty - South African Property For Sale
Thursday Jun 07, 2012

Myciti could need R500m annual subsidy

Once Cape Town's MyCiTi service is fully implemented, it could need a R500 million yearly subsidy.

The money would not only come from city coffers but would include funds from the national government.

It is similar to the amount received by other public transport operators, like Golden Arrow.

During a finance portfolio committee hearing this week, Cape Muslim Congress councillor Yagyah Adams questioned what the deficit would be once all four phases of the city's public transport system were complete.

John Martheze, an official with the transport, roads and stormwater department, said R500m had been projected. This was similar to the subsidy Golden Arrow was getting, and parts of Golden Arrow would be incorporated into the MyCiTi service.

"This will be the total deficit from all funding sources, not just the city," Martheze told the committee.

Adams said the amount seemed high andasked for clear estimates for the deficits by 2020.

"Are there any plans to make the service more sustainable? Because R500m(a year) seems a lot for the rest of our days."

Martheze replied that it was very unusual for a public transport system to be totally self-sufficient.

The DA-led administration came under fire for the running costs of MyCiTi last week during a council meeting where the budget for the new financial year was approved.

In the next financial year, starting in July, the Integrated Rapid Transit system was allocated R1.2 billion.

During the meeting, Brett Herron, the mayoral committee member for transport, roads and stormwater, said the service was never intended to generate a profit.

The MyCiTi service operates in Table View and the city centre. Last month, it had been operating for one year. Three million passengers have used the service since its launch.

By 2013, the city said it would roll out its Metro South East route to serve Mitchells Plain and Khayelitsha.

During the portfolio committee meeting this week, Martheze said the project timelines were on track.

"We try to identify the challenges and risks, and mitigate risks."

The Argus

 
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