A rapid fix for Gauteng’s transport

Glynn Davies

Africa’s first high-speed railway has drastically reduced journey times for travellers commuting between South Africa’s commercial and administrative capitals. Despite escalating costs, construction delays and lower-than-predicted passenger numbers, Glynn Davies believes Gautrain is a socio-economic success – worth the wait and every rand invested.

Gautrain, located in Gauteng, South Africa’s most highly populated and economically vibrant province, is a rapid rail system of some 80 km (15 km of which are under­ground) with ten stations. It provides a link between the central business districts of Johannesburg and Pretoria, as well as serv­ing OR Tambo International Airport (ORTIA). The plans for Gautrain were announced in 2000 by Mbhazima Shilowa, then Gauteng premier, and hailed as a project of strategic importance to the province’s development agenda.

It was envisioned that this modern transport network would improve accessibility and mobility for economically active per­sons, encouraging them to forego car travel, thus reducing road congestion and associated environmental impacts. Broader out­comes included increased employment and urban development opportunities.

Because of the magnitude and complexity of the project, the Gauteng Provincial Government (GPG) requested detailed proposals from potential partners. The Build, Operate and Trans­fer agreement was signed late in 2006, for a 15-year period, with the Bombela Concession Company (BCC) – owned on a 50-50 basis by local and international partners, including Bombardier and Bouygues Travaux Publics. BCC, as the main contractor, is responsible for the implementation of the entire project, in­cluding design, construction, operations and management. GPG maintains oversight through the Gautrain Management Agency. At the time, the deal was the biggest public-private partnership in Africa. Construction on the first phase – connecting Johannes­burg’s northern suburbs of Midrand and Sandton with ORTIA – commenced in September 2006.

Although Gautrain had been conceived, planned and signed off before South Africa was awarded the 2010 Fifa World Cup, it clearly was important to the overall success of the event – a financial incentive ensured the first phase between Sandton and ORTIA was opened on 8 June 2010, just before the opening match. The service from northern suburb Rosebank to Pretoria commenced in August 2011, while the remaining link between Rosebank and Johannesburg, delayed due to water leaking into the tunnel, opened in early June this year.

Cost escalations have clearly been significant, and getting a firm indication of figures is difficult. In 2002, estimates ranged from ZAR2.2 and 4 billion ($250-500 million), but then rose at an alarming rate. By 2003, after the completion of environmental impact studies, they were revised to ZAR7 billion ($800 million). By 2005, they reached ZAR20 billion ($2.4 billion). And in 2006, the approved cost estimate was ZAR25.2 billion ($2.9 billion), which seemingly stabilised in 2011 at ZAR25.4 billion ($3 bil­lion). The opaqueness of the process clearly worried the parlia­mentary transport committee. In 2008, its chairman remarked that it was his impression that the cost had, “quietly below the radar screen”, increased to ZAR35 billion ($4 billion). With claims for extra work and counter-claims for non-performance outstanding, the agreed final cost is still some way off.

During the period 2006/07 to 2011/12, Gautrain received ZAR25.9 billion ($3.1 billion) on a 50-50 basis from the national and provincial governments – this, together with the approxi­mately ZAR3 billion ($360 million) borrowed by BCC, gives an approximate total cost of ZAR28.9 billion ($3.4 billion). Com­paring the public contribution with total national expenditure of ZAR73.8 billion ($8.7 billion) on public transport within that period shows that Gautrain absorbed almost a third of the coun­try’s spending in this area, including all publicly funded capital projects and operating subsidies.

Over and above this, GPG provided a guarantee to BCC for lost revenue should passenger numbers fall below an agreed minimum level. Early forecasts had predicted a daily ridership of 100,000. By February 2012, however, the real figure was closer to 38,000 a day, and the subsidy for the year ending March 2012 amounted to ZAR280 million ($33.2 million). Notwithstand­ing delays in the opening of the final phase of the line between Rosebank and Johannesburg, and the failure to implement a toll­ing system on Gauteng’s highways (which, it was hoped, would encourage drivers to migrate to the Gautrain service), passenger numbers are rising and consideration is even being given to in­creasing train frequency as well as seating capacity at peak times.

With the recent opening of the Johannesburg link, the whole system is now up and running, and criticism that the project doesn’t cater for township residents has, to some extent, been addressed. Firstly, residents of Alexandra township, north-east of Johannesburg, have their own Gautrain station – Marlboro – and can now commute directly into Johannesburg and Pretoria safely and in comfort, though at a cost somewhat higher than a minibus taxi fare. Secondly, the relatively new Bus Rapid Transit (BRT) has routes linking parts of Soweto – home to a third of Johannes­burg’s population – to the city centre.

Although BRT and Gautrain stations are in close proximity, they are not deliberately linked, and thus the operations do not yet provide a seamless public transport service. Nevertheless, the opportunity exists to aggressively improve the planning for and management of an integrated network.

In light of all this, was Gautrain the most appropriate project for the time and challenges? Although technically, the project meets the highest standards, the process of priority-setting and decision-making left much to be desired. But that is not to say there have not been or will not be enormous gains.

During the initial stages, it was estimated that Gautrain had created or protected around 30,000 jobs across the board, from artisans to senior level professionals. Although some of these were temporary, there was the benefit of skills transfer. Having a reliable transport system in place is leading to enhanced inves­tor confidence. It is increasing the levels of development activity around stations. The concomitant increases in property values in these areas are translating into higher municipal revenues, which in turn are providing for more social spending. And, for those people journeying between Johannesburg and Pretoria, instead of spending 90 minutes travelling by car they can now make the same trip, in comfort and safety, in just over 40 minutes.

In short, the costs have been high but the opportunity is there to ensure that the investment returns are not lost. Political com­mitment, planning, financing and management must now focus on integrating the various transit systems – providing through-tickets, the close coordination of timetables and a common pas­senger information system – so that Gauteng benefits from a true public transport service.

About the author:

Glynn Davies is public policy analyst, focusing on urbanisation and development in Southern Africa


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