Executive Summary

Currently in South Africa, several provinces and municipalities are in the process of developing efficient public transport system such as the BRT system in order to keep up with the consumer demands. As the minibus taxi industry carries currently 65% of all public transport passengers, they cannot be ignored in these plans. The Vision for Public Transport Legacy: 2007 - 2020 as stated in the National Public Transport Strategy makes the following statement: "Integrated rapid public transport service networks (IRPTN) are the mobility wave of the future and arfe only viable option that can ensure sustainable, equitable and uncongested mobility in liveable cities and districts" (Public Transport Strategy:2007) The Public Transport Strategy and Action Plan aims to spell out how to move FROM an operator-controlled, commuter-based, uni-modal routes TO a user-friendly, fully integrated, mass rapid public transport networks (Public Transport Strategy: 2007). South African Taxi Industry has significantly grown for the past decade. The minibus taxi industry is today the most critical pillar of our public transport. Not only is it the most available mode of transport, but it is also the most affordable. Over the past two decades South Africa's minibus taxi industry has continued to grow at a rapid rate, despite (or perhaps because of) the ambivalence of government policy in this domain. By 1990 the industry was already showing signs of over-saturation in some areas and sparked intense (and often violent) battles between associations of owners, fighting for commuters routes. It is against that background that recent moves to recapitalize, formalize and reduce the size of the industry have come into being. South African government has tried various approaches such Taxi Recapitalization to regulate and bring stability within the taxi industry. To some extent it worked in minimizing "not so roadworthy" minibus taxis, but it made minimal impact on continuous disagreements between Taxi owners and operators. The disagreements arise from unfounded facts and speculations regarding:

The location of the mini bus taxi at any given time or distance travelled by minibus taxi;

The total amount to be received by the owner

The wage or salary to be received by the operator

The ability to search for taxi Drivers that are on the market.

The manner in which the minibus taxi has been operated.

These on-going disagreements are due to the lack of information and they pose as a serious threat to the industry itself.

Facts and numbers in the minibus taxi industry:

The taxi industry consists of minibuses, dominating 90% of the market, and metered taxis active in the remaining 10% of the market.

Public transport by taxis account for 65% of the transport total, 20% by bus and 15% by rail.

The industry consists of approximately 400 000 public minibus taxis.

Majority of minibus taxis operate on a fixed route, charging a fixed local rate.

Most minibus taxis carry plus minus 14 passengers.

The South African taxi industry is estimated to have a turnover of more than R16,5 billion.

The minibus taxi industry in South Africa is comprised of more than 80 000 owners and 500 000 employees.

To date, the organization of informal economy actors (workers and employers) in South Africa's taxi industry is fairly limited. A minority of taxi workers is organized by two national trade unions, the South African Transport and Allied Workers' Union (SATAWU) and the National Taxi Drivers' Organization (NATDO). They claim a combined membership of 35,000 (20 per cent of the workforce) but paid-up membership is considerably less. A new unified body representing around 90 per cent of owners across all nine provinces - the South African National Taxi Council (SANTACO) - was established in September 2001. Over the past years the industry has undergone a significant process of formalization. SANTACO plays an important role of building a relationship between the Taxi industry and government authorities in order to deal with many problems issues it faces. It is important to note that SANTACO is distinct from any previous national taxi-owner body, in that it is explicitly a business association - and not an organization focusing primarily on access to routes. SANTACO constitution states that, as an employer organization, it should register as such with the Department of Labour. The future implication here is that SANTACO will take on the role of collective bargaining partner with labour. Similarly, the standard constitution that SANTACO has drafted as a guideline (for all local taxi-owner associations) defines the local bodies as employer associations. This will become crucial in future, when a collective bargaining relationship eventually emerges between organized owners and organized labour.

Employment

On the assumption of 1.5 employees for every operating minibus taxi vehicle, there are approximately 500,000 workers in the minibus taxi industry. Employment relations tend to be precarious and, for most workers, no formal contract of employment exists. There are no national minimum labour standards and no standard formula for wage payment. Workers comprise of operators (drivers), queue marshals, vehicle washers and, in some areas, fare collectors. Responsibility for the employment of the different categories of worker is divided between the taxi owners, their associations and drivers. Drivers constitute the majority of workers in the industry. The ratio of owner-drivers to wage-employed is not known, but there are considerably greater numbers of wage employed than self-employed drivers. Wage-employed drivers are employed by individual owners and are paid in four different ways:

1. Some drivers receive no basic wage, but pay a fixed percentage of the week’s takings to the owner, keeping the rest as income.
2. Under the ‘wage/plus system’, the driver receives a basic wage and pays a portion of the takings to the owner, keeping the rest as income.
3. A fairly uncommon system is where all the takings are handed to the owner and the driver receives a regular wage.
4. The driver may hand over all takings to the owner, except the takings of one designated day in the week

Problem Statement

With the above being said, the following have been identified as the root cause for most of the problems that the minibus taxi industry faces on a daily basis.

1. Lack of Documentation. Both Taxi Owner and Taxi Driver claim that the lack of documentation such as employment contracts and payslips is the route of all problems. Both Taxi Owner and Taxi Driver state that the employment contract creates room for unrealistic expectation regarding wage, working hours and operational costs such fuel, car wash and minor mechanical maintenance issues. Taxi Drivers further state that lack of payslips prohibits them from accessing credit such as Homeloans and Vehicle finance.
2. Inadequate reconciliation process. Taxi owners claim that up to 50 per cent of takings are stolen by drivers. They very often publicly justify the low wages paid to drivers by arguing that drivers pocket large sums of cash. Drivers interviewed do not deny that some of the takings are pilfered, but they say that the scale is far smaller than the owners claim. They also argue that low wages force them to pilfer. Such counter-claims and differences in interpretation are fuelled by the absence of reliable information on the real takings of the industry.
3. Lack of Trending. Through interviews and analysis it has been determined that the lack of trending as far as the business performance is concerned often leads to poor decision making. Most Owners do not know when are their businesses at peak, which minibus taxis are making more money, when is it the right time to invest more or save.
4. Unstructured recruitment process. Currently it is difficult for Taxi Owners to find Taxi drivers that are on the market and it is also difficult for Taxi drivers to find available minibus taxis. Taxi Drivers have no point of reference regarding their experience that can be presented upfront to the Taxi Owners such as CV’s. Taxi Owners are unable to assess Taxi drivers upfront before employment agreement is reached.
5. Lack of Business to Business (B2B) relationship. The South African minibus taxi industry has had a rocky and strife-ridden history, characterized by violent confrontations between competing owners and shaped by exclusion from the formal economy. This has also created a bad reputation for the industry – making it difficult for other businesses such as retail shops to create business relationships with Taxi Owners. Most commuters are using minibus taxis to go to work or malls where there are various business or to see their loved ones. Currently there are few taxis gaining extra income through branding for marketing purposes. This is due to the fact that it is often difficult to determine the number of people that have viewed the branded minibus taxi. This has created some doubts to various businesses that are seeking to market their brand.
6. Lack of monitoring anytime and anywhere by the Taxi association. The Taxi Association which is the regional body corporate under SANTACO has also indicated that they are unable to monitor the minibus taxis anytime anywhere (real time) regarding the routes that they are supposed to be operational on.

The Solution

Both employers and employees in the taxi industry acknowledge the need for a more structured relationship: "We take labor issues very seriously. We want to see conditions improve through collective bargaining. Better conditions and better returns for owners and drivers go hand in hand". TomTracks PTY (LTD) is an exciting company that has devised a mechanism that will solve the on-going problems within the South African Taxi Industry. This mechanism is in a form of Information System called TomTracks that is made up of both hardware and software. Tomtracks which stands for Taxi Occupancy Monitoring and Tracking Solutions provides access to the following key information:

• The physical location of the minibus taxi
• The number of passengers in the minibus taxi
• Additional details such Owners and Drivers details.