Trade and Industry

Thursday, 01 December 2005

Working Paper 7 - 2005: Models for Private Sector Engagement in the Delivery of Commuter Rail Services

  • Year: 2005
  • Author(s): Karl Venter; Richard Goode

Improving commuter rail service delivery is a high-priority programme of the Department of Transport (DOT). Faced with a failing business, the DOT has launched a reform programme for commuter rail, foreseeing increased public investment and possibly an extended role for the private sector. The object of this working paper is to contribute to the emergence of a robust commuter rail reform programme that is built on sound transport principles. It presents a model for understanding the appropriate role and extent of public transport and the harnessing of the private sector to complement government-led reform.

Commuter rail services provide mass transport for the poorest category of commuters, providing 458-million passenger journeys in 2003. However, the effectiveness of the R2.5-billon spent on the service currently is in doubt. The state of the assets and the quality and extent of services are in decline, approaching a critical state. Dissatisfaction, accompanied by outbursts of public anger, is rising because of slow delivery by government on promised improvements in living and economic conditions of the poor who constitute the majority of our population.

Government has to find sustainable ways to improve performance and increase capital spending on infrastructure and rolling stock. It has recognised the urgent need to replace the current dysfunctional industry structure and has acted by launching a process to merge commuter and passenger rail assets into a single entity, PAXCo, under the control of the DOT.

A technical planning team has begun to develop a business plan for PAXCo. It envisages three phases managed retreat and stabilisation, recovery, and service development and growth. The structures of government, management and supporting institutions have to be equipped to manage the fallout of a situation that will worsen before it gets better. This paper provides an analysis of the situation and proposes a basic model for the successful and sustainable delivery of commuter rail services.