Laphum’ilanga Transport Services, the umbrella taxi body that used to run Nelson Mandela Bay’s bus system, could get a R20m boost from the municipality, if the National Treasury agrees.
A report to the council, which was subsequently withdrawn, recommends that Laphum’ilanga be paid R10.8m for technical assistance and R9.5m for historical debt.
The money, according to the report under the signature of acting city boss Peter Neilson, is for technical assistance meant to be given to the firm in 2015 and 2016.
The news comes as Laphum’ilanga was recently facing attempts by creditors to have it liquidated for unpaid debts.
The matter was on the court roll of the Port Elizabeth High Court for February, but the body had since managed to settle some of its accounts with the firms it owed, attorney Kuban Chetty said.
Neilson, meanwhile, wants the council to give him the go-ahead to discuss and negotiate with the National Treasury and department of transport to approve the payment.
At Tuesday’s council meeting, Neilson said he was not aware of threats of liquidation against Laphum’ilanga.
“I wasn’t aware at all. My input to the item was after a memo was sent to me to ask that negotiations start.
“If there is some form of liquidation it would be a huge problem for us,” Neilson said.
In the report, Neilson recommended that the council approve the process of allowing the IPTS director for the transport sector to confirm and allocate the budget.
Neilson wrote: “. . . To assist the taxi operators to finalise final planning for the establishment of a formalised integrated transport system, it is considered necessary to continue to provide financial support for technical assistance and that Laphum’ilanga should be allocated a budget of R10.8m for the period January 2016 to 31 December 2016.”
The report further states that the national transport department supported the move.
The council later decided to withdraw the item as it was not on the agenda and had not been caucused by the various parties.
Laphum’ilanga chief executive Gregory Rockman said on Monday it needed the money to pay creditors.
“What we are owing people we must pay. We explained this to the previous and current mayor,” Rockman said.
He said the body was owed the money for a number of items it developed for the city in the 2015/2016 period, including drawing up operational plans, business plans and models. It also designed bus shelters for the IPTS routes.
“As you work, you build up costs . . . and there is an agreement that when the industry is negotiating for [the transport system], it must be assisted with funding,” Rockman said.
He said it started with the negotiations for the money in 2015 and there was an undertaking from the city at the time that the money would be paid over. At a mayoral committee meeting on June 15 2016, the agreement for technical assistance to Laphum’ilanga was, however, deferred and never revisited after the 2016 local government elections.
“We got a cold shoulder when mayor Athol Trollip and them came in.
“And when the new mayor [Mongameli Bobani] came in, I engaged them and showed them everything, that we did our work.
“All of this money now is historical costs,” Rockman said.
Laphum’ilanga, which used to run the city’s integrated public transport system (IPTS) on behalf of about 10 taxi associations, was booted out as the industry representative when the DA-led coalition took over the administration.
The body was formed specifically to represent the taxi associations and relied on the city and department of transport for funding.
But when the DA-led coalition took over, the municipality started negotiating with individual taxi associations instead of Laphum’ilanga, and eventually a new vehicle operating company was formed – Spectrum Alert – which is running the Cleary Park route.
The ANC councillor in charge of the roads and transport portfolio, Rosie Daaminds, said the report was withdrawn because it was poorly drafted.
“We decided to withdraw the item so we can debate it in the standing committee.
“For now I don’t have more information.
“I am awaiting information from officials on why it got to council when it was poorly drafted,” Daaminds said.
“I need to understand why it was poorly drafted, even though the paper trail shows that it was discussed in 2015 and never made it to council, I still need to read through it.”
Daaminds said the fact remained that the city did owe Laphum’ilanga money for work that it had done.