A presentation by Adv Alma Nel (Director: Legal and Policy Research: Gauteng Provincial Government) at the Transport Forum Month of Transport Celebrations 1 October 2015 hosted by University of Johannesburg. The theme for the event was: "Trends in Policy Development for Transport" and the topic for the presentation was: "Making cities more competitive The Economic Case for Public Transport." More like this on www.transportworldafrica.co.za

1. Adv Alma Nel
Making cities more competitive: The Economic Case for Public Transport
At the
Month of Transport Celebrations
School of Tourism and Hospitality, University of Johannesburg
Bunting Road Campus
Auckland Park
1 October 2015

2. Public transport emerged out of the need for commuters to get from one place to
another for social and economic reasons.
In order to avoid disruptions to economic activity these days, while cars dominate
our roads, effective and efficient public transport is critical for getting the workforce
to and from work on time.
South Africa faces significant public transport challenges. One of the challenges is
the effects on the economy and transport availability by one of apartheid’s legacies
of urban sprawl in our cities and the fact that the road systems due to this, still
favours use by private motor vehicles.
Public transport and its economic effects

3. According to the 20 Year Review: South Africa 1994 to 2014, providing effective
public transport systems may be the single most important intervention in
supporting environmental, economic and social sustainability.
By making the economic case for public transport, it shows that public transport is
the lifeblood of a city economy and you cannot have a smart city without
highlighting the important role for public transport. Investment in public
transportation is crucial to improving the quality of life and economic vitality of our
cities.
Effective, efficient, accessible and affordable public transport creates jobs, provides
access to jobs and supports jobs in many other industry sectors helping to stimulate
economic growth.
Public transport and its economic effects

4. Transportation is a part of a complex set of systems which are inter-related and inter-
dependent for their efficient functioning; transport, land use, economic development,
ecological cycle, formation of a healthy society and infrastructural development are all inter-
dependant processes.
Planning scholar Daniel Chatman of the University of California at Berkeley has been studying
the effects of transport on agglomeration. In their paper “Urban Studies”, Chatman and
fellow planner Robert Noland of Rutgers University use concrete numbers to make the case
that transit produces agglomeration based on data from selected American Cities. They report
that this hidden economic value of transit could be worth anywhere from $1.5 million to
$1.8billion a year, depending on the size of the city. And the bigger the city, they find, the
bigger the agglomeration benefit of expanding transit simply because they have more people
sharing the transit infrastructure. On average, across all the metro areas in the study,
expanding transit service produced an economic benefit via agglomeration of roughly $45
million a year.
Looking at this study, could we argue that transport officials now have a much stronger
argument for using taxpayer money to improve public transportation service?
Public transport and its economic effects

5. In theory, public investments in mass transit can make urban economies more efficient by
enhancing employers’ access to a larger labour pool at lower transport costs.
Public transportation services are important in many ways. They provide mobility, can shape
land use and development patterns, generate jobs and enable economic growth, and
support public policies regarding energy use, air quality and carbon emissions.
Public transport and its economic effects
When transport systems are
efficient, they provide socio-
economic opportunities and
benefits that result in positive
multiplier effects such as better
accessibility to markets,
employment and additional
investments.

6. When transport systems are deficient in terms of capacity or
reliability, they can have an economic cost such as reduced or
missed opportunities.
Public transport and its economic effects

7. The National Development Plan (NDP) proposes a number of strategic focus areas in transport
infrastructure, which have to be addressed to achieve the ideals outlined for 2030.
These areas are:
• prioritisation of transport solutions that are safe, affordable and effective options;
• a focus on transport as an entire network as opposed to individual transportation modes;
• a move to finding ways to become less dependent on transportation by improving spatial
planning in cities so that people can live closer to areas of employment;
• convincing South Africans to increase the use of public transport and thereby lower
carbon-intensive transportation mode usage, which will reduce the environmental, social
and economic costs associated with transport.
The NDP says this priority should be continued as well as increasing investment in public
transport, which has already been growing at 15% a year since 2006. The bus rapid transit
systems implemented around the country are cited in the plan as models of the ability to
provide high-quality mass transit systems.
Across all metros there has been a shift towards developing sustainable and reliable
infrastructures that are designed to appeal to commuters of all economic backgrounds, from
Cape Town to Durban to Johannesburg, public transport is undergoing a transformation.
The South African Context

8. During the course of 2011, MEC Vadi had the following to say about public
transport in Gauteng:
“For the first time, the cost of public transport has become one of the top three
items of concern for Gautengers.”
“Transport has become a service delivery issue like education and health. It affects
millions of people in the province. We are ultimately a service delivery department
and have to meet expectations and the growing demands for a high quality public
transport system.”
“My job is to lay out road and transport infrastructure in anticipation of the
realisation of this vision. Cities develop along the transportation routes that serve
them. We have to visualise what is going to happen and how transport would
stimulate economic development. We therefore need to be pro-active and
forward-thinking in our vision.”
The Gauteng Context

9. Transport is a core component of urban living, central to the economy and people.
Years of under-investment in public transport infrastructure under apartheid left a
legacy of ineffectiveness and reliance on private transport.
Throughout Gauteng the following are defining features of our transport systems:
the majority of residents travel by bus, public rail or minibus taxis; and there is a
steady increase in residents who rely entirely on private car use.
Associated with the above features is the public perception that most public
transport is not safe and reliable. This conversely leads to the reality that the
reliance on cars has created widespread congestion.
The Gauteng Context

10. Gauteng is fighting against and continues to struggle to overcome the apartheid
legacy. Massive strides towards this came with the introduction of Bus Rapid
Transit (BRT) systems such as Rea Vaya, A Re Yeng and the coming Harambi, and
the Gautrain high speed rail link between Joburg and Pretoria.
Increasing transport costs also present a problem. However, the introduction of
BRT and the Gautrain provides opportunities and indicates that transport in
Gauteng is developing into a system of high-speed connecting hubs with a strong
support base of feeder services.
We still support Bus nodes through subsidisation. Not forgetting the continued
discussions with the Taxi Operators and Associations to further enhance our
transport system, specifically through the current discussions towards
incorporation of this mode into the public transport operations grant.
The Gauteng Context

11. Gautrain complements and supplements the other public transport modes in Gauteng, allowing
our citizens a safe, efficient and reliable solution.
With the expected global increase in urban populations (increase by 27% over the next 30 years
- UITP, Ticket to the Future), and the rapid urbanisation rates in Africa, the provision of a safe
and secure rail system like Gautrain in a fast developing Gauteng Province, becomes a top
priority.
The Gautrain Feasibility Study found that on average it is five to ten times safer to travel by rail
transport, compared to road transport. Poor transport infrastructure marginalises the poor and
limits certain members of society to move freely, and makes all travel less safe. Gautrain brings
independence to all, especially to women, learners and people with disabilities. It therefore
assists to lower the socio-economic cost of travel to society.
Urban areas contribute towards economic development and wealth creation, but they cannot
perform efficiently without robust public transport networks and services. Gautrain brings
economic benefits in that efficient public transport and lower road traffic congestion increase
productivity and the economic viability in Gauteng and it decreases the out of pocket cost of
transport to the community.
The Gauteng Context

12. Investment in public transport can be expensive, but the benefits are much greater and
projects like the Gautrain help towards achieving long-term economic sustainability.
These secondary factors enhancing the economy include:
•Reduced travelling costs;
•Reduced need for building vast car parks on valuable land in the city centres that could have
otherwise been used as highly priced office or retail space;
•Reduced reliance on rapidly decreasing oil supplies;
•Reduced reliance on imported fuels;
•Job creation;
•Increased property value in and around the core business areas and adjacent to public
transport stations;
•Improved integration between various sectors;
•Community development and upliftment; and
•Improved living standards.
The Gauteng Context

13. In addition to reducing costs caused by congestion, public transport creates jobs
and supports local economies. According to a study by The American Public
Transportation Association, for every R80 million invested in capital projects for
public transport, more than 300 jobs are created with a R240 million gain in
business. In Europe, public transport creates two to three times more employment
opportunities per passenger kilometre than private transport (Ticket to the Future,
UITP, 2009).
Traffic congestion and gridlock accompanied rapid economic growth and the
development of the motor manufacturing industry. Road infrastructure has come
under immense pressure due to competition for road space from industrial, public
and private road users. Access to economic opportunities is adversely affected by
traffic congestion, as business activities move from inner cities to the outskirts,
further increasing the cost of fuel and transportation for all South Africans.
Conclusion

14. The transformation of public transport requires consistent inter-government
cooperation and coordination. This is a daunting task and will require the setting of
clear public transport indicators such as reduced travel times, reduced costs, to
reduce the percentage of household income spent on transport and the
determination by the relevant transport authorities of the nature and size of
vehicles to be used, including regular renewal of the public transport fleet and
access to transport.
Government has committed towards providing South Africans with safe, accessible
public transport. This has been emphasised at national, provincial and municipal
level as an aspect that requires immediate attention.
Conclusion

15. In order to ensure their own economic prosperity, it is up to the
commuter to take advantage of these systems and support their growth,
and to push for a future that doesn't see congested roads, bad traffic and
more unnecessary road fatalities.
Conclusion