Challenges faced by small-bus operators in participating in the formal public transport system

Jackie Walters,Lesiba Manamela

doi:10.4102/jtscm.v10i1.227

Jackie Walters, Lesiba Manamela

Open Access

https://doi.org/10.4102/jtscm.v10i1.227

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Abstract

Background: Small-bus operators (SBOs) in South Africa operate on the periphery of the economic mainstream of scheduled subsidised commuter transport, and little progress has been made in getting these operators into the more formal subsidised industry. There is also a lack of information about the challenges these operators face in participating in the public transport industry.Objectives of the research: The main objective of the research was to conduct a survey among SBOs to obtain a better understanding of the challenges that they face in participating in the public transport industry.Method: A telephone survey of operators was undertaken to ensure an adequate response to a structured questionnaire. In analysing the data, we made use of Factor Analysis and the Statistical Package for the Social Sciences (SPSS) to undertake general statistical analysis.Results: The main results of the survey indicate that SBOs face significant financial and operational challenges. There is also a perceived lack of government support for SBOs. Major conclusions are that the Department of Transport (DoT) ought to address issues related to the complex governmental reporting and legal requirements for small business. In addition, government ought to be creating ‘space’ for SBOs in the design of contracts and actively encouraging the formation of consortia’s or partnerships, among the SBOs and/or between SBOs and established bus companies. Government, and especially the DoT, ought to more actively market the governments’ small-business support systems and procedures together with financial aid schemes to assist SBOs in acquiring or replacing buses.

Highlights

In South Africa, following the transition to majority rule in 1994, a White Paper was developed to consider the development of small businesses
The captured data were subjected to factor analysis using Principal Axis Factoring and Oblique Rotation (Oblimin with Kaizer Normalisation) to understand the latent structure of sets of variables contained in the questionnaire
It was assumed that the underlying factors per set of variables are related, that is, the factors were allowed to correlate. (This was confirmed by relatively high correlations between the factors for each scale.) The KaiserMeyer-Olkin (KMO) measure of sampling adequacy was used to determine the suitability of the data for factor analysis

Summary

Introduction

In South Africa, following the transition to majority rule in 1994, a White Paper was developed to consider the development of small businesses. The White Paper mentioned small business constraints as consisting of (among other) ‘the legal and regulatory environments confronting SMMEs, the access to markets, finance and business premises (at affordable rentals), the acquisition of skills and managerial expertise, access to appropriate technology ...’ (White Paper on National Strategy for the Development and Promotion of Small Business in South Africa 1995, Par 2.31). The ensuing National Small Business Act (Act 102 of 1996) established the National Small Business Council to promote the interests of small business and the Ntsika Enterprise Promotion Agency. In 2004, the Small Business Development Agency (SEDA) was established by means of the National Small Business Amendment Act (Act 29 of 2004). Small-bus operators (SBOs) in South Africa operate on the periphery of the economic mainstream of scheduled subsidised commuter transport, and little progress has been made in getting these operators into the more formal subsidised industry. There is a lack of information about the challenges these operators face in participating in the public transport industry

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