The City of Cape Town (CoCT) has completed its preliminary financial analysis and impact assessment report as part of a feasibility study on the devolution of commuter rail services from the Passenger Rail Agency of South Africa (PRASA) to the city.

According to the report, an efficient passenger rail service will save lower-income households on transport costs, while also sustaining 51 493 direct and indirect jobs.

An efficient rail service will also “contribute significantly” to Cape Town’s economic growth, with an R11-billion benefit to the local economy each year. This equates to 4% of the city’s yearly gross domestic product.

The overall purpose of the feasibility study is to guide the city in taking over the management of the passenger rail service from PRASA, and to identify the associated risks and impacts, explains the CoCT.

“Our analysis shows there is an urgent need for national government to devolve Cape Town’s passenger rail for the city to run, and for President Cyril Ramaphosa to keep his State of the Nation promise of ‘solid progress within a year’,” says Cape Town Mayor Geordin Hill-Lewis.

“The lack of a safe, reliable, and affordable rail service is currently costing lower income households R932-million a year in increased transport expenses and opportunity costs.

“This is a completely unnecessary financial burden which can be lifted from the shoulders of residents struggling with the rising cost of living. 

“We call on the President and new Transport Minister Sindisiwe Chikunga to ensure the immediate finalisation of the much-delayed National Rail Devolution Strategy so that the city can get the trains running in the interest of all residents.”

“Not surprisingly, the first deliverable from our rail feasibility study proves beyond doubt that there is a sound business case for Cape Town to have a fully operational and reliable passenger rail system,” adds CoCT Urban Mobility MMC Rob Quintas.

“In fact, the numbers from this analysis demonstrate that we simply cannot afford not to have passenger rail as the backbone of our public transport network if we want to grow our economy, create jobs, and provide lower income households with an affordable transport option.”

According to the preliminary analysis a fully restored and functional passenger rail service will, at present values, save Cape Town and its residents R81.6-billion over a 20-year period.

The biggest saving will be in vehicle operating costs, including fuel and maintenance costs, at R31-billion over a 20-year period.

The second biggest will be in congestion time-saving, at R30.7-billion over a 20-year period

The third biggest is casualty cost savings related to death and injuries caused by vehicle accidents and crashes, at R11.1-billion over 20 years. 

The fourth biggest is vehicle crash cost savings related to repairs and incidents, at R8.7-billion over 20 years.

The study also finds that the fare revenue and other operating income of the passenger rail service is currently about 34% of what it was in the 2013/14 financial year. 

This correlates with the significant drop in passenger numbers over the past decade. 

The labour costs in running the service have not shown the same decline though, and, the shortfall in fare revenue has necessitated a significant increase in operational and capital subsidies from national government, shows the report.