A state-owned bus company in business rescue is on the verge of collapse, and despite an injection of half a billion rand can't pay staff, who in turn put the brakes on operations by going on strike.
Northwest Transport Investments (NTI) — which runs the North West Star bus company in Pretoria, Mabopane, Hammanskraal and Watloo, east of Pretoria — has not paid its workers since January.
The company has more than 1,000 employees and transports thousands of commuters daily, mainly from the North West along the Gauteng border, including Hammanskraal and Mabopane, into Gauteng.
Workers and the provincial government have now revolted against Thomas Samons, a business rescue practitioner (BRP) appointed in 2022 by the provincial government to turn around the company's fortunes.
North West department of community safety and transport management head Hans Kekana said they want Samons to go.
“The department is not happy at all. As a matter of fact, it has begun legal proceedings to remove the BRP under whose watch the entity deteriorated,” said Kekana.
He said the department does not believe a business rescue process is what is needed at NTI for it to be resuscitated.
“The department has intervened on several occasions to ensure employees are paid. The department of transport and logistics in Gauteng is regularly paying for the routes serviced by NTI. However, as soon as the money comes through, the BRP prioritises other creditors rather than primary creditors ... the employees,” Kekana said.
He said more than R470m had been pumped into NTI in the past two financial years.
“The department is optimistic that with prudent management the entity will be turned around. The entity is in the process of formulating a turnaround strategy which, once fully implemented, will ensure NTI is profitable once more,” Kekana said.
Samons' lawyer, Bernard Richter from Richter's Attorneys, responded to questions sent to Samons, saying he denied all allegations and labelled them “spurious, vexatious and contrived public statements”.
Richter said the statements were “part of a continued stratagem of derailing the business rescue process ... these allegations are specifically denied with the contempt they deserve”.
Richter sent TimesLIVE Premium documents detailing legal challenges since last year and the business rescue progress reports.
The last progress report, dated April 12, stated the department had “failed to recapitalise the company” as per the agreed revised business plan.
It said the business rescue practitioners had launched an urgent legal challenge to stop the unprotected strike.
“The BRP and his team attempted to negotiate with the employees and trade unions, with the goal of reaching an agreement regarding unpaid wages. Unfortunately, these negotiations were unsuccessful,” said the report.
“Workers were paid for December only in January, having endured the festive season without salaries. They are now owed three months' salaries.”
Before going into business rescue in mid 2022, the company was struggling to pay employees on time and had defaulted on payments to its workers’ provident fund, leading to the fund’s liquidation.
NTI has been the main source of public transport in North West since the days of the erstwhile Bophuthatswana homeland under Lucas Mangope.
Clifford Matube, 52, a security guard in Faerie Glen, east of Pretoria, commuted daily using the buses from Makapanstad in North West but now has to use taxis.
“A return trip on a bus costs me R74 a day, while a taxi costs me R160. I am hurt and angry at the same time because this is a state-owned company, which means we are being failed by the state,” he said.
A return trip on a bus costs me R74 a day while a taxi costs me R160. I am hurt and angry at the same time because this is a state-owned company which means we are being failed by the state
— Clifford Matube
The bus service stopped two weeks ago on a Tuesday afternoon, leaving thousands stranded.
“What's more sad is that many of us bought the monthly bus tickets on the very same Tuesday morning and were forced to use taxis to get back home,” Matube said.
A monthly bus ticket costs Matube R1,880. That would increase to about R2,800 using taxis. “There's no way I can afford it. I hope ... the buses return as soon as possible.”
A bus company employee in Hammanskraal, speaking on condition of anonymity, said he is living on handouts and help from relatives.
“I'm somehow still alive and surviving ... it has been extremely tough.”
General secretary of the South African Workers Union (Sawu-Ya Bashumi), Dave Lebusa Mamaregane, said provincial authorities and the BRP were equally responsible for the situation: “It’s a difficult period for workers.”
He said kicking out the BRP might not be the solution as the BRP “did not appoint [Samons] himself, and all we want is for him to rescue the company and avoid liquidation”.
Transport and Allied Workers Union (Satawu) general secretary Jack Mazibuko said they were opposed to placing the company in business rescue from the outset.
“We feel vindicated because the business rescue practitioner is not prioritising workers' salaries as workers went six months without pay last year,” Mazibuko said.
NTI had in 2022 been paying workers' salaries late, citing a “reduced subsidy” and “under-collection of ticket sales” as reasons.
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