The good, the bad and the ugly

The good, the bad and the ugly

Government and its institutions are the enforcers of road safety, emissions control and other aspects of road transport. Yet how well do government fleets comply with the spirit of the law? FOCUS considers the numbers and some anecdotal evidence.

 

There are 9,6 million vehicles on South African roads: six million cars, two million LDVs, 343 000 commercial vehicles above 3 500 kg, and 52 000 buses and minibuses. With 450 000 vehicles, the public sector fleet is huge – five percent of the total. The vehicles are distributed across nine provincial governments, 44 government departments and 270 municipalities. However, the difference in the age and condition of vehicles from one operation to another varies considerably. Why?

Government already follows standard procedures in accounting with Generally Accepted Municipal Accounting Practice (GAMAP) and Generally Recognised Accounting Practice (GRAP) for national and provincial government. It also enforces international security standards in the handling and carrying of cargo. So wouldn’t it make sense to adopt international fleet management standards?

 A teacher’s report on public fleets would read “could do better”. While government has advantages denied to private operators such as a captive market, it also faces unique constraints. One is the withholding of rates as a political protest, denying it the revenue for re-investment. Plus many operations encounter daily “torture-test” conditions. Examples are police and emergency vehicles with their Formula One acceleration need; refuse compactors on tight stop-start schedules; and forestry vehicles with heavy-duty loads on difficult on- and off-road terrain. Such services may not be glamorous, but they are part of the transport backbone and need to competently perform an essential job.

More eye-catching is the new breed of Bus Rapid Transport (BRT) vehicles such as those used on Cape Town’s MyCiTi network. These and Johannesburg’s glittering Gautrain feeder busses and those in the Rea Vaya services have shown that, given the funds and the will, South Africa can implement world-class public transport operations. So why isn’t this happening across the board?

Next door (in stark contrast to these fancy new buses) is the aged Metrobus commuter fleet. The operator is locked in a vicious circle because of the age and condition of its buses. In the 2011/12 Annual Report, chairperson, Vincent Mntambo laments: “An ageing fleet leads to a high number of breakdowns and this impacts on the reliability of our services. The company is in serious need of recapitalisation.” Of its 455 buses, 18 are over 20 years old, 37 are between 17 and 20, 76 are over 11 and 324 are close to 10 years old.

Maintenance budgets overran by 13 percent mainly to fix overheating. Capital budgets overan by six percent and availability of spare parts is also problematic. Only 59 percent of the 15,5 million passengers were satisfied with the service, which posted a R45 million loss, despite a council subsidy of R294 million. On the bright side, the Annual Report assures us that none of the buses are smoking excessively and Metrobus is looking to acquire up to 100 new buses by 2014.

Some authorities aren’t waiting that long. The Eastern Cape’s Department of Transport fleet management trading entity sourced 2 043 vehicles last year from Fleet Africa. And it is not just the big boys getting the message. With a population of only half a million, Alfred Nzo District Municipality boldly replaced over 20 vehicles that were not fit for purpose. The new vehicles will be available for important dam and reservoir projects. Mayor, Eunice Diko, says that curbing abuse and reducing fuel consumption will deliver savings close to R1 million a year – a substantial sum for one of the poorest districts in the province.

Managing the age profile is critical as older vehicles suffer more breakdowns, attract high insurance premiums, are costly to maintain, use fuel less sparingly and are guilty of excessive emissions. According to RGT SMART Market Intelligence, in aggregate, 56 percent of government buses, 53 percent of EHCVs and 46 percent of HCVs are 15 or more years old, with LCVs at 29 percent, MCVs at 24 percent and passenger vehicles at 31 percent.

Drakenstein Municipality underscores the problem in regretting that: “Repair and maintenance of vehicles plant and equipment older than accepted replacement norms, comes at a high cost.” Is the expense of persisting with vehicles past their “sell-by-date” higher than the cost of replacement? Or are some government fleets victims of the “sunk cost trap”, burdened with workshops, tooling and equipment, spare parts and components inventory? These legacy systems incline towards false economy, running paid-up but unproductive assets into the ground.

Such an “Elastoplast” strategy misses out on efficiency gains and multiplies risk. The United Kingdom’s Corporate Manslaughter Act now targets management as well as drivers in cases of road deaths involving business vehicles. Such legislation has a way of being adopted internationally and may be here sooner than we think.

Fleet investment is not being driven solely by vehicle age. Trends in security and technology dictate changes to applications. Security regulations mandate what can be transported, by whom, where, when and how.

A major operator such as the South African Post Office (SAPO) is experiencing a revolution as correspondence, greeting cards and accounts migrate to e-mail, while e-commerce increases the number of packages for suburban and business delivery. This swing prompted SAPO to review its trailer configuration, incorporating additional below-floor compartments to utilise wasted space and defer replacement.

Reconfiguration is one alternative to outright purchase – another is retrofitting of drive-train components, refurbishing and rebuilding. According to a major parts distributor, this can be accomplished at two thirds of the cost of a new purchase: “As many municipal vehicles work to punishing schedules, in difficult conditions, the body sometimes goes first and needs to be rebuilt and sometimes it’s the chassis, or major components.”

Modern practice is a never-ending cycle of benchmarking, measurement, diagnostics and monitoring of costs, efficiencies, risks and consumer satisfaction and weighing-up options. The growth in the number of specialist third parties with the expertise and systems to analyse, plan and fulfil fleet optimisation has helped. More importantly, South Africa has excellent transport and supply chain management programmes at universities in Johannesburg, Cape Town, Stellenbosch and Pretoria. These turn out leaders with the requisite strategic skills to complement hands-on transport veterans. So implementing world class standards is possible.

As South Africa already complies with international standards in security and accounting, why not in fleet management, aiming for nothing less than world class transport? It would add weight to current road safety and emissions-control messages – and there are the people available to implement it.

The necessary disciplines are found in the Road Transport Management System (RTMS). It addresses safety and compliance, driver wellness, loading control and skills. Procedures developed by the South African Bureau of Standards are consistent with ISO 39001 international standards. Moreover, cost is not a valid objection as RTMS users confirm that it pays for itself through fewer accidents and fines, less downtime and fuel saving.

Implementation of RTMS at this level would implant a common efficiency mindset and capability in local, provincial and national government, with resultant improvements in service delivery, thus benefiting all stakeholders.

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