The South African government’s decision to allocate R408 million to the taxi industry as part of a Covid-19 relief fund has sparked widespread debate, with opposition leaders questioning transparency, accountability, and the logic behind the expenditure.
Transport Minister Barbara Creecy disclosed the allocation during a written parliamentary response to Build One South Africa (Bosa) leader Mmusi Maimane, who raised concerns about the once-off gratuity outlined in the 2025/26 national budget.
Covid-19 Relief Revisited
According to Creecy, Cabinet initially approved a R1.135 billion relief fund in 2021 to support the taxi industry, which had been excluded from other formal Covid-19 economic support packages. However, the full amount was never disbursed due to “challenges within the taxi industry,” including a lack of valid documentation or incomplete applications.
By March 2023, over 56,000 operating licences in the system had still not received payments. To address this, Cabinet approved an extension on 3 August 2023, allowing the remaining R708 million to be disbursed in two phases: R300 million in 2023/24 and R408 million now allocated for the 2025/26 fiscal year.
“The taxi relief fund was approved as an ex-gratia payment to assist taxi operators to mitigate the hardship caused by the Covid-19 restrictions,” Creecy stated. She added that only legal operators with valid operating licences and who were active during the lockdown are eligible for the funds.
Opposition Slams Lack of Oversight
Maimane fiercely criticized the allocation, calling it “highly questionable” and indicative of misplaced government priorities at a time when citizens are grappling with VAT increases, high fuel prices, and escalating living costs.
“For a multibillion-rand industry that pays zero tax, this allocation is highly questionable,” Maimane said.
He also argued that the government is disbursing funds to an industry that contributes little to the national tax base while ordinary South Africans carry the financial burden. He accused the government of prioritizing politically connected sectors over essential services and underfunded programs that directly impact the broader public.
Maimane confirmed that Bosa will formally request a detailed explanation of the R408 million allocation from Finance Minister Enoch Godongwana.
“Bosa calls on the Minister to provide full transparency and not allow this allocation to become another questionable expenditure that lacks oversight,” he said. “We remain committed to fighting corruption and wasteful spending.”
A Politically Sensitive Sector
The minibus taxi industry plays a vital role in South African public transport, carrying millions of commuters daily. However, it has long operated within a partially regulated framework, often criticized for its lack of formal taxation, regulation, and accountability. The sector’s political influence, especially during election cycles, has further complicated government interactions and funding allocations.
The relief fund’s rollout now faces renewed scrutiny amid calls for improved oversight mechanisms, especially for sectors that have historically operated outside formal economic structures.
