The High Court ordered the provincial Department of Roads and Transport to pay Putco more than R154.4 million within five court days.
Image: Jennifer Bruce
South Africa’s subsidised public transport system has come under judicial scrutiny after two separate court rulings highlighted mounting legal, financial and operational pressure across provincial bus networks relied on by hundreds of thousands of commuters.
In two divergent judgments delivered in Gauteng and KwaZulu-Natal, the courts reached opposite conclusions on subsidised bus contracts - but both cases underscored the central role public transport plays in keeping workers, pupils and vulnerable commuters moving.
In Gauteng, the High Court ordered the provincial Department of Roads and Transport to pay Putco more than R154.4 million within five court days after the bus operator approached the court over unpaid contracts linked to subsidised commuter services.
Judge AJ Millar criticised the department for repeatedly failing to honour payment obligations despite previous litigation between the parties.
The dispute related to contracts concluded in June 2023 for subsidised bus services in Gauteng and Mpumalanga. Putco, which had been trying for some time to resolve the issue, sought payment for services rendered during February and part of March 2026.
The court noted that Putco had previously returned to court in May 2025 over R178.5 million and again in November 2025 over R45.9 million in disputes that were eventually resolved by agreement.
Millar rejected Gauteng Transport’s argument that budget constraints and discretionary grant limitations prevented payment.
“The contract between it and Putco is extant, and it is to be held to it for so long as it remains so,” the judgment stated.
The court also dismissed allegations that Putco had overclaimed for buses operating on the Moloto route, pointing to monitoring data showing the operator completed 99.96% of scheduled subsidised trips. “Putco delivered that which it had contracted to deliver, and it is in respect of this that an order was sought for Gauteng Transport to pay it.”
Importantly, the judgment stressed the broader public consequences should subsidised services collapse.
According to the court, the contracts support transport for about 130,000 passengers daily, including commuters travelling to work, schools and hospitals.
“The consequence of a disruption, besides being financial for Putco, would likely be devastating to those dependent on the transport provided,” the judgment stated.
In KwaZulu-Natal, however, the High Court ruled against several bus service providers on another set of subsidised bus agreements.
Judge PC Bezuidenhout ruled that long-running extensions of bus contracts in the province were unlawful because they bypassed competitive tender processes required under the Constitution and public finance legislation.
The matter involved 15 bus operators, including Sizanani Mazulu Transport, Duzi Bus Services and Metro Bus Services, which sought orders compelling the KwaZulu-Natal Department of Transport to continue extending interim transport contracts.
The contracts originated from tender processes dating back to between 1997 and 2001, with agreements repeatedly extended over many years.
The court found that while the National Land Transport Act permits negotiated contracts under limited circumstances, repeated one-year extensions excluded potential competitors and undermined constitutional procurement principles.
“The extension of the contracts for a year at a time for the same service provider cannot be competitive or fair,” the judgment stated. The court also noted that National Treasury approval for procurement deviations had not been obtained despite the contracts continuing outside ordinary tender procedures.
The judge stated that “in my view the fact that there may not be any other operators who have the necessary infrastructure to conduct the transport business is not an exclusion for not going to tender.”
Despite declaring the contract extensions invalid, the court similarly prioritised continuity of service to commuters.
The declaration of invalidity was suspended for one year while the province undertakes a fresh tender process, allowing the operators to continue running services temporarily to avoid disruptions to the public.
Recent transport data from Statistics South Africa points to changing commuter behaviour across the country’s public transport system.
According to the 2021 National Household Travel Survey, households using taxis as their preferred mode of transport increased from 9.8 million to 11.4 million.By contrast, households relying primarily on buses declined from 2.9 million to 2.1 million, while train usage dropped sharply from 1.4 million households to just 500,000.
The survey also found growing dissatisfaction among commuters, particularly around safety, facilities and service quality. Taxi and bus commuters expressed dissatisfaction with conditions at ranks and bus stops as well as driver behaviour, while train passengers recorded even higher dissatisfaction levels in most categories except fares.
Transport affordability has also become an increasing pressure point for households.
Statistics South Africa found that by 2020, travel costs had overtaken travel time as the single biggest factor influencing transport choices, with 30.8% of households identifying cost as the main determinant compared with 23.3% citing travel time.
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