Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News

      TCS | South Africa’s Sociable wants to make social media social again

      23 June 2025

      Tech stability key to getting South Africa off damaging financial grey list

      23 June 2025

      ‘System offline’ scourge to end, says Schreiber – but industry must pay

      23 June 2025

      Naspers shifts to an AI-first strategy – and it’s paying off

      23 June 2025

      Letter: South Africa risks missing AI wave while world surges ahead

      23 June 2025
    • World

      Watch | Starship rocket explodes in setback to Musk’s Mars mission

      19 June 2025

      Trump Mobile dials into politics, profit and patriarchy

      17 June 2025

      Samsung plots health data hub to link users and doctors in real time

      17 June 2025

      Beijing’s chip champions blacklisted by Taiwan

      16 June 2025

      China is behind in AI chips – but for how much longer?

      13 June 2025
    • In-depth

      Meta bets $72-billion on AI – and investors love it

      17 June 2025

      MultiChoice may unbundle SuperSport from DStv

      12 June 2025

      Grok promised bias-free chat. Then came the edits

      2 June 2025

      Digital fortress: We go inside JB5, Teraco’s giant new AI-ready data centre

      30 May 2025

      Sam Altman and Jony Ive’s big bet to out-Apple Apple

      22 May 2025
    • TCS

      TechCentral Nexus S0E3: Behind Takealot’s revenue surge

      23 June 2025

      TCS+ | AfriGIS’s Helen Hulett on how tech can help resolve South Africa’s water crisis

      18 June 2025

      TechCentral Nexus S0E2: South Africa’s digital battlefield

      16 June 2025

      TechCentral Nexus S0E1: Starlink, BEE and a new leader at Vodacom

      8 June 2025

      TCS+ | The future of mobile money, with MTN’s Kagiso Mothibi

      6 June 2025
    • Opinion

      South Africa pioneered drone laws a decade ago – now it must catch up

      17 June 2025

      AI and the future of ICT distribution

      16 June 2025

      Singapore soared – why can’t we? Lessons South Africa refuses to learn

      13 June 2025

      Beyond the box: why IT distribution depends on real partnerships

      2 June 2025

      South Africa’s next crisis? Being offline in an AI-driven world

      2 June 2025
    • Company Hubs
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • AvertITD
      • Braintree
      • CallMiner
      • CambriLearn
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • Incredible Business
      • iONLINE
      • Iris Network Systems
      • LSD Open
      • NEC XON
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Tenable
      • Vertiv
      • Videri Digital
      • Wipro
      • Workday
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Fintech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Public sector
      • Retail and e-commerce
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » Helen Zille » Why Uber’s arrival led to gov’t paralysis

    Why Uber’s arrival led to gov’t paralysis

    By Helen Zille6 July 2015
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp

    helen-zille-180Government is a complex beast. It can only do what the law specifically allows it to do, not what people (or the premier) think it should do. Decision making requires long processes, by numerous people in different departments, governed by a whole range of laws, regulations and by-laws.

    With that in mind, let me deal with the controversy that exploded in Cape Town last week about Uber, the e-hailing cab service. For the uninitiated, Uber is a smartphone application that is revolutionising the metered-taxi industry. It allows consumers to request a trip, locates them, and refers them to the nearest available Uber partner driver. It has proved to be a “cool”, safe, cheap and efficient service. Young people love it, and many parents (including me) sleep better at night knowing that their kids will “Uber home” rather than take risks after a night out.

    So it came as a shock to discover that over 200 Uber taxis have been impounded by the traffic police since the beginning of the year.

    Last week, public frustration exploded on Twitter. Within hours, #CTneedsUber was trending and 14 000 people had signed an online petition to legalise them.

    But here’s the thing: Uber’s e-hailing service “does not fall into any of the categories of the National Land Transport Act”, as an official explained to me this week. It is also not provided for in the integrated transport plan. And any process to regularise the e-hailing service must follow the requirements of the Promotion of Administrative Justice Act. Furthermore, just last week, a court case in the US concluded that Uber drivers were not self-employed, but employees of the Uber company, a decision with far-reaching legal implications.

    In other words, Uber is a market disrupter.  It was unheard and unthought of when South Africa’s legal framework for public transport was put in place.

    This situation creates a crisis for government. Officials must act within the law. But the law doesn’t envisage or cater for e-hailing services. The result is government paralysis.

    No wonder Business Day gave us a “red light” for not being “nimble” enough in dealing with Uber. But a figurative “red light” is far easier to survive in government than a qualified audit from the auditor-general for “irregular and unauthorised expenditure”.

    So time drags by while officials try to squeeze the new reality into the prevailing legislative framework, and the city prepares a by-law to legalise and regulate e-hailing. The solution currently on the table is to license Uber taxis in terms of the clauses covering metered taxis, while providing certain exemptions.

    But why insist on licences at all, several people have asked? Surely, consumer choice should be regulated by the market? In any event, they say, Uber is self-regulating through a star-rating system.

    When it comes to public transport operators, it is not so simple. Government cannot evade responsibility for safety, which includes roadworthiness, passenger insurance and third parties. If, for example, the vehicle does not have a valid operating licence, passengers cannot claim from the Road Accident Fund in the event of a crash.

    Moreover, regulation of the taxi industry in South Africa has proved to be one of the examples of market failure. Competition is more often resolved by violence than consumer choice. There have been 15 murders (and many more injuries) in the past year relating to taxi conflicts in an overtraded industry. And the current situation of overtrading can only be resolved by market displacement, which usually results in escalating violence. Furthermore, the law prohibits the issuing of additional licences in an overtraded market.

    Uber's popularity is skyrocketing in South Africa
    Uber’s popularity is skyrocketing in South Africa

    When I pointed this out last week, it only increased the controversy.  “Do you think my Uber driver in his Mercedes is going to shoot someone?”, an uber-angry user asked. No, I do not think so, but how do you know that he won’t become a target?

    This is not far-fetched. Just last month in France, President Francois Hollande called for a ban on the Uber app, following violent resistance against the service in various parts of the country. Hollande is a socialist and believes in market manipulation. We do not. But this does not exempt us from the legal requirement to prevent overtrading and take into account the comments of current licence holders before we issue new ones.

    And it is not only socialist governments that have a problem with Uber. Earlier this year, reports surfaced that Spain and Germany had prevented Uber from offering unlicensed services.

    What a minefield! Once I had investigated, I could understand why officials are treading so warily. They know they will be held responsible if something goes wrong.

    On the other hand, I can also understand the public’s fury at the red tape and inconvenience over our failure to regularise e-hailing, not to mention the impact this has on jobs. It was hardly surprising that Alan Winde, the provincial minister of economic development, signed the protest petition, while his colleague, minister Donald Grant, provincial minister of transport, defended his officials. These are some of the inevitable contradictions and conflicts that happen in government.

    Meanwhile, we are all working together on a way forward. On Thursday, 9 July, there will be a meeting of the Provincial Regulating Entity, where all the verified Uber licence applications supported by the city will be considered. Those who gave false addresses, or other deficient information, will be rejected.

    The city has also started the process of compiling a by-law to create a legal framework for the e-hailing industry, while the national government has started the process of amending section 66 of the National Land Transport Act, to make e-hailing taxis a subcategory of metered taxis.

    The vigorous public debate has been helpful, and brought the matter to my attention. This is the way open, responsive government functions. And it is the way that, I hope, we can become more “nimble” and innovative when facing market disruptions in the future.

    • Helen Zille is Western Cape premier


    Alan Winde Donald Grant Francois Hollande Helen Zille Uber
    Subscribe to TechCentral Subscribe to TechCentral
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleTelkom’s Maseko denies fraud allegations
    Next Article MTN Business to pursue acquisitions

    Related Posts

    South African law is failing gig-economy workers

    12 June 2025

    Keep bitcoin away from South Africa’s strategic reserve: Helen Zille

    5 February 2025

    ‘Afrikaans Uber’ sparks controversy

    27 January 2025
    Company News

    IoT connectivity management in South Africa – expert insights

    23 June 2025

    Let’s reimagine Joburg using the power of tech, data and AI

    23 June 2025

    Netstar doubles down on global markets while backing SA growth

    23 June 2025
    Opinion

    South Africa pioneered drone laws a decade ago – now it must catch up

    17 June 2025

    AI and the future of ICT distribution

    16 June 2025

    Singapore soared – why can’t we? Lessons South Africa refuses to learn

    13 June 2025

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    © 2009 - 2025 NewsCentral Media

    Type above and press Enter to search. Press Esc to cancel.