The dispute between the Gauteng provincial government and the Bombela Concession Company over the construction of the Gautrain rail system has been settled.

The Gauteng road and transport department said the mutually agreed settlement brought protracted, costly and multiple legal and arbitration processes between the Gautrain Management Agency (GMA) and Bombela to an end.

In a statement, the Gauteng road and transport department said that the settlement agreement included the following significant disputes:

• Sandton Station cavern
• John Vorster and Jean Avenues cantilever bridges in Centurion
• Water ingress in the tunnel between Park and Rosebank Stations
• The Delay and Disruption claim.

“In terms of the agreement, the Gauteng Provincial Government will pay Bombela an amount of R980 million and a payment over two years of a capped amount of R294 million,” the department said. “This is in full and final settlement of all construction-related disputes between the GMA and BCC.”

Gauteng MEC for Roads and Transport, Ismail Vadi, said that “due to the time and extent of the costs involved in legal proceedings, as well as the uncertain outcomes of these protracted processes, the parties have agreed to this comprehensive settlement of the disputes.

“This is akin to an amicable, all-inclusive out of court settlement of lengthy contractual disputes,” he added.

Bombela chairman, Henry Laas, welcomed the agreement and said that “he believes the settlement is in the best interest of all stakeholders.  It is expected that all legal and financial processes be finalised by mid December 2016.”

The Gautrain public transport rail system has increased passenger ridership by 26% year-on-year since its inception in June 2010, the department said. It added that presently, 1.4 million passengers used the train on a monthly basis.

GMA CEO, Jack van der Merwe, said that increased ridership on the Gautrain indicated that commuters were making a conscious shift from private car use to public transport.

He added that the Gautrain had achieved significant economic, social and environmental benefits for the province over time, which included the following:

• R47 billion estimated total value added to the Gauteng economy
• 34 800 directly created jobs during construction
• 87 000 indirectly created and induced jobs during construction
• 245 000 jobs created by property developments induced by the Gautrain
• 52% reduction in the carbon footprint of Gautrain users who used to commute by car
• 24 200 fewer car journeys a day in 2014 due to the Gautrain
• 12 working days saved a year by the typical Gautrain commuter
• Commuter time saving as Gautrain is eight times faster than road travel in peak hour traffic.

Gautrain expansion

Vadi said Gautrain services will be improved over the next two years with the acquisition of 12 new trains sets and related signalling and maintenance asset enhancements.

“The legal settlement allows the GMA to focus on planning future improvements to the public transport system in Gauteng and paves the way for future investors in the system” Vadi said.

The GMA said that it concluded the feasibility study on an expanded rapid rail network in the province, and indicated that it would be released shortly.