Council seeks review of transportation policies

03/07/2008 11:36

The Consumer Council of Fiji finds it difficult to understand the dire financial circumstances the bus operators argue they are in amid the decision to cease services to consumers this morning. The rationale to take strike action as a form of retaliation following the delay in receiving a response from LTA on their proposed bus fare hike is hard to comprehend. If indeed bus companies were genuinely struggling, strike would not have been an option. The Council views the strike as an intimidating tactic by the bus operators.  

All consumers and the government require is for bus operators to present their true operational accounts to justify the call for fare hikes. There are a great many leakages in the revenue collection of bus operators, given the lack or absence of monitoring and non-issuance of tickets to consumers. If the leakages had been addressed in the 62 years of the bus industry’s service to Fiji consumers, it would have adequately covered any additional costs to the operators from the rising fuel prices. But of course, the bus operators, as usual, expect the government and consumers to compensate for the loss of patronage.

Although bus operators had decided to resume services shortly after ceasing their operations, the hasty decision not to supply transport to the needy consumers impacted their daily routine and inconvenienced many commuters who relied on their service. The bus companies’ actions were highly irresponsible in their protest to the rising fuel prices, which is affecting everyone, traders and consumers alike. Therefore, the Council is concerned with unfair treatment of consumers who are always at the receiving end of such events over which they do not have any control. These companies have a duty to guarantee regular public transportation to the consumers by paying a minimal permit fee of $550.00 for 10 years –a mere $55 per year, without strict terms and conditions or penalties imposed by the enforcers for such impulsive actions.

Buses definitely provide a critical service to consumers in Fiji. It is the mode of transportation that the vulnerable sector of the society relies on including children, elderly, and the low income earning consumers. In fact, thirty-four percent of Fiji’s population or an estimated 284,798 people who are living in absolute poverty rely on bus services for transportation. Bus operators need to remember that they were approved licenses to provide a service to the people of Fiji. The approved licence therefore comes with a responsibility to ensure the provision of bus services to consumers.

Moreover, bus operators need to remember they are much more reliant on the consumers and their cent than the other way round. Todays strike did impact the travel arrangements of bus commuters but they have somehow managed to get to work and school. The massive invasion of the public transport sector by informal operators, that the bus industry keeps harping have affected their operations, is growing largely because strike actions and cessation of services by bus operators provides them with the opportunity to do so. The Council obviously is not supporting illegal transport operations, but merely stating that the bus operators only need to blame themselves by creating the vaccum, which informal operators are coming in to fill.

While the Consumer Council of Fiji applauds the move by the interim Government not to implement further bus fare increase based on the recent fuel price hikes, it calls upon those charged with monitoring and regulating the land transport industry to consider introducing “controlled competition” as opposed to any deregulation. This will enhance service delivery and tackle any setbacks encountered by bus companies suddenly withdrawing their services.

Under the present system, all bus operators are benefiting from the government subsidy, irrespective of whether they operate along economical routes and earn decent financial returns or along non-economical routes. In order to create a level playing field for bus operators, the government needs to re-look at its subsidy allocation.

The Council is further of the view that upon the expiry of the ten-year bus licenses, that a fresh tender on route services be called by LTA. Currently there exists a ‘closed shop’ type operation where a bus company is servicing the same route for decades. As such, other bus companies are not provided with an opportunity to service economical routes. Consequently, operators who have been operating along economical routes feel that their place is guaranteed and have become complacent in the manner service are provided to consumers. The tendering process will not only allow bus operators with an equal opportunity to service new routes but consumers will also be able to experience the delivery of service by different operators. Additionally, bus operators vying for specific routes may be compelled to offer extra services socially like discount offers on fares for the elderly etc that could benefit and be a win-win situation for consumers, government and the bus operators.

The Council is calling upon the relevant State ministries to review their policy decisions to ensure that consumers are put at the heart of strong competition regime to create better choices for all.