Staff Reporter

State Transport Corporation units, MTC do not fare well

  • Salem, Coimbatore, Villupuram and Kumbakonam units in the red
  • All corporations saw their establishment costs rise owing to the wage settlement

    CHENNAI: While the State Express Transport Corporation of Tamil Nadu cut its losses during 2005-2006, the Tamil Nadu State Transport Corporation units and the Chennai Metropolitan Transport Corporation did not fare so well.

    The annual reports of all the corporations were tabled in the Assembly on Wednesday.

    The highest loss

    While the Salem, Coimbatore, Villupuram and Kumbakonam units went into the red, posting losses as against profits in the previous year, the Madurai unit and the Chennai MTC saw their existing losses rise exponentially.

    The Madurai unit posted the highest loss of Rs 85.9 crore, plunging from the previous year's Rs 2.5 crore.

    All the corporations saw their establishment costs rise owing to the wage settlement, which provides for a revision with retrospective effect from September 1, 2003.

    The average price of diesel rose 17.4 per cent from Rs 25.94 a litre in 2004-05 to Rs 30.46 per litre in 2005-06. With most corporations also increasing the number of kilometres operated, the diesel price hikes were extremely damaging to their balance sheets.

    However, as the MTC's report said: "But for the steps taken to reduce the cost of operation and to increase revenues, the loss of the company would have been much higher."

    Better occupancy ratio

    In fact, all the corporations saw an increase in their operating revenues largely owing to better occupancy ratios and vehicle productivity.

    Rationalisation of low earning services and more effective maintenance also contributed to the rise. The Salem unit was the best performer in this regard, with its operating revenue showing a growth of 7.19 per cent.


    The SETC cut its losses by over 14 per cent, from Rs 31.5 crore in 2004-05 to Rs 26.9 crore in 2005-06.

    The corporation received Rs 19 crore as compensation from the five State transport units, which run parallel operations with new buses in the operational jurisdiction of the SETC.

    A Rs. 9-crore compensation will be paid in the current financial year. However, as the SETC claims that the revenue loss incurred is to the tune of Rs. 25 crore a year, it says it is awaiting orders from the Government for the contribution of the balance amount by the State transport units.