Eight transport bodies cut losses after tariff revision

Eight State transport corporations (STCs) have improved their performance after a fare revision in November 2011.

For the first time, the Tamil Nadu government has formulated a ‘common dividend policy’ for the public sector undertakings to ensure healthy returns.

The net losses of the corporations went down from Rs. 1,792 crore during 2011-12 to Rs. 856.5 crore during 2012-13, according to a government review of the performance of PSUs for 2012-2013.

An official says that besides the fare revision, improvement in the functioning of the STCs helped to cut losses.

Of the eight STCs, the Tamil Nadu State Transport Corporation (TNSTC), Villupuram, recorded the maximum reduction in loss, to Rs. 182.14 crore during 2011-12 and 2012-13.

It was followed by the TNSTC, Kumbakonam, with Rs. 174.55 crore and the Chennai-based Metropolitan Transport Corporation with Rs. 151.61 crore.

The review dealt with 51 PSUs, of which 35 earned a net profit of Rs. 628.89 crore.

The rest suffered a net loss of Rs. 1,002.16 crore.

The aggregate loss of Rs. 1,838.42 crore, suffered by all PSUs during 2011-12, came down to Rs. 1,002.16 crore during 2012-13.

Eleven PSUs declared Rs. 38.35 crore in dividend during 2012-13, against Rs. 39.36 crore from 12 PSUs in the previous year.

Common dividend policy

To arrest the decline in return from investment, the government evolved a common dividend policy through a May 2014 order. Under it, the PSUs should declare dividend at 30 per cent of the net profit or 30 per cent of the paid-up share capital, whichever is higher, subject to the availability of disposable profits.

During 2012-13, nine PSUs and a statutory board — the Tamil Nadu Maritime Board — made an additional contribution to the government through vend fee and special privilege fee to the tune of Rs. 6,454 crore against Rs. 5,158.5 crore during 2011-12.