Diesel price hike fuels STC crisis

MADURAI SEPT. 21. The recent hike in diesel price has caused State Transport Corporations to suffer losses to the tune of several crores a month. With no indication of a fare revision in the near future, several STCs are contemplating withdrawing services on some loss-making routes, besides tightening their belts.

In the Tamil Nadu State Transport Corporation (Madurai Division-I) alone, officials have put the loss at Rs. 1 lakh per day. The division, already in deep debt, is operating over 930 buses in the city, suburban and mofussil sectors. "If this financial crunch continues, it would become difficult to sustain the operations. After the last fare revision in September 2001, the price of diesel was hiked on six occasions," said a senior official.

Even as a majority of the 18 transport corporations are limping back to normal, following the denial of subsidy dues arising out of provision of free bus passes to students by the Government, the fuel price revision has worsened their financial instability.

"This is a clear indication that the transport sector is headed for privatisation". There was an acute manpower shortage, particularly of drivers, and the image of the corporations is also going down what with a large number of buses having outlived their operational efficiency," said V. Pitchai, general secretary, Centre of Indian Trade Unions.

While the proposed amalgamation of the STCs into seven individual entities is expected to bring a reprieve from financial instability, officials have no idea when the process will commence, though the Company Law Board is said to have cleared the decks.

"We have to go by the policy of the Government. The system has to be managed with the available infrastructure and funds. Steps are being taken to educate the crew to be more responsive to the demands of passengers. An increase in revenue by Rs. 100 (in each bus) per day will fetch several crores per month," an official pointed out.

"The revenue of the corporations is mainly dependent on scheme routes on which they enjoy a monopoly. Any move to open up such exclusive routes to the private sector will be the first step towards privatisation.

This will be in violation of the basic principles of nationalisation," said P.T. Tirumalaisamy, general secretary, Tamil Nadu State Transport Corporation Staff Federation.

Besides the entry of private operators at different stages, the exorbitant debts, growing expenditure and declining revenue are pushing the STUs into a tight corner, say trade unions.

The officials, on condition of anonymity, admit that the transport sector is headed for a financial emergency.

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