Metro Bus Service: Punjab pays Rs5m per day as subsidy

Published: October 25, 2014
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Govt has to pay expenditures of all supporting staff at stations, electricity expenditures and other costs. PHOTO: AFP

Govt has to pay expenditures of all supporting staff at stations, electricity expenditures and other costs. PHOTO: AFP

ISLAMABAD: 

As Punjab authorities inject more taxpayers’ money to keep buses running under its metro project, commuters travelling along four-dozen other routes in Lahore are suffering due to the dilapidated condition of transport, The Express Tribune has learnt.

Launched at a cost of Rs30 billion for a 27-kilometre-long route in Lahore city, Metro Bus Service is causing a daily loss of approximately Rs5 million to the government while the Turkish company operating the buses almost recovered its cost within a year, a concerned official said.

According to figures shared by a Metro Bus Authority (MBA) official, Lahore’s Metro Bus is like a white elephant, which has caused Rs1.64 billion loss to the government since its inauguration in February 2013 in terms of subsidy, which the government has paid to a private Turkish company. “A passenger pays Rs20 for one-way travel while the government has to pay a subsidy of Rs40,” he said.

He said under the MBA, government and passengers are losers while the private company earns profit due to its agreement with Punjab government. According to official information shared by the official, a Turkish company Albarak is responsible to run the Metro Bus.

Under the agreement, a subsidiary company of Albarak looks after the affairs related to the provision of buses for the service, their maintenance and operation. According to the agreement, the government has fixed Rs362 per km for Turkish company buses.

Whether buses are plied on the track or not, the private company is not responsible and it gets its fixed price mentioned in the agreement. The company provided 52 buses each costing Rs20 million. The company has paid the prices of buses and is responsible for their operational expenditures including their fuel.

Apart from it, the government has to pay expenditures of all supporting staff at stations, electricity expenditures and other costs. The official in the MBA said the Turkish company has recovered its investment like fast-track return business within a year and currently is running in profit.

The official said the government is giving such a huge subsidy on a single route while ignoring around 50 other routes in Lahore, which have almost no public transport facility.

DRTA and LTC

The District Regional Transport Authority (DRTA) was responsible for the operation of transportation in the city in 2008, when Shahbaz Sharif returned to the country and became Punjab’s chief minister.

Under the DRTA, there were 863 buses which were responsible to provide transport facility to millions of commuters in the city. The budget of the DRTA was around Rs2.5 million, while it earned profit of Rs80 million.

“Instead of meeting the requirement of the buses in city, LHC has completely failed,” said an official in the transport department.

The official in Transport Department said Lahore needs around 1,300 more buses but the LTC has decreased numbers of buses from 863 to 250.

A Punjab government official said the contractors under the LTC had started to demand that their deal be like that of the Turkish company.

Opposition Leader in Punjab Assembly Mian Mehmoodul Rashid said Shahbaz Sharif instead of improving the LTC introduced another white elephant which runs under huge losses. “The CM does not have vision of transportation and relies on retired bureaucrats, who are more loyal to the king than public,” he said.

Published in The Express Tribune, October 25th, 2014.

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Reader Comments (4)

  • madeeha khan
    Oct 25, 2014 - 12:29PM

    Either challenge this massive loss to public exchequer or APOLOGIZE to the nation for misleading, miss spending, miss handling the trust and money of he honest people of Pakistan.

    Recommend

  • Maryam Nawaz
    Oct 25, 2014 - 3:11PM

    Mashala good governance

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  • pak47
    Oct 25, 2014 - 9:00PM

    ET its not a loss. Public Transport Systems around the world in most cases are subsidized. for the poor and working class. Imagine what will happen if rich people don’t get fuel for cars subsidized ?Recommend

  • Usman
    Jan 31, 2015 - 3:18AM

    @pak47:
    With all due respect, I would dare to disagree with you. It indeed is a loss! No government in the world design such public transports in which they have to bear Rs5million loss per day when they are serving just few thousands on a single route of one city! I mean Rs5m per day is a huge burden on an already troubled economy! Sensible governments don’t initiate such projects when they already have a burden of failed institutes like PIA, steel mills and Railway. And governments in west don’t pay subsidies when they know that they can use the same amount of money to send out of school children to schools and provide basic health facilities to those who are dying out of hospitals! And FYI, rich people in our country don’t get subsidized petrol.

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