[sustran] Takeover of debt-ridden bus service

Craig Townsend townsend at central.murdoch.edu.au
Sun Jan 30 05:55:49 JST 2000


>From the Nation (Thailand) on line edition, 29 Jan.2000

Takeover of debt-ridden bus service

THE city's administration could take over Bangkok's bus service in the next
three-to-five months following a decision by the government to nationalise
the state enterprises' huge debt. 

The move is regarded as fair to taxpayers outside Bangkok in the long term,
but raises questions about the service's employees and whether the millions
of city residents who use the system will see any actual benefits. 

The long delayed plan was finally given the green light after the national
government agreed to assume the Bt20 billion debt of the Bangkok Mass
Transit Authority (BMTA). 

''The Ministry of Finance has agreed in principal to take the BMTA's debt
onto the state account,'' said Transport and Communication Minister Suthep
Thaugsuban. His ministry is responsible for the transit authority. 

''The plan can be completed within the next 3-5 months,'' Suthep added. 


The Bangkok Metropolitan Administration (BMA) had balked at taking over the
transit authority and its Bt20 billion debt at the same time. 

The Finance Ministry's agreement to nationalise the debt would mark the
last time taxes paid by non-city residents would be used to support a
service that benefits only Bangkok residents. 

However, the plan will likely face tough resistance from the bus system's
3,700 workers, because the city's modernisation plan is expected to affect
them adversely. 

Once the city controls the bus service manpower restructuring is imminent,
confirmed deputy Bangkok governor, Thirachon Manomaipibul, yesterday. 

''According to a study by Thammasat University, 45 per cent of the
operational costs involve salaries, some of which are redundant,'' he
explained. The city's restructuring plan will include, for example, a smart
card system, which could affect the job of conductor, he added. 

The city, which plans to set up a company to operate the bus service, wants
the restructuring completed within 2-3 years, Thirachon said. However, the
Thammasat University study pointed out that it would take five years to
implement a smooth restructuring that minimised labour problems. 

But the question remains for bus users -- what difference will the transfer
make? 

Bangkok residents have long had to endure indifferent service, poorly
maintained buses as well as rude drivers and conductors, who are paid up to
Bt19,000 and Bt16,000, respectively, in salaries and perks. 

Since the BMA will operate the bus service, there will be no problem
concerning fare increases, Thirachon said. 

The transit authority and the city's administration have begun discussing
the implementation plan for transferring the assets and employees of the
public bus agency to a new entity that will be under the supervision of
city administrators, Suthep said. 

A restructuring and privatisation plan for the loss-making State Railway of
Thailand (SRT) could also succeed if the state would assume the railway's
debt of Bt30 billion, Suthep said at a seminar held by Nation Multimedia
Group and the National Energy Policy Office yesterday. 


''If the government agrees, I would hold talks with SRT employees asking
them to accept the change. The SRT incurs more debts every day since it
cannot increase the ticket price,'' he said. 


However, Deputy Finance Minister Pisit Lee-artham who was on the same panel
as Suthep, made no comment concerning nationalising the debt of either the
railway or the bus system. 


Rather, he said the government was in no hurry to privatise its state
enterprises considering the present state of its finances and liquidity. 

''We would sell the shares (of state enterprises) when it is deemed
appropriate and provides the most benefit,'' he added. 

However, Prime Minister's Office Minister Abhisit Vejjachiva reiterated
that the government would adhere to its plan to sell shares of three state
enterprises this year -- Thai Airways International Plc, Bangchak Petroleum
Plc and Ratchaburi Power Plant. 


The SRT's privatisation plan looks very similar to the British model, which
led to the successful privatisation of everything but the British railway
agency, said Ammar Siamwala, president of Thailand Development Research
Institute, at the seminar. 


Ammar said he did not trust the Thai private sector and was afraid that the
privatisation would merely be the transfer of a monopoly from the state to
the private sector. 


BY NAREERAT WIRIYAPONG and 

SUKANYA SAE-LIM 

The Nation

________________________________________________
Craig Townsend
Institute for Sustainability & Technology Policy
Murdoch University
South Street, Murdoch
Perth, Western Australia 6150

tel: (61 8) 9360 6293
fax: (61 8) 9360 6421
email: townsend at central.murdoch.edu.au



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