Loss-making BMTC stares at just two options: Raise the fare or seek subsidy
The operational loss of air-conditioned buses is much more than that of ordinary buses. The BMTC spends Rs 80.29 to run an AC bus for a kilometre while it earns Rs 63.95.
Due to prolonged losses in the operation of air-conditioned buses — excluding the airport buses — the transport minister had recently announced that the utility would stop procuring air-conditioned buses.
The spike in fuel cost is taking a toll on the finances of state-run Bangalore Metropolitan Transport Corporation (BMTC). The transport utility is losing Rs 22 for every kilometre run by a bus in spite of ticket fare collected from passengers. This has pushed the BMTC to either seek financial support from the state government or raise the ticket fare.
The utility’s 6,800 ordinary and airconditioned buses run almost 11.48 lakh kilometre a day, catering to over 45 lakh passengers. This leads to a daily operational loss of Rs 2.5 crore while the ticket collection is at Rs 5 crore.
The operational loss of air-conditioned buses is much more than that of ordinary buses. The BMTC spends Rs 80.29 to run an AC bus for a kilometre while it earns Rs 63.95.
“None of the public transport corporations in India or anywhere in the world are making profit but they are subsidised by the government. We will also approach the government for help. The BMTC had asked for Rs 1,000 crore but we got only Rs 100-crore subsidy. We will again write to the government for help,” said transport minister DC Thammanna.
Due to prolonged losses in the operation of air-conditioned buses — excluding the airport buses — the transport minister had recently announced that the utility would stop procuring air-conditioned buses.
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BMTC managing director V Ponnuraj said there was little option to improve the financial performance. “In the total revenue we generate, 54% goes as salary for the 34,000 employees and around 27% is spent on fuel. Both these components constitute about 80% of our revenue. We are doing our best to cut down expenses where ever it’s possible,” he added.
In case the state government does not respond to the BMTC’s pleas, the transport utility is likely to increase the ticket fare of both ordinary and air-conditioned buses. “We have not given a proposal to the government on a fare hike,” Ponnuraj said. “The BMTC used to increase the fare every year from 2008 to 2014. Since 2015, we have not raised the fare but the cost of operations has gone up,” he added.
The KSRTC, transport minister said, had sought the state government’s approval to increase the fare by 20%. “We have not got a fare hike proposal from the BMTC,” Thammanna noted.
