Subsidy culture & the KTC
The subsidy culture unleashed in the State is quite unprecedented and would stump most economists, especially when Goa is going through a financial downturn due to the drying up of revenue from mining. For, just when the private bus operators are demanding a subsidy of Rs 3 per kilometre over implementation of the KTC concessional pass system, the magnanimous Transport Directorate had already drafted a proposal to grant the subsidy, which has been pending with the government since August. To many this would appear as too much of a coincidence.
Rather than providing a per kilometre subsidy, it would make much more economic sense to allow the private sector bus owners to implement the concessional pass system. And anyway since when has government begun to subsidise the private sector? By its very essence business is defined by entrepreneurship which involves risk as well as rich dividends. The government has to act as a regulator and ensure fair play in terms of rules of the game in a free market economy.
When India has moved towards freeing controls and liberalisation, the Goa government seems to be moving against the tide by centralising and monopolising bus routes. The principal reason for this is twofold ~ to cut losses of the ailing corruption ridden KTC and to curtail the indiscipline of private bus operators.
By its very essence the KTC, a corporation, should work on a business model that ought to be self-sustaining and not require government subsidies, while ploughing its profits into its expansion plans. But give the political appointments of the chairman and board of directors, and the corruption, KTC has been reeling under heavy losses forcing the government to subsidise it and create a monopoly on certain routes, instead of forcing it to become more efficient, cut costs and innovate.
On the other hand the private bus operators are street-smart and are regularly accused of blocking KTC buses, threatening drivers and dangerously overtaking KTC buses to ensure that the corporation ends up in a loss on competing routes. By itself, the private bus operators’ attitude is shocking. Governments have not shown any will to rein in these operators to issue tickets, wear uniforms, avoid overcrowding and prevent conductors getting physical with lady commuters. Of course these conditions are touted religiously by the RTO every time it offers private operators a hike in fare, but seldom followed. Bus operators are no strangers to demanding ticket price hikes and then implementing a de facto pass system ~ offering their regular passengers concessions to undercut KTC profits.
Media has amply documented in the past how conductors are regularly seen visiting police stations and RTOs, which probably many feel is the reason why the law enforcing authorities turn a blind eye to violations. KTC taking on private buses and paying private operators would be another disastrous decision.
Why the soft corner for such groups is the question many people would ask. The probable answer is that they have powerful lobbies and form critical vote banks. If not, why would the government given in to the demands of the bus operators even as the lobby is headed by a voluble Congressman who has now put in his papers? Or was putting in his papers the pre-condition to allocate the subsidy? The answer to this will indicate whether the subsidy makes economic or political sense.
