Govt gives nod to hike transport fares

KATHMANDU, Nov 19: Bowing to pressure from transport entrepreneurs, the government has principally agreed to hike public transportation fares by 13 percent merely six months after the fares were last revised.

The Ministry of Labor and Transport Management is preparing to enforce the agreement once Minister Mohammad Aftab Alam returns from India on Sunday.

However, officials said the hike is against the agreement the government reached with transport entrepreneurs. "The fares were revised just six months ago. Going by the understanding, the fares cannot be revised twice in a year," said an official at the ministry.

MoLTM and transport entrepreneurs had principally agreed to make the fresh adjustment in transport fares at a meeting on Thursday.

“It would be a blatant act of defiance against scientific-fare-setting mechanism if the government yielded to transport entrepreneurs´ demand for fare hike within a year," an official at the MoLTM told Republica.

The government two years ago had devised the mechanism for scientific fare fixation, aiming to end the confusion over criteria to be adopted to determine transport fares. The mechanism also provided for a provision to adjust fare once a year in mid-July as per the price movement in non-fuel components such as administrative cost, spare parts, salary of workers, bank interest, among others.

The government had hiked the transport fares of diesel-run vehicles by 9.9 percent on May 27, 2010 taking into account the rise in the prices of fuel and non-fuel inputs. As per thprabhakarji@gmail.com agreement, both the sides had agreed not to revise fares if fuel prices did not fluctuate by at least five rupees per liter. And records of Nepal Oil Corporation (NOC) show the price of diesel has not increased by over Rs 4.5 per liter since last May 27.

However, Anil Gurung, director the Department of Transport Management (DoTM) claimed that the government would take decision on fare hike taking into account the rise in the price of fuel and non-fuel components. He claimed that the hike wouldn´t be over nine percent.

Federation of Nepalese National Transport Entrepreneurs (FNNTE) had decided on September 20 to unilaterally hike the fares by 15 percent with effect from November 17 if the government failed to timely adjust the fares of public transport. However, transport entrepreneurs have already been collecting fares higher than that fixed by the scientific fare mechanism.

Ram Chandra Simkhada, secretary at the Consumer Rights Protection Forum, said it would be a mistake of the government if it gave permission to hike transport fares which is already 25 percent to 50 percent higher than that fixed by the scientific fare mechanism.

“It wouldn´t be acceptable if the government gives the nod to hike the fares without consulting consumer´s rights organizations,” said Simkhada.

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