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Government will give a 10% (VEP) subsidy to all registered bus operators in the country. This subsidy will be based on a monthly revenue reported by each bus operator to the Fiji Islands Revenue and Customs Authority (FIRCA). Cabinet based its decision on a submission by the Minister for Works and Transport, Colonel Timoci Natuva. Colonel Natuva explained that there has been an increase in the operating costs of bus operators resulting in a request for a bus increase. “Government, however, has decided that instead of the traveling public to bear the increased cost of bus fares, the Government will bear the cost via a direct subsidy to bus industry, on the basis of each bus operator to report their monthly income figures to FIRCA.” He said that the provision of a 10% subsidy was arrived at following the evaluation of the bus operators’ request via the Land Transport Authority’s Cost Index Model. The Minister also explained that since 1974 to 2008, Government has approved a 197.6% increase in bus fares. “The recent increase in bus fares determined by LTA are as follows: 2000 – 7.0% (VEP), 2001 – 10% (VEP), 2003 – 7.1% (VEP), 2005 – 4.5% (VEP), and 2008 – 10.0% (VEP). “The sole basis of the historical bus fare increases has been the fuel retail price increments.” The Minister said that in addition to increase in bus fares by LTA, Government has various concessions and rebates to the bus industry, which include 18 cents per litre fuel concession, and concession given on purchase of new chassis/engines and identifiable fixtures and components. “The revenue impact in respect to the concessions/rebates provided by Government to the bus industry is $2,639,7778, for the period January to May 2008.” The Minister said that it is unfortunate that despite the Government concessions, rebates and bus fare increases, bus operators have historically suspended bus services in respect to non-commercial road routes/timetables. He said that a technical consultancy will be undertaken to evaluate the quantum of annual concessions and rebates provided to the Fiji Bus Industry to offset its financial losses as claimed, in comparison to the intended benefits derived by Government from the Fiji Bus Industry. Amongst other things, the consultancy will also identify the non-commercial road routes/timetable of bus operators for deregulation to other modes of PSV land transport. - Ends - No:1035 |
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