Govt making final preparations for public transport fare hike

The Kathmandu Post, 2013-02-18

KATHMANDU, Feb. 18 -- The government is making final preparations to hike public transport fare s. The Department of Transport Management has recommended a 9 percent hike in the fares to the Ministry of Physical Planning, Works and Transport Management last week. Based on the changes in prices of fuel and non-fuel components that affect the cost of transport, the department has recommended increasing bus, taxi and cargo carrier charges, according a ministry official. The proposed increment for taxi and cargo fares is '5-7 percent'.

The proposed hike in transport fare s is based on the study and finding of a technical committee formed by the ministry under the coordination of Sarad Adhikari, director of the department. The committee had studied the price hike in fuel and non-fuel components before proposing the fare hike to the ministry.

Non-fuel components include inflation, prices of spare parts, lubricants, tires and bank interest rate, among others.

"We submitted separate reports on fare adjustment of bus, taxi and truck," said Adhikari, adding the new rate will be implemented after ministry gives its go-ahead, deciding on the percentage to be increased.

Earlier, transport entrepreneurs' organisations had demanded the government jack up the fares by 15 percent. However, the department had committed to limit the fare hike below 10 percent as it directly affects the daily life of the general public and delivery of goods.

The Federation of Truck Tanker and Transport Entrepreneurs, the Nepal Metre Taxi Entrepreneurs' Association, and Federation of Nepalese National Transport Entrepreneurs Association have long been demanding that the government increase the fares.

As per the guidelines, public transport fare s have to be reviewed each year based on factors such as consumer price index, spare parts' prices, cost of lubricants, tires and fuel, staff salary and bank interest rates.

Department officials said the drop in bank interest rates, constant government taxes and no hike in transport workers' salary helped keep the hike below 10 percent.

According to the ministry, it will analyse the reports of the technical committee and decide on the fare hike. "We will take a decision soon as there has not been annual adjustment in transport fare s this year," said Tulasi Prasad Situala, secretary at the ministry.

The scientific fare determination mechanism implemented in 2009 requires the government to review transport fare s annually. Fares are computed on a basis of 35 percent contribution of fuel factors and 65 percent contribution of non-fuel factors.

Six months ago, transport fare s were increased by 3.75 percent and freight charges by 4.45 percent in the Tarai and by 4.50 percent on the Kathmandu-Pokhara-Narayanghat route. The fare was hiked based on an understanding between transporters and the department that allows fares to be revised if fuel prices fluctuate by at least Rs 5 per litre.

Published by HT Syndication with permission from EKantipur.com.

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