WEDNESDAY, JANUARY 7, 1981
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SINCE FEBRUARY, THE GOVERNMENT HAS BEEN CLOSELY MONITORING EACH COMPANY'S ADHERENCE TO THE AGREEMENTS. IN GENERAL, THE AGREEMENTS HAVE BEEN ADHERED TO. THE EFFECT OF THE IMPROVEMENTS CAN BE SEEN IN A NUMBER OF WAYS. FIRST, BECAUSE OF IMPROVED STANDARD OF MAINTENANCE, MORE BUSES ARE AVAILABLE FOR SERVICES. SECONDLY, BECAUSE OF THE GROWTH IN THE SIZE OF THE FLEET WITH THE PURCHASE OF MORE BUSES, IMPROVEMENTS HAVE BEEN MADE TO EXISTING SERVICES, BOTH BY INCREASING BUS FREQUENCY AND CAPACITY AND THROUGH THE INTRODUCTION OF NEW WEEKDAY SERVICES (29 NEW ROUTES IN 1980). FURTHER SUBSTANTIAL IMPROVEMENTS ARE PLANNED IN 1981 WHEN, ON THE BASIS OF CONFIRMED ORDERS, KMB'S FLEET WILL
EXPAND FROM JUST OVER 2 000 TO JUST UNDER 2 500 BUSES, AND CMB'S FLEET WILL EXPAND FROM ABOUT 950 TO ABOUT 1 050 BUSES.
THE COMPANIES MUST INITIALLY THEMSELVES FIND THE MONEY REQUIRED TO MEET THE IMPROVEMENT AND EXPANSION PROGRAMMES, EITHER THROUGH RAISING FUNDS FROM SHAREHOLDERS (WHO CAN FAIRLY EXPECT A REASONABLE RETURN ON THEIR INVESTMENT) OR FROM LOANS. IN PRACTICE, THEY FUND THE PROGRAMMES THROUGH A MIXTURE OF THE TWO SOURCES.
IN EXAMINING THE COMPANIES APPLICATIONS FOR ANY INCREASE IN FARES THE GOVERNMENT IS CAREFUL TO ENSURE THAT THE PUBLIC OBTAINS VALUE FOR ITS MONEY AND THAT EQUALLY THE COMPANIES SHOULDER THE IR RESPONSIBILITIES.FOR IMPROVING SERVICES.
THE COSTS WHICH THE TRAVELLING PUBLIC ARE EXPECTED TO PAY ARE EXAMINED BELOW. THESE COSTS FORM THE MAIN BURDEN OF THE PETITIONS SUBMITTED. THEY FALL INTO THREE MAIN CATEGORIES :-
(A) THE COST OF RUNNING THE SERVICE PROVIDED TO
THE PUBLIC, THAT IS THE WAGES OF DRIVERS, MECHANICS AND OTHER STAFF, FUEL, SPARE PARTS AND OTHER MAINTENANCE CHARGES-
(B)
FINANCIAL COSTS - PRINCIPALLY DEPRECIATION AND INTEREST ON LOANS- AND
(c)
A LIMITED LEVEL OF PROF ITS FOR THE COMPANY, PART OF WHICH MAY BE USED TO ASSIST IN DEVELOPMENT AND EXPANSION.
I
WITH REGARD TO CATEGORY (A), I THINK YOU WILL AGREE THAT THESE ARE CHARGES THAT SHOULD WITHOUT DOUBT BE MET BY THE TRAVELLING PUBLIC. THEY HAVE ALL BEEN INCREASING DRAMATICALLY IN RECENT YEARS, AND THIS TREND IS LIKELY TO CONTINUE. THE FACTORS INVOLVED INCLUDE HIGHER WAGES FOR DRIVERS AND MECHANICS AND THE SPIRALLING COST OF FUEL AND SPARE PARTS. IN 1981 WHEN, AS NOTED ABOVE. THE FLEET IN SERVICE WILL INCREASE SUBSTANTIALLY RUNNING COSTS WILL OF COURSE FURTHER INCREASE.
/CATEGORY (3)