Bus association lauds subsidy removal, but wants deregulated fares

Pan Malaysia Bus Operators Association (PMBOA) said it welcomed the removal of diesel subsidy for express buses if the government deregulates bus fares.

PMBOA president Datuk Asfar Ali said allowing market forces to determine prices would allow operators cope with higher fuel and operating costs following the removal of subsidies.

“Express bus operators are facing increase in the costs of operation due to higher wages, fuel cost and spare parts.”

“We don’t need the subsidy (depending on government's decision to deregulate bus fares) and allow the market mechanisms determine the prices of express bus fares,” he told Astro Awani, in response to the removal of fuel subsidies for RON95 and diesel beginning December 1.

Express buses have a quota of 2,880 litres of subsidised diesel, per month.

Deregulating the fares, he said, would also enable passengers enjoy better services from bus operators.

“Because the fares are controlled by the government, we can’t afford to buy more sophisticated buses with better safety features. We are unable to provide more innovative services like multi-channel music and movies, better seats and even blankets.”

Asfar added that local bus operators are at risk of losing businesses when the Asean Free Trade Area (AFTA) agreement comes into effect next year.

“Once the borders open via the AFTA scheme, bus operators from Singapore, Thailand and Indonesia will operate here. We won’t be able to compete with them if the government still regulate the fares," he said.

While the association welcomes the removal of diesel subsidy for express buses, Asfar said stage buses operators need the subsidy to stay afloat.

“The operating costs are too high for stage buses. Most of the riders come from the lower income sector who can’t afford higher bus fares. Maintaining the prices without any diesel subsidy will force companies to go out of business.”

At present, stage buses have a quota of 1,440 litres of subsidised diesel, per month.

The government, through the Land Public Transport Commission (SPAD) had also allocated RM400 Million under the Interim Stage Bus Support Fund to help stage bus operators who are experiencing losses.

The initiative, which started on January 3, 2012, acts as interim measure to cover the shortfalls in daily operations of the affected stage bus operators, especially on social routes.