Govt gearing up for transport fare hike

Govt gearing up for transport fare hike

The government is making final preparation to revise public transportation fare in line with rise in prices of fuel and non-fuel components.

Officials at the Department of Transport Management (DoTM) told Republica that they had already completed studying fuel and non-fuel costs. “We have completed changes in prices of fuel and non-fuel components over the past year,” Sharad Adhikari, acting director general of DoTM, said, adding, “We will fix the new fare as per the changes in price of these components.”

Adhikari said the department would write to the Ministry of Physical Infrastructure and Transport (MoPIT) for final approval once the new rate is finalized.
As per the Scientific Fare Determination Mechanism that the government enforced on 2009, transportation fare has to be revised once a year based on fuel and non-fuel factors.

Non-fuel factors includes price of vehicles, spare parts and lubricants, bank interest rates, salary of staffers, and inflation rate, among others.

Fuel factor weigh

According to the existing provision, transport fare has to be revised if fuel price increases by 5 percent. New fare is determined on the basis of 35 percent contribution from fuel factor and 65 percent contribution from non-fuel factors.

Transport entrepreneurs have been demanding that the government raise fare by at least 15 percent. But Adhikari hinted that the fare won´t be hiked by more than 10 percent.

The government had raised transportation fare by 9 percent in March last year.

“We will soon finalize the new fares,” Mukti KC, director of DoTM said. “The final meeting with stakeholders will finalize the new rate.” He, however, kept mum on when the meeting would be held.

KC also said fare won´t be increased by a flat-rate like in the past years.

Meanwhile, transport entrepreneurs have urged the government to revise fare at the earliest. “Prices of fuel as well as non-fuel components have increased significantly,” Dolnath Khanal, general secretary of Federation of Nepalese National Transport Entrepreneurs (FNNTE), said demanding that the government hike transport fare by at least 15 percent.

Source: Republica