KOCHI: Despite the rise in operational earnings, the Kerala State Road Transport Corporation (KSRTC) remains critically dependent on massive, and increasing, financial aid from the state government to stay afloat.
Notably, the government has ploughed around Rs 13,000 crore into the corporation over the past nine years, with the bailouts showing little sign of stopping in the near future.
On an average, KSRTC receives a sum of Rs 120 crore monthly from the state exchequer, primarily to meet pension and salary payments. And that has helped the transport corporation disburse wages and pension on the first day of the month for the past several months.
The government is also extending additional assistance to help the public entity tide over the poor state of financial affairs, according to a report presented in the seminar ‘Finance Department: Achievements and Future Perspectives’ held as part of the Kerala government’s ‘Vision 2031’ initiative.
“The huge, recurring outlay means that, without government support, the KSRTC will be unable to meet its most fundamental obligations to its employees. It indicates a state of negative cash flow where operating revenue is insufficient to cover personnel costs, let alone maintenance or expansion. The corporation can’t survive on the tax paid by the public forever. It’s high time it achieved financial self-sufficiency,” said Dijo Kappen, transport expert and chairperson of the State Public Transport Protection Committee.
Bring professional efficiency: Experts
A comparison across different government tenures highlights a dramatic escalation in the financial support required to keep KSRTC afloat. As per the report, the total aid provided by the previous UDF government (2011-16) was Rs 1,466.79 crore. The aid nearly tripled during the tenure of the first Pinarayi Vijayan-led government (2016-2021) to Rs 5,002.13 crore — an increase of 241%. The assistance has continued to surge, reaching Rs 7,829.71 crore already, an increase of 56.51% over the previous LDF term.
Along with revolutionary changes on the operational side, the very nature of the transport entity needs to be changed so as to bring professional efficiency at all levels, experts stressed. “KSRTC is currently registered under the Road Transport Corporations Act, 1950. The same has resulted in lower accountability with regard to financial management,” said transport expert G P Hari, former additional general manager (urban transport), Kochi Metro Rail Ltd.
“It should be re-registered under the Companies Act, which will make auditing of balance sheets and maintaining accountability on a par with international standards mandatory. That will bring in professional efficiency. Further, the government should take steps to float shares and sell a portion to the public, while retaining control. For example, it can make a corporation a Public Limited Company and sell 10% of the shares over a period of time,” he said.
aid for transport entity
Monthly financial aid: K120 cr
Aid during UDF govt (2011-16): K1,466.79 cr
During previous LDF govt (2016-21): K5,002.13 cr
During current LDF govt (from 2021): K7,829.71 cr
