Cheaper fuel: pass the full benefit to the masses

One of the major election pledges of President Maithripala Sirisena during his successful election campaign was to reduce the cost of living.

Soaring oil prices always contribute to high cost of living.

Hence, the masses earnestly looked forward to reduction of petrol, diesel and kerosene oil prices after voting the common Opposition candidate Maithripala Sirisena to victory early last month.

Days after his election to high office as the First Citizen, President Sirisena took prompt action to fulfill one of his major election pledges by reducing prices of petrol, diesel and kerosene by a significant margin.

For instance, the price of a litre of Petrol was reduced by Rs. 33. Similarly, prices of diesel and kerosene too were reduced to help the masses, especially those in far flung areas of the country. That was a commendable move by the new President and the Prime Minister.

Moreover, the price of a 12.5 kg domestic LP gas cylinder was reduced by Rs. 300 by the people’s-friendly 100-day program of the new Government, headed by Prime Minister Ranil Wickremesinghe.

Minister of Finance, Ravi Karunanayake presented an interim budget of the new Government led by President Sirisena on Thursday.

It contained bountiful relief and concessions to the ordinary masses that surpassed the efforts of all other administrations in the country's post-independence history.

The budget also proposed to increase the allocation for the health sector to three percent of the GDP from the 1.4 percent as proposed by the previous government.

The allocations made for education will be increased to six percent of the GDP.

The price of kerosene was further reduced by Rs. six – the second price reduction of the poor man’s power source within three weeks. In addition, prices of 13 essential goods were reduced by the removal of taxes.

The price of sugar was reduced to Rs. 85 while the price of milk powder has been reduced to Rs. 325 (400g). The reduction is Rs. 61. The price of Sustagen milk powder was reduced by Rs. 100 (400g). Flour, bread, green gram, sprats was reduced by Rs. 12.50 per kilo, Rs. 6, 40 per kilo, Rs. 15 per kilo respectively.

Masses

But the reduction of oil prices should be passed to the masses. Bus fares have already been reduced by around eight percent.

That is a big relief for the commuters who rely of public transport.

Unfortunately, the benefit of the reduction of petrol and diesel has not been fully passed to the people by three-wheel taxi drivers and those who operate school and office transport services.

These are the people who would promptly increase their taxi fares or monthly transport charges by a considerable margin even when the petrol and diesel prices are increased by a few rupees.

Such increases were never proportionate as the taxi drivers and the operators of school and office transport services always looked for undue advantage from oil price increases to expand their profit margin.

Low fuel consumption and affordable maintenance costs created a big demand for three-wheelers. Although they are randomly purchased for personal use, three-wheelers are mostly operated as taxis - a popular mode of public transport.

Taxis

Low operational costs have made the three-wheelers the popular common man's vehicle in next to no time, displacing the age-old Morris Minor cars, the popular taxis in the good old days. Three-wheelers lined up at junctions anticipating hires are a common sight today.

The introduction of taxi meters has made three-wheelers even more popular, not only among the middle class but also among the poor. Although most trishaw drivers and operators showed initial resistance to taxi meters, the ‘metered taxis’ are now in bigger demand.

Prior to the introduction of taxi meters, unscrupulous drivers who operated at ‘three-wheeler stands’ in key junctions exploited the public by quoting exorbitant fares, mainly from non-frequent travellers. These errant taxi drivers targeted only a couple of hires, quoting fares in keeping with the appearance of customers.

Being acutely aware how much an intended journey would cost and the ‘unique skills’ of three-wheeler drivers to take customers to their destinations in double quick time, avoiding heavy traffic, more and more people now go for this popular mode of transport.

The introduction of meters for three-wheelers also attracted new customers who had previously used public transport for their short distance travel.

However, only a handful of people who patronise three-wheelers regularly know that the rates of metered taxis vary from one vehicle to another.

Though the meters in three-wheelers look similar and the cost of the first kilometre is Rs. 50 or Rs. 60 at present, they adopt different rates from the second kilometer, ranging from Rs. 3.20 to 4.50 per km. In addition, Rs. two each would be charged when the vehicle is held up in each traffic block.

Depending on the choice of three-wheeler owners at the time of installing meters, the charge from the second kilometre on metered taxis varies from Rs. 32 to Rs. 45. Most passengers are unaware of the tariffs of the meters when they board these three-wheelers.

Only a handful of importers and their agents install meters in three-wheelers. At the time the meter is installed, the owner or the driver of the vehicle has the option of deciding on the rate that he intends to charge.

The taxi meter is programmed accordingly. Whether it could be tampered is anybody's guess. A holding charge, when in heavy traffic or parking between journeys, is also added to the final fare.

Hence, the fare for the same distance differs significantly and could be almost double for short distance travel.

According to regular travellers, some three-wheeler drivers impose an additional fare at night.

Though levying an additional charge at night is understandable, passengers are kept in the dark on what basis it is calculated.

Hence, it's time the authorities regularise the operations of three-wheeler taxis. In the event they are permitted to apply different fare structures - eg. Rs. 32, 34, 35, 40, 42 or 45 from the second kilometre, an easy method of identification should be introduced, preferably by a colour code for the vehicle. A mechanism of this nature would be most welcomed for passengers to decide on the three-wheeler of their choice.

In the absence of a governing body or a controlling authority to regulate three-wheeler taxi operations, the drivers are at liberty to exploit the public to their hearts’ desire. An institution or a regulatory body, where passengers could lodge complaints against three-wheeler drivers who literally take people for a ride, is a pressing need.

The same goes for four-wheel taxis, mainly small hatchback taxi cars which also have similar meters, but operate on a different fare structure. Hence, the exploitation of passengers who use these taxis should be stopped forthwith.

The Government should take steps immediately to set up a regulatory body for three-wheel and four-wheel taxi operators. The fare structures should be clearly displayed on taxis and any subsequent increase should be approved by that regulatory body.

We propose that a structure similar to the private passenger transport authority be introduced as the need of the hour.

This would not only regularise taxi fares, but also discipline three-wheeler drivers who could even be provided uniforms for easy identification, like private bus drivers and conductors.

An organised mechanism would undoubtedly safeguard the interests of three-wheeler passengers and thereby protect their interests. Different fare structures could be permitted depending on the area in which they operate - hilly or flat in keeping with the fuel consumption.

At present three-wheeler passengers do not have a regulatory body to lodge complaints other than bandy words with taxi drivers or seek police assistance as a last resort. Hence, the setting up of a regulatory authority for taxis is a sine qua non.

Such regulatory body for both taxis and school/office vans could work out a fare structure based on current fuel prices, as in the private buses.

It would be ideal if such a regulatory body implement a flat fare structure for three-wheelers. Similarly, there could be different fare structures for school and office vans, based on distance.

Only such a mechanism could guarantee the passing of benefits of fuel prices to commuters.

If not, the Government’s efforts would be in vain as the masses fail to enjoy the full benefit of oil price reductions.

Similarly, the reduction of LP gas prices and wheat flour too should be passed on to consumers.

Hotels, bakers and confectionery industry people who always make use of flour and gas price increases to skyrocket the prices of their products conveniently ignore any price reductions of LP gas and wheat flour.

This is where the Consumer Affairs Authority could play a big role to protect customers from opportunistic traders. What is important is to pass the benefit of the price reductions to the masses.

We earnestly hope that the Government, as it took prompt action to reduce prices of essential goods and fuel, would work out a mechanism and closely monitor how the traders would pass those benefits on to the masses.

It is heartening to see Minister of Internal Transport Ranjith Madduma Bandara making a sincere effort to pass the benefit of fuel price reduction to the masses. His effort to regulate three-wheel taxi and school and office transport vans is a positive sign.

At a recent meeting with the minister, three-wheel drivers’ associations have agreed to reduce their rates by 10 percent while the representatives of the office and school transport services have agreed to reduce their monthly charges by five percent with effect from today.

However, the said price reductions are nowhere near the fuel price reductions, compared to more than 20 percent drop in petrol prices. We hope that the efforts of the new President and the Government to reduce cost-of-living could be fully reflected if the three-wheel taxi and school and office transport vans reduce their rates accordingly.

- Rasika