HCMC – Even as experts have proposed abolishing subsidies to bus services, which have been increasing over the years, the public transport authority insisted that subsidies were a necessity for this form of transport.
As the HCMC Public Transport Management Center announced, bus services No. 2, 11 and 144, which have received subsidies in the past, will be suspended from next month.
The city’s bus subsidies for this year amount to VND1.15 trillion but an additional VND161 billion is being sought.
In a document sent to the HCMC Department of Finance regarding the additional subsidies, the HCMC Department of Transport said that if the subsidies are maintained at VND1.15 trillion, buses can be in service until mid-November or be cut to 85% in the year’s second half, including the suspension of certain bus services.
According to the transport department, as many as 10 subsidized bus services have been cut since late 2018. There are now only 91 subsidized bus services.
HCMC targeted that public transportation will meet 25-30% of the travel needs of the city’s residents. However, the latest updates revealed that only 9.7% of such needs were fulfilled.
Eight years ago, HCMC recorded some 305 million bus passengers on average each year, but the number has dropped to 147 million this year.
Amid the inefficient operation of bus services, Nguyen Le Ninh from the Scientific, Technical and Environmental Advisory Council has proposed stopping bus subsidies.
Stating that bus subsidies were only suitable in the 1970s-1980s and needed by transport cooperatives, Ninh said such subsidies will only lead to cooperatives relying on government assistance.
Ninh noted that buses are operating inefficiently because this means of transport is not as convenient as other means and is thus not favored by passengers. Spending on buses amid the low demand is not only wasteful but can also cause environmental pollution.
Meanwhile, Vo Khanh Hung, deputy director of the HCMC Department of Transport, argued that public transportation needs to be subsidized to remain operational, stressing that VND1.15 trillion in subsidies is not enough.