Latest update May 18th, 2024 12:59 AM
Nov 08, 2008 Editorial
Yesterday we commended the minibus operators for their decision to decrease fares. Our commendations turned out to be premature, since, as it now turns out, many operators are resisting the agreement reached by their associations with the Ministry of Tourism, Industry and Commerce.
Some of those resisting are pointing to the increased cost of living. They, however, fail to accept that the cost of living increases have been a constant; what determined the last increase in fares was not the general cost of living, but the movement of fuel prices above the $1,000 threshold.
The Government, at the time, was reluctant to sanction an increase, because of concerns as to how this would affect consumers.
In the end, however, the Government could do nothing, since fares are not regulated but are determined by market forces.
There was, however, an understanding that fares would be reduced once the price of fuel, the most critical recurrent expenditure, declined.
The price of fuel has declined from above $1000 per gallon to an average of $780 per gallon. Commuters, in these circumstances, ought to have expected and enjoyed a decrease in fares.
Agreement was reached on this between the minibus operators and the Commerce Ministry. However, it would seem as if there is resistance to a reduction in fares.
We are disappointed in this development. We expected greater responsibility from the public transport operators. We expected them to pass on the benefits of the reduced cost of fuel to consumers. Many of them are now openly saying that they will not reduce fares.
This, we feel, represents the triumph of greed over responsibility. We condemn it and hope that good sense will prevail; more especially since the reason being offered for resisting a decrease in fares is without foundation.
Transportation is an important element in the cost of living. An increase in transportation costs ultimately results in an increase in prices generally.
Therefore, it is paradoxical that the minibus operators should be using the general level of prices in the economy as the basis for not decreasing their fares.
They ought to know that, once their fares are kept at the same level, there is hardly likely to be downward movement in prices. On the other hand, if prices are decreased, it will mean that overall prices in the economy will decline.
A decrease in fares will also boost sales in the economy, since there will be cumulatively greater disposal income circulating, and this circulation can help to pull prices down.
Commuters are once again at the mercy of private operators, and there is bound to be greater pressure on the Government to intervene to regulate the cost of public transportation.
While in market economies such intervention is undesirable, the Government would seem to be left with little choice at this time but to place public transportation under the regulation of the Public Utilities Commission.
Because of the stubbornness of those private minibus operatives who are resisting the better judgment of their association, it would seem that the Government is left with little choice but to do what it has been consistently threatening to do, and that is to regulate transportation fares in Guyana.
Consumers deserve protection, and it is the duty of the Government to ensure that consumers are protected against poor service and exploitative charges.
As much as regulation will go against the grain of twenty years of economic reforms in Guyana, there seems few other options open to the Government at this time but to move regrettably towards controlling fares.
Public Servants salary can double overnight by just fencing the oil projects.
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