BMTC audit by CAG

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Written By vinod_shankar - 21 March, 2010

Bangalore BMTC Bus Media Reports audit CAG Transportation public transport public transport

Recently CAG  had done a audit of BMTC , an article has been published on the same in business standard.

http://www.business-standard.com/india/news/bmtc-profitsdownward-curve/389290/

 

Some of important points in the report

1.For year-ended March 2009, the corporation has reported a 60.6 per cent drop in the net profit at Rs 55.18 crore, compared to the previous year.

2. an operating loss of Rs 20.6 crore compared to an operating profit of Rs 70.8 crore for 2008-09 as against the previous year.

3. The earnings per kilometre (KM) was Rs 24.63 and expended Rs 23.28 per KM during the year.

4.carried an average of 3.66 million passengers per day

5. the number of trips operated by the corporation increased to 25 million in 2008-09 from 16 million in 2004-05, the percentage of trips checked to the trips operated declined 1.17 per cent from 1.65 per cent in 2004-05

vinod

COMMENTS


Lots of AC's

ss87 - 22 March, 2010 - 10:14

We can see lots of AC buses running on the road due to which cost of operation has increased. Also many buses running to ITPL and electronic city from Banashankari return quite empty and run empty in teh afternoon times. We actually require this buses only in the peak hour(Especially 500K series volvoes) and the same frequency is again required in the evening peak hour. BMTC can reschedule these buses by keeping them in the depots or using them ins ome other routes which get good crowd in the afternoons. this also will reduce the cost of operations during this period as otherwise cost of operation> revenue generated.

See this

44 per cent schedules were not earning enough to meet even variable cost of operation.

And then, see this detailed data on schedules (http://www.praja.in/en/gyan/bmtc-info): Vaayu Vajra and Vajra combined are 5.76% of total schedules. Assuming all Vajras are bleeding, you still have 38% schedules that are not earning enough meet cost of operations.

Now to the other interesting negative point noted in the report is:

Its passenger load factor at 63.80 per cent was less than the All India Average of 71 per cent ... The load factor (capacity utilisation) of the corporation decreased to 63.8 per cent in 2008-09 from 67 per cent in 2004-05.

If BMTC had maintained its load factor of 67%, (that is 5% higher than 63.8%) earnings could have been higher by 5% with not much change in expenses (as same bus, fleet would bring more revenue).

Also note the jump in number of Trips:

... number of trips operated by the corporation increased to 25 million in 2008-09 from 16 million in 2004-05

16 mill to 25 mill, that is more than 50% increase in trips. More trips, and lower load factors - tells you that route rationalization is whats needed here to carry more with less.

The analysis reveals - Load

ss87 - 23 March, 2010 - 10:26

The analysis reveals - Load factor of 63.8% from 67%. That means load as increased but the proportion of increase in people has reduced i.e for 11 million extra trips the load increased is only about 5-6 million i.e 50% of the schedule increase. Well people going by buses have increased but they can increase more only with better operations and regulated fares.

BMTC in the recent times have always had a decision-increase in diesel prices=increase in running costs=increase fares. However they have failed to cut down some of the costs and some of the routes.

There are some routes which are characterized by detours. The distance from Banashankari to market is around 6-7 kms by the route bus takes. Also these buses instead of taking the shorter route of continuing on Kanakapura road or going via K.R.Road take a detour to South end circle and return. No. of people travelling to south end is quite few(About 3-4) and almost a litre of diesel is spent for the detour. One more detour is the well known Wilson garden detour followed by all buses from Jayanagar to Banashankari including the new ones which can also be avoided by majority buses, Many new buses can be diverted via short routes by which major operational costs can be recovered.

The metro work going on has also resulted in major diversions in the MG roads and major areas which has also caused an increase in fuel costs especially for Old madras road buses.

Number of volvoes running in the city have doubled and these buses have another problem fo lesser mileage due to AC's running and inability to switch off engines at signals.

The major revenue loss occurs over the short distances where people find travelling by autos cheaper and faster rather than travelling by a bus when 2-3 travel together , owing to high fares. If these problems get rectified probably the profits and earnings of the corporation will boost up.

By the way is this profit after the subsidy from govt. with resepct to student passes or before that?

Asfaq - Suggestion sent for passes

Naveen - 24 March, 2010 - 05:03

A few observations :

1) As ss87 mentioned, in percentage terms, loads might have reduced, but due to large increase in the number of buses & trip schedules, the number of users has actually increased.

2) If buses are too crowded, they become uncomfortable & this can put off those that might have better alternatives such as cars. Thus, the objective to increase loads might have an impact on street congestion too - I think about 65% is just about right. "Carry more with less" & route rationalization can have adverse impacts too, though they may improve BMTC's profitability.

3) Point to point passes - a suggestion had been forwarded to CTMO - see this earlier post. No response has been received so far. I think we need to take this up more seriously now. Manjari /Rithesh - when do you plan the next BMTC meeting ? Following is the text of the letter that had been forwarded :

 

Dear Sir,

Greetings & it is heartening to see so many BMTC buses now everywhere in the city, & at good frequencies.

To follow up on the bus day event, there is one more potential way to get more daily commuters into BMTC's folds & this is to explore possibilities for increasing commitment to BMTC with monthly passes by passengers.
Since the estimated no. of monthly pass holders (other than students, seniors, etc) is low at just over 2 lakhs out of 35 lakh daily users, attempts need to be made to improve this as it will be beneficial in increasing bus patronization as also in reducing congestion.

Presently, the most commonly used passes for office goers that are on offer are :
1) City - Rs.450/- per month for Unlimited travel in all Non-A/C services within City;
2) Sub-Urban /Pushpak /Suvarna - Rs.600/- per month for Unlimited travel in all City, Suburban & Pushpak /Suvarna;
3) Vajra Gold Pass - Rs.1250/-.

If an office goer spends Rs.12 each way (ie. Rs.24 /day), then his monthly office commute expenditure would be about Rs.600/- (assuming 25 working days in a month), which is the same as the cost for a suburban pass. The person may not see much value in the unlimited use of the pass since he may or may not use it on weekends or after his office (ie. he may not know if it will be of more use or not to him at the time of purchase). Thus, he may prefer not to buy one & lock up Rs.600/-.
Hence, the category of users that buy daily tickets priced within this range will opt out, & this may be a sizable lot that BMTC would have lost.

The 600rs pass will therefore attract only those that generally live far off from their work places & those that have to make a bus change in between (ie. their bus expense has to be well over Rs.25/- a day). Others will not consider these passes.

Similar to student passes, if an additional variety of commuter passes are available based on point of origin to point of destination, with some discount, there may be a lot more sale of monthly passes.

For example, with daily tickets, if the same office goer spends Rs.600/- per month, & a pass is available to him rigidly only for his home-office-home route for Rs.540/- (after a discount), he is more likely to buy it.

Also please consider this - A daily bus commuter stated the following on Praja.in :
I found that people are very reluctant to change buses. They expect direct connectivity. Those only who regularly travel are ready to keep moving by changing over buses especially those who have monthly or daily passes.

I believe this is quite true - once they buy passes, they will be more inclined to use buses everywhere & not look for other options.

Hence, I request you to please consider other pass options for office goers /daily commuters based on their actual routes, rather than blanket "unlimited use" passes that might not be of much use to some types of users.


Thanking You,
Your's Faithfully,
Naveen Chandra
Praja.in

services on uneconomical routes

saravankm - 22 March, 2010 - 03:18

The Hindu article on the same subject also touches upon the adequacy of services on uneconomical routes. I think it's an important responsibility of a PT system like BMTC to support the upcoming suburbs with frequent buses

Some of the Volvo fancy routes like 500 are having sporadic frequency of Non AC buses i believe.

"In the absence of norms, the adequacy of services on uneconomical routes could not be ascertained in audit. Thus it is desirable to have an independent regulatory body,” the report said"

http://www.thehindu.com/2010/03/21/stories/2010032154100400.htm

 

 


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