Facing flak over transport strike, KCR mulls partial privatisation of RTC

Facing his first major challenge in the wake of intensified agitation by the state transport employees and opposition parties preparing to call for a statewide bandh, Telangana Chief Minister K Chandrashekar Rao has drawn up plans for partial privatisation of the state transport corporation.

However, it will be an uphill task for the TRS government as experts warn that the path to privatisation is risky and can throw up new hurdles. Meanwhile, the Congress has alleged that the Chief Minister and his associates were “eyeing” the massive properties of the Telangana State Road Transport Corporation (TSRTC) in the garb of privatising the loss-making company.

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The TRS government is facing all round flak for dismissing nearly 48,000 striking employees of the TSRTC, one of the biggest lay-offs at one go by any state government. Brushing aside protests and warnings by the opposition parties, Rao has taken a tough stand and ruled out taking back the striking staff.

The partial privatisation plan

Now, a major transformation is on the cards in the state-owned transport behemoth. The government has decided to part-privatise the TSRTC, with about 2,100 buses to be run and maintained entirely by private players. This will constitute about 20% of its entire fleet.

Out of 10,400 buses, as many as 5,200 would be run by the corporation. Of the remaining, 3,100 buses would be given on hire to private operators, but would be maintained by it. Another 2,100 buses would be handed over to private bus operators who would run the same on designated routes, including rural areas.

Further, no trade unionism will be allowed in the TSRTC. On the growing demand to reinstate the employees, KCR had shot back, “By refusing to resume their duties before the deadline (October 5), they have dismissed themselves. Where is the question of the government terminating them?”

Also read | 48,000 striking transport employees sacked in Telangana

The employees have been demanding, among other things, merger of the corporation with the state government as was done in neighbouring Andhra Pradesh, where they are being treated as government employees with their retirement age enhanced to 60 years. They are also demanding revision of their salaries pending since April 2017 and fresh recruitment in the corporation to reduce workload.

However, the government has firmly ruled out any merger of the loss-making corporation and made it clear that it would not succumb to the blackmail tactics of the employees’ unions. The TSRTC is incurring an annual loss of ₹1,200 crore and has an accumulated debt of ₹5,000 crore.

“The RTC should earn profits. It should be made into a profit-making organisation. People should not suffer under any circumstances. We will not tolerate indiscipline and blackmailing tactics,” Rao said while ruling out talks with the striking staff.

Experts warn against privatisation

Experts have warned the government against privatisation, saying what the transport corporation needs is more operational autonomy.

“It is ridiculous to blame the transport corporation and its employees for the losses. The government must reduce the tax burden on the corporation and allow greater operational freedom to achieve the turn-around,” analyst Professor K Nageshwar said.

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Diesel alone accounts for 32% of the total expenditure by the corporation and heavy state tax on fuel is one of the key factors responsible for the losses. “The RTC pays nearly Rs 650 crore per year to the government towards taxes. If the government reduces the tax burden, then the corporation will be able to cut down its losses,” he said.

The expenditure on fuel, which stood at 20% of the total expenditure in 2015, rose to 32% in 2018 while the component of staff salaries went up by just 1.2% during the period from 54.8% to 56%.

“This shows that instead of privatisation, the corporation needs to be freed from the shackles of high taxation. Moreover, it must be seen as a service organisation, not a commercial one. Providing safe and efficient public transport is the social obligation of the government,” added Professor Nageshwar.

Opposition attack

The Congress has accused the Chief Minister of trying to use the employees’ strike to push for privatisation. “KCR’s family is eyeing for the corporation’s properties worth more than ₹65,000 crore and wants to grab them in the name of the corporation’s revival plan,” alleged senior Congress leader G Narayan Reddy.

“The Chief Minister is neither concerned about the inconvenience being caused to nearly one crore commuters, nor is he bothered about the fate of over 48,000 employees whom he declared as ‘self-dismissed’. He is creating a situation wherein his family members and friends can easily take over corporation’s properties,” he added.

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Reddy further demanded a white paper covering the details of the corporation’s assets, liabilities, dues from the government and taxes imposed on it.

Echoing similar views, Ashwatham Reddy, the president of the Joint Action Committee of the TSRTC employees, charged the TRS government with resorting to intimidating tactics.

“The Chief Minister is planning to privatise the corporation while showing our strike as an excuse. He is making baseless allegations against the striking employees and resorting to intimidating tactics. We are not going to succumb to any pressures,” he said.

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The Congress, BJP and Left parties have extended support to the striking employees and stepped up attack on the TRS government for its unilateral and undemocratic decisions.

A delegation of the state BJP leaders, along with representatives from the employees’ union, met Governor Tamilisai Soundararajan on Thursday (October 10) and submitted a memorandum, seeking her intervention to resolve the crisis.

Jayalalithaa’s template

CM Rao’s move has drawn comparison with former Tamil Nadu Chief Minister J Jayalalithaa’s response to a similar situation in 2003. She had then dismissed 1.76 lakh government employees who had gone on strike.

Following the court’s intervention, her government had later agreed to take back the employees on its terms. The reinstatement was subject to every employee tendering an unconditional apology as well as give an undertaking that they will not go on strike in future.

In Telangana too, Rao has ordered recruitment of new employees after taking an undertaking from them that they will not go on strike.