•On a normal day, over 70,000 matatus and buses in operation rake in an average Sh15,000
•On top of running costs including fuel, spare parts, tyres, crew, insurance cover and taxes, matatu and bus operators now have to incur the extra cost of providing hand sanitizer for passengers as well as fumigating the PSVs after every trip
The public transport industry is losing up to Sh840 million daily owing to the effects of the coronavirus pandemic.
Speaking to the Star, Matatu Owners Association chairman Simon Kimutai said that on a normal day, over 70,000 matatus and buses in operation rake in an average Sh15,000.
This means the industry’s gross earnings amount to more than Sh1.05 billion on a daily basis, with earnings now dropping by between 70-80 per cent over effects of COVID-19.
“This is what the industry is capable of making on a daily basis. We are facilitators of the economy,” he said.
But now, with the government directives on social distancing, workers to operate from home and the recently effected curfew from 7pm to 5am, the public transport industry has suffered a major blow.
To adhere to the social distancing directive, the 14-seater matatus were directed to carry eight passengers, those with a 25-seater capacity to reduce to 15 passengers while those above a 30-seater capacity were directed to maintain a capacity of 60 per cent per trip.
“The public transport sector is now on its knees with the directive to stay at home. To add insult to injury the curfew has made it worse,” Kimutai said.
On top of running costs including fuel, spare parts, tyres, crew, insurance cover and taxes, matatu and bus operators now have to incur the extra cost of providing hand sanitizer for passengers as well as fumigating the PSVs after every trip.
Kimutai told the Star to try to cushion the losses, and with no incentives or subsidies, the sector has been forced to try to mitigate these losses through hiked fares, forcing commuters to bear the brunt.
The curfew which requires people to be out of the streets between 7pm and 5am, in place since last Friday has also resulted in a decline in the public transport business.
"We still have to return the buses from upcountry destinations even if the capacity is at 20 per cent ridership in order to fulfil the next day’s bookings,'' Easy Coach managing director Azym Dossa told the Star.
He added that cross-border travel restrictions have also affected the firm’s service routes.
The PSV operators, however, noted that without any form of government assistance, remaining in the sector had become unreasonable.
''In order to rationalise our labour cost, we have plans to allow for outstanding leave, then unpaid leave, then voluntary leave but within the boundaries of the labour laws of Kenya,'' Dossa said.
Last week, the president directed that Treasury move to parliament to offer immediate relief to both consumers and business owners, including reduction of VAT from 16 per cent to 14 per cent.
Commuters may, however, have to wait to mid-April through the Energy and Petroleum Regulatory Authority’s monthly price review, for the cost of fuel to drop over the Saudi Arabia- Russia oil spat which has seen global crude prices drop 50 per cent to $30 per barrel.
The Energy Petroleum price review takes into account a cumulative nine taxes and levies, nearly half of the cost of a litre of fuel goes to the state as tax.
The taxes include Excise Duty, Road Maintenance Levy, Petroleum Development Levy, Petroleum Regulatory Levy, Railway Development Levy, Merchant Shipping Levy, Import Declaration Fee and Value Added to all petrol and diesel imports.
The government needs to look into subsidizing fuel prices and also see how they can help companies by topping-up salaries for employees,'' Dossa said.