Freezing ticket prices an economic crime
A top official of a government body said freezing prices of government output was an ‘economic crime’ because the popular concept of ‘government bearing the burden’ had no factual basis.
“Suppressing prices and freezing them is an economic crime,” head of Sri Lanka Railways Lalithasiri Gunaruwan told reporters. “It is not raising prices that cause an economic crisis.”
Gunaruwan says the railways lost 7.5 billion rupees last year, which was topped up by the Treasury, saying the government was bearing the burden.
This year it is set to increase by a further 900 million with the latest increase in fuel prices. Only 5.0 percent of the traveling public used trains.
“We say, ‘The government is bearing the cost. We will not charge the passenger’,” he said.
“There is nothing called the government bearing the cost. This whole expenditure is borne on behalf of the train passengers by the whole country.
“A poor villager in Angunakolapalassa who does not even step on a train bears the burden of this 8.5 billion rupees.
“A beggar on the road pays this with the vat on his bun the cost of maintaining the railways.”
The same applied to buses or other government service.
“The innocent person in the village who does not travel in buses, sometimes waking 10 or 15 miles to the hospital or school, they pay with everything they have,” says Gunaruwan.
“I say that we should increase the price. Without an increase we are putting the burden on everyone in the country.”
Gunaruwan said when he was a university student the train fare from Panadura to Colombo was higher than the bus fare.
Now the train fare was 14 rupees to Panadura and the bus fare was 30 rupees before a recent 17 percent increase, he said.
Bus fares were about a one rupee per passenger kilometre. Rail fares had not been raised from 2005.
Sri Lanka railways now charged 50 cents per passenger kilometre from ordinary citizens, 5 cents from state workers and 3 cents from 17,000 rail workers.
The government policy was to keep rail fares slightly below bus fares. This meant rail fares had to almost double.
“We do not want to burden commuters,” Gunaruwan said. “But those who get the benefit must pay for it.
“We falsely say that the government is bearing the cost. We can only be happy saying this for a short time.”
Sri Lanka’s inflation in Colombo was 25 percent in April 2008, the highest since the index was created.
Large budget deficits stemming from a too large government and accommodative monetary policy had long been blamed for high domestic inflation in the country which impoverishes people in general and destroys the savings of older people.
Source: Lanka Business Online
Tags: bus fares, economic crime, economic crisis, factual basis, fuel prices, government body, government service, innocent person, ordinary citizens, panadura, rail fares, rupees, sri lanka railways, train fare, train passengers
