CHAPTER III PROFILE OF STATE TRANSPORT UNDERTAKINGS IN INDIA AND TAMIL NADU AND THEIR OPERATIONAL PERFORMANCE

CHAPTER III PROFILE OF STATE TRANSPORT UNDERTAKINGS IN INDIA AND TAMIL NADU AND THEIR OPERATIONAL PERFORMANCE In this chapter an attempt is made to review the current scenario of the operation of the nationalised bus service. It has been divided into two parts, the first part dealing with THE operational performance of State Transport Undertakings (STUs) in India and the second part with that of the Tamil Nadu STUs. 3.1. OPERATIONAL PERFORMANCE OF STUs IN INDIA The operational performance of STUs is reflected in few-indexes, which are discussed below: 1. Fleet Strength, Passengers Carried and Kilometers Operated There are 67 STUs, of which 21 are Corporations, 27 are Companies, 8 are Government Departments and 11 are Municipal Undertakings. Fifty-two of them own 98 per cent of total passenger fleet of STUs as on March 2009. The combined fleet strength of STUs as on 31.03.2009 was 1,17,324 passenger buses. They operated nearly 1264.87 billion passenger kms in the year 2008-09 or 56 per cent of the total passenger movement by road. They carried 2230.62 crore of

84 passengers in 1999-2000. The number of passengers carried has increased to 2310.29 crore in 2008-09, recording an annual growth rate of 3.57 per cent. The growth of STUs in the number of passenger buses and effective kms. operated during the last ten years has been indicated in Table 3.1 from which it is observed that the number of buses has gone up to 117.324 thousand in 2008-09 from 110.300 thousand in 1999-2000, accounting for 6.37 per cent increase. Similarly, the effective kms operated by all these buses have also increased from 1083.03 crore kms to 1264.86 crore kms during the same period. TABLE 3.1 FLEET STRENGTH, PASSENGER CARRIED AND EFFECTIVE KILMETERS OPERATED Year Fleet strength Passenger carried (in crore) Effective kms (in crore) 1999-2000 110300 2230.62 1083.03 2000-01 111084 2462.89 1112.45 2001-02 111042 2419.78 1103.26 2002-03 113826 2390.75 1142.08 2003-04 114689 2368.73 1172.46 2004-05 114970 2416.96 1189.10 2005-06 115218 2343.48 1209.40 2006-07 115229 2196.69 1203.69 2007-08 116309 2194.82 1254.11 2008-09 117324 2310.29 1264.87 Source: Performance Statistics of STUs, 1999-2000 to 2008-09, CIRT,Pune. Next to Indian Railways, STUs account for the highest number of persons employed, namely 7.52 lakh. It is estimated that by the turn of this decade,

85 passenger road transport would account for 2384 billion passenger kilometers per annum. 2. Fleet Utilization The percentage of fleet utilization to fleet held has been in the increasing order. It has gone up from 89 per cent in 1999-2000 to 93.20 per cent in 2008-09, showing an increase by almost 4.2 per cent (Table 3. 2). It is also noted that the increase has been consistent over the period except in the year 2000-01 when it declined to 87.6 per cent from 89 per cent in the previous year and in two consecutive years, namely i.e. 2003-04 and 2004-05 when there were a marginal decline of 0.01 percent. TABLE 3.2 FLEET UTILIZATION Year Rural Hill Region Urban (in per cent) Overall Fleet Utilisation 1999-2000 90.32 82.38 80.10 89.00 2000-01 89.13 83.50 77.29 87.60 2001-02 90.18 82.23 81.76 89.00 2002-03 91.12 86.17 86.25 90.40 2003-04 90.25 91.95 87.42 89.90 2004-05 90.48 89.05 86.37 89.80 2005-06 92.69 88.38 80.93 90.60 2006-07 91.28 89.90 82.81 89.90 2007-08 93.26 91.36 83.42 91.80 2008-09 94.97 95.27 85.53 93.20 Source: Performance Statistics of STUs, 1999-00 to 2008-09, CIRT,Pune.

86

87 For the following parameters, Table 3.3 is to be referred. 3. Capital Productivity The kms operated per bus has also been in the upward trend. From 302.3 kms, it has gone up to a level of 321.80 kms recording an increase of 19.5 kms between 1999-2000 and 2006-07. However, in the year 2008-09, there is a decrease of 5.7 kms per fleet per day. 4. Man-Power Productivity The average kilometers operated by an employee per day have been impressive. From 37.57 kms in 1999-2000, it went up to 45.95 kms recording an increase of 8.38 kms during the period, which is 22.31 per cent. The bus-staff ratio has been in the decreasing order, which shows better performance. The busstaff ratio has been reduced to 6.88 per bus in 2008-09 from 8.05 per bus in 1999-2000. 5. Fuel Conservation Kilometers operated per litre of diesel have increased through the concerted efforts of the STUs. From 4.41 in 1999-2000 it has consistently increased and reached a level of 4.68 kms in 2008-09, recording an increase of 6.12 per cent during the period.

88 6. Break-down and Accidents In the sphere of quality of service also, the STUs have fared well, which is indicated by less number of break-downs and accidents. The data pertaining to these factors have been in the decreasing order; the former has come down from 0.31 per 10,000 effective kms. in 1999-2000 to 0.16 in 2008-09 and the accident per one lakh kilometers has come down to 0.13 in 2008-09 from 0.33 in 1999-2000. 7. Service Mix of Public Buses in India The service mix, namely bus services in different areas, such as rural, urban and hill regions are shown in Table 3. 4. Mofussil ordinary services account for 49 per cent in 1989-90 followed by City/Town service, Metro service and Mofussil express service. In comparison of the present services with that in 1999-2000, Metro and Mofussil express services almost remain the same while Mofussil ordinary services have declined by 11 per cent and City/Town services have increased by 13 per cent. With regard to the share of public and private sectors in the different category of services, it is observed that in the case of Metro services almost 100 per cent are with the STUs, and in the case of City/Town and mofussil express services the STUs have about 80 per cent share in the total fleets. Whereas in the case of the mofussil ordinary services it has a share of 57 per cent in 1989-90.

89 TABLE 3. 4 SERVICE MIX OF PUBLIC BUSES IN INDIA Year Rural Hill Region Urban 1999-2000 87.89 2.12 9.99 2000-01 87.04 2.84 10.12 2001-02 86.99 2.39 10.62 2002-03 85.92 2.44 11.64 2003-04 84.35 2.25 13.40 2004-05 82.81 2.30 14.89 2005-06 82.78 1.99 15.23 2006-07 83.34 1.95 14.71 2007-08 84.93 1.93 13.14 2008-09 80.42 2.30 17.28 Source: Performance Statistics of STUs, 1999-2000 to 2008-09, CIRT,Pune. 8. Financial Performance Table 3.5 exhibits the losses incurred by the STUs during the period 1999-2000 to 2008-09. It is noted from the table that during all these years the STUs have incurred losses though the amount of loss which fluctuates over the period and ranges from Rs. 792.98 crore (1999-2000) to Rs.1964.98 crore (1994-95). The cumulative losses of STUs have increased from Rs. 792.98 crore in 1999-2000 to Rs. 14493.29crore in 2008-09.

90 TABLE 3.5 EXTENT OF LOSSES OF STUs IN INDIA (Rs. in crore) Year Net Revenue Expenditure Loss Cumulative Loss 1999-2000 7647.82 8440.80 792.98 792.98 2000-01 7962.95 8998.19 1035.24 1828.22 2001-02 8456.77 9643.69 1186.92 3015.14 2002-03 8734.46 9915.14 1180.66 4195.80 2003-04 9179.51 10944.09 1764.58 5960.38 2004-05 11187.27 13152.25 1964.98 7925.36 2005-06 12419.16 14225.70 1806.54 9731.90 2006-07 13065.57 14865.40 1799.83 11531.73 2007-08 15801.02 17473.26 1672.24 13203.97 2008-09 17657.53 18946.85 1289.32 14493.29 Source: Performance Statistics of STUs, 1999-2000 to 2008-09, CIRT, Pune. It may be noted that the operating ratio has been less than 100 per cent (it ranges between 77.27 and 86.08 per cent) in each year denoting that the cost of service is met from the revenue generated from it. In spite of the inspiring performance of STUs, in terms of the operating ratio, the financial performance on the basis of total expenditure and revenue is not healthy as revealed in Table 3.6. The causes for the continued financial losses seem to be external such as high incidence of tax, operating uneconomic services and unremunerative fare. In this regard, it is pertinent to mention here the observations made by the Planning Commission, "Financial viability of SRTUs has been seriously impaired by inflexible fares, an environment of rising costs, concessional travel, uneconomic routes and above all high level of taxation. Periodic increases in

91 prices of key inputs have pushed up the cost of vehicle manufactures, the burden of which has been passed on to the undertakings. The position has come to such that unless these undertakings are supported with lower taxes and given the flexibility to adjust fares to match their costs, they may become a serious burden on the economy. Year TABLE 3.6 OPERATING RATIOS OF STUs IN INDIA Operating Cost (Rs. In Crores) Net Revenue (Rs. In Crores) Operating Ratio 1999-2000 5909.40 7647.82 77.27 2000-01 6335.64 7962.95 79.56 2001-02 7019.64 8456.77 83.01 2002-03 7240.30 8734.46 82.89 2003-04 7867.31 9179.51 85.71 2004-05 9630.54 11187.27 86.08 2005-06 10478.65 12419.16 84.37 2006-07 10954.95 13065.57 83.85 2007-08 13142.25 15801.02 83.17 2008-09 14251.82 17657.53 80.71 Source: Performance Statistics of STUs, 1999-2000 to 2008-09, CIRT, Pune. 3.2 NATIONALISED BUS SERVICE IN TAMIL NADU 1. Profile of Tamil Nadu: Tamil Nadu accounting for 7.5 per cent of India s population and 4.3 per cent of geographical area has the longest surfaced road length (78.1 per cent) in the country. The length of roads has increased more than four-fold since 1961,

92 from 38,192 kms to 1,31,516 kms as on 31 st March 2004 and now Tamil Nadu occupies the third rank next to Maharashtra and Uttar Pradesh in length of roads. More than 55 per cent of the villages are connected by all weather roads. The road intensity per 100 square km in Tamil Nadu (71.7 kms) is higher than the all India rate of 65.3 kms. However, the density of road kms per lakh of population in the State is only 227 as against the all India density of 391.7 kms. Maharashtra had the largest number of motor vehicles, 92.54 lakhs followed by Tamil Nadu which had 27.72 lakh motor vehicles on road in 1999-2000 and 67.52 lakh in 2008-09.(Table 3.7)

93 TABLE 3.7 GROWTH OF VEHICLES IN TAMIL NADU Year as on 31 st march Transport vehicles Non-transport vehicles Total 1999-2000 2,83,404 24,88,442 27,71,846 2000-01 3,09,817 28,72,002 31,81,819 2001-02 3,44,244 32,70,004 36,14,248 2002-03 3,68,922 37,01,812 40,70,734 2003-04 3,99,300 42,07,928 46,07,228 2004-05 4,21,365 47,40,717 51,62,082 2005-06 4,32,106 52,25,991 56,58,097 2006-07 4,57,448 57,51,589 62,09,037 2007-08 4,72,172 62,80,301 67,52,473 Source: Department of Road Transport, Government of Tamil Nadu With progressive nationalisation and bifurcation of the bigger units and the establishment of new corporations, the number of transport corporations in Tamil Nadu till 2008-09 was 21. As on 31-04-2009, the date from which these 21 corporations were formed, their principal area of operation is indicated in Table 3.8.

94 TABLE 3. 8 DETAILS OF STATE TRANSPORT CORPORATIONS IN TAMIL NADU Sl. No. Name of the Corporation 1 Metropolitan Transport Corporation. (Ch.Dn.I) Ltd Chennai 2 Metropolitan Transport Corporation. (Ch.Dn.II) Ltd Chennai 3 State Express Transport Corporation, (T N Dn.I) Ltd. Chennai 4 State Express Transport Corporation, (T N. Dn.II) Ltd.,Chennai 5 Tamil Nadu State Transport Corporation, Villupuram 6 Tamil Nadu State Transport Corporation, Vellore 7 Tamil Nadu State Transport Corporation, Kancheepuram 8 Tamil Nadu State Transport Corporation,Salem 9 Tamil Nadu State Transport Corporation, Dharmapuri 10 Tamil Nadu State Transport Corporation, Coimbatore 11 Tamil Nadu State Transport Corporation, Erode 12 Tamil Nadu State Transport Corporation, Ooty Date of Formation Principal area of operation 01.01.72 Chennai Metropolitan area (South) 19.01.94 Chennai Metropolitan area (North) 01.04.80 Entire State of Tamil Nadu Fleet Strength as on 31.04.2004 (including sparebuses) 1491 1329 724 27.01.94 Inter State 212 16.01.75 Villupuram & Cudalore Districts 1021 01.12.82 Vellore & 838 ThiruvannamalaiDistric 01.04.92 Kancheepuram & 754 Thiruvallur Districts 15.02.73 Salem/Namakkal 949 Districts 01.04.87 Dharmapuri District 688 01.03.72 Coimbatore District 1206 01.04.83 Erode District 914 18.02.94 The Nilgiris District 401

95 13 Tamil Nadu State Transport Corporation, Kumbakonam 01.03.72 Thanjavur, Nagapattinam &Thiruvarur Districts 14 Tamil Nadu State Transport 01.04.85 Thiruchirapalli, 979 Corporation, Karur & Perambalur 15 Tamil Nadu State Transport 01.04.83 Sivaganga & 591 Corporation, Karaikudi Ramanad Districts 16 Tamil Nadu State Transport 16.03.96 Pudukottai District 367 Corporation, Pudukottai 17 Tamil Nadu State Transport 17.01.72 Madurai District 945 Corporation, Madurai 18 Tamil Nadu State Transport 01.01.74 Tirunelveli & 836 Corporation, Tirunelveli Tuticorin Districts 19 Tamil Nadu State Transport 01.04.83 Kanniyakumari 676 Corporation, Nagercoil District 20 Tamil Nadu State Transport 01.04.86 Dindigul, Theni 741 Corporation, Dindigul District 21 Tamil Nadu State Transport 01.05.97 Virudhunagar 386 Corporation, Virudhunagar District TOTAL FLEET STRENGTH - 16994 Source: Transport Department, Government of Tamil Nadu, Policy Note - 2008-2009, Demand No. 46 946 In the year 2008-09, in Tamil Nadu, out of 18,683 passenger vehicles, the State Corporations owned 12,697 which accounted for 67.96 per cent. In the year 2008-09 the share of the public sector increased to 72.24 per cent of the total fleet of 23,525 passenger vehicles (Table 3-9). Transport Corporations together were operating 16994 buses on 7,248 routes in that year, carrying every day nearly 121.96 lakh passengers over 159.38 lakh kms and employing 1,00,500 persons. Thus the public passenger road transport sector has come to stay in Tamil Nadu and is poised for an accelerated growth in future.

96 TABLE 3.9 TOTAL NUMBER OF BUSES IN PUBLIC AND PRIVATE SECTORS IN TAMIL NADU (2000 2009) Year Buses Held By Public Private Total 1999-2000 12697 (67.96) 5986 (32.04) 18683 2000-01 14055 (69.88) 6058 (30.12) 20113 2001-02 14231 (70.07) 6079 (29.93) 20310 2002-03 15588 (70.96) 6182 (29.04) 21770 2003-04 15708 (71.42) 6286 (28.58) 21994 2004-05 16213 (71.85) 6352 (28.15) 22565 2005-06 16308 (71.92) 6367 (28.08) 22675 2006-07 16607 (72.07) 6436 (27.93) 23043 2007-08 16823 (72.18) 6484 (27.82) 23307 2008-09 16994 (72.24) 6531 (27.76) 23525 Note: The figures within parentheses are percentages to the Row Totals. Source : Records of Transport Department, Government of Tamil Nadu, Ezhilagam, Chennai. 3. Centre-wise Break-up of Public and Private Stage Carrier in Tamil Nadu. (2003-2004) The data pertaining to operations of buses by private and STUs are shown in Table 3.10.

97 TABLE 3.10 CENTRE-WISE BREAKUP OF VEHICLES IN TAMIL NADU (2008-09) Sl DISTRICT NO OF BUSES No PUBLIC PRIVATE TOTAL 1 Chennai 4825 (95.83) 210(4.17) 5035 2 Tiruvallur 160(59.26) 110(40.74) 270 3 Kancheepuram 661(81.10) 154(18.90) 815 4 Vellore 559(57.63) 411(42.37) 970 5 Tiruvannamalai 196(40.66) 286(59.34) 482 6 Cuddalore 363(55.59) 290(44.41) 653 7 Villupuram 588(65.85) 305(34.15) 893 8 Salem 554(57.59) 408(42.41) 962 9 Namakkal 162(41.22) 231(58.78) 393 10 Thiruchengodu 74(45.96) 87(54.04) 161 11 Dharmapuri 655(65.83) 340(34.17) 995 12 Trichy 289(49.57) 294(50.43) 583 13 Sri Rangam 223(65.98) 115(34.02) 338 14 Karur 106(29.44) 254(70.58) 360 15 Perambalur 170(63.91) 96(36.09) 266 16 Thanjavur 581(73.27) 212(26.73) 793 17 Nagapattinam 170(64.89) 92(35.11) 262 18 Tiruvarur 162(65.59) 85(34.41) 247 19 Pudukkottai 313(64.80) 170(35.20) 483 20 Erode 350(60.03) 233(39.97) 583 21 Gobi 230(60.37) 151(39.63) 381 22 Tiruppur 318(71.78) 125(28.22) 443 23 Pollachi 334(69.29) 148(30.71) 482 24 Coimbatore ( N ) 459(70.18) 195(29.82) 654 25 Mettupalayam 127(51.63) 119(48.37) 246 26 Udagamandalam 366(100) 0 366 27 Madurai 782(82.23) 169(17.77) 951 28 Periyakulam 228(75.50) 74(24.50) 302 29 Dindigul 492(61.27) 311(38.73) 803 30 Virudhunagar 335(64.67) 183(35.33) 518 31 Ramanathapuram 311(82.49) 66(17.51) 377 32 Sivagangai 284(68.11) 133(31.89) 417 33 Tuticorin 317(64.96) 171(35.04) 488 34 Tenkasi 189(66.78) 94(33.22) 283 35 Tirunelveli 384(64.76) 209(35.24) 593 36 Nagercoil 677(100) 0 677 State -Total 16994(72.24) 6531(27.76) 23525 Source: Records and Administrative Reports (1999-2000 and 2008-09) of Transport Department, Chennai: Government of Tamil Nadu.

98 It is observed from Table 3.10 that STUs operate all Metro services and their share in Madras City is 95.83 per cent and the rest 4.17 per cent is covered by other Mofussil buses by private operators. The other districts in which STUs have larger share are Nagarcoil (100 per cent), Ramnad (82.49 per cent) and Madurai (82.23 per cent). The centres where STUs' share is relatively less are Karur (29.44 per cent), Tiruvannamalai (40.66 per cent) and Nammakkal (41.22 per cent). In the rest of the centres the STUs' share ranges between 60 and 65 per cent. 4. Service Mix of Public and Private Buses in Tamil Nadu The service mix, namely operation of different types of services, such as metropolitan, city/town, mofussil ordinary and mofussil express services are shown in Table 3. 11. Mofussil ordinary services account for 56.52 per cent in 2008-09 followed by city/town service, mofussil express and metro service in the order of 77.80 per cent, 92.93 per cent and 100 per cent respectively. Out of the total investment of Rs. 2671.02 crore made by Tamil Nadu Government in all the statutory corporations covering various industries and services till the year 2008-09, the passenger transport sector alone accounted for Rs. 623.12 crore (nearly 23 per cent). The Government expects the transport corporations to function in accordance with sound commercial principles as far as practicable, consistent with their responsibility as public utility concerns, dealing with a vital sector of importance to the community as a whole.

99 TABLE 3.11 SERVICE MIX OF PUBLIC AND PRIVATE BUSES IN TAMIL NADU (2008-09) 2008-09 Type Of Service Total Public Private 1. Metropolitan Service 2554 (100) 0 (0) 2554 (11.86) * 2. City/Town Service 5633 (77.80) 3. Mofussil Ordinary Service 6137 (56.52) 4. Mofussil Express Service 2670 (92.93) 1607 (22.20) 4721 (43.48) 203 (7.07) 7240 (30.78) * 10858 (46.15) * 2873 (12.21) * Total 16994 6531 23525 Figures in brackets indicate percentages.* indicate overall percentage on State level Source: Administrative Reports (1989-90 and 2008-09) of Transport Department, Chennai: Government of Tamil Nadu 3.3. PERFORMANCE REVIEW OF STUs IN TAMIL NADU The performance of Tamil Nadu STUs has been dealt with next. It is discussed under the following headings: (1) Physical Performance, (2) Financial Performance, (3) Quality of Service, and (4) Social Benefits.

100 1. PHYSICAL PERFORMANCE It is significant to note that the physical performance of TNSTCs has shown an increasing trend right from their inception. Table 3.12 shows the progress made by TNSTCs from the year 1999-2000 to 2008-09. It is noted that the fleet strength has increased from 14,047 in 1999-2000 to 16664 in 2008-09 thereby indicating a rise of over 15.70 per cent over the period of 10 years. In the three consecutive years, namely 2002-03, 2003-04 and 2004-05 the fleet strength had gone upto 17028, 17025 and 17035 respectively, owing to the reason that more number of buses were added, keeping the over-aged buses ones also on the road. Metropolitan Transport Corporation (Chennai Division I & II) tops the list with a fleet strength of 2820 in the study period followed by TNSTC Coimbutore division with 1206 buses and TNSTC Villupuram Division with 1021 buses. The minimum number of buses (212) is with the State Express Transport Corporation T N Division - II. During the above study period, the maximum number of replacement of buses took place during the last 4 years, namely from 1999-2000 to 2008-09, when 1620, 1270, 1619 and 1281 buses respectively were replaced. It is also noted that the maximum augmentation took place in the year 2003-04 when 1013 buses were added to the service. In the year 2007-08 and 2003-04,530 and 539 buses were augmented.

101

102 Similarly the number of routes served by TNSTCs has also increased significantly, from 7248 in 1999-2000 to 8225 routes in 2008-09 recording an increase of more than 13 per cent. The maximum addition to the existing routes took place in the year 2005-06 in which 117 routes were added. It is pertinent to mention here that during the same year the maximum number of buses were added (1620). Passengers carried per day also increased by 34.03 per cent, from 121.96 lakh in 1999-2000 to 184.86 lakhs in 2008-09. It is also observed that the percentage of fleets operated to fleets held (Fleet Utilisation) by the TNSTCs has been between 91.67 per cent (2005-06) and 95.87 per cent (2007-08), reflecting a high rate of fleet utilization in Tamil Nadu and also it is well above the all India STUs level of 88 per cent in 2008-09.' The ratio between operated km to scheduled km (km efficiency percentage) has shown an increasing trend from 93.9 per cent in 1999-2000 to 97.91 per cent in 2008-09, showing an increase by 4 per cent. The increasing trend is also reflected in high fuel efficiency of TNSTCs. It speeded up from 4.2 km per litre of diesel in 1999-2000 to 4.72 km in 2008-09. In the year 2008-09 it has touched an all time high of 4.72 km. The occupancy ratio (OR) of all STUs in Tamil Nadu ranges between 70.99 per cent (2008-09) and 84.42 per cent (2000-01) during the study period. The low OR can be attributed to running uneconomic routes/trips under social obligations by the STCs.

103 Number of persons engaged to operate a bus (Vehicle-Man Ratio) is another indicator reflecting the efficiency of the undertaking. An increasing Vehicle-Man Ratio (VMR) is indicative of poor performance. The data in the table reveals that VMR in TNSTCs has increased from 6.03 in 1999-2000 to 7.01in 2008-09. It is observed that it has declined to 5.81 in the year 2000-01 and touched 7.49 in 2005-06. Even though there has been a fluctuation in the ratio between 5.81 and 7.49, this is very much low against the norm prescribed by All India Association of Road Transport Undertaking at 9.0. A significant aspect of public bus service is its penetration into hitherto inaccessible rural areas. The total number of villages benefited was 43 in 1999-2000 which increased to 117 in 2000-01, thereby bringing 9,948 villages into the network of bus transport service. Thereafter, a total of 137 villages were connected by the bus services. During the period under study, the bus service benefited 5.43 lakh people in the above villages (Table 3.13). It is to be noted that now the State Government is committed to press bus services into villages with a population of 1000 or more before the end of the year 2010.

104 TABLE 3.13 VILLAGES CONNECTED AND POPULATION BENEFITED Villages Population Year Connected Benefited 1999-2000 43 0.86 2000-01 36 0.61 2001-02 67 0.64 2002-03 73 0.56 2003-04 76 0.23 2004-05 72 0.55 2005-06 117 0.69 2006-07 76 0.66 2007-08 39 0.41 2008-09 22 0.35 Source : The Performance of Tamil Nadu STUs from 1999-2000 to 2008-09, from various records, Chairman Cell, Transport Department, Chennai, Government of Tamilnadu. 2. FINANCIAL PERFORMANCE Transport is quite different from manufacturing and trading, especially in the hands of government. Its principal aim is to provide adequate service to the public rather than to earn profits. Surplus/deficit over the total cost of operation, ratio of operating cost to operating revenue are the key parameters of financial performance of public transport corporations. a). Revenue Trends The gross revenue of all STCs in Tamil Nadu was Rs. 1525.24 crore in 1999-2000, which went upto Rs. 3853.73 crore in 2008-09 recording an increase of about 7.9 times over the period of 13 years (Table 3.14). During the same

105 period the cost also increased from Rs. 1573.27 crores in 1999-2000 to Rs. 4346.57 crores in 2008-09 recording an increase of 2.76 times, which is marginally more than the increase in the gross revenue. This additional increase in the cost over the gross revenue has led the transport corporations to incur losses in the recent years. From the year 1999 onwards, the aggregate cost in all Transport Corporations exceeded the gross revenue and resulted in huge losses. The cumulative profit/loss has been shown in Col. (iv). Till the year 1999-2000 the aggregate profit stood at Rs. 236.37 crores and till the year 2008-09 the cumulative loss of all TNSTCs has increased from Rs. 2653.10 crores.recording an increase of over 11 times. TABLE 3.14 FINANCIAL PERFORMANCE OF STCs (Rs. in crore) Year Revenue Expenditure Profit/Loss Cumulative Loss 1999-2000 1525.24 1573.27 48.03 284.4 2000-01 1591.52 1632.73 41.21 325.61 2001-02 1648.81 1856.21 207.4 533.01 2002-03 1687.51 1998.11 310.6 843.61 2003-04 2060.62 2289.12 228.5 1072.1 2004-05 2185.75 2597.14 411.39 1483.5 2005-06 3210.74 3528.65 317.91 1801.4 2006-07 3476.82 3705.68 228.86 2030.3 2007-08 3658.79 3788.73 129.94 2160.2 2008-09 3853.73 4346.57 492.84 2653.1 Source : The Performance of Tamil Nadu STUs from 1999-2000 to 2008-09, from various records, Chairman Cell, Transport Department, Chennai, Government of Tamilnadu.

106 b). Earnings per Kilometre A few disquieting trends were further substantiated while analysing transport corporations average revenue/cost per km operated. It is noted that during the period of study, all the Corporations put together have been making losses. The maximum loss was in the year 2008-09 followed by 1999-2000 and 2002-03 (Table 3.15) TABLE 3. 15 EARNINGS PER KILOMETRE (in Rs.) Year EPKM CPKM P/L 1999-2000 9.569833 9.871188-0.30136 2000-01 9.576509 9.824478-0.24797 2001-02 8.603235 9.685416-1.08218 2002-03 8.312448 9.842422-1.52997 2003-04 9.834487 10.92502-1.09054 2004-05 9.754764 11.59075-1.83599 2005-06 14.01947 15.40761-1.38813 2006-07 15.54998 16.57355-1.02357 2007-08 15.95078 16.51726-0.56648 2008-09 16.52189 18.63481-2.11293 Source : The Performance of Tamil Nadu STUs from 1999-2000 to 2008-09, from various records, Chairman Cell, Transport Department, Chennai, Government of Tamilnadu. 3. QUALITY OF SERVICE Apart from physical and financial dimensions, quality of service is another area of vital importance for evaluation. Quality of service consists of less number of break-downs, and accidents and complaints resulting in more safety.

107 Break-downs per 10,000 kms considerably declined, from 1.48 in 1999-2000, to 0.32 in 2008-09, which is well below the all-india mark of 0.65 for the year 2008-09. It is noted that all STUs of Tamil Nadu have significantly brought down the number of break-downs, from 1.48 in 2000-01 to 0.32 per 10,000 kms recording a decrease of 21.62 per cent. The number of accidents per lakh kms was 1.10 in 2000-01 which has gradually decreased to 0.33 in the year 2008-09 which is less than the average accident rate of all STUs in India which is 0.57 per lakh kms. (Table 3.16) Year TABLE 3. 16 QUALITY OF SERVICE No. of Breakdowns/ 10,000 Lakh Kms No.of Accidents/ 1 Lakh Kms No.of Complaints/ 1 Lakh Passengers 1999-2000 1.48 1.10 0.93 2000-01 1.04 0.91 0.86 2001-02 1.00 1.04 0.83 2002-03 0.08 0.94 0.79 2003-04 0.64 0.97 0.82 2004-05 0.61 0.62 0.76 2005-06 0.61 0.59 0.72 2006-07 0.53 0.54 0.65 2007-08 0.43 0.53 0.62 2008-09 0.32 0.33 0.45 Source : The Performance of Tamil Nadu STUs from 1999-2000 to 2008-09, from various records, Chairman Cell, Transport Department, Chennai, Government of Tamilnadu.

108 With regard to the number of public complaints, it is observed that all TNSTUs received the highest number of complaints from the public, which was 0.93 per lakh passengers in the year 1999-2000, followed by 0.86 per lakh passengers in the subsequent year 2000-01 and in 2008-09 it has gradually reduced to 0.45 per lakh passengers. Even though the rate of public complaints regarding the operations of TNSTUs has been less in number, much is-to be done in the area of passenger service, passenger-crew relationship and handling of luggage. 4. SOCIAL BENEFITS a). Travel concessions The Government has given travel concessions for travel in State Transport Corporation buses to the following category of persons. Members of Parliament, Members of Legislature, Ex-Members of Parliament, Legislative Assembly and Council. Students Accredited Journalists

109 Freedom fighters drawing Central/State pension and those who participated in border/language stir, widows and legal-heirs of freedom fighters drawing Central pension/state pension or wife/husband and minor legalheirs of those who participated in language stir to protect Tamil language and those who are receipients of financial assistance from Government. Cancer patients, physically handicapped, deaf, blind, mentally retarded and epileptic patients and Drama artists b. Concession to Students With a view to benefiting all students and to give a real meaning to the concept of education for all, every academic year, all students studying from Standard I to Standard XII in all schools including private schools are provided with Free Travel Bus Passes to travel from their residence to school and back to their residence. The free school bus passes are valid on all days including all holidays. Similarly, the students studying in all colleges including private colleges are given 50 per cent concessional travel bus passes to travel from their residence to colleges, polytechnics, ITIs and Private Arts Colleges and back to their residence. These passes are valid on all days including all holidays. Exchange tokens up-to 60 in number are issued to the College students travelling in STC buses to travel to the library and back to their residence. During the year 2003-2004 alone all over the State, 19,14,288 students were benefited.

110 c. Concessions to commuters For the benefit of general passengers, monthly season tickets are issued collecting the LSS (Limited Stopping Service) fare equivalent to 40 trips from the origin to destination for travel up and down on all days in a month in the metro and town services. Passengers can travel anywhere in the city by purchasing tickets at the following rates subject to the conditions printed in the ticket. 1) One day ticket: Rs. 30/- 2) Weekly ticket: Rs.160/- 3) Monthly ticket: Rs.600/- d. Concession for group reservation 10 per cent discount on fare is given in the buses of State Express Transport Corporation when reservation is done for 8 or more members as a group. e. Concession for Senior Citizens 10 per cent discount on fare is given in the buses of State Express Transport Corporation when reservation is done by senior citizens who have completed 60 years of age.

111 Apart from the above, the transport corporations run buses in uneconomic routes also, to benefit the poorer sections of the society. 3.4. DATA ENVELOPMENT ANALYSIS The Central Institute of Road Transport, Pune has developed a methodology known as Data Envelopment Analysis Technique (DEA Technique), which would eliminate imbalancing factors and try to identify the physical resources (Inputs) to be compared with physical output. The main resources (Input) are identified as: (i) Capital Invested, (ii) Manpower employed, (iii) Fleet of buses utilised, and (iv) Material consumed. The total passengers served or service availed of by the travelling public is considered as output. As every passenger has different lead or distance travelled, scientifically the passenger kilometer has been considered as output. The DEA Index for the STUs of Tamil Nadu, Gujarat, Karnataka, Maharashtra and Uttar Pradesh has been worked out, which has been exhibited in Table 3.17. DEA Index reveals that Tamil Nadu State Transport Corporations stood first in this regard followed by Uttar Pradesh and Gujarat. Thus, Tamil Nadu STUs have fared well in all respects.

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114 3.5. SUMMARY Bus transport has come to occupy a pivotal position in the overall transport system in India, where both private and public operators co-exist. In recent years, the share of STUs is in the decreasing order. With regard to the performance of all STUs in India, it is satisfactory in terms of fleet utilization, capital productivity, labour productivity, conservation of fuel and quality of service. But in the sphere of financial performance, it has not been satisfactory, where the losses are in the increasing order. According to the transport economists and experts including those of Planning Commission of India, these losses are not the sign of inefficiency of STUs but due to the external factors such as high incidence of taxation and depreciation and low rate of fare which are beyond the control of the STUs. The performance of STUs in Tamil Nadu has been fairly good in respect of all the parameters of physical and operational performance and they are well above the all India STUs averages. Certain corporations are the forerunners with regard to certain performance such as fleet utilization, km efficiency, fuel conservation and bus-staff ratio. Still, the financial performance has not been uniformly good. The above stated external reasons may be applied to TNSTUs also for the unsatisfactory financial performance.