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State taking back buses

(China Daily)
Updated: 2009-03-31 07:43

The Shanghai Public Transport Company, the operator of the city's bus system, became a trailblazer when it privatized in 1996.

The reform was hailed as a successful bid to introduce a market-based replacement for the old egalitarian "big rice bowl" transport system, which invariably produced poor service and mounting deficits.

In a matter of a few years, the company had split into more than 40 separate enterprises, owned mostly by private businessmen or shareholders.

Last Saturday, when the Shanghai municipal government announced its intention to reverse tack and nationalize the city's bus companies, it drew at least as much attention and applause from local residents.

While privatization has helped the local government cut deficits and improve services to a certain extent, its problems are also plain to see.

To maximize profits, bus companies prefer to operate lucrative routes rather than lines to sparsely populated residential quarters in the near suburbs.

This has made work and even school inaccessible for many people who have moved there.

Over the years, Shanghai's public transport system has become one of the most expensive among Chinese cities.

Its residents envy Beijingers for the 2-yuan unlimited subway transfers they enjoy and super cheap 40-cent bus fares when transport cards are used.

In Shanghai, the local government has also found it hard to distribute subsidies among bus companies, since they are all so different.

In this milieu, mapping out a sensible bus service network has become something of a mission impossible.

The replacement of old buses, especially those emitting black smoke, has also been progressing at a snail's pace.

All these shortcomings mean privatization, a chic word in the mid 1990s, should be rethought.

Public transport, after all, should serve the public not private investors' desire to chase profits.

It should be the lubricant for the work and life of local residents, instead of a snag resulting in astronomical societal costs which make Shanghai less livable.

In this sense, nationalization may very well be a boon for the 7.28 million commuters who use the city's bus system each day.

But it is by no means a silver bullet.

Since many State-owned enterprises are notorious for bad services, many fear a return of the lousy pre-1996 transport system.

This outcome would effectively squander all the rationale for nationalization.

That surely does not need to occur if Shanghai can emulate the nationalization move of the Beijing bus system.

Its high-quality service constitutes a good model, especially after the Beijing Olympics.

Shanghai must prove it can do even better.

(China Daily 03/31/2009 page6)