Web Desk
The Peshawar Bus Transit system faces the imminent risk of closure due to the provincial government’s failure to pay approximately Rs1 billion in dues to five private companies responsible for managing different sections of the public transport system.
Daewoo Pakistan, which operates a fleet of 244 buses serving around 300,000 commuters in the provincial capital, stated that the amount owed to them by the government has increased from Rs450 million last month to Rs750 million.
Four other companies are also claiming Rs300 million from the government for their services. On June 1, the management of Daewoo once again requested payment from the provincial government, expressing concerns that they may not be able to continue operating the bus service due to insufficient funds.
Daewoo has repeatedly appealed to the government to resolve the issue, first on April 27 and subsequently on May 17 and May 23. In their latest letter addressed to the caretaker Chief Minister Mohammad Azam Khan, Daewoo emphasized that TransPeshawar, a subsidiary of KP Urban Mobility Authority and the government entity responsible for overseeing mass transit in the province, has failed to release the due payments.
The outstanding amount has now reached Rs754 million, encompassing invoices for the months of February, March, April, and May.
The company stressed that the funds are crucial for procuring diesel, lubricants, and parts, as well as covering expenses related to electricity and salaries. The timely disbursement of payments, as stipulated in the contract, is essential for fulfilling these obligations.
However, despite numerous meetings and correspondences to convey their concerns, the issue remains unaddressed.
Officials fear that further delays in clearing the dues are likely to result in the suspension of the bus service. TransPeshawar, the government-owned company responsible for managing mass transit, currently has over Rs450 million in its accounts. The finance department has been requested to release an additional Rs400 million, which is expected to be released soon.
However, officials point out that according to the contract, around 90% of the invoices submitted by the companies should be cleared within 10 days. The delay in payments is occurring without any substantial reason, causing significant problems for the companies.
While banks typically provide credit lines to meet short-term liabilities, prolonged payment delays pose a severe challenge, as it becomes increasingly difficult to manage growing liabilities in the current economic climate.
There are indications that some influential individuals are seeking to cancel Daewoo’s BRT lease and award it to another firm. Furthermore, documents reveal discussions to alter the composition of the TransPeshawar board of directors by appointing the provincial minister for transport and mass transit as its chairman, potentially violating corporate governance rules.
Despite attempts to reach out, Transport and Mass Transit Secretary Zakaullah Khattak did not respond to inquiries from Dawn.
The potential closure of the Peshawar Bus Transit system not only jeopardizes the livelihood of the private companies involved but also impacts the thousands of commuters who rely on this public transport service. The situation calls for urgent attention from the provincial government to address the outstanding dues and ensure the continuity of this essential transportation service.
