A total of 146 employees are expected to be laid off when the only state owned transport company, National Public Transport Authority (Onatracom) is rebranded Rwanda Interlink Transport Company (RITCO), a public-private partnership.

The government will retain majority shares (52 per cent) in the debt-ridden company and the rest will be taken over by Rwanda Federation and Transport Cooperative (RFTC).

While lawmakers are examining the bill dissolving the company which is likely to be passed next week, the government says it has written off all Onatracom’s accumulated debts from suppliers apart from Rwf2.7 billion that is yet to be paid to Rwanda Revenue Authority (RRA) and Rwanda Social Security Board (RSSB).

During a parliamentary committee meeting that considered the bill, yesterday, the State Minister in charge of Transport in the Ministry of Infrastructure, Dr Alexis Nzahabwanimana, announced that 146 of the company’s personnel will be laid off immediately once the bill is enacted into law.

"The contract binding workers with the company will be terminated and the termination benefits will be determined by laws governing public servants,” he said.

According to the minister, the liquidation process won’t go beyond six months shortly after the law is adopted by the parliament.

Article 3 of the bill states that responsibilities, movable and immovable property as well as liabilities of Onatracom will be transferred to the Ministry of Infrastructure.

"However, assets which are still in the public domain have to be transferred to private domain before its use as share capital in any private company,” reads part of the Bill.

Members of the parliamentary committee in charge of Trade and Economy stated that it was in the interest of the government to surrender the loss-making company into the hands of a competent management company.

"The performance of Onatracom has not been satisfactory over the years because of high operating costs compared to revenues generated, they haven’t been able to meet stakeholders’ expectations which necessitated a revamp,” said Clotilde Mukakarangwa, the chairperson of the committee.

Since 2013 a number of private foreign firms have shown interest in acquiring assets and operations of Onatracom but many have since withdrawn due to heavy liabilities of the company or failure to agree on the deal.

The latest company that had expressed interest in buying shares is Royal Haskon, a South African based firm that wanted to buy a large stake in the firm but failed to reach a deal with the government in terms of payment and regulations.

As of last year, its revenue had dropped by 43 per cent, translating into Rwf1.4 billion, while its destinations had reduced to 27 down from 51.

Of its 185 buses procured back in 2012 from Japan, only 70 were still operational with 35 of them in good condition while the rest had been damaged beyond repair, with some having been dismantled to supply spare parts to the buses in good condition.

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