Legislators seek end to Onatracom woes

Members of the parliamentary Public Accounts Committee, yesterday, visited the struggling public transport agency, Onatracom, to follow up on the implementation of resolutions adopted by the Parliament during the analysis of the report of the Auditor-General. Onatracom has in the recent past registered liquidity and operational problems, according to the 2012/13 Auditor-General’s report. The same report concluded that the transport agency has problems that have brought it to the point of “almost ceasing operations.” MPs wanted to know if there is a clear roadmap in place to settle Onatracom’s arrears, paving a way for the private investors to come on board following a Cabinet Resolution passed in 2013 calling for a permanent solution to the public transporter’s woes. Worn out seats of one of the buses parked at Onatracom. (Timothy Kisambira) “Is there any interested private investors to take over Onatracom? What is the recent progress on the plans of privatising the company?” Munyangeyo asked. John Bosco Murasanyi, the acting director-general of the bus company, told PAC that foreign investors who had shown interest in taking over Onatracom had pulled out due to “some issues” both parties failed to agree on. However, he assured the legislators on the oversight committee that Onatrcom management has since opened the takeover opportunity to interested local investors. “Foreign investors did not show intent in taking over, that is why we chose to look for local investors who are even more well-versed with the business,” Murasanyi said, adding that in order to attract investors, they have embarked on clearing the debts owed by the agency. He said, so far, 70 per cent of the arrears have been settled, while other pending bills await supporting documents to be cleared. The New Times understands that the Rwanda Federation of Transport Cooperatives (RFTC), a local private public transport company, has submitted its proposal to Rwanda Development Board, with interest of taking over Onatracom’s management. The outside view of one of the parked buses no longer in operation. (Timothy Kisambira) As per the RTFC proposal, according to Murasanyi, they want to bring in the required expertise in managing the company while the assets will remain in the hands of government. Onatracom woes According to the 2012/13 Auditor-General’s report, Onatracom was staggering from financial mismanagement that saw it accumulate debts totaling Rwf5 billion since 2008. The debt has since been slashed to Rwf1.7 billon following the intervention of the government. The financial challenges in Onatracom were partly explained by the old fleet of buses it still holds, despite the buses spending more time in the garage than on the road. The firm is also struggling to operate routes the City of Kigali designated to it. By 2012, out of 143 buses, 105 were past their road worthiness and needed repairing, while 70 of the buses were beyond repair, says the report. The number of bus routes operated by Onatracom had reduced to just 27 by September 2013, falling from 50 routes in 2011, and 130 in 2007. Some of the buses that broke down. (Timothy Kisambira) “Bus revenue declined significantly over the last five years from Rwf5 billion in 2008 to Rwf1 billion in 2012, yet cost of maintenance and service of an old fleet of buses is high,” the audit report stated. The entity was unable to pay its obligations and the suppliers were threatening to withdrawal their services and take legal actions. This forced Onatracom to seek the financial bailout from government to facilitate settlement of about Rwf5 billion that it owed suppliers, bankers and other service providers. Murasanyi said regardless of the issues that have marred Onatracom, there are efforts in place to restore it. editorial@newtimes.co.rw

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Legislators seek end to Onatracom woes