Kigali Bus Service administrator seeks more time

Kigali Bus Service’s woes are far from over despite the firm spending over eight months under an appointed administrator. The leading bus company was put under an administrator in November last year by the Rwanda Utilities and Regulatory Authority (RURA) for what was supposed to be a six-month stint. The intervention by the regulator came at a time when the firm was undergoing managerial and operational challenges, consequently making it unable to fulfill contractual and licence obligations. KBSs has the most dedicated routes of the three companies that were contracted by the City of Kigali to exclusively handle transport within the city. The administrator, Eng. Deo Muvunyi, told The New Times that though a lot has been done to address the financial and operational challenges, much more remains to be done before the firm can be handed back to its owners. He noted that six months or even one year was quite a short period considering the extent of the woes. Sources knowledgeable of the state of affairs before the administration told The New Times that employees had gone for about three months without pay while some suppliers were threatening to withhold goods and services over accumulated arrears. The firm had also incurred hefty loans and was falling behind repayment schedule. Muvunyi said he is not sure how long he will be at the helm of the firm as the decision can only be taken by the appointing authority. “There are still a number of challenges, especially those related to repaying the loans. There were also challenges in the number of vehicles that had broken down and had been retired to the garage. That is still a problem as we have to ship spare parts from the factory, which takes some time and incurs costs,” he said. With the firm’s owners having renegotiated the loan terms, restructuring the loans is quite an uphill task for the administrators, he said. “Finding new terms of repayment is tricky, negotiations have been done before but not respected; therefore, restructuring the loans was quite an issue. ‘‘So it’s not easy to restructure again and be able to pay banks when capacity can only be found when the buses have returned to the road which also means extra costs,” he explained. So far, the interim administration has started paying back the loans, according to Muvunyi. The damage control has to be done without affecting service delivery to city residents or breaching their terms of contract with the City of Kigali, he added. Since taking over, the administrator says that salaries and other benefits have been paid on time while suppliers have been paid promptly. The firm currently has about 200 staffers and a fleet size of about 100 buses. Philbert Rwamukwaya, a bus driver with the company, told The New Times that there had been some notable improvement in recent months. Admitting not to know what was going on previously during the crisis, he said that a number of staff had resigned while others had been looking for alternative jobs. “There has been quite a change in the last few months. We are now paid on time and the buses are attended to when we report issues. I do not know what exactly was going on previously but some of the drivers left while others were looking for jobs elsewhere, it is much better now,” he said. KBS is one of the three firms which, in 2013, were awarded a 5-year contract by RURA and the City of Kigali to operate public transport in the city. This was in line with the implementation of a cabinet decision on public transport in October 2012. By press time, RURA had not responded to inquiries on the possible extension of the administration of KBS. editorial@newtimes.co.rw

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Kigali Bus Service administrator seeks more time