Matatu operators ought to pass fuel benefit to consumers

The Energy Regulatory Commission announced further cuts in fuel prices last week.

Low crude oil prices at the international market have precipitated further drops in fuel prices across the world.

The latest drop by Sh8 per litre of petrol brought the current pump price to within the range of prices in 2011 when a litre of petrol retailed at Sh82.

As opposed to the trend in the past when fuel would be lowered by Sh2 only to shoot up by Sh4 the following month, the energy regulator has lowered the price for four consecutive months yet the benefits of the drop have not trickled down to consumers who bear the brunt whenever fuel prices are adjusted upwards. Realistically, the drop in prices represents 40 per cent which should by now have translated into a relatively lower cost of living as commodity prices fall in line with the reduced cost of production, which many manufacturers have blamed for soaring commodity prices.

A few months ago, President Uhuru Kenyatta commissioned an additional 140 megawatts which was expected to lower the cost of electricity by 40 per cent towards the end of 2014.

However, there has been little or no change in power bills and the fuel levy has remained constant despite the significant drop in fuel prices.

These costs are usually passed on to the consumer who often has no recourse for help.

The only reduction that has benefited the common man is the lowering of the price of kerosene which shed off almost Sh14 per litre.

While the drop is welcome, extensive use of paraffin contributes greatly to greenhouse emissions that impact negatively on the climate. So one gain is offset by another.

The unfortunate thing is that most households in Kenya cannot afford to use gas hence the heavy reliance on paraffin and wanton felling of trees. The cost of living remains high.

The prices of essential commodities like flour, milk, bread and sugar remain high despite industries operating on a lower budget in terms of energy usage.

Of great concern, however, is the fact that the area in which the ordinary Kenyan expected relief was in the lowering of fares by public service vehicle operators. This has not happened.

In the past, whenever fuel prices went up, fares would shoot up almost immediately. It is worth noting that despite four consecutive drops; fares have remained the same.

Industry operators have been reluctant to let citizens enjoy the drop in fuel prices.

At some point, officials of the Matatu Owners Association tried to justify their refusal to lower fares by claiming the cost of spares and maintenance was still high.

 

This observation does not hold water because there is a marked improvement in the quality of roads which contributed to breakdowns. In truth, most of the Public Service Vehicles are poorly maintained and are a safety risk and environmental hazard, thus the excuse that spares and service are expensive is not convincing.

The chairman of the National Transport and Safety Authority, Lee Kinyanjui, has threatened to compel operators to lower prices.

Considering that we operate under a liberalised market economy, it will be hard to enforce that threat. As we demand that fares come down, it is necessary that mechanisms are put in place to protect the ordinary citizen from exploitation.