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Let me try to explain my point again. Especially because @DrJoeAbah likes to pour mud inside clear water in the name of being ‘non-partisan’ - Short thread
In ascending order, simplified costs of running a railway service
1. Cost of fuel
2. Cost of staff (salaries etc)
3. Cost of maintaining tracks
4. Cost of expansion - new tracks, new trains etc
It is almost impossible to find a rail that covers all these costs from fares
1. Cost of fuel
2. Cost of staff (salaries etc)
3. Cost of maintaining tracks
4. Cost of expansion - new tracks, new trains etc
It is almost impossible to find a rail that covers all these costs from fares
So when people are making noise about profit, at what level? Imagine that you start at the top of that list and pour down the fares - the question is where does it get to?
Let’s say cost of 1 and 2 comes to N1m. Also say the revenues from fares comes to N2m. You have made a ‘profit’ at level 2 but does this mean you’re profitable at level 4?
Any decent rail service should make a profit at level 2 or try very hard to. Cost of expansion at level 4 is VERY expensive and you will always need Govt to step in there. This is what is described as ‘subsidies’ in many European countries
But in Nigeria, the fares don’t even clear level 1. This makes the job so much harder. Yet people are defending this meaningless subsidy as some kind of right. Money is not infinite so if Govt subsidies go to clear level 1 and 2, you can forget level 3 and 4.
Your government is corrupting you by making you think you don’t even have to pay to fuel the train that is carrying you. That somehow someone somewhere will pay to fuel the train that carried you with magic money. That is corruption
All this noise about ‘profits’ is just because people don’t want to pay for what they use. If you think Nigeria Railways are not happy with this arrangement, I have a brand new bombardier carriage to sell you
At the most basic level - people should clear the basic cost of providing the service to them. This is the only way to guarantee the future of the service so funding can be focused on the heavy costs of expansion and maintenance
You can see what the NRC people are doing. Something as simple as advance booking, they won’t do. Their incentive is for Govt to continue subsidising them from level 1 while the service slowly deteriorates.
Na una sabi. Next level abeg
