Fola Tinubu, Managing Director/ Chief Executive Officer of Primero Transport Services, operators of Lagos BRT in this exclusive interview with Publisher/Editor-In-Chief of Complete News, Enitan Olukotun spoke on challenges and plans to make the bus service a world class. Excerpt:
People have been complaining of waiting endlessly for hours for buses to arrive. What is the cause?
Let me say this, if they are honest, they will tell you that the waiting time has reduced. Having said that, I don’t believe anybody should wait for more than 10 to 15 minutes to board a bus. Waiting for 30 to 45 minutes does not make sense considering our harsh weather condition. People waiting in the sun, rain, anybody that has human feeling should be concerned.
The solution is to put more buses out. God willing, by the end of this month, we will have about 350 buses out. We have about 290 presently. We will add like 60 to 70 more and that will reduce the waiting time.
But there are a lot of things out of our control that people need to take note of. I will give you an example. Today, Ikorodu road was blocked both sides for close to about two to three hours. The buses going towards the Island could not go, the buses coming back could not come. People were calling me at Ikorodu screaming on the phone and abusing me saying I don’t know what I am doing. People are calling me from Barracks Bus Stop that they needed buses. But what can I do in that instance?
I will give you another example. I think last week Wednesday or Thursday, I actually to send them (Primero Staff) to go count. 63 of our buses were back to back from Owode Onirin to Mile 12. And it was because of the bad portion at Kosofe and Ketu. We spent over an hour there. People were waiting at the other end for buses but we were stuck in traffic because of the bad road.
Primero can do a better job than what we are doing now and we are working on it and not relent but people must understand that sometimes it is because of circumstances totally beyond our control. And they need to take cognizant of that.
The easiest thing to do is to point fingers at people, as the big guy I can take it. People can say whatever they like. My job and goal is that I don’t want anybody waiting for more than 10 to 15 minutes to board a bus and God willing I will accomplish that.
Passengers also complained about the state of the buses in terms of neatness
Thank you, you have got to an area I really want to talk about. Everybody in Lagos and Nigeria is talking about service… We need more buses, they have to be clean, the air conditioners must work but all of these things cost money. But who is talking about the cost? Nobody!
Not the state government nor the commuters. You cannot pass the social responsibility of our state to a private company. We all agree there is a social element in our business but if you want a world class service, it has to be paid for…That is the honest discussion we should all have. Who pays for what? What portion should the commuters pay? Is the government going to do anything about it and what kind of profit do you want Primero to be making?
But the way the system is right now is not sustainable. All I hear daily. We want you to start running 24 hours, we want you to get to the shelter at 4am. Everything is service, service, service but all of these things come at a cost. But nobody is talking about the cost. Nobody is talking about the 25% interest rate commercial banks are charging on our loan, nobody is talking about the hike in price of Diesel as a result of the tension between Iran and US. We have to buy Diesel at 250 per litre, nobody is talking about.
Nobody is talking about the fact we have to import everything we use and Naira losing value. Naira to Dollar is N365. All of these things affect our cost but nobody wants to talk about that but the easy part everyone is talking about is the service. But the service comes at a cost. And someone has to pay for it.
My question is this. Do you want a world class service? Everybody will say yes. How do we pay for it? Who pays? Everybody will keep quiet.
Are you implying that the current fare regime is not sustainable?
Yes it is not sustainable. Do you know that in Lagos State, the cost of BRT fare has only gone up one time in 15 years. Now tell me as rational thinking person, how is that sustainable? Remember we don’t manufacture anything in this country. Everything we use, we import. And when we increase (Bus fare) it only went up like 25 percent. Are you telling me that Naira only lost 25 percent value in the last 15 years?
Are you telling me what you are buying 15 years ago has only gone up by 25 percent? The reason why we don’t have good service is because everybody shies away from this.
Perhaps may be because they believe Primero leverages dedicated government infrastructure, so that should reflect in what passengers pay as taxpayers
In London that many people are quick to cite as example. Don’t they have a bus system? The government still gives them 35 percent of TFL revenue as a subsidy. Their own bus lane, you dare not go there. Our own dedicated lane here, everybody gets on it.
Who gets on bus lane in London? Nobody. Yet they still get 35% of their revenue from the government. It is not sustainable. You either say, Primero go out there, if you charge them N10,000 from Ikorodu to TBS and they pay, that is your headache, go and sort it out with them.
But you cannot cap our revenue generation and not do something about out cost.
On the cost you mention, you buses are high capacity that accommodate many commuters and you still enjoy dedicated lane, why the complaint about going under?
That is the misconception. Sixty percent of our route is dedicated the other 40 percent we go on regular road. From Ikorodu to Mile 12, yes dedicated. From Mile 12 bridge , the bus we join normal road and join dedicated lane again at Kosofe to Ojota from Ojota, we join normal road till Maryland . From Maryland we ply dedicated route to Fadeyi and they go back on the road… And then you join the dedicated lane again at Barracks up to Stadium. That is where it ends. And we Join at Marina again.
Even if it 100 percent dedicate, we still have to be financially viable. Even the dedicated route, by 7:00 pm, everybody plies. But having said that, we are willing to open our books to everybody. We have nothing to hide. And that is why I said we must have honest conversation. People should agree on the profit Primero needs to make.
But we must cover our cost first. I don’t know how old you are but I remember when I was growing up, we got Ilara’s Bus, LMTS, Benson transport. They all folded up because they were not covering their costs. It is either the government decides on what it wants that is what is obtainable everywhere but you can’t eat your cake and have it.
Don’t get me wrong, I am not advocating for subsidy or increase but I am saying if you want this (Primero BRT) to be here 50 years from now when many of us would have gone, it must be put on sustainable financial footing.
If we don’t do that, we are all lying to ourselves. It must be on a sustainable financial footing. We went to the capital market last year, we were able to raise N60.5b from the bond market. People are willing to invest in public transportation in Nigeria but it must make money. The government cannot do it by itself. The amount of money is too much for the government to do it by itself.
And we all know that government never do things efficiently. But if you want people to invest and invest heavily, it must make sense financial. Anything other than this, we are lying to each other. But you can lie to everybody but not to yourself.
Everybody talks about services but it cost money. LAMATA sends our buses back if they are dirty to wash them. People tell me, Fola, we know Danfo is charging more than you but why do you want to review your fare? But hold on, does Danfo provide insurance for those vehicles? NO, Do they provide insurance for passengers? NO, Do they give health insurance to their staff? NO, Do they have pension for their staff? NO. Do they wash their buses practically everyday? NO. Do they have air conditioner in their buses? NO. Yet they charged more than us. Why would it not be profitable? Who is fooling who here?
Who is lying to who? If you want a world class service, it must be paid for. It is a political decision, who pays. It is a decision we have to make as a people. If you don’t want Okada model transportation in Lagos, people have to pay for it. How we pay for it is a political decision, it is easier to say we want services. But when the issue of cost comes up everybody keeps quiet, let’s Fola (Primero MD) go and figure that out. You cannot cap a business revenue generation ability and don’t do something about their cost.
I gave an analogy when I was interviewed on Wazobia TV. I asked if the television station would survive if the government orders it to do everything that NTA does without subvention? Would it survive? That is exactly what everybody is asking of us. Everybody wants good thing but it cost money. And somebody has to pay for it.
You can’t pass a social responsibility duty of a state to a private company. If Primero is a government agency, it does not matter, we can be pilling up the loses at the end of the day, taxpayers will write it off. So who is going to write Primero’s debt off?
Honestly, we must be upfront with each other in this country. There is no free launch anywhere and we have become used to dividend of democracy, the government must do this and that. Please, don’t get me wrong, I am not asking for subvention, or an increase but I know something has to give if you want it to be sustainable
What I can deduce from what you have said so far is that you are struggling
That is an understatement.
But only few people will believe you with huge revenue you rake in daily
You see that is the problem with Nigerians. Everything we do, we look at the revenue side but we don’t look at the cost side. For instance, when government gives you contract, people will scream, Ah, he has been giving N1b contract. Is N1bn the profit? But everybody will be talking oh he got N1bn contract as if the whole 1bn is going to his pocket.
You can be bringing in N10bn monthly and still be running at a loss. If you are bringing in N10bn and your cost is N11bn a month, are you breaking even? Everybody looks at the revenue side but nobody looks at the cost side because the cost side is difficult to figure out. The revenue side is easy but cost side is complex. It takes a lot thinking and soul searching.
You have to make some tough decision that we don’t want to make. All our attention and energy is on the revenue side. I just told you that banks are charging us 25% interest rate on our loan.
But the perception out there is that you got funding from international bodies
Not a Kobo came from any of those bodies to buy the buses. You can quote me on this anywhere. Not a Kobo from State, Federal or international development bodies came in. Anybody that has contrary information should bring it up.
Banks are charging us whopping 25percent on our loan totally about 25bn or more. And people talk as if Fola Tinubu does not know what he is doing. You have to sit behind that desk to understand what we are going through. And that is why I said that this conversation is needed. I told them Call your Senator, House of Representatives member and Lagos House of Assembly member to all look into the matter. All stakeholders sit and we open our books.
Is there any plan to shelve the bus fare hike?
What I said is that we are going to meet our regulator, LAMATA to ask for review. We have not announced an increase, nor did I announce any figure. People are just saying what they like. I have seen so many figure bandied about. Until will sit with the regulator, we can’t say what the new fare regime will be. Like 3 years ago, we went with a figure, they brought their figure and we met somewhere in the middle. But we have approach them that we need an increase.
1 Comment
Is primer paying April salaries for the staffs or not