How Prasarana can meet new impossible targets

KUALA LUMPUR, 15 May 2023:

Urban public transport operator Prasarana Malaysia Bhd has been set an even higher service standard to deliver within the next three years, Transport Minister Anthony Loke Siew Fook announced today.

In a nutshell, Prasarana will have to reduce breakdowns of its bus and rail services by:

  • announcing Mean Kilometre Between Failures (MKBK) on the 20th of each month, achieving MKBK of at least 1 million km for its rail services. Prasarana aims to be among the top 10 rail operators in the world, matching at least Singapore’s MRT Corp achievement of 2 million kilometres MKBK;
  • doubling the number of engineers, for better and faster maintenance response to improve from the around 150,000 kilometre MKBK trend now; and
  • raising salaries of its key ground staff (like bus drivers) by at least 10% to meet manpower needs.

In the meantime, Prasarana will also:

  • potentially end services earlier and start operating later for more thorough maintenance;
  • try to figure out how to gain more non-fare revenue (like advertising, space rentals and value-adding to its station properties); and
  • also reduce subsidy dependency from the government via its main shareholder, Ministry of Finance Inc.

It should be very clear to anyone glancing at these summary points that it is impossible for Prasarana to meet, much less reconcile, these lofty targets.

To reduce the MKBK – together with extra investments in equipment, spare parts and higher salaries – Prasarana needs to about triple its funding needs over the 3-year target period.

Asked how this funding challenge will be met, Loke said he will leave this issue to Prasarana’s management to resolve.

What was left unsaid was that the funding shortfall over the past five years – compounded by lower fare and none-fare income during the two-plus years of Covid19 restrictions – was the main reason for Prasarana’s service sinking to the doldrums.

Here’s how Prasarana can resolve its funding issue, with some help from the government to increase revenue:

  • making it mandatory for all outfits with ad-spend total of over RM1 million yearly to place at least 10% into Prasarana assets like buses, trains, stations and more. This includes all government departments, agencies, ministries and associates. Treat it as a cross-subsidy for own staff using public transport.
  • raising the value of data sharing with online services like Google, e-hailing apps and various ticketing services. There is a need to review prior agreements to reflect changing trends, which is short-changing data providers like Prasarana.
  • lift advertising restrictions on professionals like doctors and lawyers, allow wider advertising of prescription drugs like that allowed in more developed nations. It’s time to stop nannifying Malaysians.
  • increase transparency of funds obtained from ‘sin’ products like alcohol and tobacco. A blatant example would be the millions paid by firms to have these products displayed prominently at retail outlets. It’s time to treat these as advertising revenue which can also be channelled to Prasarana and other public transport operators like KTM Bhd.

In short, Prasarana can meet service targets only if it gets the right support from the government – not just by getting subsidies, but also a better framework for sustainable revenue-generation.