Democratic Socialist Movement

For Struggle, Solidarity and Socialism in Nigeria

By - DSM

LAGBUS: A Classic Case Of Public Resources Channelled Towards Private Interest

LAGBUS: A Classic Case Of Public Resources Channelled Towards Private Interest

By Chinedu Bosah

When LAGBUS started transport operation in Lagos State, many heave a sigh of relief. The popular belief among motorists was that a public transport outfit had come to rescue Lagosians of chaotic transportation system.

The transportation company which is widely known as LAGBUS or “Fashola bus” was established in 2007 as private company named “LAGBUS Assets Management Limited”. The Lagos State Government however gives the impression to the public that LAGBUS is a government owned company, particularly when Gov. Babatunde Fashola commissions new buses and declares free ride to Lagosians in one or two days at festive periods.

Checking out the LAGBUS website, one gets an insight of how the company was set up, ownership and whose interest. Visitors to the website could first be confused who really owns LAGBUS because the same website has Government Vision and LAGBUS mission. Government Vision: “To establish a company that will provide a safe and efficient bus and efficient bus transportation system in Lagos State. The company is conceived as a private limited liability company, it will operate strictly along commercial lines.” The core policy and strategy are as follows:

  • The company must be run as a private limited liability company
  • Management of the maintenance company must be separated from the bus Company.
  • Bus company must operate in conjunction with local transport operators
  • Ticketing is to be centralized.
  • Backward integration with investment in Bus Assembly plants is necessary
  • Ownership of the company should include institutional private investors.

From the aforementioned policy statements and what is playing out since operation started, one can easily conclude that Lagos State Government established LAGBUS as (1) a private company with key privileged individuals that are connected to the government as board members/owners/top managers and (2) Lagos State government invested public resources to advance the profit interest of tiny privileged individuals in form of loans and landed properties. One has come to this conclusion, considering the policy statement of LAGBUS

Lagos State Government created a distinct lane solely for LAGBUS vehicles out of the very busy and inadequate roads, a privilege just for less than 2 percent of vehicles and users so as to escape the chaos and traffic on these roads. This is also a strategy to guarantee huge patronage for LAGBUS and to sustain profit. Obviously, one cannot be convinced that this measure is in the interest of the public when the vast majority of the public have been further condemned to chaos on the roads. In the same vein, Lagos State Government also provided the company parks across the state when many areas lack decent parks for generality of the public. If the rate at which key government officials use public money to advance their private interest is anything to go by, Lagos State Government may have invested heavily in the LAGBUS ventures in terms of loans and ‘goodwill’ used in procuring the buses and other equipment.

The only way LAGBUS would have benefitted the public in all ramification is when (1) quality and affordable services are rendered to the public, (2) LAGBUS is publicly owned such that profits generated is for public and (3) workers are well paid with good condition of service. These primary objectives have been defeated. For example, LAGBUS Asset Management Limited in conjunction with the Lagos State Government has succeeded in employing most of the staff on contract basis and at poor wages. Currently, there are about 800 contract staff to about 300 regularised staff whom are also more like casuals since they do not have defined and better condition of service. All contract staff were employed to work in LAGBUS by 5 contractors viz. Driving Solution, Excel, T.K and Bucad and NURTW, all connected to close allies to the Lagos State Government and the management. These 5 companies deny workers the right to belong to a union and other little benefits. For Example, Driving Solution sacked 2 of the leading unionists (Mr. Adebayo Samuel and Mr. Odijie Solomon) when workers joined Amalgamated Union of Public Corporations, Civil Service Technical and Recreational Services Employees (AUPCTRE), an affiliate of the NLC in December 2010. Unfortunately, the union has refused to take any major action that will compel the management to reinstate them back to work.

Besides, workers have worked for about 6 years under a poor condition of service that makes it possible for most workers to work for 16 hours daily and for 15 days in a month (that is one-day-on, one-day-off) which makes it inevitable for workers to work 240 hours monthly and 60 hours weekly instead of 8 hours daily with weekends and public holidays as rest days or paid for as overtime. The average wage of workers in LAGBUS is N30, 000 despite the stress, tedious and hazardous nature. The drivers earn N35, 000 while the ground staff, most of whom are bus assistants earn N25000. Sweeping and cleaning jobs are outsourced to private contractors whom are close to the management and Lagos State Government. Sweepers who clean the depots and buses earn a meagre N10,000 per month while Bus Washers who wash the buses are paid about N12,000. Perhaps, 3 times the amount paid to these workers are earned by the contractors. There are 4 contractors for Bus washing, OILIB SIBOG, DAGO, GABAK VENTURES and CLEANIX while the sweepers have their own contractors.

One major reason LAGBUS could not protect overall public interest is because the company is set up with sole interest to guarantee profit for some privileged individuals and managed bureaucratically. Workers do not have a say in the way and manner the company is managed. Investigations reveal that LAGBUS is run with the aim of satisfying the profit drive of different interest groups and privileged individuals. One of the biggest exploitation currently is the supply of diesel by Oando, owned by Wale Tinubu, nephew of Bola Tinubu, is the sole supplier of diesel to all LAGBUS buses. For every litre it supplies, it charges LAGBUS N170 despite supplying thousands of litres on a daily basis while the same OANDO sells a litre of diesel for N150 and some other petrol stations sells for N140/N145.

Lagos State Government claimed in the website that the reasons the previous transportation companies failed have been taken care off with the setting up of LAGBUS. This is fallacious. The way and manner LAGBUS is run does not guarantee long term sustainability except Lagos State Government keeps doling out money to the management to keep it afloat. Presently, about 50% of the buses are in bad shape due to poor maintenance policy. LAGBUS has 675 buses and about 350 are currently working. In the same way, employment of workers have been outsourced to private companies, repair of buses are outsourced to a private company called B.S. Since, the maintenance of buses are handled by another private company, the cost of repair is usually inflated to guarantee huge profit for B.S and other contractors who are linked to the management and influential individuals in the Lagos State Government. Hence, such arrangement becomes unsustainable in the long run. That explains why LAGBUS major depots (Tollgate, Ikorodu and Sango) have large numbers of faulty and abandoned vehicles. What has become a daily occurrence are buses being driven back to the parks few hours after starting work for the day due to one fault or the other.

The only sustainable policy of maintenance is for the company to own and maintain a workshop or maintenance department to repair and maintain these vehicles including washing/cleaning of the vehicles. A section of this maintenance department should accommodate spare parts store wherein the management based on its experience places regular orders for different spare parts from the auto company that produce the buses. Workers in the maintenance department like other department should be well trained and paid living wage under a good working condition and condition of service. This is the only maintenance policy that can stand the test of time because it is far cheaper and more efficient.

A company that is democratically managed by workers made up of experts from the beginning will oversee a policy that will pay workers living wage, quality maintenance of the buses at lowest possible cost, regular expansion of the transport outfit etc. Presently, most of the management team were employed because of their political affiliation to the government and do take workers advice with a pinch of salt. Hence, the Public Private Partnership (PPP) they promote is just an avenue to use public resources to guarantee private profit/interest. That is the story of the much publicized PPP; the same for the Lekki Concessioning wherein tax payers are to be forced to pay another road tax; it also the same government policy on education where poor parents are being asked to cough out between N193, 750 and N348, 750 as school fees at the Lagos State university in what look like a full scale commercialization of education.

LAGBUS is one of the “success stories” linked to Fashola-led administration and so they would for political reasons do everything to sustain the exploitation and secrecy, even if it is to continually deep hands into public treasury. The government will also do anything to sustain the massive exploitation in LAGBUS by these profit-tasty, privileged individuals. The Lagos State Government should convert LAGBUS Assets Management Limited to public company since it has greater stake through tax payers’ money and end all these exploitation currently going on in LAGBUS. The company must be placed under the democratic control with involvement of the elected representatives of workers in the management in order to sustain it in the overall interest of workers and the public.