Assessing the prospects and challenges of public private partnership in the provision of public transport services in Ghana: A case study of Metro Mass Transit Company Limited
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Date
2014-07-24
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Abstract
In 1983, Ghana adopted the Economic Recovery Programme and its success was predicated on export-led growth. The tenets of the programme were based on the development of an open and liberalized economy, reduced state participation in trading activities, and a growing economy, which is private sector oriented.Recognizing the significant role of transportation in the socio-economic development of a country,the Government of Ghanaestablished Omnibus Services Authority (OSA), City Express Services (CES) and the State Transport Corporation (STC) to assist in the mobility of people within Ghana. These state owned companies were not profitable even though the government continued to spend money on their operations. This led to the government’s decision to diversify STC and the liquidation of OSA.However, the huge investment that is associated with public transport operation coupled with none immediate return often discourage many private organisations and individuals from entering into the business. Government therefore entered into partnership with the State Insurance Company (SIC), National Investment Bank (NIB), Ghana Oil Company (GOIL), Agriculture Development Bank (ADB), Prudential Bank Limited (PBL) and the Social Security and National Insurance Trust (SSNIT) to establish Metro Mass Transit Limited in 2003. Even though the objective for its establishment has been good, the numerous debts and none payment of dividends to shareholders since its operations has raised serious reservations with regard to its sustainability.
Using a total sample size of 273, comprising passengers, management, shareholders and key informants, it was revealed that the company encounters many challenges including revenue leakages, high budget on fuel, poor infrastructure at depots and terminals and non-payment of dividends to shareholders. In spite of the challenges, the company has better prospects since the affordability of fares,good sitting arrangements, high level of safety and reliability, high level of competence of drivers, availability in most parts of the country, among others continue to give it more comparative advantage.
It was therefore recommended that infrastructural development and physical facilities at the various depots and bus terminals be developed; electronic ticketing should be practised and enforced with proper monitoring and evaluation. Shareholding structure of the company should also be reassessed to ensure equity and fairness among shareholders.
Description
A thesis submitted to the School of Graduate Studies,
Kwame Nkrumah University of Science and Technology
In partial fulfillment of the requirements for the degree of
MASTER OF SCIENCE
IN DEVELOPMENT POLICY AND PLANNING. 2012