Passengers should brace themselves for tough times ahead. Minibus Owners Association of Malawi (MOAM) has said passengers should not expect any mercy from it following a hike in insurance cover costs because the association is in "business and not charity".
The cost of traveling on a minibus is expected to rise by between 50 and 100 percent should negotiations between insurance companies, ministry of transport and bus owners yield nothing.
MOAM general secretary, Coxley Kamange, said a minibus fare hike is in the offing, advising commuters to expect new fares should the Ministry of Transport fail to negotiate with insurance companies on the possibility of reverting to the old insurance regime.
"While we sympathise with commuters, the only option we have now is to raise fares. We are just waiting for the Ministry of Transport and Public Infrastructure to finish discussions with the insurance companies, and then we will take the next course of action which is raising minibus fares because we are in business and not charity," Kamange said on Friday.
He was responding to a Passenger Welfare Association of Malawi (PAWA) statement asking MOAM not to come up with new fares following the rise in premium insurance on a minibus from K55, 000 to K150, 000, representing an increase of 130 percent.
While observing that the 'steep increase' in insurance premium on passenger liability would affect minibus operations, PAWA secretary general, Alfredo Mkandawire, has asked minibus owners to await the outcome of discussions between the ministry and insurance providers.
Ministry and MOAM officials agreed during a meeting held on Wednesday to delay the implementation of a new fare regime after the rise in insurance costs.
"While we sympathise with the predicament that the increase has placed on the operations of minibuses, we would like to advise MOAM to delay the increase in fares until the proposed talks with the Minister of Transport and Public Infrastructure have been exhausted.
"PAWA realizes that an increase of over 130% of (sic) insurance is substantial and is bound to affect any business. That is why we support MOAM's proposal for a meeting between the Ministry of Transport and all stakeholders," Mkandawire argues, while ask ing the Reserve Bank of Malawi to effect increases on the monetary front "with a human face".
Mkandawire describes the 130 percent increase in insurance costs as "too harsh, insensitive and unrealistic"
PAWA further accuses minibus owners of passing every cost encountered in their business operations to commuters, observing that the country is already going through hard economic times. It adds that minibus owners are also to blame for escalating insurance costs.
"MOAM should be reminded that insurance companies have been reluctant to insure minibuses because of the high risk element involved in their business sector and would therefore do well to put their house in order so that they can negotiate the high insurance premium from a position of strength," Mkandawire says.
PAWA suggests that, should there be a hike, as expected, MOAM should increase the fares by between five and 10 percent.
But Kamange hit back at PAWA, accusing Mkandawire of being "too ignorant to talk about minibus operations".
"These people know nothing. I repeat, these people know nothing. All they know is talking, talking. What they should know is that running minibuses is a business. While we feel for the commuters, we have to think of our businesses too. Fare increases cannot be avoided," Kamange said.
Kamange added that PAWA had no justification for its call, saying minibus owners are already incurring "huge losses" in the wake of insurers' delays to revert to old passenger liability fees.