PPD needs dissolution: A new firm welcome

Soeryo Winoto, The Jakarta Post/Jakarta

Public transportation in Jakarta remains a perennial headache. The recent strikes by thousands of drivers and employees of the state-owned transportation company Perusahaan Pengangkutan Djakarta (PPD), leaving thousands of people with no means to get around town, merely compounded the headaches.

Thousands of drivers parked their buses on the street, marching to the State Palace compound, demanding that their salaries be paid. They parked the buses on nearby streets, causing serious congestion, ignoring passengers who seemed unaware that their basic rights for transportation had just been denied.

Reports of PPD drivers and crew members taking to the streets demanding their rights have become commonplace, and yet the public and relevant government institutions, unfortunately, have taken no serious action to address the problem.

In one street demonstration in 2003, PPD drivers demanded an increase in their salary, which was an average of Rp 300,000, and suggested that the debt-ridden company be dissolved due to the management's failure to cleanse the company of its corrupt officials.

Responding to reports that the government planned to inject Rp 250 billion to cure the company's cancer, the drivers said that such an injection of fresh funds would be useless and that they feared the money would go straight to managers' pockets without any clear accounting of it.

It was obvious that the employees' trust in their own managers has been in peril for several years. Nonetheless, both the transportation and state enterprise ministries, which jointly manage PPD, have yet to concretely or positively respond to the situation.

The government has not yet asked the public to discuss the ways to help PPD out of its managerial and financial predicaments.

If corruption has been rife in the company, which was supposed to provide Jakarta residents with cheap transportation, for years, then why are the anti-corruption agencies and groups not doing anything?

With not a single official, public explanation as to what has really happened to the company, the government has simply let the problems go unresolved, making it possible for further unrest among the drivers and employees to erupt again. And, thus, the drivers' strikes earlier this week may well have been predicted.

To fix PPD, the government seems to have two options: Handing over PPD to the Jakarta administration, or inviting private investors to take it over.

Offering the Jakarta administration an option to manage the mismanaged PPD was first made two years ago following the drivers' protests. Governor Sutiyoso hinted at that time that it was not possible that the Jakarta administration could take over the "chaotic" company, without the company resolving all its problems first. The Jakarta administration's stance has not changed.

The city will obviously agree to "accept" PPD once the company is freed from its financial burdens. And this is very understandable.

However, many may express skepticism about the administration's sincerity in accepting PPD after the company has no debts. Does the administration really want to improve transportation by improving PPD, or is it just is interested in PPD's abundance of assets, valued at more than Rp 360 billion?

Given that the city administration's track record in managing its own companies is far from impressive, it is doubtful that PPD would be better managed by the Jakarta administration. The fact that many of Jakarta's assets have been sold to private firms also indicates the administration's inability to manage what should be profit-oriented companies.

Then what about the second choice? Private investors, naturally, would be extra careful before putting money into such a poorly managed company, where corruption has become rife. Most would probably see investing in PPD like pouring a pail of water onto a desert.

Dealing with PPD's problems will be complicated and very costly. The government has no other option but to bear all the consequences. Cleansing the company of all its corrupt and unscrupulous staffers appears to be impossible, however, dissolving the company and dismissing all the employees would be the best choice. A new company should be set up to replace (old) PPD to make it possible for the investors to own a company with a new, fresh and healthy atmosphere. The 5,000 laid off employees of (old) PPD would given the opportunity to enter the new company (new PPD - or whatever its name) on the condition that they passed serious screening process.

Political will must exist to make all this happen. Only under new management will a new PPD be able to serve the public with better transportation and, expectedly, reap profits at the same time.