Matatu owners seek regulation of licensing as PSVs flood roads

Matatu owners are looking to the regulatory hand of the government to help tame an influx public service vehicles (PSV) as stiff competition drastically cut their profit margins.

Through their lobby, the Matatu Owners Association (MOA), the investors want new PSV operating licences to be issued only after demand assessments are conducted on specific routes.

The PSV licences are currently granted to any investor who presents a vehicle that meets quality specifications to the National Transport and Safety Authority (NTSA).

MOA chairperson Simon Kimutai says only the investors whose routes have been assessed and issued with licences should be allowed to import PSV vehicles.

“Licences should be issued first before buying a vehicle. One should have the concept before buying.

“But today somebody will go build a bus then come and ask for a licence, so automatically he must get it,” he said.

“It is very good as a regulator to advise the industry.

“Today, as we say it is saturated there is bound to be overlapping and misbehaving on our roads because everyone is competing for those few passengers.”

Mr Kimutai says the industry is saturated and is currently loss-making because investors spend millions of shillings without hard data on demand to guide their decisions.

He wants the NTSA to collect data on passenger numbers and public service vehicles on each route.

This data, he added, will then be used to determine if a route is sufficiently served before issuing any licence.

Industry players have blamed the small margins on the cut-throat competition for passengers that often push matatu players to disregard the law.

“The industry is loss making because we don’t have statistics. It would be better to know, if it is Kawangware, for example, do we have enough services provided to them as opposed to keeping on piling (more vehicles),” he added.

NTSA chairman Lee Kinyanjui said the agency would be looking to have data-driven decisions on licensing public service vehicles to make sure standards are maintained.

“How many vehicles are needed to serve those passengers effectively and also profitably because these people (investors) have taken loans,” Mr Kinyanjui said

“When the competition is so high and the margins are so thin, then there’ll be compromises on the quality of vehicles we have on our roads.”

Data from the Kenya National Bureau of Statistics shows that the total number of new PSV licences issued last year went up by 12.3 per cent to 30,506.

The statistics also show that earnings from road passenger transport grew by 2.9 per cent to Sh322 billion, highlighting the mismatch between number of new vehicles and income.