Minister of Transportation and Communications Yeh Kuang-shih (葉匡時) threatened that, if the legislature disagrees with his plan to restructure the finances of Taiwan High Speed Rail Corp (THSRC, 台灣高鐵), the government might end up having to take over the company, which would be an unfavorable outcome for the nation. However, it might actually be a better solution as far as the public is concerned.
Yeh tried to get the legislature to agree to his plan by extending the current build-operate-transfer model for 40 years, triggering criticism from lawmakers across party lines, who criticized it as benefiting only the large corporations that have invested in THSRC.
Yeh argued that if the plan was rejected, the government might be forced to take over THSRC, which would place the burden for the company’s poor finances on the nation.
However, THSRC’s financial problems originated from the idea of keeping it profitable for corporate investors and it might be better if the government did take it back.
For the public, the high-speed rail system is just a convenient way to travel. However, the government had another agenda from its inception. With high-speed rail stations located in less developed areas of cities, the government’s original idea was to create commercial zones around the stations, aimed at attracting private investment and development projects.
The attempt is clearly a failure, as most of the land around high-speed rail stations remains unused, while a large amount of money has been paid in compensation to the original landowners.
A large amount of money has also had to be spent on subsidizing shuttle services between high-speed rail stations and city centers.
For private corporations invested in THSRC, their main concern is to make money, therefore as long as private firms remain major investors in the high-speed rail system, the government must do something to keep it profitable for them. Future policies ensuring a return for these private investors might lead to more expenditure from the public purse, with results that would still be difficult to predict.
The best way to keep the high-speed rail system going and to prevent it from losing more of taxpayers’ money might be to allow it to go bankrupt, so the government can take over THSRC according to the law, and when THSRC becomes a state-owned enterprise, it would be able to focus on serving passengers.
It is difficult to conceive that Yeh did not take this possibility into consideration, especially when even lawmakers from his own party, the Chinese Nationalist Party (KMT), are opposed to his financial restructuring plan, because the aim of benefiting large corporations at the expense of the public might be at the core of his scheme.
In fact, it is not the first time that Yeh has been “soft” on big business. In the past year, former freeway toll collectors have been protesting over Far Eastern Electronic Toll Collection Co’s (FETC) failure to keep its promise to find them jobs, after electronic toll collection was introduced on freeways.
The Ministry of Transportation and Communications has remained inactive on the issue, and has even frequently defending FETC during the controversy.
Maybe now is the time for the ministry to wake up and take over the running of these operations, and out of the clutches of big business.
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