Arriva will transfer its shares to a government company on January 1 for an undisclosed sum of money, Joe Mizzi has confirmed, as the bus operator makes a premature exit from Malta.
The Transport Minister said the exit contract with Arriva, a subsidiary of Germany’s Deutsche Bahn, will be finalised in the coming days when the firm will transfer its shares to a state company that will run the public transport service.
“The financial details of the share transfer will be given when the contract is signed but a team from Arriva and Transport Malta will be working together to ensure a smooth transition,” Mr Mizzi said.
The government company will be absorbing Arriva’s assets and debts.
But while the bus fleet will remain the same, Mr Mizzi said the Arriva name will stop being used. Bus routes will also remain as they are until a new private operator is engaged.
Mr Mizzi said a call for expression of interest will be issued “in the shortest time possible” to engage a new operator. He avoided giving a timeline but insisted any company will have to operate within the parameters of the routes redrawn over the summer months to address customer complaints.
Mr Mizzi would not say whether a new operator will have a 10-year contract like Arriva.
When contacted, former transport minister Austin Gatt, who triumphantly announced the “time for shenanigans was over” when the Arriva service was rolled out in 2011, said: “I do not want to comment on current political matters.”
The extensive route changes requested by the government after March and the stoppage of bendy buses in August because of three incidents in which they caught fire were the final nails in the operator’s coffin.
Arriva was a loss-making operation and Mr Mizzi admitted that during the talks the company had warned it could opt for liquidation, a situation which would have left the country without buses as this would have frozen the company assets.
People were promised a revolution, they got confusion
“We did not want this to happen,” he said, but “it became evident that Arriva were not prepared to invest further in a loss-making operation”.
Mr Mizzi said the government was subsidising a service that was not up to scratch – a subsidy that went up to €23 million in two-and-a-half years. “It was a lose-lose situation and while people were promised a revolution, they got confusion,” he said.
Transport Malta executive chairman James Piscopo put paid to speculation that the old yellow buses will return to the roads. “We want to move forward not backwards,” he said.
Mr Piscopo said the intention was to carry out the necessary route changes with Arriva but it became evident early in the talks that the company did not want to invest more money despite having a contractual obligation to follow the transport regulator’s lead.
Addressing commuter concerns, Mr Mizzi said they should not experience difficulties during the transition phase but urged them to collaborate, along with trade unions, workers and Transport Malta.
He said Arriva workers’ jobs will be safeguarded after the share transfer is completed. The bus service, Mr Mizzi stressed, had to improve and this required more buses and drivers.
The minister said the higher fares charged to foreigners, deemed discriminatory by the EU, will have to end immediately.
Meanwhile, the General Workers’ Union yesterday held a meeting with Mr Mizzi and Mr Piscopo where it was agreed that no workers will lose their job during the transition period.
The union said when the time came it would also be involved in the talks with the eventual operator chosen to run the service.
Alternattiva Demokratika transport spokesman Ralph Cassar said workers should not suffer the consequences of bad political decisions and mismanagement.
He said the original service contract with Arriva sought to reduce costs rather than invest in a reliable mass transportation system.
ksansone@timesofmalta.com