Following the protest by Bharatiya Janata Party councillor Inder Aggarwal over the losses being incurred by city bus service run by the Ludhiana Municipal Corporation and its failure to earn revenue by displaying advertisements on 105 buses, the MC has finally entered into an agreement with the private operator to get a share in revenue from advertising.
Now as per the agreement, the private operator Horizon Connect Transways Private Limited will be paying MC Rs 4,000 per month per bus for low-floor and semi-floor buses and Rs 3,000 per month per bus for mini-buses.
Initial estimates say that now the MC will be earning more than Rs 40 lakh per year from advertising on city buses while earlier this revenue was zero as there was no such clause in the agreement.
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This monthly income will be in addition to Rs 3,829 per bus which the MC gets from the operator on a monthly basis as rent (Rs 48.23 lakh annual contract has been given to Horizon to run the city bus service).
The special meeting regarding the revenue sharing of advertisements was held under the chairmanship of assistant commissioner Satwant Singh, also managing director of Ludhiana city bus service.
A copy of minutes of the meeting, accessed by Ludhiana Newsline, says, “It was felt by the authorities that a lump sum payment of advertisement revenue share on per bus per month basis is transparent and uncomplicated revenue model.” It added that it would ensure revenue for MC even if no advertisement was displayed on buses.
Another clause which has been added to the agreement says that once the contract of nine years ends, buses shall be transferred to the operator only against a payment of minimum 20% of price on which buses were purchased by the MC and if the operator refuses to purchase buses at this rate, they will be sold in open auction.
Speaking to Ludhiana Newsline, BJP councillor Aggarwal said, “It is a big achievement that now MC will be earning additional Rs 40 lakh from city buses. Had we not protested and raised the matter, they would have agreed to sell their property for advertising free of cost without any share in revenue.”
Baljeet Singh, manager of city bus service, said, “Apart from Rs 48.32 lakh annually, Horizon would be paying us more than Rs 40 lakh for 105 buses as advertising revenue and in return they are free to display as many ads they want to on city buses.” The payment cycle would begin from April 7 onwards, said MC officials.