Rail workers strike over SRT reorganisation

The government's attempt to reorganise the money-losing State Railway of Thailand hit a major obstacle yesterday as hundreds of workers went on strike and disrupted 17 per cent of the national rail service.

The Cabinet approved the SRT's reorganisation plan on June 3, allowing the agency to set up a new company to take charge of the Airport Rail Link between Suvarnabhumi Airport and inner Bangkok.

This company, with initial capital of Bt500 million, was scheduled to hold its first meeting today.

Another company, with initial capital of Bt60 million, will be set up to oversee the SRT's vast property interests.

Transport Minister Sophon Saram insisted yesterday that the new companies would be 100 per cent owned by the SRT and there would be no share-sale to the private sector, as feared by the SRT's labour union.

Deputy Finance Minister Pradit Pataraprasit also insisted that the reorganisation plan was not a privatisation of the SRT.

SRT governor Yuttana Tabcharern said 274 workers, including 130 train drivers, did not report to work yesterday, resulting in the inability to provide services on nearly 50 of the agency's 290 routes across the country.

The strike led to the suspension of 12 outbound services from Bangkok to southern, northern, eastern and northeastern destinations yesterday morning.

Another 35 local train services and 25 cargo-only services were also suspended.

Large numbers of commuters and some cargo were left stranded by the industrial action.

The SRT's revenue losses from this level of action were put at Bt15 million per day, with no indication of how long the strike would last.

In addition to the Airport Rail Link, sources said unionists were afraid that the SRT would assign the new company to hire outsiders to run some of routes in the second stage of the reorganisation.

The reorganisation plan has been touted as a means to reduce the SRT's losses, as the agency needs to boost its overall efficiency and minimise internal corruption, while generating more income from its cargo service to help subsidise the money-losing passenger operations.

The SRT's accumulated losses stand at about Bt72.8 billion, requiring the government to directly subsidise its operation.

The agency also has the obligation to pay for the pensions of its 25,749 workers. Earlier, it was proposed that a pension fund worth Bt58 billion be set up.

Savit Kaew-wan, president of the SRT's labour union, said his members had suspended parts of the national rail service because they were opposed to the reorganisation plan, which would effectively privatise some operations.

He said the reorganisation plan would lead to higher passenger fares, but Yuttana said the union had misunderstood the essential points of the plan.

The SRT's top management also insisted the new company would only be responsible for the Airport Rail Link, while existing train services would not be affected.

According to the reorganisation plan, the SRT's revenues are projected to rise from the earlier estimate of Bt79 billion to Bt109 billion during 2009-2018 as a result of new measures.