In January next year, the Taiwan Railways Administration (TRA) is to be transformed into the state-owned Taiwan Railways Corp (TRC). The corporatization plan was proposed in response to the Taroko Express train crash in Hualien County in April 2021. The expectation is that the restructured entity would operate more efficiently than the TRA, resulting in higher safety standards.
However, TRA personnel are less optimistic about the plan than the public and families of the crash victims. The employees said they believe that establishing safety operations should be at the core of TRA reforms and doubt that the corporatization plan is up to that task.
In addition to its ongoing deficit, the TRA has to deal with many issues, including a rigid administrative organization, low pay for employees, labor shortages, inadequate safety awareness and political interference.
The restructuring plan has the potential to raise safety standards, but only after the other issues are addressed. Key to that is tackling the TRA’s fiscal deficit, which would enable it to retain employees and attract the caliber of staff that it needs.
Since 1978, the TRA has accumulated a deficit of NT$400 billion (US$13.13 billion). Cost reduction measures have exacerbated the administration’s woes, resulting in low salaries, an M-shaped human resources structure and inadequate safety maintenance standards. Consequently, the TRA has failed to address its fiscal deficit, and major train accidents have continued to occur.
After the Hualien crash, TRA morale cratered.
Like other staff in public-sector agencies, TRA employees are considered civil servants, but their pay terms are less favorable than those of their counterparts in other government agencies. The main reason is that the TRA adopts a rank-and-position system laid out in the Terms of Transportation and Public Servant Employment (交通事業人員任用條例), which, unlike the more traditional Senior Recommended Appointment System (簡薦委制), has lower starting salaries for new recruits and does not provide subsidies for marriage, births, deaths in the family or children’s education.
It is little wonder that young people find the prospect of working for the TRA unattractive and do not take its civil service examinations.
The workforce at the TRA, too, has declined even as the deficit has grown. The number of TRA employees has dropped from 23,000 to 15,000 in the past few years. Meanwhile, the number of responsibilities carried out by TRA workers has increased 1.5-fold. In other words, TRA employees have seen their workload increase.
The TRA has been trying to recruit more workers, but to no avail. It cannot offer salaries higher than other government agencies, its reputation continues to erode and the serious labor shortage makes it difficult for the TRA to dig itself out of the hole it has gotten itself into.
Its plan of keeping its employees and recruiting more has failed to address the fundamental problems. The company must know that it is the employees that maintain safety standards, making it imperative to retain mid-level project supervisors.
Technician staffing levels within the administration has always been a function of supply and demand within the labor market, and the administration is certainly not overstaffed, but it might want to rethink its preferential early retirement program, which might mean it would lose the mid-level supervisors it should be trying to retain.
To fix the TRA’s rank-and-position system, the TRC would need to increase salary levels to retain employees and attract new ones. It should also offer enticements to keep senior employees, especially supervisors experienced in maintaining safety standards.
The TRC’s zero-deficit planning should be applauded. Yet, a corporation should pay extra attention to its performance. If the TRC’s labor and equipment costs turn out to be even higher than those of the TRA, it might have to accept that the railway business is not profitable and confront problems resulting from market mechanisms.
However, public transportation should be considered a public service, not a profit-making venture. The Ministry of Transportation and Communications should lay out a 20-year financial plan for the TRC to ensure that the company can be reformed for the greater good.
Johnson Kung is a civil engineer and director of the Taiwan Professional Civil Engineers’ Association.
Translated by Emma Liu
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