From Iceland — Government Did Not Supply Needed Funds For Strætó, Board Member Says

Government Did Not Supply Needed Funds For Strætó, Board Member Says

Published October 20, 2022

Andie Sophia Fontaine
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The ongoing woes of capital area bus service Strætó can be attributed in part to the national government not standing by their promise to provide financial assistance to the company during the height of the COVID pandemic, Strætó vice chair and Pirate Party Reykjavík city councilperson Alexandra Bríem told RÚV.

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Last month, Strætó announced it was raising fares by a whopping 12.5%. This they said was the only option apart from cutting services, as the company has been operating in the red for far too long. Earlier this week, they announced they cut service of the night bus.

This prompted Pirate Party MP Arndís Anna Kristínardóttir to raise the issue in Parliament, saying, “At the same time as the government has doled out tens of billions [of krónur] in paying down electric cars and hybrids, which are first and foremost for well-off people, only one [billion] has been devoted to public transport. This is an environmental issue, an equality issue, a safety issue and it is in the public interest to support public transport for all.”

Alexandra told reporters that the government had promised Strætó financial assistance to get through the pandemic, but the funds needed never fully materialised. As a result, the money that would have been used to buy cheaper and more environmentally friendly buses was burned through in the early pandemic. This has made the company especially vulnerable to the oil crisis ongoing in Europe.

She also considers the great amount of funds going towards paying down electric cars but so little towards public transport to be unfortunate, contrary to what the government had promised the bus company.

“If it had been clear from the beginning that we wouldn’t get a billion [krónur] or two but rather the 120 million that we got [early in the pandemic], then Strætó would have certainly decided ahead of time to pull back on services for that period,” she said. “So it’s kind of the worst possible combination of circumstances.”

As it stands now, the idea has been floated to contract out part of Strætó’s services, but Alexandra says services will never been contracted out in full, and even if partly done, it will take a few years. As such, the idea will not help Strætó now, and other solutions are needed.

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