Government owned bus company Saskatchewan Transportation Co. is getting an operating grant of up to $9.2 million for 2012, about $300,000 more than the amount approved last year.
The Saskatchewan Party government cabinet authorized the expenditure at a recent cabinet meeting.
The government also approved a $2.3-million capital grant for STC for 2012, money that will go toward upgrades of buildings, technology and the company's bus fleet.
Deanna Bergbusch, STC's executive director of planning and communications, said the company's costs are fairly stable but the impact of inflation is pulling the operating grant up a bit from last year. There is also ongoing uncertainty over what impact changes in the industry in neighbouring provinces will have on STC, Bergbusch said.
But STC's ridership has increased for the second year in a row as the company seeks to woo travellers with better amenities and seat sales, she said. In 2010, the company reported an increase in ridership of nearly four per cent and preliminary figures for 2011 indicate an increase of seven per cent.
Bergbusch said STC has taken steps to increase the amenities available for passengers, with free on-board Wi-Fi service on many of the coaches. Seat sales targeted at youth and seniors have produced positive results as well, she said.
"We're also experiencing growth in ridership in riders between age 25 and 59. It's only three per cent, but that segment has not grown in the past, so we're quite excited about that."
But even the boost in ridership doesn't change the present reality of requiring operating grants.
"Our revenue would have to go up a great deal to offset the changes in the industry and the inflationary costs," Bergbusch said.
Jim Reiter, the minister responsible for STC, was away and unavailable for comment Monday. In an interview last year, he said the grant is still too high, but he believes it has stabilized thanks to management efforts to boost revenue through measures such innovative seat sales.
The annual grant is handed over so STC – which loses money on most of its routes – can fill its mandate of providing safe, affordable and accessible bus passenger and freight service. But the level of subsidization has often sparked controversy, with some public policy groups such as the Frontier Centre arguing the provincial government needs a new model for bus service.
STC has 29 routes and serves 290 communities. The routes are examined every year, Bergbusch said, but "right now we haven't forecasted any changes."