• DOTC clarifies fare hike, defends LRT-1 bid


    The Department of Transportation and Communications (DOTC) on Wednesday refuted claims that the bid award of the P65-billion Light Rail Transit Line 1 (LRT-1) Cavite Extension (Cavex) project will result in a fare increase for LRT-1 passengers on August 1 this year.

    DOTC acknowledged the proposed P 11+1 fare increase for LRT-1, LRT-2, and MRT-3 riders, but stressed it is completely separate from the Cavex Private-Public Partnership project.

    Under the proposed “11+1” formula, passengers will be charged P11 upon boarding trains and pay an additional P1 for every kilometer traveled.

    The DOTC, the Light Rail Transit Authority (LRTA) and the Metro Rail Transit Corp. (MRTC) have been seeking a fare increase since 2010, in order to improve their facilities and services to the public.

    Their proposal has already undergone 2 public consultations, although no date has been set for the implementation of the fare hike.

    In December last year, DOTC, LRTA, and MRTC proposed to rationalize the rail fare system of Metro Manila by adopting the “users’ pay” principle, whereby commuters will be charged based on the distance they travel instead of the number of stations they pass, in a format similar to that of other public transport modes such as jeepneys and buses. The DOTC and the two light rail operators did not explain, however, how the kilometer-based fare would be calculated and applied to the commuter trains, as all three lines will presumably continue to have fixed stations.

    The fare increase is projected to provide an additional P2.06 billion in revenues to the LRTA and MRTC. This will be deducted from the subsidy that government provides for the operation of the LRT Line 1 and 2, and the MRT Line 3.

    The added revenues can also be used to enhance services, improve facilities, and providing better maintenance works.

    Earlier, LRTA had said that its ongoing and recently competed projects involve medical and security upgrades such as the provision of ambulances, first aid kits, stretchers and wheelchairs in its stations.

    In another development, DOTC Secretary Joseph Emilio Abaya also issued a strongly-worded statement defending the bidding process which resulted in the Cavex project being awarded to a consortium led by Manuel V. Pangilinan’s Metro Pacific Investment Corporation, saying that the project was fully in accordance with law, and that recent attempts to block its award are meant to deprive the riding public of better access to jobs and other opportunities in Metro Manila.

    “This is clearly an attempt to block progress. The project will give residents of Paranaque, Las Pinas, and Cavite convenient and affordable transportation to the metropolis,” the statement read in part.

    “Those who cannot afford to live in the business districts and economic centers will be given access to jobs and educational opportunities. Intrigues shouldn’t prevail over the interest of the riding public,” it added.

    The statement apparently refers to a complaint raised by unknown parties not identified by the DOTC, questioning the propriety of the bidding process due to the alleged connection of DOTC Undersecretary Rene Limcaoco’s brother with the winning consortium. “Based on records in the transport agency’s possession, the allegation that Undersecretary Rene Limcaoco’s brother is an officer of the winning bidder is simply untrue. There is no Jose Teodoro Limcaoco listed as a director, officer, or shareholder of AC Infrastructure or any other member company of the Light Rail Manila Consortium,” the DOTC statement stressed.

    “We disagree with the assertion that this project does not need to be awarded yet. We cannot honestly say this to the riding public who have been waiting for this project for many years, those whose lives will be uplifted with the opportunities and quality of life that the project presents,” it added.

    When reached for comment, MPIC Chief Financial Officer, David Nicol, said in a text message, “There is always a reason not to do things but actually the public wants these improvements don’t they? [It was]An open bid process and compliant bid so I do wonder at the delay.”

    The winning consortium is composed of Metro Pacific Investments Corp.(MPIC), which has a 55-percent interest, AC Infrastructure with 35 percent, and Macquarie with 10 percent.


    Please follow our commenting guidelines.

    1 Comment

    1. The tact of the DOTC, through Sec. Abaya, is to brand those opposing the PPP mode as anti-progress. As in this article, Sec. Abaya has always emphasised in various press releases that if the PPP will not push through it will deprive the commuters from the south from being given convenient and affordable access to mass transportation service.

      We would like to point out that we are not against the LRT Cavite Extension Project per se. What we are against is the privatisation of the LRT and the PPP mode of implementing the extension project because it is grossly disadvantageous to the riding public, the government and the employees of LRTA.

      Here is an excerpt of our position paper on why we are against it:

      “Beyond the government’s rhetoric on the so-called benefits of the PPP Program is the grim reality that in adopting the PPP scheme, the government is essentially abandoning its role in the development of the country, leaving it instead to the hands of private investors. Government refuses to learn from the bitter lessons of earlier privatisation schemes that have raised the fees for services, increased government debt and resulted in mass retrenchment of state workers.

      With the sweeteners employed to attract investors, such as the privatisation of the LRT1 Operations and Maintenance, government’s assuming the payment of Real Property Taxes of around PhP 64B for the entire 32-year contract, guaranteed fare adjustments, and shouldering the lion’s share of the cost of the project, privatisation removes from the private Concessionaire any financial liability and business risk, transferring instead all risks and liabilities to the government and the commuters.

      Moreover, contrary to the government spin that the PPP program will create more job opportunities, it will instead displace workers. The LRTA employees that will be absorbed by the Concessionaire for a 6 months probationary period may be terminated after the lapse of such period since the Concessionaire is allowed to dismiss any employee due to Economic Causes (e.g. installation of labor-saving devices and/or redundancy).

      We, the Alliance Against LRT Privatisation, a network of concerned individuals, employees and commuters, call on the people to reject the privatisation of the LRT Line 1 Operations and Maintenance and the hybrid PPP mode of implementation of the LRT1 Cavite Extension Project.

      We call on all the people, especially the taxpayers and commuters, to sign this petition asking President Aquino to halt the privatisation of the LRT1 Operations and Maintenance and the Hybrid PPP Mode of Implementation of the LRT1 Cavite Extension Project, to maintain the status quo, wherein the LRTA will operate the system, and for the government to uphold its responsibility to provide the necessary transport infrastructures.”

      More of this here: http://www.change.org/ph/mga-petisyon/president-benigno-aquino-iii-and-the-members-of-the-16th-congress-stop-the-lrt-privatization-and-the-hybrid-ppp-mode-of-implementing-the-lrt1-cavite-extension?utm_campaign=petition_created&utm_medium=email&utm_source=guides