MRT fare hike won’t hike overall PH transportation cost


The looming fare hike in the Metro Rail Transit (MRT) won’t automatically increase transportation costs in the country, a Cabinet official said on Monday.

Secretary Joseph Abaya of the Department of Transportation and Communications (DOTC) made the argument after Rep. Antonio Tinio of Alliance of Concerned Teachers questioned the Aquino administration’s plan to increase the MRT fare by an average of P5 pesos.

Tinio argued that it the planned fare hike is contrary to the target of the DOTC to reduce the overall transportation cost in the country by eight percent.

“When we said reducing the overall costs, we are not only talking about the fare. We are also talking of time costs, health costs and economic costs. This does not go against the reduction of overall transportation cost because the possibly reasonable fare hike might translate to more efficient travel time, making us more productive,” Abaya pointed out during the budget hearing of the P46 billion proposed budget of DOTC for 2014 before the House Committee on Appropriations.

The longest ride in the MRT (Trinoma to Taft Avenue station and vice-versa) is priced at P15 pesos, way below the real cost of P53 pesos. Moreover, the P15 maximum fare in the MRT is only P5 pesos higher than the minimum fare of P10 pesos.

Tinio refused to back down, arguing that the cost of maintenance and operations of the MRT is at P1.82 billion which is lesser than MRT’s income worth P2.1 billion.

“At this rate, the MRT even had income. Why would the government need to subsidy the MRT for P5 billion?” Tinio pointed out.

Abaya countered that the P5 billion subsidy from the government is mainly for the Philippine government’s payment of its equity rental payment dues to the MRT-3 Corporation which owns the MRT facilities.

The Philippine government, for its part, is in charge of operations and maintenance of the MRT.

“This is our contractual obligation because we do not own the MRT yet. We are not going to have an increase [in MRT fares]to pay for the profit of the privately owned MRT Corporation. This is our payment for their facilities because we do not own them,” Abaya explained.

Abaya, however, conceded that such set up should be changed so as not to out the government in a bind in making decisions.

Having said that, Abaya revealed that the DOTC is keen on pushing for an MRT buyout this year to the tune of P55 billion.

Under scheme, the government will own the MRT facilities and subject the operations and management side to private entities.

“At present, what we have is like half-in, half-out relationship. The government wants to make the political decisions by buying it out. We want to get out of this set up. The government is really keen on pursuing this so I don’t think there will be a problem on funding,” Abaya added. LLANESCA T. PANTI


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