A brief dialogue with the DOTC on the MRT/LRT fare hike

Posted: January 15, 2011 in Economy
Tags: ,

Last Wednesday January 11, we decided to visit the Department of Transportation and Communications office along Ortigas Avenue after hearing of the news that a provisional fare increase for LRT 1 and 2 had been approved. We thought we could get some initial documents from the DOTC regarding the fare increases.

We were able to talk to Undersecretary Dante Velasco, the spokesperson of the DOTC for the particular issue of the fare hike. We were given a matrix of the new fares along with some useful information.

The fare hike will affect the LRT1, LRT2 and MRT lines and will be effective starting March 1 this year.

The proposed fare matrix shows that single-journey tickets for the LRT 1 will now cost P15, P20 and P30, with P15 being the minimum fare till the first four kilometers, P20 for the next five to nine kilometers, and P30 for the next 10 kilometers onward. For the LRT 2 line, it will be P15, P20 and P25. The fee structure will be implemented for all train lines but the MRT has yet to finalize a fare matrix. So under the new rates, if you’re commuting from Monumento to Baclaran, you will be paying P30 instead of the current P15.

For those using stored-value tickets, there will be a boarding fee of P11 and a charge of P1.00 for every succeeding kilometer. So what used to be a P14 ride from Baclaran to Bambang station wil now cost P20.

 

LRT 1 Current and Proposed Fare Matrix

From/To Baclaran Station

Stored Value Single-Journey
To/From: Current Proposed Current Proposed
EDSA 12 12 12 15
Libertad 12 13 12 15
Gil Puyat 12 13 12 15
Vito Cruz 12 14 12 15
Quirino 13 15 15 15
Pedro Gil 13 16 15 20
UN Ave 13 17 15 20
Central 13 18 15 20
Carriedo 14 19 15 20
D Jose 14 19 15 20
Bambang 14 20 15 20
Tayuman 14 21 15 30
Blumentritt 15 21 15 30
Abad Santos 15 22 15 30
R Papa 15 23 15 30
8th Ave 15 24 15 30
Monumento 15 25 15 30
Balintawak 19 27 20 30
Roosevelt 20 29 20 30
Source: LRTA

 

The fare hike has been approved provisionally, and will be finalized after so-called public consultations on February 4 (for students), 5 (employees) and 8 (other groups). The consultations will be at the cafeteria of the LRT 2 depot in Santolan, Pasig.

 

LRT 2 Current and Proposed Fare Matrix

From/To Recto Station

Stored Value Single-Journey
To/From: Current Proposed Current Proposed
Legarda 12 12 12 15
Pureza 12 14 12 15
V Mapa 12 15 12 15
J. Ruiz 13 16 13 20
Gilmore 13 17 13 20
Belmonte 13 18 13 20
Cubao 14 19 14 20
Anonas 14 21 14 25
Katipunan 14 22 14 25
Santolan 15 24 15 25
Source: LRTA

 

The approving body for the increase is the Light Rail Transit Authority Board, chaired by the DOTC secretary and whose members include the secretaries of the DoF, DPWH, DBM, the NEDA director, MMDA chair, the LRTA administrator and a private sector representative. The fare hike has the imprimatur of Malacanang and was earlier announced by a Palace spokesman at the start of the year.

The DOTC has only issued a fare matrix. It has not made public any study, formula or basis of computations for the new fares. This is an important point because you can’t just raise fares without any clear basis. When government says subsidies are too big, we have to ask how and where the subsidies used in the first place. When the government says it is losing money, we have to know how and why.

In our talk with Undersecretary Velasco, he told us that the increase was small and on the average only P5.00. He even said that some employers can even subsidize the increase though they apparently have yet to figure out how they can do this.

Roel Landingin’s article on Newsbreak gives us an idea of the impact of the fare hike on commuters. Ctiing the Mega Manila Public Transport Study of 2007, the income profile of the MRT and LRT commuters show that 67.7% of the total commuters have monthly incomes below P10,000.

Some 14.9% of total commuters have zero incomes, most likely these are the student commuters and of course the other unemployed. The biggest number of commuters, 29.7% come from the less than P8,000 income bracket. These are the minimum wage earners, low-level government and private employees, contractual and so on. And for those who earn more than P30,000, not many of them actually ride the MRT, only 1.4%.

 

Income Profile of LRT/MRT Commuters
Monthly income Share
None 14.9 %
Less than P8,000 29.7 %
P8,000-P10,000 23.1 %
P10,000-P15,000 19.6 %
P15,000-P20,000 7.8 %
P20,000-P30,000 3.5 %
More than P30,000 1.4 %
Total 100 %
Source: Newsbreak, Mega Manila Public Transport Study, 2007

 

However, the claim that the average increase is only P5.00 hides the fact that for some commuters, the increase can be anywhere from P3.00 to P15.00, anywhere from 33% to 100%, depending on the length of the trip.

Can the minimum wage earners, low-paying employees and students absorb the impact of the 25%-100% fare hike? A P10 increase in daily transportation cost will result in at least P220 additional monthly expenses. A P30 increase in daily transportation cost will result in at least a P660 additional monthly expense.

The DOTC data tells us that it is relatively cheaper to use stored-value cards. However, as Landingin’s article pointed out, 70% of train commuters still use the single-journey tickets, because majority of the commuters come from low-income groups.

Usec. Velasco also told us that there will be improvements in the services of the LRT and MRT. I told him that any improvement of the services should be funded by the government and not sourced from the pockets of consumers, since the train systems are a form of public service.

Velasco also said that it was unfair for taxpayers who are NOT riding the LRT and MRT to continue subsidizing the train system. I argued that if that were the logic, then it would be unfair for people who are not studying in UP to continue subsidizing the state university. Aren’t taxpayers from Luzon also subsidizing the services in Visayas and Mindanao? The claim that it is unfair for those not riding the LRT and MRT to subsidize those who use it is a fallacy.

The public consultations on February 4, 5 and 8 have the format of a public forum. They are nothing like the public hearings held at the ERC, LTFRB or other regulatory bodies that determine increases in rates and fees. There are other questions as to the procedures employed in approving the rate hike, even provisionally. We shall discuss these in a later post.

The most important thing I learned from that dialogue is that at the end the day, it is the people’s outrage, the public opinion generated against the fare hike, which could prove as the decisive means to stop this latest economic burden. Velasco agreed, they cannot simply ignore the protests of the people.

It is not surprising though that Palace spokesperson Abigail Valte has appealed for calm amid the fare hikes. They know too well that this issue will spark outrage from the people. #


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