Clarissa Batino, Gil C. Cabacungan Jr., Inquirer News Service (10 May 2005) PHILIPPINES: Starting May 26, the minimum fare in Metro Manila will go up by P2 to P7.50 for jeepneys and to P8 for non-airconditioned buses, according to the Land Transportation Franchising and Regulatory Board (LTFRB).

The LTFRB granted yesterday the petition of public utility vehicles (PUVs) for higher fares in Metro Manila, which will also apply to public vehicles entering the metropolis from Central Luzon or Southern Tagalog region.

In a comment that sounded insensitive to the plight of the poor, Press Secretary Ignacio Bunye said the increase was not significant. "Two pesos? That's just (the cost of) two text messages," he said.

At a briefing, he said: "This (fare increase) is justified because it has been a long time that the transport rates had been adjusted."

Bunye said workers need not fret too much about the fare increase because President Gloria Macapagal-Arroyo would deliver on her promise to adjust the minimum wage within the month.

Ms Arroyo has used the petition for a transport fare increase as the main reason for her recent order to the regional wage boards to raise the minimum wage.

LTFRB Chair Maria Elena Bautista said the 20-percent student discount would be honored only during school days. The discount will no longer apply on weekends, holidays and semester and summer breaks.

The 20-percent discount enjoyed by senior citizens will continue all year round because the privilege is mandated by law.

The LTFRB also allowed jeepneys to collect an additional 25 centavos or a total of P1.25 for each kilometer after the first 4 km.

Regular metro buses will charge an extra 50 centavos for a total of P1.75 for every kilometer after the first 5 km.

Bautista said the board approved different jeepney fare increases ranging from P1 to P2 in the provinces after considering the paying capacity of commuters in other regions.

Provincial buses

The board, she said, had not acted on the petition of provincial buses to increase fares. Metro aircon buses have not sought an increase.

She pointed out that the fare increase the LTFRB granted was lower than the P2.50 being sought by jeepney operators and the P3 demanded by bus owners.

The National Economic and Development Authority (NEDA) said the LTFRB should have granted a fare increase of only P1.20 so as not to put additional pressure on inflation.

But drivers and operators said the 60-percent increase in the price of diesel since fares went up a year ago justified the new round of fare adjustments. Diesel now costs almost P29 a liter, up from P18 a liter in June 2004.

The LTFRB said it had to do a tough balancing act, weighing what PUV drivers and operators needed and what commuters could afford.

It was almost a year ago when fares went up by P1.50 for the first 4 km and 37 centavos for every succeeding kilometer for jeepneys and by P2 for the first 5 km and 38 centavos for every additional kilometer for ordinary metro buses.

Cost of living

"In approving the fare hike, we considered several factors. Among these are the prices of fuel and spare parts, the capacity of the commuters to pay and the cost of living and salaries in different parts of the country. This is the reason why we have different increases," Bautista said.

In Regions 1 (Ilocos), 3 (Central Luzon), 4 (Southern Tagalog), 5 (Bicol) and the Cordillera Autonomous Region, the LTFRB also raised the minimum fare by P2 to P7.50 for the first 4 km but did not grant an increase for the succeeding kilometers.

For Regions 2 (Cagayan Valley), 9 (Zamboanga Peninsula), 10 (Northern Mindanao), 11 (Davao) and 12 (Socsargen and Caraga), the board raised the minimum fare by P1 to P6.50, Bautista said. There was also no additional increase per kilometer in these regions, she said.

The LTFRB allowed Regions 6, 7 and 8 (Western, Central and Eastern Visayas) to raise the minimum fare by P1. Jeepneys in Central Visayas currently charge P5 for the first 4 km, while jeepneys in Western and Eastern Visayas charge P5 for the first 5 km.

Sufficient

Vigor Mendoza, lawyer for the transport groups, said the fare adjustments for Metro Manila were sufficient. But the lower fare hikes for the provinces could be a cause for concern.

"We all know that in the provinces, fuel prices are higher. Thus, they actually need a higher fare increase. But we understand that the LTFRB considered the paying capacity of those in the region," Mendoza said.

He expressed the hope that the government would give more incentives to PUVs in the provinces to help them cope with the spiraling cost of fuel amid a lower fare hike.

Mendoza suggested a higher diesel discount for the provinces that were given a smaller fare increase. Currently, oil players provide PUVs with a P1 per liter discount on diesel through selected outlets.

He said jeepney drivers incurred an additional cost of P30 for every P1 increase in diesel prices.

Inflation

Economic Planning Secretary Romulo Neri said the reasonable fare increase based on fuel price hikes should only be between 5 and 8 centavos for each kilometer plus 22 centavos per kilometer due to higher cost of spare parts.

"Thus, total fare hike should not exceed P0.30 per kilometer or P1.20 for the first 4 kilometers. If the transport fare hike will be managed prudently, wage increases will be tempered," Neri said.

Based on a study made by the technical working group of the Development Budget Coordination Committee, a resulting wage increase "given the petitioned fare increase" would raise inflation by one percentage point.

The peso's purchasing power weakens every time prices go up. A high inflation rate will erode any wage increase.

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