P25 jeepney fare hike: LTFRB-7 says it won’t happen

LTFRB-7 chief cites processes to grant a fare increase, inflationary impact of P25 raise

CEBU CITY, Philippines – The demand for a P25 increase in the minimum fare for jeepney drivers, from P15 to P40, is deemed impossible to realize, according to the Land Transportation Franchising and Regulatory Board (LTFRB) Region 7 Director Eduardo Montealto Jr.

Montealto said that the P25 increase should not be taken lightly, as it would require consultation with the Department of Energy (DoE), the Department of Trade and Industry (DTI), the National Economic and Development Authority (NEDA), and the commuting public.

“Kinahanglan balanse na siya kay dili ta pwedeng mahimong usa sa factor nga mutaas samot ang atong inflation,” he said in an interview with CDN Digital on May 2.

(That should be balanced because we cannot do one thing that will be a factor that will increase further our inflation.)

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Montealto’s remarks followed statements from Greg Perez, head of the local transport group in Cebu, who said that jeepney drivers might seek higher minimum fares due to pressure to repay loans taken for the purchase of modernized jeepneys under the Public Utility Vehicle Modernization (PUVM) program.

The LTFRB-7 Director clarified that even if transport groups would petition for a minimum fare increase, it could not be implemented easily. It would still undergo a thorough study and multiple consultations with concerned authorities.

“Ako lang ipasabot nga wala naginitiate ang LTFRB og increase so dili na mahitabo. Karon gani, naa tay provisionary increase og provisional 1 peso so sa traditional jeepneys 12 pesos plus 1 peso, 13 pesos ang minimum fare. Provisional na siya kay nagdepende man tas [price] sa fuel,” Montealto said.

(I would just like everybody to understand that the LTFRB has not initiated any increase so that will not happen. Even at present, we have an provisionary increase of 1 peso so in traditional jeepneys 12 pesos plus 1 peso, then the minimum fare is P13 pesos. That is provisional because it will depend on the [price] of fuel.)

He said that an increase as high as the P25 raise could only be plausible when the price of fuel reaches P150, and at that time, they would surely consider implementing an increase.

Montealto further clarified that a decision on a fare increase would depend on fuel prices and the petitions they would receive.

“So if magpetition sila og ingana ka dako, kwarenta, dili man pod na basta-basta ma-approve. Kinahanglan na og proper computation,” he said.

(So if they will petition an increase of that big, P40, that cannot be approved easily. It would require a proper computation.)

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With regard to the monthly amortization of the modernized jeepneys as the motivation for the increase in minimum fares, Montealto refuted the idea and said that the anticipated computation was not accurate.

According to Montealto, before the bank approves or grants loans to transport cooperatives, a thorough assessment must be conducted.

He said that before approval, a comprehensive review of the feasibility study provided by the applicants would be necessary, and this process might take several months before approval would be granted.

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For instance, if one applies for a loan for 10 units, there is a possibility that only 5 will be approved based on their capability and projected income.

“So dili na basta-basta, expect for the worse na sila kalingaw. Kanang 5 na ilang i-release dili gyud na sila magexpect nga kanang tanang lima mogenerate og dako na income. So if maapprobahan, kana siya kay feasible and viable, so dili necessary nga magincrease,” Montealto added.

(So, it will not be done easily, they expect the worse that is how they do it. The 5 (units) that they release they do not expect that all 5 would generate a big income. So if that will be approved, that is because it is feasible and viable, so it is not necessary to implement an increase.)

Meanwhile, the Department of Transportation (DOTr) Undersecretary for Planning and Project Development, Timothy John Bata, said last January this year, that no fare hike should occur without undergoing the process of the LTFRB.

He said that the fare increase had no basis, and they would not anticipate such a significant increase in their consolidation and PUVMP.

Similarly, DOTr Secretary Jaime Bautista also refuted the assertion made by a commuters’ group regarding the potential increase of the minimum fare for modern jeepneys to P50 and clarified that the primary factor influencing any fare adjustment in public transportation would be the cost of fuel.

“We strongly believe there is no basis for the alleged P50 minimum fare,” he said.

He said that fare increase petitions undergo en banc deliberation by the Land Transportation and Franchising Regulatory Board (LTFRB).

Bautista further stated that NEDA (National Economic and Development Authority) opinion would be necessary regarding the inflationary impact of any increase, and consideration would be given to the affordability of the commuting public.

The current minimum fare stands at P13 for traditional jeepneys and P15 for modern jeepneys.

In 2017, at the outset of the PUV modernization program, the minimum fare was P9 for traditional jeepneys and P11 for modern jeepneys.

“This showed that LTFRB has always balanced the need of drivers against commuters when fuel price increase happens,” Bautista said.

As part of the modernization program, the consolidation deadline for jeepney operators and drivers – the initial phase of the program – was set for Dec. 31, 2023.

However, the deadline was extended to April 30, 2024. Jeepney operators and drivers who did not participate in the PUV modernization program will not be allowed to continue operations beyond the given date. They will now be classified as “colorum” vehicles and will be apprehended by authorities.