LRT-MRT loans eyed in House scrutiny
Militant lawmakers on Saturday protested the impending P10-increase in full fare for the Light Rail Transit (LRT) and Metro Rail Transit (MRT) even as they pounded on Congress to intervene on the matter.
Gabriela party-list Rep. Luz Ilagan and Kabataan party-list Terry Ridon stressed the need for Congress to listen to consumer complaints that the December hearings at the Department of Transportation and Communications were only a venue for the agency to present the fare hike without really accommodating the people’s sentiments.
Ilagan also sought a congressional probe of the foreign loans obtained by the Philippine government to finance the commuter train systems.
In House Resolution 137, the party-list lawmaker stressed the need to “protect the riding public from shouldering the real cost factors passed on by the Aquino administration, which are the accumulating loan burdens, and the overpriced rate of return set for the Build, Lease, and Transfer (BLT) agreement for the LRT line extensions and operations.”
Ilagan said the DOTC has been justifying fare hikes with the claimed need to reduce taxpayer subsidy losses and assure investors a return of their investment funds.
DOTC Secretary Joseph Emilio Abaya on Saturday said there was no decision yet on the proposed increase. But if the fare hike pushes through, Abaya said, the government would reduce around P900 million in annual subsidies to MRT and LRT, thus allotting more funds to other public basic services.
“The ‘small’ fare hike would be the effect of a reduction of P900 million in national government subsidy to MRT and LRT,” Abaya said earlier last month.
With the planned fare increase, MRT and LRT passengers would have to pay additional P10 for using the mass rail transit systems from end-to-end.
But Abaya earlier clarified that “average commuters will only have to pay an extra P5 since only three percent of the total MRT and LRT passengers use the systems end-to-end.”
Government statistics show the MRT service some 500,000 commuters daily, while the LRT accommodates at least 400,000 passengers daily.
Parañaque Rep. Gus Tambunting also denounced the impending MRT and LRT fare hike, saying “the DOTC should find a way to maintain the rate as is, by increasing subsidy if needed.”
“We should not add this burden to our people. The government should find the money,” Tambunting said.
Isabela Rep. Rodolfo Albano III described the move as “unpopular” but the government cannot provide a full subsidy for the mass rail transit systems.
“They want everything for free? That’s impossible,” he said.
Citing a study conducted by the Inter-Agency Committee led by the Departments of Finance (DoF), Budget (DBM), the National Economic and Development Authority (NEDA) and the Palace , Ilagan said the 25-year contract with private firms prevented the government from negotiating what the committee declared as the “onerous” 15 percent rate of return.
“Even the DOTC and the Light Railway Train Administration acknowledge that tax subsidies are not financing train operations, but are used to pay the debt servicing. Clearly we need to expose the loan provisions to the public even before the government proposes to hike fares,” Ilagan added.
Since 1998, Ilagan said, the government has been saddled with loans from the Export-Import Bank of Japan, Sumitomo Bank, and other Japanese, Czech, and local financers like the Bank of the Philippine Islands to fund the contract Metro Rail Transit Corp. conglomerate.
“The latest yen loan costs P18.56 billion for line extensions to the north and south,” Ilagan said.
Ridon said that the Makabayan Bloc in the House would question the wisdom of the fare hike.
“It will not add more trains. It will certainly not improve service. It will only serve to augment income for funding which the government removed in the last two years,” he said.