Stop increase, SC urged

Abaya, heads of MRT, LRT named respondents in suit

A LEFTIST group and a former congressman asked the Supreme Court Monday to stop the fare increase for the Light Rail Transit (LRT) 1 and 2 and the Metro Rail Transit (MRT) that was imposed Sunday, Jan. 4.

The Bagong Alyansang Makabayan (Bayan), represented by its secretary general Renato Reyes Jr., and former Iloilo Rep. Augusto Syjuco filed separate petitions Monday seeking the Court’s intervention.

The protest continues. Members of the group Bayan protest outside
the Supreme Court against the announced increase in MRT and
LRT fares. Danny Pata
In its petition, Bayan argued that the Court should issue a temporary restraining order against the Department of Transportation and Communication on the grounds that Secretary Joseph Emilio Abaya acted with grave abuse of discretion when he approved the fare hike without a public hearing.

“DOTC Secretary Abaya has no authority nor jurisdiction to resolve the fare adjustment or increases of LRT and MRT especially since both... are public services and must be subject to regulation, and their fare rate may not be adjusted unilaterally,” Bayan said.

Under the new rates, passengers of the LRT Line 1 from Baclaran in Pasay to Monumento in Caloocan City and vice versa must pay P30 for single-journey tickets and P29 for stored value tickets, from P20 fare.

Passengers of the newer LRT Line 2 from Recto in Manila to Santolan in Pasig and vice versa must pay P25 for single-journey tickets and P24 for stored value tickets, from P15. Those taking the MRT 3 from North Avenue in Quezon City to Taft Avenue in Pasay City and vice versa must pay P28 from P15 for stored value and single-journey tickets.

The DOTC has defended the fare increase, saying the money raised would be used to help fund a much-needed upgrade for the mass transit system.

But Bayan said the DOTC had not right to grant such a fare hike, especially since it was not published as required by law.

 “The LRT and MRT cannot claim such increases as a matter of right, and the DOTC or any agency for that matter, cannot grant such increase ex parte because any such increase should be based on reasonable grounds to be determined in a quasi-judicial proceeding or hearing. Likewise, the DOTC secretary does not have any conferred authority and there is no available procedure within the DOTC to properly consider the propriety of a fare hike for the mass transit system,” it added.

Bayan also asked the Court to issue a status quo ante order to provide the riding public with “immediate relief.”

Abaya, LRTA Administrator Honorito Chaneco, MRT 3 officer-in-charge Renato San Jose and the MRT Corp. and the Light Rail Manila Consortium were named as respondents.

In his separate petition, Syjuco also prodded the Supreme Court to immediately bar the fare increases, also arguing that the DOTC had committed a grave abuse of discretion.

If not stopped, the fare increase would cause “undue damage and injury to the riding public who will spend their own hard-earned money for a public transportation that is supposed to be subsidized by the government.”

Syjuco also lamented the lack of public consultation on the fare hike, which he said deprived the public of due process and their right to be heard on such an important issue.

The DOTC held only one “make-do” public consultation on Dec. 12, during which it presented the new fare matrix.

 “On this so-called public hearing, the DOTC presented a 64-slide PowerPoint presentation, but in actuality, there was no consultation whatsoever,” Syjuco said.

Since a public utility is imbued with public interest, Syjuco said any fare hike should be subject to

The former lawmaker also complained that the DOTC failed to present “any legal or factual bases for their computation” of the fare increases and did not provide a detailed computation.

 “Other than their self-proclaimed general statement about an allegedly necessary user-pay scheme and the need to continue paying debts to be incurred in the refurbishing and expansion of these train lines, no other basis were presented to justify the increase,” he said.

Syjuco also questioned the DOTC’s explanation that the fare increases were needed to reduce the government subsidy.

He said there was no need to raise fares because Congress has allocated P9 billion for the railway system’s repair and rehabilitation in this year’s budget.

After drawing flak for raising fares without improving the deteriorating train services, the Palace said Monday that improvements were “forthcoming.”

 “We can assure the MRT riding passengers that rehabilitation is forthcoming. We’re going to improve the services of the MRT,” presidential spokesman Edwin Lacierda said.

 “The improvements will take time to happen. But you will see these happen. We have the will to do and finish what we have set out to do,” he added.

Lacierda said with the fare adjustment, government subsidy for the three train lines has been slashed from P12 billion to P10 billion.

The savings of P2 billion will be spent for development projects outside of Metro Manila, he said.

 “This is an issue which is Metro Manila-centric. Certainly, there is unhappiness, displeasure or dissatisfaction with the riding passengers but we’re also going to allocate resources to the other regions of the country which would better the condition of our countrymen as well. It is not a popular decision but it has to be made. As a government, we have a responsibility outside of Metro Manila,” Lacierda said.

But the Ibon Foundation think tank disputed the Palace claims and said the fare hikes would not go to improvements in the service.

 “The argument that the fare hikes for LRT 1 and 2 and MRT 3 are justified because they will go to the much-needed improvements for the train system is erroneous,” the group said.

The foundation said even the DOTC had admitted that the funds raised from the fare hike would go to paying off the government’s “questionble financial obligations” to the MRT Corporation.

The group said low fares are not the reason behind the bloated government expenses for the LRT/MRT. In the case of MRT, the costs swelled because of the onerous financial obligations of government arising from its build-lease-transfer (BLT) contract with the privately owned MRTC. Under the BLT, the government agreed to pay for the guaranteed annual 15 percent return on investment of the MRTC in the form of equity rental payments, as well as the settlement of MRTC’s tax liabilities.

Based on latest available data, these financial obligations under the BLT comprise about 81 percent of total MRT 3 expenses, Ibon said.

For LRT 1 and 2, the bulk or 47 percent of the expenses go to their debt servicing, the foundation added.

 “But what makes the fare hike more unjust, particularly in the case of LRT 1 that has been recently privatized, is that the people will bear an increasing share of the debt-servicing burden even as the system generates private profits for the consortium of the MVP-Ayala group (which won the LRT 1 public-private partnership or PPP project) and their foreign partners,” Ibon said.

It added that it was clear there was no need to increase fares if the government fulfilled its mandate to provide reliable and affordable mass transportation.

Opposition lawmakers on Monday supported the petitions against the fare hike.

1-BAP party-list Rep. Silvetre Bello III denounced the decision of the Palace and the Transportation Department to raise fares without public hearings or consultations.

Bello also expressed hopes that the Supreme Court would issue a temporary restraining order to stop the fare hikes.

“The rate increase has no legal basis,” said Bello. “Worse, the increase was imposed without the benefit of hearing. I hope the Supreme Court sees its way clear on this issue,” Bello said.

Kabataan party-list Rep. Terry Ridon said imposing the fare hike only proved how “despotic and uncaring” the Aquino administration is.

“Policy-makers should remember that staggering increases in transportation costs will quickly upset the daily budget of low to middle income families. With millions of white and blue collar workers depending on the state-subsidized train fares to cope with their daily transport expenses, the new wave of fare increases will quickly result in an overwhelming crisis back home,” said Ridon, a member of the House committee on transportation.

 “For many families, train fare increases will mean a significant reduction in basic expenses, primarily on food. Every peso added to daily transport expenses is a peso less for food,” Ridon added.

Gabriela Rep. Luz Ilagan blasted the government for justifying the fare hikes by invoking the need to reduce taxpayer subsidies and to assure investors of higher returns on their investment.

 “Even the DOTC and the Light Railway Train Administration acknowledge that tax subsidies are not financing train operations, but are used to pay debt servicing. Clearly we need to expose the loan provisions to the public even before the government proposes to hike fares,” Ilagan said.

Senator JV Ejercito said raising fares would not be a problem if train services were improved. – With Macon Ramos-Araneta

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