An umbrella group of consumer stakeholders has asked the Philippine Ports Authority to put on hold a petition of the Manila North Harbour Port Inc. for a 37.45 percent tariff increase, saying democratic consultations must first be held.
“Consumers will ultimately be burdened by this planned tariff hike because traders will just pass on the added costs to the public,” United Filipino Consumers and Commuters president Robert Javellana Jr. said, warning of a spike in prices of basic commodities if such adjustment is implemented.
“The PPA must conduct democratic consultations where consumers must have representation,” Javellana said, in an interview.
Port stakeholders earlier rejected the petition, saying it was both unwarranted and unjustified that the MNHPI, which they accused of already acting as a “monopoly,” should hike its fees.
The Philippine Inter-Island Shipping Association rejected the claim of the port operator that it needs to adjust cargo-handling tariff to compensate for the “upward trend in cost drivers” and the increasing cost of operating Manila North Harbor.
“For every increase incurred for any cost driver reflected as expense, computed per twenty-foot equivalent unit (TEU), there is already a proportionate revenue earned to compensate such costs incurred by the port operator,” PISA stressed.
According to Javellana, this makes the tariff hike petition “unfair and unjustified.”
“The port operator must explain where the tariff hike will go. This might have a domino effect with other port operators seeking tariff increases also,” the UFCC official warned.
Export Development Council vice chairman Sergio Ortiz-Luis Jr. also slammed MNHPI for asking for a tariff increase.
“The MNHPI is a monopoly in domestic trade. Port stakeholders have no choice but to transact business with them. Being a monopoly, it should even cut its cost rather than increase it,” said Ortiz-Luis, who is also the president of the Philippine Exporters Confederation Inc.
PISA said statistics from the Philippine Ports Authority would show that MNHPI’s net income has been steadily increasing from P177.9 million in 2012 to P305.7 million in 2013 to P332.6 million in 2014. This means the port operator’s net income went up by 13 percent, 19 percent, and 16 percent for the said period.
MNHPI has listed labor, fuel and power rates as among the cost drivers but these were all debunked by the Philippine Liner Shipping Association.
The group said the fuel and power consumption of the company was “alarming” at the very least and should trigger an audit instead.
PLSA said the port operator’s “remarkable” increase in fuel consumption—55 percent from 2012 to 2013 and 78 percent from 2013 to 2014—could mean “inefficient” fuel use. Within the same period, MNHPI’s power consumption increased by almost 2 million kilowatts, or a 103.12 percent hike in power cost per TEU.
“This is not acceptable…Like fuel costs, a reasonable cap on power consumption must be determined to compel MNHPI to make effective and efficient use of power,” PLSA chairman Sulficio Tagud Jr. said.
Tagud has also raised the alarm against possible price hikes in consumer goods if the MNHPI tariff rate increase is approved. Using 2014 PPA statistics, additional annual cost of stevedoring for PLSA members alone will reach P118.78 million.
A technical working group composed of PPA officials and representatives from other concerned government agencies is scheduled to review the position papers submitted by all the groups that will be affected by the tariff hike petition.