Two property firms keen on managing LRT

ABS-CBN News

Posted at Aug 09 2010 04:37 PM | Updated as of Aug 10 2010 01:45 AM

MANILA, Philippines - Two property firms have expressed their interest in operating the Light Rail Transit (LRT) system.

Undersecretary for rail transport Glicerio Sicat said the firms approached the Department of Transportation and Communications (DOTC) following the agency's earlier pronouncement that it may tap private firms to manage the country's railway systems.

"They approached us and asked if there is any way they can possibly help. So we told them we will hand in our concept paper of privatization to them and they will give their feedback after," Sicat said. He did not identify the interested firms.

Sicat noted that the concept paper will detail the ownership structure and revenue sharing between the government and the private entity.

"We will hire a consultant to draft the concept paper for us. After which, we will present the paper to interested investors. From there, negotiations or discussions will take place. We are optimistic on this. There are many private firms that would want to develop the country's railway systems," he said.

LRT lines 1 and 2 are currently owned, operated and subsidized by the government. The 2  railways combined  carry about 750,000 passengers daily.

Line 1 runs from Baclaran, Pasay City to Balintawak, Quezon City, while Line 2 goes from Recto in Manila to Santolan, Marikina.

Metro Manila has another railway system, the Metro Rail Transit Line, which runs along Edsa from Taft Avenue, Pasay City to North Avenue, Quezon City. This is operated by a local private consortium led by the Sobrepeña family.

The DOTC is currently reviewing fare hikes for both the LRT and MRT lines to help cover costs and alleviate pressure on government finances. The results of the review will be out by mid-September, Sicat said.

"Along with the fare review is the review of the advertising contracts. We may not be maximizing the revenues from ads and that is what we would like to focus on. There are ad payments but we may have to re-compute these," Sicat added.

LRT line 1 passengers using single journey tickets are being charged P12 for the first 4 stations, and P15 for the rest of the route. Stored value ticket holders are charged P12 for the first 4 stations, P13 for 5 to 8 stations, P14 for 9 to 12 stations, and P15 for 13 to 15 stations.

Line 2, meanwhile, imposes a fare of P12 for the first 3 stations, P13 for 4 to 6 stations, P14 for 7 to 9 stations, and P15 for 10 stations.