Malacanang says MRT fare hike still being studied

ABS-CBN News

Posted at Aug 12 2010 04:13 PM | Updated as of Aug 13 2010 12:13 AM

MANILA, Philippines - The government is still studying the appropriate fare hike at the Metro Rail Transit (MRT), Malacanang spokesperson Edwin Lacierda said on Thursday.

In a press briefing, Lacierda said that just like the imposition of a value added tax (VAT) on toll fees, the revenue expected from the increase in MRT fare will be used to support the government's social services programs.

"The (amount of fare increase) is still being studied. But let me emphasize that we are removing the subsidy and diverting that subsidy to more useful and more beneficial social programs to alleviate the general population rather than (give it to) a selected few."

The government's plans to impose a VAT on toll fees, along with the plan to raise MRT fares, is being scored by various sectors which see such measures as an additional burden to the public, especially on lower-income households.

In a hearing of the Senate ways and means committee also on Thursday, Pinag-isang Samahan ng Tsuper at Operator Nationwide (Piston) Secretary-General George San Mateo likened the VAT on toll fees to a "sword na nakumang sa aming mga ulo." The VAT toll he said, is on top of the pending 250% increase in toll fares at the South Luzon Expressway (SLEX).

"Mamumulubi po kami dito, mas malaki pa babayaran ng mga drivers sa mga toll at VAT sa SLEX kesa sa iuuwing kita," said San Mateo.

Lacierda said the government is hoping that the public will realize that what the state is doing is to transfer money from a losing entity to something that will benefit people at large.

Previously, the Department of Transportation and Communication (DOTC) said the planned fare adjustment will be minimal, and government is still exploring ways to reduce the state's subsidy on MRT fares.

DOTC Undersecretary Dante Velasco said the government is spending more than P5 billion yearly for MRT operations and maintenance, and it needs to raise fares to recover losses since the railway is only earning about P1.8 billion a year.

The government said earlier it may hike the fares by as much as P25.