A long-overdue fare increase at Metro Manila’s three elevated rail systems could take effect as early as August as the government seeks to recover part of its operating costs from the heavily subsidized train lines, according to Secretary Joseph Abaya of the Department of Transportation and Communications (DoTC).
But Abaya said in a round-table discussion with INQUIRER editors and reporters on Wednesday that the planned P10 average increase for the Light Rail Transit (LRT) Lines 1 and 2 and the Metro Rail Transit (MRT) Line 3 would be done in two equal stages through 2014.
This means fares, which were last adjusted in the early 2000s, will increase by P5 in 2013 while the second P5 increase will kick in next year.
“This increase has been long delayed so we are about to execute it. The matrix for LRT 1 requires us to catch up,” Abaya said.
“It was discussed a year ago in the budget hearing and it was taken as a set, all three railway lines,” he added.
“It should happen planning-wise in August or within the year.”
The announcement of the fare increases comes amid severe criticism of the LRT-MRT operations—coaches with passengers woefully packed like sardines most times of the day and long queues to the stations during rush hours.
For example, MRT 3 was designed to serve 350,000 passengers per day, but some 600,000 people cram the system daily.
A 1.3-kilometer stretch of the line on north Edsa—from Muñoz to Trinoma—has yet to be connected, three years into the Aquino administration.
Former Transportation Secretary Mar Roxas proposed a fare increase earlier in 2011, but it was met with opposition from critics who pointed out that managing public transport was a government function.
Critics say that no mass transportation system anywhere in the world makes money, quite apart from Hong Kong. But in this Chinese enclave, revenues come mainly from shop rentals in the mass transit railway stations, they add.
Reports showed earlier that the entire P10 average fare hike will happen this year but the DOTC secretary said the agency decided to “break it up” into two parts over two years.
Even with the fare increase, the LRT lines and MRT 3 come out “cheaper” than rates charged by bus operators, which are pegged at P40 per passenger, Abaya said.
The government is calculating that ridership at the train lines, which serve over 1.3 million passengers daily, will not be substantially affected by the rate increase.
The current fare at MRT, which runs through Edsa, Metro Manila’s main highway, is pegged at a maximum of P15 per passenger. For LRT 1, passengers are charged up to P20 each for a single journey; for LRT 2, the rate is pegged at P15.
Lower than bus fares
An earlier study by the Light Rail Transit Authority (LRTA) indicated that ridership was initially expected to decline, but the study concluded that figures would recover given the “convenience” the train lines offered, according to a DOTC spokesperson.
The fare increase, meanwhile, will still need to be cleared with the board of the LRTA, in consultation with the Land Transportation Franchising and Regulatory Board.
A public consultation, while not mandated by the law, will also be held, as this is the typical practice of the agency to allow affected stakeholders to raise their concerns.
Unlike other agencies under the DOTC, the LRTA is unique, as it does not have a regulating body when it comes to setting fares.
As noted, the government is eyeing a reduction to costly subsidies for the elevated train systems.
For the MRT 3 alone, Abaya said the government was spending P60 to transport one passenger from end to end, well above the current ticket price. This translates to about P7 billion to P9 billion in subsidies every year.
“The motivation is [the railway lines] are even cheaper now than the buses. So from an economic point of view, we could stand some [rate] increase and recover some of the operating costs to make sure at least some operating costs are recovered,” Transportation Undersecretary Rene Limcaoco said in a separate interview.