DOTr seeking to ease financial burden on drivers, operators amid PUVMP
MANILA, Philippines — The Department of Transportation (DOTr) on Tuesday said it is continuously exploring methods to reduce the financial burden on jeepney drivers and operators amid the Public Utility Vehicle Modernization Program (PUVMP).
DOTr Undersecretary Timothy John Batan made the pronouncement after the non-profit think tank Ibon Foundation warned that the forced consolidation of jeepneys may raise the fare by 300 to 400 percent over the next few years.
However, Batan pointed out that the potential increase in fares may not be solely attributed to the consolidation itself but rather to the second step of the PUVMP, which involves upgrading traditional jeepneys into modern ones.
The official said the government has already introduced changes in the program to ease the financial burden on jeepney operators, such as increasing the subsidy for drivers and operators and simplifying procedures to avail loans.
“First, we have increased the subsidy. At the start, we were only giving P80,000 per unit; that was increased to P160,000 per unit. Now, it is between P200,000 to P300,000 depending on the type of jeepney that you are modernizing into,” Batan said in an interview with ANC.
“Number 2, we’ve continued working with our government banks, Landbank (Development Bank of the Philippines), to simplify the procedures for availing of cheap financing,” he added.
The said subsidy is part of the “5-6-7-8” financing package for jeepney drivers and operators, which would allow them to access loan programs through government banks, requiring them a 5 percent down payment, with an interest rate of 6 percent and seven years to pay.
When asked about the high-interest rate, Batan said that the government is currently engaged in discussions with private lenders to reduce the cost of borrowing.
“One of the ways we’re trying to address is by increasing the number of potential lenders and creating competition among the lenders by involving the private banks,” said Batan.
“The interest rate is subject to banking regulations because the banks also have to protect the interest of their depositors, so what we’re doing now is expanding the pool of possible lenders by inviting private banks to participate,” he added.
The cost of a modernized jeepney would range from P2.4 to P2.6 million per unit.
Meanwhile, the deadline for consolidating jeepney operators under the PUV modernization is December 31, 2023.
Batan stressed that there would be no additional extensions to the deadline, especially given President Ferdinand Marcos Jr.’s declaration on the final date.
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