The P34.6-billion budget for the Department of Transportation and Communications (DOTC) that the House of Representatives presented to the plenary on Wednesday provided for a cut in the state subsidy to the Metro Rail Transit (MRT) system, from P6.92 billion in 2011 to only P4.29 billion in the proposed budget for 2012.
Whether there will be a fare increase as a result of the decreased subsidy, Transportation Secretary Manuel Roxas could not say at this point.
Roxas, who witnessed the budget presentation together with other DOTC officials, said he hoped no further changes would be made to the department’s budget during the period of amendments.
He thanked both majority and minority blocs for initially approving the DOTC budget.
According to opposition Rep. Danilo Suarez (Quezon), the minority did not oppose the DOTC budget because Roxas was “maybe one of the best choices decided by the President” for being a good manager with better training.
The DOTC explained that the P2.63 billion, or 38 percent, decrease in the subsidy allocation was a result of the reclassification of expenses from subsidy to train maintenance. The MRT’s operation and maintenance budget is expected to increase by P1 billion next year.
As such, the subsidy will solely comprise the government’s payables under the build-lease-transfer contract with the Metro Rail Transit Corp. (MRTC).
Also, a spike in revenues has been projected from the rail system’s operations from a proposed rate adjustment which was under discussion when the DOTC budget was being drafted earlier this year.
Foreign exchange rate adjustments because of the stronger peso would also explain the lower budget for the MRT subsidy, the DOTC said.
According to Roxas, the subsidy cut had been discussed and been pending for a long time.
“President Aquino wanted as much as possible to ease the burden of our people by subsidizing [the MRT] for as long as possible, but our money is limited,” Roxas said.
He said government has been subsidizing the MRT’s operations for the past 10 years at a total cost of P70 billion.
Every peso that goes to the MRT subsidy means less money for the development of ro-ro port facilities, he said.
He said the the DOTC’s priority next year was the maintenance of maritime transport services and tightening the regulations affecting this sector.
On Wednesday Roxas was scheduled to meet with the President and transport sector representatives concerning the proposed increase in transport fares.
Though a proposal for a staggered fare increase was already being discussed, he said there was still no timetable as to when the subsidy would last.
Party-list representative Teddy Casiño (Bayan Muna) said there was no need for a fare increase this year in the MRT and LRT systems as their operations are still covered by the P7 billion subsidy approved by Congress in 2011.
Any increase in fares can take place only next year because of the decreased subsidy, he suggested.