To better aid drivers and operators as they transition from their old jeepney units to environment-friendly vehicles, the government will hand out to them over P2.2 billion in subsidy in the next three years of the rollout of the public utility vehicle modernization program.
READ: LTFRB: Jeepney modernization program on track
Aileen Lizada, board member of the Land Transportation Franchising and Regulatory Board (LTFRB), said on Monday that the P80,000 subsidy that would be given to each driver is enough to cover the 5-percent equity for the highest financing package being offered by the Land Bank of the Philippines at P1.6 million.
For the pilot implementation of the subsidy this year, Lizada said that the Departments of Budget and Management and of Finance have approved to give P20 million to 250 jeepney drivers plying the routes Senate-Philippine International Convention Center, Taguig-Pasig and Pateros-Fort Bonifacio.
According to Lizada, jeepney drivers plying these routes were chosen for the subsidy because they’re part of the cooperatives whose members have existing individual franchises, a requirement of the Land Bank to be accommodated to the financial aid package. She noted that the subsidy would be “directly” given to the drivers.
The three groups are the Senate Employees Transport Service Cooperative Inc., the Taguig Transport Service Cooperative, and the Pateros-Fort Bonifacio Transport Service Multipurpose Cooperative.
Next year, another batch of 28,346 drivers nationwide would be able to avail themselves of the subsidy, totaling to over P2.2 billion. Another round of subsidies will also be released in 2019, though details of as to how many drivers and how much this would cost have yet to be released.
Because of the subsidy, Lizada said that jeepney drivers, most of whom live on a hand-to-mouth existence, would no longer need to worry where they would get the money to pay up for the equity.
In April, Land Bank entered into an agreement with the LTFRB to set up an initial P1-billion financing package for the modernization program.
Under the special program for environment-friendly and efficiently-driven (SPEED) jeepneys, drivers can avail themselves of a loan package of P1.2 million to P1.6 million to buy either an air-conditioned electric, hybrid or Euro-4 jeepney.
Land Bank president Alex Buenaventura said that under this package, the driver would be able to own the jeepney since he would be the listed borrower for the loan, which he has to pay over seven years at an interest rate of just 6 percent.
He added that the financing scheme would work similarly to the boundary system drivers are used to, as they would pay the bank P800 daily in its designated cash deposit machines. JPV