Davies says JUTC revenues increasing

By Balford Henry Observer writer

Friday, June 22, 2012    

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DR Omar Davies, Minister of Transport, Works and Housing, said over the past six months the daily revenues of the Jamaica Urban Transit Company (JUTC) have increased from an average of $7 million per day to $10 million per day.

In addition, he said the roll out of buses has been steadily increasing and now stands at 370 buses, all of which are being maintained at the JUTC's own garage at a savings of approximately $8 million per month.

"Nonetheless, there is need for a comprehensive restructuring of the finances of the JUTC," he said, highlighting that apart from the amounts the company owes the National Housing Trust (NHT) and the National Insurance Fund (NIF) very few of its obligations to public entities can be cleared from its revenues. In light of that, the Ministry will have to work with the Ministry of Finance and Planning to develop a platform for the recovery of the company.

In terms of further improvements to the operations of the JUTC, there are certain steps to be implemented by the new board and management.

For example, the Jamaican German Automotive School (JAGAS) will be used to initiate a major refurbishing programme. The project will be housed at the Lyndhurst Road facility. The JUTC has over 110 buses to be refurbished.

Davies said an initiative, inherited from the previous government, which the buses were shipped to Brazil to be refurbished has been terminated.

"To begin with, the shipping cost for each bus was US$25,000, and the actual cost of refurbishing each bus was US$100,000. All five buses which were shipped have been returned, but this has been at a cost of US$125,000 each," the Minister said.

He said an arrangement made by the previous government, which committed Jamaica to purchasing 230 new buses from Belgian manufacturer, VDL, for $1.8 billion, the current government has decided to honour the loan, but is seeking to alter the content to make the deliverables consistent with its plans to improve the JUTC.

"Specifically, we are seeking to change the loan to import 65 buses this year and the remainder over the next four years. We will also seek to convert some aspects of the loan to the purchase of spare parts and to proceed with technical assistance to support the bus refurbishing project," Dr Davies said.



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