News

JUTC seeking fare hike

BALFORD HENRY Observer senior staff reporter balfordh@jamaicaobserver.com

Tuesday, December 11, 2012    

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THE Jamaica Urban Transit Company (JUTC) is in the process of seeking a fare increase, likely to come into effect by next April.

The Jamaica Observer has learnt that the State-owned bus company has already sought approval from the Ministry of Transport, Works and Housing to seek an increase from the Office of Utilities Regulation (OUR), and has been asked by the ministry to provide the supporting information.

The JUTC has projected that for 2012/2013 its loss before subsidy would increase to over $2.4 billion, as increased revenue flow is inadequate to bridge the gap in the fare box.

The company has attributed its ballooning losses to three reasons: The decline in the annual subvention from Government; the loss of revenue to illegal transportation operating on the exclusive routes; and the $70 difference between actual fares and the Government subsidised fares paid by students and the elderly, for which no refunds are provided.

In recent times, concern within the company has focused on its incapacity to maintain the concessionary fares for students, the disabled and the elderly.

The JUTC offers concessionary fares on regular service routes to children ages six to 11 at all times; students ages 12-18 wearing school uniform; seniors — women 60 and over and men 65 and over with ID; and disabled persons with ID from the Combined Disabilities Association. Also, children up to five years old are allowed to travel free. The company said that these fares factored heavily in the 2010/2011 losses.

Given the gap between revenue and expenditure, Government has provided financial support in the form of cash subsidies, tax waivers, debt assumption/write-offs and the injection of fixed capital in the form of buses and spares. Direct financial support from the Government in 2012/13 was projected at $3 billion, including $554 million in subsidies and $320 million in waivers on general and special consumption tax payments.

The most recent increase in bus fares was implemented on April 1, 2010.

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