JUTC Seeks Bus Fare Increase

The Jamaica Urban Transit Company (JUTC) has applied for an increase in bus fares, which if approved, would take effect within the next few weeks. JUTC president Patrick McIntosh, addressing a JIS Think Tank this morning (Aug. 3), said the increase was necessary for the bus company to remain in operation and to continue to serve passengers in the Kingston Metropolitan Region (KMTR).
“What we are faced with at the current time is that we have a major shortfall in what it cost to operate the service and what we are collecting in the fare box and the government is unable at this time to fill that gap. What we are doing is looking at the fare box to recover the cost of running the service,” he told JIS News. He noted that the intent was not to make a profit but to recover the cost of operation.
According to Mr. McIntosh, an application for the increase has been submitted to the government and was being favourably considered. “We are likely to hear very soon from the government what this fare increase will be,” he said, adding that children, the aged and the disabled should not be affected.
The total annual expenses of the JUTC is $4.7 billion, of which $3.2 billion is related to operating cost, with government contributing some $1.2 billion or 26 per cent of the total amount, in addition to a one off contribution of $2.2 billion.
“There is still a shortfall between the operating cost of service and what we collect from the fare box,” Mr. McIntosh told JIS News, adding that only 47 per cent of total cost was being recovered from the fare box and up to the end of March 2004, 69 per cent of the operating cost was collected from fares.
He noted further, that the cost of inputs has increased significantly over the last few years, with fuel for example, increasing by 100 per cent. “All of our inputs, with the exception of labour and some items like insurance are all foreign based. When the last fare increase was given just prior to that, the exchange rate would have been $50 to US$1 and the current exchange rate is running from $62 to US$1 and that has had a significant impact on increasing the cost,” he pointed out.
Meanwhile, Mr. McIntosh said that there has been a reduction in passenger load, with the bus company transporting 78 million riders last year, down from 96 million in 2002. “A significant part of that (the decrease) is the advent of what I called the alternate providers, which includes legal as well as illegal operators,” he argued.
He informed however, that the government had taken steps to address the issue by amending the appropriate legislations to more efficiently regulate the public transport system.