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Director General of the Office of Utilities Regulations (OUR), J. Paul Morgan, said that the regulatory body was unlikely to recommend the 100 per cent increase that the Jamaica Urban Transit Company (JUTC) has said that it needs to keep its operations viable.
The bus company is requesting that the fare for adults be increased to $60, with the concessionary fare for children, the aged and the disabled remaining at $15. Commuters now pay $30 to travel within the city and $40 to travel to Portmore and Spanish Town.
Mr. Morgan, who was addressing a public forum held at the Lion’s Club Centre in Edgewater, St. Catherine on August 9, said that in the past, when the OUR had been asked to mediate on a price increase application, the recommendation had never amounted to what the companies requested.
He cited the cases of the National Water Commission (NWC), which had asked for a 46 per cent increase and had received only about half of that, and the Jamaica Public Service Company (JPSCo), which had requested a 20 per cent increase and had received nine per cent, as an indication of what usually happens after a due diligence exercise was carried out.
Mr. Morgan pointed out, that in carrying out its analysis, the OUR remained mindful of certain mitigating facts.
“What we do when executing the due diligence is to look at the business plan of the company, we look at their costs, their expenses and at their efficiencies and we arrive at our own view of the company and based on that view, we determine if there is a need for an increase and at what level is reasonable” he said.
“Consumers are served a disservice if companies that make a tariff increase request are not put in a position to earn the requisite revenue to deliver the service efficiently” Mr. Morgan added. “The thing to do,” he continued “is to create an incentive for them to become increasingly efficient and not leave any space for padding the revenue they can earn. So we really try to do a very detailed assessment on the operations of the company”.
He noted that the public’s input in the process was important in measuring the quality of service aspect.
Though the turnout at the meeting was low, residents made a number of suggestions to maximize earnings and improve the bus service, which the JUTC hierarchy has indicated that it will take and scrutinize for possible implementation.
One recommendation, which the company’s President Patrick McIntosh said would be looked at immediately, was the expansion of the use of the smart cards by offering dedicated organization-oriented packages to schools and the corporate sector, as well as expanding the reach of the executive service buses.
The final public consultation was held on August 11 and the OUR is expected to begin collating all the information submitted by the public, examine the data from the JUTC and other relevant data, before making a recommendation to the Minister of Transport and Works Robert Pickersgill.