Senator Win Gatchalian called for an increase in the level of subsidy provided by the government for the modernization program for public utility vehicles (PUVs).
Gatchalian made the call at a recent Senate hearing on the 2024 proposed budget of the Department of Transportation (DOTr). Under the PUV modernization program, all jeepney engines should at least be Euro-4 and Philippine National Standards (PNS)-compliant.
“From the briefers that I read, the compliance rate right now is only at 60% and the allocation for the modernization for 2024 is zero. In other words, we compel them to modernize but we don’t have any support to give them in the next few years,” Gatchalian told Transportation officials.
The legislator emphasized that increasing the subsidy should form part of the DOTr’s strategy to achieve at least 100% modernization of the country’s PUVs. According to the transportation department, one unit of modernized PUV costs P2.4 million to 2.8 million.
Transportation Secretary Jaime Bautista told the committee panel that the department will continue giving equity subsidies to all PUV drivers and operators to help them replace the old units that they currently operate. Bautista said they requested at least 1.6 B for the program for next year.
Under the program, a portion of the fares earned by the jeepney drivers will go to the payment of a modern vehicle. Gatchalian noted, however, that at the time the program was introduced, fuel costs ranged from $20 to $30 per barrel. Fuel prices have since increased to a range of $80 to $90 per barrel due to the Russian-Ukraine conflict.
The deadline for the modernization program was earlier suspended to allow individual jeepney operators to consolidate themselves into a cooperative. The deadline for consolidation has been set for December 31 this year. “It’s a step towards the right direction that we are modernizing through the cooperatives,” Gatchalian said.
The transportation department also said that certain private sector groups are interested in venturing into manufacturing modernized PUVs which could keep the cost in the lower end of the range.
