Subsidy for MRT going to private contractors – RILES Network

11 Jul

Claiming that the Metro Rail Transit refuses to present the complete picture of the MRT’s finances to the public, a network opposing the planned fare hike in the MRT and LRT said today that most of the government’s subsidy allotted to the MRT goes to the train system’s big business contractors.

The Riles Laan sa Sambayanan (RILES) Network said that P5.3 billion of the subsidy for the MRT goes to equity rental to the MRT Corporation (MRTC) and P1.2 billion to the MRTC and a foreign corporation for management and maintenance.

The MRT contract also stipulates that big business will receive a guaranteed 15 per cent interest payment based on the computation of P60.00 per passenger multiplied by 350,000 daily.

The group said that instead of increasing fares in the MRT, the Aquino government should renegotiate its onerous contract on the MRT with the private contractors.

“How could a train system that’s almost always filled to the rafters lose money? Only when the contract behind that train system guarantees huge profits for private contractors that are beyond the public’s capacity to pay,” said Sammy Malunes, RILES Network convenor.

“While we agree that the government should subsidize an efficient and safe mass public transport system, the subsidy being siphoned off by the contractors of the MRT is too huge. The government should renegotiate its contract for the MRT in favor of the public,” he added.

“The public should not be made to suffer in order for the government to honor its onerous contracts with big business. A passenger’s budget for food should not be further reduced so that big capitalists can continue to pocket huge profits,” he said.

To illustrate his point, the RILES Network convenor compared the MRT with the LRT-1, which is financially self-reliant and spends less on maintenance despite having an infrastructure older than the MRT.

He also pointed out that the LRT-1’s non-rail revenue of more than P100 million is bigger than the MRT’s P12 million despite the fact that the MRT is connected to the biggest malls around Metro Manila.

“A government-big business collusion is responsible for the MRT’s inability to generate a bigger income. It is also responsible for the huge subsidy being siphoned off by the MRT’s private contractors,” Malunes said.

“It would be revolting for the people if the government decides to increase their burden so that the enormous profits of big capitalists can be ensured. The planned fare hike should be junked immediately,” he added.###

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