GOVT ALLOWS BASIC TRANSPORTATION COST TO RISE BY 15 PERCENT

By Andi Abdussalam

     Jakarta, May 27 (ANTARA) - The government has issued a ruling that following the recent 28.7-percent increase in fuel oil prices, economy-class public land transportation rates in the country can be raised by not more than 15 percent. The norm was set with the aim of preventing the rates from being raised by the public transport operators unilaterally and exxessively.

        But in reality, bus and minibus owners or drivers in many parts of the country had already reacted to the fuel oil price hikes announced on Friday (May 25) by increasing their tariffs or suspending operations pending an announcement on new fares by local authorities.

        Transportation Minister Jusman Syafii Djamal has written to all governors in the country notifying them about the 15-percent limit on transportation fare raises.

        "This should be used as a reference for raising public transportation fares so that any increase in intercity bus economy-class fares or city and rural transportation fares will not be excessive," the minister said in his letter No. AJ.302/1/1/Phb-2008 sent to the governors.

        In the government's calculations, as a result of the fuel oil price hikes, the basic cost for the operation of intercity buses increased by about 15 percent.

        Based on its calculations, the basic costs for region I, which covers Sumatra, Java, Bali and Nusa Tenggara, increased from Rp100.26 per kilometer per passenger to Rp115, and for region II which covers, Kalimantan and Sulawesi) increased from Rp110 per kilometer per passenger to Rpp126.5.

        "With such an increase in transportation operating cost, the rate for intercity bus economy-class fare increase should be at a maximum of 15 percent. This means that in region I, the upper limit fares are set at Rp150 per passenger per kilometer and the lower limit was set at Rp92 per passenger per kilometer, while in region II, the upper limit was set at Rp165 per passenger per kilometer and the lower limit was set at Rp101 per passenger per kilometer," the minister said.

        In the meantime, it was reported from a number of provinces in the country that public transportation operators had unilaterally raised transportation fares at a rate ranging from 20 to 35 percent.

        Passengers had no choice and were forced to pay the fares they had raised unilaterally. The Organization of Land Transportation Owners (Organda) could understand if some operators had raised their fares while waiting for the government decision.

        Organda's branch for Semarang,

Central Java, is proposing an increase of about 20 percent for public transportation fares. Sri Marjoko of Semarang office of Organda said that in response to the fuel oil hikes by an average of 28.7 percent, Organda wanted that public transportation fares should also be increased by about 20 percent.

        "The 20 percent increase is calculated based on operational costs and increase of spare-parts prices following fuel oil price hikes," he said.

        Actually, Organda and local authorities are still discussing fairer rates for the increase in public transportation fares following the fuel oil price hikes.

        In Jakarta for example, Organda and the Jakarta administration were until Monday still discussing the hikes of public transportation fares.

        "We are still discussing the rate of fare hikes in Jakarta with Organda. There is no decision has been reached yet. It is not correct if we decide it alone. Let alone if it concerns intercity bus fares," Jakarta Governor Fauzi Bowo said on Monday.

        The Jakarta Transportation Council also met with Organda on Tuesday to discuss the fare hikes in Jakarta but so far they had not reached a decision.

        Head of Jakarta Transportation Service Nurachman said that his side would discuss the option of raising fares with Organda. There are other options for Organda in connection with the fuel oil price hikes, which included subsidy and tax cut facilities.

        "If subsidy and tax cut facility options are not taken then the public transportation fares should be increased. In calculating it, the a rate should be set not more than 15 percent. Transportation owners should go on strike only as a last option if other options are not met," said Nurachman.

        He said that his side has called on Organda not to go on strike because it would have wide impact on the general public while the options of raising fares or providing subsidies were still under discussion.

        Organda has previously threatened to go on strike if public transportation fares are not increased soon, or one week at the latest after the fuel oil prices were raised. But Nurachman has predicted that the negotiation process for raising the rate of public transportation fares could need more than one week.

        The fact on the ground now is that while discussions were still going on some public transportation owners have unilaterally raised their fares.

        Metromini and mikrolet mini buses, for example, have raised their fares by Rp500 per passenger while air-conditioned buses increased their tariff by Rp1,000 per passenger.

        Transportation Minister Jusman Syafii Djamal hoped that all relevant parties, including the central government and regional administrations would take concrete steps to help reduce the potentials that could cause high cost economy.

        "Illegal levies and other undesired actions that would put burdens on public transportation owners must be reduced," he said. 

 (T.A014/A/HAJM/A/O001) (T.A014/A/A014/A/O001) 27-05-2008 20:54:34