Things to know about PUV service contracting program amid Middle East conflict

The Department of Transportation (DOTr) is reviving the service contracting program to support drivers and commuters as fuel prices continue to rise amid the conflict in the Middle East.

Under the program, the government will pay public utility vehicle (PUV) operators and drivers based on the distance they travel, with rates varying by vehicle type:

• EDSA Bus Carousel: P100 per km
• Modern jeepney: P40 per km
• Ordinary jeepney: P30 per km

Participating vehicles are required to operate at least five days a week. The government will cover only up to 100 kilometers per day. Any distance beyond that will not be compensated.

Based on these rates, a contracted EDSA Bus Carousel may earn up to P10,000 per vehicle per day, while modern jeepneys may earn up to P4,000 and traditional jeepneys up to P3,000 in government subsidies.

Transportation Secretary Banoy Lopez said the initiative aims to address the growing number of drivers forced to stop operations due to high fuel costs, which has also affected commuters.

All contracted vehicles are required to be equipped with GPS for monitoring. The GPS device, which can be rented for P500 per month, will be shouldered by the operators or drivers.

The program is expected to run for two weeks, starting Wednesday, April 15, and may be stretched for three weeks.

Commuter discount

Unlike during the COVID-19 pandemic when government-contracted rides were free, commuters will still pay fares. However, passengers on contracted PUVs will get a 20% discount.

Lopez explained that the decision to implement a discount instead of free rides was made to extend the duration of the program and ensure its sustainability. He noted that if the program were to offer free transportation, it would only last for two days, or 48 hours.

For persons with disabilities (PWDs), senior citizens, and students, this 20% discount is applied on top of their existing 20% fare discount.

The discount will continue to apply for the whole day, even after the vehicle exceeds the 100-kilometer daily subsidized limit.

Government contracted vehicles are marked with a tarp or poster with a fare matrix, showing the discounted fare.

Routes

The program will cover 823 routes in major thoroughfares across the Philippines. At least 545 of these routes are located in Metro Manila, Cavite, Laguna, and Rizal.

According to President Ferdinand Marcos Jr., the route of the service contracting program will focus on areas connected to rail lines and major bus routes to ensure more efficient and reliable travel.

The Land Transportation Franchising and Regulatory Board (LTFRB) will release the specific routes. This story will be updated once the information becomes available.

How to apply

PUV operators interested in the government’s service contracting program may apply online.

The link for the online application will soon be available on LTFRB’s social media accounts.

Payment for services rendered by contracted vehicles is targeted for release within three to five days after service completion, Lopez said. Payments will be processed via online banking or e-wallet transfers.

Program funding

DOTr has allocated P1 billion for the service contracting program to help address rising fuel costs.

• P800 million is earmarked for land-based public transportation
• P200 million is allocated for maritime transport, including Roll-On/Roll-Off (RoRo) vessels

The Maritime Industry Authority, an agency under DOTr, is still finalizing the implementation details for maritime service contracting.

Lopez noted that this will be the first time the government enters into service contracts with maritime vessels. He added that there is no specific implementation date yet, but expressed hope that it can be rolled out on April 15, alongside the service contracting program for land transportation.

Lopez said that he requested an additional P5 billion budget to extend the implementation of the service contracting program.

Based on Marcos’ estimate, the program is expected to benefit around 50,000 PUVs, 1,000 operators, and up to 15 million passengers. – Rappler.com