Gov’t to cut bus fares to cushion inflation over next 2 years

Commuters who travel on the Jamaica Urban Transit Company (JUTC) and Montego Bay Metro buses will pay reduced fares over a 24-month period.

On January 1, 2024, the regular adult fare charged by the state-owned bus companies will be reduced from $100 to $70, while children will be asked to pay $25, down from $30.

At the same time, pensioners will also have their fares reduced from $40 to $30.

Effective April 1, 2024, a further reduction will see the regular adult fare moving from $70 to $50, while the fare for children will be adjusted from $25 to $20. Pensioners will then be required to pay $20.

The reductions, which were announced on Tuesday by Finance and the Public Service Minister Dr Nigel Clarke, are intended to cushion the impact of the recently imposed fare hike on inflation.

A 19 per cent hike in fares for public passenger vehicles (PPV) was announced last month. The increase took effect on October 15.

A further 16 per cent increase is to take effect in April 2024.

However, members of the parliamentary Opposition indicated that the reduction in the JUTC fares was insufficient as the state-owned bus company only provided about a quarter of the seats in the Kingston Metropolitan Transport Region (KMTR).

Rural commuters

Opposition Spokesman on Transport Mikael Phillips said that the move will have little effect on the majority of commuters in the KMTR and rural Jamaica, who are paying the 19 per cent increase on the PPV and private buses.

St Andrew South Eastern Member of Parliament Julian Robinson welcomed the reduced fares for JUTC passengers, but argued that the promised increase in the JUTC fleet will not come in time to benefit a significant number of commuters who need a reprieve from inflation.

“It is welcomed, but will have very little impact. There is a need for more investment in JUTC. People prefer the JUTC buses, but they are not enough to move commuters,” he added.

For the current financial year, taxpayers are expected to fund a projected operational loss of $11.4 billion. That amount represents a $2.6 billion increase in the cash-strapped state-owned bus company’s operating loss over the 2022-2023 fiscal year.

In a statement to Parliament, the finance minister said that the Government would provide the JUTC with the resources to finance the fare cut to passengers over the two-year period.

Clarke said that the measures announced on Tuesday was a follow-up to a commitment by the transport minister to mitigate the impact of the fare increase on commuters.

Inflation reversal

The finance minister told his parliamentary colleagues that the Government was advised by the Bank of Jamaica that as result of the adjustments in PPV fares, the central bank was expecting a reversal of the downward trend in annual inflation starting in November 2023.

“Given that the cost of transportation services comprises a notable portion of the consumer price index basket, the Bank of Jamaica further advises that the announced increases in taxi fares, cumulatively, would add approximately two percentage points to inflation if not balanced by countervailing measures,” he said.

He said that for the period January to March of the current fiscal year, the Government’s intervention will cost approximately $200 million. For the full year of April 1, 2024 to March 31, 2025, it will cost the Government $800 million.

“While we recognise that this does not solve all problems associated with the expenditure to do with public transportation, this represents a concerted effort by the Government, which will have a positive impact on inflation outcomes and on cost of living,” Clarke said.

The finance minister also said that the Government was now seeking to acquire 300 new buses over the next two years instead of the 200 that it had previously announced.

edmond.campbell@gleanerjm.com

Fare adjustments for JUTC and MoBay Metro

Current fares Jan 1, 2024 April 1, 2024

Adults $100 $70 $50

Children $30 $25 $20

Pensioners $40 $30 $20