Bus companies call for end to fare hike suspension amid rising fuel prices
Bus companies are calling on the government to lift the suspension of the fare hike order amid continued fuel price increases. It warned that rising operating costs could soon threaten their operations.
On Sept. 22, the Provincial Bus Operators Association of the Philippines, Nagkakaisang Samahan ng Nagbibiyahe ng Panlalawigang Bus sa Pilipinas, Inc., Soluboa, and Mega Manila Consortium issued a joint statement calling for the suspension of the fare hike approved on March 14 to be lifted, citing increasing operating costs.
"The provincial and city bus industries are bleeding... We ask for a fare that will keep public transport moving," it began in its statement, which was shared by Victory Liner Inc., Genesis Transport Service Inc., Bicol Isarog Transport System Inc., and ALPS The Bus Inc.
In the statement, the bus groups said fuel prices have become too much for operators to absorb, accounting for around 45% to 50% of operating costs while authorized fares have not kept up with rising expenses.
They lamented that, compared to airlines and sea transport operators, provincial and city buses are at a disadvantage because they cannot impose fuel surcharges in response to significant increases in fuel prices.
"There is another inequity: passenger fares are not subject to VAT, while the fuel we purchase carries VAT. Because our operations generate no output VAT against which the VAT on fuel may be credited, that tax becomes part of our cost—a burden the bus operator must absorb," they added.
They also highlighted the mounting financial burden of fleet modernization, saying operators had invested in new buses and taken out substantial loans to comply with the requirement.
"Today, we must carry the combined costs of fuel, modernization loans, spare parts, tires, maintenance, insurance, toll fees and regulatory compliance," they continued.
"An impending wage increase will add further pressure. We recognize that our employees deserve fair compensation. But higher wages must be supported by revenues sufficient to sustain both employment and operations," they added. "No industry can survive when its regulated revenue is lower than the actual cost of delivering its service."
The group went on to stress that operators are not asking for government assistance, but for fares that reflect the actual cost of operating public transportation. They noted that drivers and operators cannot independently adjust fares or impose fuel surcharges, while halting operations could put their franchises at risk.
"This is not a threat to stop operations. This is a notice that operations may soon become impossible," the bus groups underscored.
"If responsible operators are pushed into insolvency, commuters will ultimately suffer: fewer buses, longer trips, longer waiting times and the loss of vital connections between cities and provinces," they added, adding that thousands of drivers, conductors, mechanics, and other support workers could lose their jobs.
"We understand that fare adjustments affect commuters. But keeping fares artificially below the actual cost of service does not protect the public in the long term. It merely delays the crisis until operators can no longer deploy enough safe and roadworthy buses," they added.
"The provincial and city bus industries remain ready to serve. But public service must also be allowed to survive," they concluded.
Since early this year, motorists, bus operators, and commuters have faced repeated fuel price increases amid tensions in the Middle East that have disrupted global oil supplies and pushed fuel costs higher.
On Sept. 22, gasoline prices rose by P4.88 per liter, while diesel and kerosene increased by P8.82 and P6.47 per liter, respectively.
Last week, it was reported that the Development Budget Coordination Committee is in the process of finalizing a proposal for possible fuel excise tax relief as fuel prices continue to rise.
