Oppose mass rail transit fare hike, privatization plan-CPP*
Information Bureau
Communist Party of the Philippines
July 31, 2010
The Communist Party of the Philippines (CPP) today urged the Filipino people to unite and oppose plans by the Aquino government to hike fares in the Metro Rail Transit (MRT) and Light Rail Transit (LRT) systems. Government officials have confirmed plans to raise the fare citing rising operational costs and plans to reprivatize government-owned shares.
"The rail transit fare hike plan shows that behind its rhetoric of concern about the poverty of the people, the new puppet reactionary regime is actually insensitive to the downtrodden masses' social and economic plight," the CPP said. "This increase would increase the daily cost of living of the impoverished masses, with 10% of their minimum income already being spent on transport fares." The MRT and LRT combined have an average of about a million riders a day.
The CPP added that the fare hike is actually meant to ensure the profitability of the mass rail transport systems and make them more attractive to potential buyers. "The fare hike is but a prelude to a more sinister agenda, that is the reprivatization of government-owned shares in the MRT."
The CPP said the new US-Aquino regime "is proving itself no different from past regimes in terms of upholding the policies of denationalization, privatization and deregulation imposed by the International Monetary Fund (IMF) that make the public become a milking cow for the private rentiers' superprofits.
"Because of this profit-oriented and anti-public service framework of the elite reactionary government, investments in the public railway system are being disparaged by the IMF--trained financial and public transport managers of the new puppet government as well as by imperialist institutions as losses instead of necessary social expenditures for the benefit of the public," said the CPP.
"Esential social services such as state public transport systems necessarily require government subsidies and should not at all be means for private profit," added the CPP. The CPP pointed out that a large part of the so-called losses being shouldered by the government are actually payments for guaranteed profits in the form of "equity rental payments" as well as for loans incurred by the Metro Rail Transit Corporation (MRTC) when it built the MRT under a 25-year "build-lease-transfer" (BLT) scheme in 1997.
The BLT contract guaranteed the consortium a 15% rate of profit. A large part of the so-called "government subsidies" also went to interest payments for debts to Export-Import Bank of Japan, the Sumitomo Bank, and other Japanese and Czech banks, as well as some local banks like the Bank of Philippine Islands (BPI) and the Ayala-led MRT Holdings Inc.
The majority of MRT shares is currently owned by the government after government financial institutions led by the Development Bank of the Philippines (DBP) and the Landbank acquired 76% of MRT's assets for $800-$900 million starting December 2009. These shares were ordered transferred to the National Development Corporation last February to facilitate privatization.
"Instead of raising fare rates, the Aquino government should have reviewed the lopsided BOT contract and possibly rescinded or renegotiated it with the public welfare in mind," pointed out the CPP. "The Aquino government should take advantage of its present majority ownership of the MRT to ensure that fare rates remain low and accessible to the people. Instead, it plans to re-privatize its shares in the MRT, completely ignoring the lessons of the past."
"In the face of the intense economic crisis and the already miserable plight of the toiling masses, the US-Aquino regime is poised to further its denationalization, privatization and deregulation offensive, selling off the few remaining assets of the state at the expense of social subsidies, making it no different from its predecessor," said the CPP.
The CPP urged the Filipino people to vigorously resist the unjustified mass rail transit fare hike plan as well as the new puppet regime's further denationalization, privatization and deregulation schemes.
*Url: http://theprwcblogs.blogspot.com/2010/08/oppose-mass-rail-transit-fare-hike.html
"The rail transit fare hike plan shows that behind its rhetoric of concern about the poverty of the people, the new puppet reactionary regime is actually insensitive to the downtrodden masses' social and economic plight," the CPP said. "This increase would increase the daily cost of living of the impoverished masses, with 10% of their minimum income already being spent on transport fares." The MRT and LRT combined have an average of about a million riders a day.
The CPP added that the fare hike is actually meant to ensure the profitability of the mass rail transport systems and make them more attractive to potential buyers. "The fare hike is but a prelude to a more sinister agenda, that is the reprivatization of government-owned shares in the MRT."
The CPP said the new US-Aquino regime "is proving itself no different from past regimes in terms of upholding the policies of denationalization, privatization and deregulation imposed by the International Monetary Fund (IMF) that make the public become a milking cow for the private rentiers' superprofits.
"Because of this profit-oriented and anti-public service framework of the elite reactionary government, investments in the public railway system are being disparaged by the IMF--trained financial and public transport managers of the new puppet government as well as by imperialist institutions as losses instead of necessary social expenditures for the benefit of the public," said the CPP.
"Esential social services such as state public transport systems necessarily require government subsidies and should not at all be means for private profit," added the CPP. The CPP pointed out that a large part of the so-called losses being shouldered by the government are actually payments for guaranteed profits in the form of "equity rental payments" as well as for loans incurred by the Metro Rail Transit Corporation (MRTC) when it built the MRT under a 25-year "build-lease-transfer" (BLT) scheme in 1997.
The BLT contract guaranteed the consortium a 15% rate of profit. A large part of the so-called "government subsidies" also went to interest payments for debts to Export-Import Bank of Japan, the Sumitomo Bank, and other Japanese and Czech banks, as well as some local banks like the Bank of Philippine Islands (BPI) and the Ayala-led MRT Holdings Inc.
The majority of MRT shares is currently owned by the government after government financial institutions led by the Development Bank of the Philippines (DBP) and the Landbank acquired 76% of MRT's assets for $800-$900 million starting December 2009. These shares were ordered transferred to the National Development Corporation last February to facilitate privatization.
"Instead of raising fare rates, the Aquino government should have reviewed the lopsided BOT contract and possibly rescinded or renegotiated it with the public welfare in mind," pointed out the CPP. "The Aquino government should take advantage of its present majority ownership of the MRT to ensure that fare rates remain low and accessible to the people. Instead, it plans to re-privatize its shares in the MRT, completely ignoring the lessons of the past."
"In the face of the intense economic crisis and the already miserable plight of the toiling masses, the US-Aquino regime is poised to further its denationalization, privatization and deregulation offensive, selling off the few remaining assets of the state at the expense of social subsidies, making it no different from its predecessor," said the CPP.
The CPP urged the Filipino people to vigorously resist the unjustified mass rail transit fare hike plan as well as the new puppet regime's further denationalization, privatization and deregulation schemes.
*Url: http://theprwcblogs.blogspot.com/2010/08/oppose-mass-rail-transit-fare-hike.html
