ASEAN KEY DESTINATIONS
One public entity to control urban transportation services: Govt
Indonesia: The Transportation Ministry is planning to restructure the ownership of the country’s urban transportation in a move that will see one entity controlling urban transportation services, hence making them more affordable for users.
“It is time to restructure the management of urban transportation. It can no longer be privately owned. It has to be controlled under one professional corporation, because we are planning to subsidize it,” the ministry’s acting director general for land transportation, Sugihardjo, told reporters on Thursday evening.
Average monthly expenses for transportation in Indonesia account for 30 percent of the minimum wage after the hike in subsidized-fuel prices, far higher than the World Bank’s standard of 12 to 15 percent, according to ministry data.
“Based on this data, the government has committed to subsidizing urban transportation; however, if we provide them with subsidies now, it would be hard to control as it might be used for personal use,” Sugihardjo said.
Metromini and Kopaja minibuses in Jakarta, for instance, are currently owned and operated by private owners, without a single management system.
Sugiharjo said that Law No. 22/2009 on traffic encourages urban transportation operators to establish a corporation to ease control processes.
He said, however, that several social aspects should first be taken into consideration, before deciding to establish one single urban transportation corporation.
“It will take years before we can realize this plan, since we have to make sure that people who are currently working in the sector are able to find alternative jobs. Obviously it will take time and we will first discuss this with Organda [Organization of Land Transportation Owners],” he said.
According to Sugiharjo, under one professional management body, the efficiency of land transportation could also be controlled.
“For instance, the public transportation system could operate more buses during peak hours, in the morning and in the afternoon, and less during noontime. Therefore it would also help to reduce traffic,” he said.
Separately, Organda secretary-general Andriansyah said that the organization had since last year assisted the government in realizing the plan, and that a lot of minibus operators had formed cooperations to help better manage their vehicles since last year.
“We are basically supporting the plan as this will also help to realize the incentives promised by the government for public transportation operators,” Andriansyah told The Jakarta Post on Friday.
Meanwhile, Transportation Minister Ignasius Jonan said that to help operators cope with an increase in costs due to the subsidized-fuel price increase from Rp 6,500 (53 US cents) to Rp 8,500 per liter, the government was mulling over a plan to provide incentives that could include exemptions for import duties and value-added tax for public transportation spare parts.
The government has previously stipulated a maximum 10-percent increase in tariff adjustments for intra-provincial public transportation following the 30-percent hike in subsidized-fuel prices.
The country’s public transportation load factor is only around 45 percent this year, down from around 60 percent last year, Organda data showed.
Organda chairwoman Eka Sari Lorena Surbakti previously said that a lower load factor and an increase in operational costs from higher fuel prices had hurt public transportation businesses.
“We’ve asked the government to provide incentives to help revitalize public transport,” she said.
“However, up until now, we have not seen the government’s commitment to supporting the public transport sector,” she continued.
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