Minister of Science, Energy, Telecommunications, and Transport, Daryl Vaz, says the Government utilises an existing fare review structure to determine the adjustments granted to public passenger vehicle (PPV) operators.
Speaking at a Press Conference on October 12 to update the public on matters pertaining to the transport sector, Minister Vaz explained that the formula is called the Fare Adjustment Mechanism and it takes into consideration all associated expenses incurred by operators such as fuel, insurance, licensing and repairs.
The Minister said that the tool also examines the current fare structure and how the operating expenses have moved since the last review.
The fare adjustment, Vaz explained, is used to restore parity to PPV operations and the operators, so that they can cope with the operational expenses associated with providing the service.
“It also looks at the cost of inputs, such as tyres, parts, fuel and the rise in these costs over the period under review,” he said.
Vaz pointed out that the last increase was granted in 2021, at which time it was agreed that there would be a 25 percent increase, for which the operators got 15 percent, and the additional 10 percent did not take effect.
The Minister further stated that the latest increase, which became effective on Sunday, October 15 (19 percent), with a further 16 percent in April 2024, was staggered by the Government with other considerations in mind.
“We are cognisant of the ravaging effect of inflation worldwide, which Jamaica is experiencing as well, and as we know, transportation has an inflationary impact,” he said.
The Minister noted that the Budget for the upcoming financial year, 2024/2025, will be tabled in March 2024 and that this gives the Government and the Ministry of Finance and the Public Service the opportunity to take into consideration the impact of the fare adjustment, “to see how best we can cushion the impact of this increase”.
The Minister contended that the fare adjustment is not done in isolation, as “everything is being affected as a result of inflation”.
