Transportation Secretary Vince Dizon admitted on Tuesday that the long-delayed Public Transport Modernization Program (PTMP) is no longer viable in its current form.

During his confirmation hearing before the Commission on Appointments (CA), Dizon cited the number of transport cooperatives that have fallen behind on loan payments for modern vehicles.

“If given the present state of the modernization and if it continues continuously, feeling ko po, the fact that those who recently bought vehicles can no longer pay their debts — that is a clear sign that it is not viable in its present state,” he told lawmakers.

He made the admission in response to Senator Grace Poe, who previously chaired the Senate Committee on Public Services, when she asked whether the PTMP is still viable.

Citing documents from the Department of Transportation, Poe said P5.1 billion of the P15.3 billion in loans availed by transport cooperatives through government-owned financial institutions such as the Land Bank of the Philippines (LandBank) and the Development Bank of the Philippines (DBP) are now considered defaulted.

“The loans that were released by the banks — P15.3 billion were the released loans of the government from LandBank and DBP. One-third of that, P5.1 billion, is the defaulted amount,” she said.

“That’s why our banking institutions no longer want to lend,” she added.

Dizon confirmed that LandBank and DBP are no longer offering loans to transport cooperatives due to the problem.

According to Dizon, a modern jeepney costs around P2.8 million, with only 15 percent subsidized by the government. That leaves a jeepney driver needing to pay around P2.3 million out of pocket.

“If divided over five years, he would need to pay P40,000 a month,” Dizon said.

Launched in 2017, the implementation of the PUV Modernization Program (PUVMP) has been postponed multiple times.

Part of the program requires the phasing out of traditional jeepneys, buses, and other PUVs at least 15 years old, in favor of more environmentally friendly and efficient models. Transport groups have opposed the move due to concerns over high costs, loan accessibility, and the impact on the livelihood of small operators.

Unconsolidated PUVs

The Transportation chief also said that of the 171,079 public utility vehicles (PUVs) across the country, only around 40 percent have consolidated into transport cooperatives.

“Roughly 60 percent have not yet [been able to consolidate]; only 40 percent are actually consolidated,” Dizon said when asked about the number of PUVs that complied with the PUVMP.

The PUVMP also requires jeepney operators to consolidate their franchises under a transport cooperative — an idea resisted by small operators who do not want to lose individual ownership of their units.

Another issue raised during Dizon’s deliberation was the lack of rationalization of routes for PUVs across the country.

Dizon revealed that only 280 local government units have rationalized their routes.

“That’s true — less than 20 percent of the routes nationwide have been rationalized,” he told Poe.