Funding crunch caps service contracting program at 2 weeks

The Department of Transportation’s (DOTr) Service Contracting (SC) program is set to initially run for only two weeks, as its P1-billion initial budget is insufficient to sustain a wider rollout of the initiative designed to help stabilize public transport operations amid a global crisis.

At a media briefing on Friday, Transportation Acting Secretary Giovanni Lopez said the initial rollout is constrained by nationwide coverage and funding, but the government is pushing to extend implementation. 

“We can manage two weeks, to be honest, because this is nationwide, but we are still trying to extend it to three weeks, although we might have difficulty because we will be rolling it out all at once,” Lopez said.

Lopez said the SC program, which officially starts on 15 April, may be expanded further, but it would need an additional P5 billion.

“We have already requested additional funding from the President, from the DBM, and from our economic managers, and I am confident that the additional funding will be granted,” he said.

Under the Service Contracting (SC) program, the agency has allotted P1 billion for the rollout—P800 million for the road sector and P200 million for maritime services.

The program is expected to support around 50,000 public utility vehicle (PUV) units and 1,000 operators, benefiting an estimated 1.5 million passengers daily.

Under the SC program, bus operations along the EDSA Busway will be supported at a net rate of P100 per kilometer, covering around 50 operators and 500 buses and serving an estimated 300,000 daily passengers.

For other public utility vehicles, the program provides compensation of P40 per kilometer for UV Express and modern jeepneys, and P30 per kilometer for traditional jeepneys.

Commuters will also receive a 20 percent fare discount throughout the day.

The initiative will cover 823 routes nationwide along major thoroughfares, including 545 routes in Metro Manila and nearby provinces such as Cavite, Laguna, and Rizal.

Units are expected to operate five times a week, with payouts to operators released within three days.

The DOTr, together with the Land Transportation Franchising and Regulatory Board (LTFRB), is also pushing for improved reporting systems and staffing adjustments to support implementation. 

In particular, LTFRB Chairman Vigor Mendoza II said the agency aims to address and correct lessons learned from the pandemic rollout of the SC program, especially issues involving manual monitoring and computation disputes, prompting a shift to full GPS-based tracking to improve efficiency and transparency.