Lower subsidies worsen LRTA deficit

MANILA, Philippines — The Light Rail Transit Authority (LRTA) suffered another blow in its drive to trim its deficit, as the agency received less subsidies that worsened its financial condition.

Based on its financial report, the LRTA’s net loss went up by 69 percent to P3.33 billion in the nine months to September last year, from P1.97 billion a year ago.

The LRTA recorded a 58 percent increase in revenue to P1.18 billion, but this gain was erased by the 19 percent jump in expenses to P4.88 billion.

Also, the government trimmed its subsidies to the LRTA during the period.

Government support for the agency dropped by 76 percent from P1.31 billion to just P309.39 million.

Last year, the LRTA received approval from the Department of Transportation (DOTr) to increase passenger fares to improve its financial standing. However, President Marcos suspended the fare hike to minimize price pressures on consumers.

It was only in August 2023 that the President permitted the LRTA to enforce the fare adjustment, allowing the agency to increase the boarding fee to a minimum of P13.29 and the distance fare to P1.21 per kilometer.

This means that the LRTA, as the operator of the Light Rail Transit Line 2 (LRT-2), can lessen its dependence on subsidies in running the railway.

Further, the LRTA is trying to raise as much funds as it can not only to maintain LRT-2, but also to upgrade its facilities, to serve the growing ridership in the rail line.

Based on data from the LRTA, the LRT-2 is close to regaining its pre-pandemic levels of revenue from passenger tickets.

The railway earned P988.4 million in revenue from ticket collection from January to November 2023, behind by just P80.23 million from the pre-pandemic total of P1.07 billion in 2019.

Similarly, the LRTA said LRT-2 ridership leaped by 61 percent to 44.95 million as against a year ago’s 27.84 million. The railway’s pre-pandemic ridership stood at 56.98 million.

The LRTA wants to expand LRT-2 by three stops to the west of the Recto Station in a project that would make the railway reach Tutuban, Divisoria and Pier 4.

However, the agency requires P10.12 billion to commence that project, and the government has yet to issue its approval for the release of such an amount.