Fare hike another slap in the face for the poor

Berni K. Moestafa, The Jakarta Post, Jakarta

Widespread criticism of the government is growing as transportation fares are set to go up by 40 percent following its earlier fuel price increases.

Critics slammed the decision as a slap in the face of the poor, and called into question the government's unilateral approach of raising the fares.

"It's bad. Companies can weep on the government's shoulder if fuel prices go up but the poor have nowhere to go," said Wardah Hafidz of the Urban Poor Consortium (UPC) on Wednesday.

The government has said it would raise transportation fares by between 28 percent and 40 percent through two stages starting next month and January 1, 2003.

All fare increases will apply for economy class seats, thereby affecting mainly the lower-income group.

Media reports quoted the government as saying on Tuesday that ferry tickets will increase by 40 percent, trains by 40 percent, and inter-city buses by 28 percent.

The decision followed complaints by transportation owners after the government raised fuel prices four times this year.

State oil and gas company Pertamina is selling fuel at 75 percent of international market prices as part of the government's effort to phase out fuel subsidies.

"I'd say scrap or delay the fare hikes," Wardah said.

With the school season arriving, she said, parents of poor families were also burdened with school fees.

"Usually this is the month, that lower-income families devote all their resources to getting their children into school. The entrance may be free now, but uniforms and school contributions are not," she said.

A Rp 2.85 trillion (about US$328.15 million) fuel compensation program has been drawn up to protect the poor from the impact of the fuel price hikes.

According to the government, the number of poor people in the country is about 40 million, with monthly expenditures ranging from Rp 72,000 to Rp 95,000.

Under the compensation program, each poor family with an average of five members, should receive about Rp 350,000 worth of assistance.

But Wardah said the compensation fund failed to reach its intended target.

"Only the higher class among the poor have received the funds, the real poor people like scavengers and squatters remain out of reach," she said.

Azas Tigor Nainggolan of the Jakarta Citizens Forum said the government should drop its unilateral approach when deciding to raise transportation fares. It should take inputs from consumers, he said. "The fare hikes show that the government is bowing to transportation owners."

Chairperson of the Indonesian Consumer's Foundation (YLKI), Indah Sukmaningsih said the government turned the costlier fuel price into an easy excuse to raise fares. Many problems of transportation companies lied outside of higher fuel prices, she said.

"People from the ferry sector complain about costly fees at ports. Others complain about illegal levies along their routes.... what is the government doing about that?" she asked.

An executive at the Association of Land Transportation Owners (Organda), G.T. Surbakti defended the decision to raise fares as necessary amid a reeling transportation industry.

Higher prices of fuel and spare parts due to the rupiah's sharp depreciation in the last four years against the U.S. dollar have put a strain on transportation owners to improve services or even to maintain their fleet.

Surbakti said that even the 40 percent increase in fares was inadequate to cover the higher fuel cost since the beginning of this year.