JUTC cuts high overtime payments

THE cash-strapped Jamaica Urban Transit Company (JUTC), which is faced with a net operating loss of some $8 billion this year, appears to be getting a handle on its overtime expenses – a major expense.

Last July, Auditor General Pamela Monroe Ellis called out the State-owned bus company for extensive expenditure on overtime payments in a performance audit report tabled in Parliament.JUTC Managing Director Paul Abrahams told the Public Administration and Appropriations Committee (PAAC) at a meeting yesterday that the company’s management had taken a strategic decision on how to deal with the issue of overtime. He said overtime payments have dropped by 64 per cent, translating to $121.5 million being spent out of the company’s overtime budget of $339.8 million, up to March.He also told the committee that the JUTC’s staff has been reduced to close to 1,900 now; however, while the company makes every effort to curtail its expenditures it continues to grapple with revenue losses. The auditor general’s report showed that between 2014 and 2019 the JUTC had unapproved staff which was costing the company an accumulated $1.15 billion. It was noted that the positions included 145 who were given permanent positions, which the JUTC in June 2020 shaved to 92.

The company’s overtime budget, said the report, had been overshot by $728.6 million, despite the excess staff capacity, with claims ranging between 71 per cent and 182 per cent of some employees’ annual salaries. Overtime hours ran from 18 to 83 hours for a fortnight, the report said.

Meanwhile, Abrahams told the PAAC that the JUTC continues to lean heavily on government subvention. He said revenue has been significantly hampered by the COVID-19 crisis, which had forced an all-seated arrangement on the buses, exacerbated by competition from other players in the public transport sector.“Concession [fares] are non-existent [and] charter fares are non-existent,” he said, noting that the projected revenue of $260 million from charters had been lost, as had the fares from students, which accounted for 40 per cent of the company’s ridership. “However we are doing our best to still provide the service that is needed,” he said.The company’s projected operating losses for this fiscal year is approximately the same as losses for the last fiscal year, and just $800 million less than its audited losses for the 2017/18 fiscal year.Fares were down $1.3 billion or 55 per cent at the end of January, and the company will once again be depending on $4.42 billion from central government coffers in statutory write-offs. This is out of a total of $7.7 billion which date back to 2012.

The JUTC needs $1.85 billion to purchase parts for units that are out of service, as well as another 440 buses to move commuters efficiently.It also owes Johnson’s Petroleum $16.2 million for the supply of petrol.

— Alphea Saunders


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