JUTC reports 54% hit in revenues
The Jamaica Urban Transit Company (JUTC) is reporting a 54 per cent fall in revenues from fares, as well as a severe drop in charters since the start of the novel coronavirus pandemic in March 2020.
“We have seen a 54 per cent fall-off in revenues from the fare box, and charter revenues have taken a 268 per cent hit of more than $180 million per annum,” the company’s Managing Director Paul Abrahams said over the weekend.
In a statement responding to issues raised by the Opposition spokesman on transport and works, Mikael Phillips, in the annual Sectoral Debate (2021/22) last Wednesday, Abrahams said the revenue losses were due primarily to the fall off in revenues from these sources.
“Let’s be real, we are not saying the company didn’t have challenges before. However, the pandemic has made things worse,” he said, noting that the crux of Phillips’ address was about the sustainability and viability of the company.
“We, therefore, would like to set the record straight, not in a combative manner; but simply to highlight what’s been our reality,” Abrahams stated.
“Like other transit operators internationally, the coronavirus has had a deleterious effect on our operations. Our ridership, revenues, and the ability to meet the required bus availability have all been negatively affected, placing the JUTC in a position where it has had to strategically cut operational expenditure, with a view to maintaining the viability of the company,” Abrahams said.
He said that in response to the revenue fall-off, the State-owned and operated bus company has successfully implemented a number of strategic measures aimed at reducing its operating expenditure. The measures include a 67 per cent reduction in general overtime, a 47 per cent reduction in rostered overtime, and a six per cent reduction in the staff complement.
He said that the reduction in the staff complement alone has allowed the company to realise savings of $159.9 million in direct salaries, and $108.7 million in other staff-related costs for total savings of $268.6 million for 2020/2021.
In 2016, the staff complement was 2,236. However, it has been reduced by 336 to rationalise operations, while continuing to provide service to commuters.
“The company continues to maintain operational viability by reducing operational overheads which were reduced by seven per cent. In the interim, total operational expenses have been reduced by 14 per cent and administrative or corporate expenses reduced by 12 per cent, leading to a total reduction in all expenses of 14 per cent,” the managing director said.
In terms of bus availability, Abrahams said that, with the onset of the pandemic, the company’s international parts suppliers have also been faced with great difficulty meeting the global need for spare parts, compounded by extreme shipping delays through international ports.
“This has negatively impacted our operations, resulting in a reduced availability of more than 25 per cent. In public transit, an important metric is the average age of fleet (AOF). The higher the AOF, the maintenance of units will become more difficult,” Abrahams explained.
He noted that in 2016, AOF was 4.6 per cent compared to the current AOF of 10.1 per cent, which means that most of the units are over 10 years old.
“Our maintenance department must be commended for their efforts despite the challenges as they work to ensure that our buses remain functional,” Abrahams said.
He added that though the reduction in the operational fleet is a cause for concern — as it has led to some increased waiting times across the Kingston Metropolitan Transport Region — it has also led to the need to adjust operations to be more technologically focused.
“We have successfully digitised over 66 per cent of our road operations, so far facilitating more intelligent dispatching and improved monitoring of assets in the field. Though the operational fleet is reduced at this present time, we will continue to implement measures aimed at improving our operations, levels of service, and commuter comfort,” Abrahams said.
In his sectoral budget debate speech Phillips had said that the country has been forced to “continue to endure the chaos” in the system.
“The lewdness continues, robot taxis continue, the playing of loud and vulgar music continues. The JUTC is not providing an efficient and modern bus system, and so, the public passenger transport system remains disorganised, dangerous and demeaning,” he stated.
He also accused Minister of Transport and Mining Robert Montague of failing to produce a practical transport plan, which should incorporate the advances in technology and artificial intelligence to begin the modernisation of the system.
However, he extended appreciation to the staff of the company and operators of public passenger vehicles for their “heroic and dedicated effort in maintaining a working system during the height of the pandemic”.
Now you can read the Jamaica Observer ePaper anytime, anywhere. The Jamaica Observer ePaper is available to you at home or at work, and is the same edition as the printed copy available at https://bit.ly/epaper-login