Transport Fare Hike is a Certainty

An increase in public transportation fares is inevitable after the subsidized fuel prices raised. This has also triggered an increase in the prices of a number of basic commodities as well as inflation in the regions.

KOMPAS/NIKSON SINAGA

Passengers disembark from public transportation on Jalan Gatot Subroto, Medan, North Sumatra, Monday (5/9/2022). The Medan City Land Transportation Organization has started to increase public transport fares because the government has raised the price of fuel oil, although there has been no official government decision regarding the increase in public transport fares.

JAKARTA, KOMPAS — The subsidized fuel hike has had an impact by increasing the operating costs of public transportation by up to 30 percent. Public transport operators hope that the government will soon set a standard for increasing the fares of public transportation modes.

In a number of regions, public transport drivers have complained about the price hike for fuel (BBM). In fact, in Kendari, Southeast Sulawesi, city transport drivers held a mass strike on Monday (5/9/2022). Didin (36), a coordinator of angkot (public minivan) drivers, said the 30 percent increase in subsidized fuel prices had made it difficult for drivers to make a profit.

"We also increased [angkot fares], but the passengers protested. The argument has continued. Therefore, we ask not to increase the price of subsidized fuel or to officially raise angkot fares,” he said.

In North Sulawesi, the Manado municipal administration is currently reviewing a plan to increase public transport fares. Donald Wilar, the head of road traffic and transportation (LLAJ) at the Manado Transportation Service, has invited the leadership of the Manado Land Transport Organization (Organda) to discuss the plan to increase transportation fares, with the results to be announced on either Tuesday or Wednesday (7/9).

"This has caught our attention, so we invited Organda [to a discussion]. What we are thinking about are not only the drivers, but also the passengers,” he said.

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Organda’s Jakarta branch, along with the Jakarta City Transportation Council (DTKJ) and the Jakarta Transportation Service, is also discussing an idea to adjust public transport fares. Shafruhan Sinungan, who chairs Organda Jakarta’s regional leadership council, has said that the increase in urban transportation fares was estimated to be between 12.5 and 17.5 percent.

"We don’t want the increase to [transportation fares] to burden the public. For example, taking an angkot is now Rp 5,000. So we will try to increase it to Rp 5,500 so it is not too burdensome,” he said.

Earlier, the Organda central board (DPP) issued a press statement on its request to adjust public transport fares, which was signed by DPP Organda’s general chairman Adrianto Djokosoetono and secretary-general Ateng Aryono in on Saturday (3/9).

We don’t want the increase to [transportation fares] to burden the public.

The fare hike for public transport considers several factors, including location, the Transportation Ministry’s guideline on economy class tariffs for intercity and interprovincial (AKAP) transport, provincial transportation offices’ tariffs for economy class seats on provincial intercity (AKDP) transport and taxis, and regency/municipal transportation offices’ tariffs for urban and rural transportation.

Apart from adjusting public transportation fares, according to Adrianto, the fuel hike also needed to be accompanied by a guarantee on the smooth distribution of subsidized fuel supplies throughout the country. The government has also been called on to supervise the distribution of subsidized fuel in accordance with existing regulations.

In Surakarta, Central Java, public transportation services under the Transportation Ministry’s “buy the service” (BTS) scheme could be affected by the fuel hike, with the contract value to be adjusted in line with the higher operational costs resulting from the fuel hike.

KOMPAS/RADITYA HELABUMI

The new fuel price list is listed at one of Pertamina's gas stations in West Jakarta, Monday (5/9/2022). The government started on Saturday (3/9/2022) to increase the price of Pertalite, subsidized diesel and Pertamax fuel.

Surakarta Transportation Agency head Taufiq Muhammad said the fuel hike had not affected the public so far, and that BTS services were still free.

As for fare adjustments, according to Taufiq, bus operators had consulted with the central government, with further notifications on any changes to fares. Adjusting public transport fares was a possibility, as discussions had started during the first contract.

Separately, Institute for Transportation Studies (Intran) head Darmaningtyas said that public transportation still needed the fuel subsidy. To ease data collection and on target distribution, the government could involve industry associations or Organda.

“This is not too difficult to do, considering the limited number of public transportation [vehicles]. Buses only number 211,675 units and trucks only 5.73 million units out of a total of 146.04 million vehicles nationwide. This is only 4 percent of the total number of motorized vehicles in Indonesia,” he said.

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In addition, he continued, the MyPertamina application developed by PT Pertamina (Persero) could be used optimally to record the number of passenger and freight transportation vehicles in Indonesia. The fuel demand for each public transportation mode could also be calculated according to their function.

Regional inflation

Syamsir Nur, the head of Halu Oleo University’s Economics Laboratory, believed that the subsidized fuel hike was almost certain to be followed by a transportation fare hike. This would then be followed by price increases in other sectors, which would affect many things.

"This will have a spiraling effect from transportation to distribution, on the prices of goods, and other price increases. From a macro perspective, it will certainly cause inflation in the regions," he said.

In Palembang, South Sumatra, the prices of a number of basic necessities have increased as a result of the fuel hike. Observations at Palembang's Kilometer Marker 5 Market showed that the price of curly red chili had increased from Rp 70,000 per kilogram to Rp 90,000 per kg, while the price of cayenne pepper also rose from Rp 50,000 per kg to Rp 70,000 per kg.

Aini (42), a vegetable trader, said that prices had increased two days ago after the government announced the subsidized fuel hike.

The increase in subsidized fuel prices has sparked demonstrations in a number of areas, including Balikpapan, Makassar, Jayapura, Banda Aceh, and Batam. (OSA/NCA/REN/OKA/FLO/ JAL/NSA/AIN/RAM/NDU/ KOR/CIP/EGI/GIO/HLN)

This article was translated by Kurniawan Siswo.