JUTC can’t determine extent of fuel theft, says MD
Published:Friday | July 15, 2022 | 12:06 AM
An admission that the management of the Jamaica Urban Transit Company Limited (JUTC) is unable to quantify fuel lost to theft could be among the reasons the state-owned bus company has projected $8 billion in losses this financial year.
Further, taxpayers will have to fund a $5-billion subsidy from the Government to the company this year.
For years, the JUTC has suffered significant financial losses with the Government injecting huge sums to keep it afloat.
At Wednesday’s meeting of the Public Administration and Appropriations Committee (PAAC), JUTC Managing Director Paul Abrahams said that the company has been battling a “very big challenge with pilferage” of fuel from its inception.
“We have tried to quantify pilferage, but it has eluded us, and that is the truth because we run an operation that is 24 hours a day, seven days a week, 365 days a year, so 2, 3 o’clock in the morning, activities can possible take place,” he said.
Abrahams insisted: “It’s very difficult for us to put a figure on it, but we have a pretty good idea that there is a substantial figure out there.”
Trelawny Northern Member of Parliament (MP) Tova Hamilton reasoned that the fuel theft could be significantly impacting the company’s budget.
Indicating that the long-standing problem was intractable, Abrahams said that his predecessors had also failed to estimate the fuel-theft losses.
And with the sharp increases in fuel prices in recent times, the JUTC said its budget for petrol is expected to be exhausted by September.
PAAC Chairman Mikael Phillips noted that even though the JUTC rolled out fewer buses in the last financial year, its fuel costs had jumped by about $500 million.
“We are getting a hit with fuel prices,” the JUTC boss said, noting that it was costing the company 35 per cent to 40 per cent more to buy fuel.
Abrahams said that the company, through its parent ministry, will have to make representation to the Ministry of Finance for increased funding to purchase fuel.
Approximately 30 per cent of the JUTC’s fuel cost is from the Government’s fuel taxes, Abrahams said.
At the same time, the increased cost to use the Portmore toll road will put a further dent into the JUTC’s budget. The company has budgeted $194 million for toll costs this year. However, Abrahams said that preliminary estimates indicate that it will have to pay an additional $2.4 million in toll fees per month with the recent rate increase.
Highlighting other concerns affecting public transportation in the Kingston Metropolitan Transport Region, Phillips said the JUTC might be operating in breach of its licence, which mandates it to provide between 25,000 and 31,000 seats daily. He said that at present, the company was only rolling out about half of the required number.
The JUTC is currently rolling out 230 buses daily when a fleet of 450 is required.
According to Abrahams, Portmore alone requires 130 buses daily to properly service the huge dormitory community, but at present, the JUTC is only able to provide 85 units.
St Catherine South MP Fitz Jackson quipped that there is no shortage of frustration among commuters who are unable to get buses.
And despite efforts to reduce the staff levels, the JUTC is still operating above its established complement of 1,680 posts as it now has 1,767 workers. Abraham told the committee that several persons were in temporary positions.