More financial woes are
on the horizon for the state-run Jamaica Urban Transit Company (JUTC) despite
the government's announcement this week that bus fares are going up.
Although commuters will in a few days begin paying more to travel on the company's buses, the JUTC will suffer more than $1 billion in losses in the new financial year.
This was revealed in a report on public sector bodies tabled by Finance Minister Audley Shaw in Parliament on Thursday.
It showed that the bus company will rack up $1.3 billion in operating losses during 2010/2011.
This is a reduction from the $1.7 billion loss the entity is projected to incur for 2009/2010.
The company is projected to earn $3.7 billion, a 97$ percent increase over the $1.9 billion expected for 2009/2010.
The Finance Ministry report said in an addition to the hike in fares the JUTC will experience an increase in passenger loads with the arrival of 100 new buses.
However, the increase in earnings will be eroded by soaring fuel costs and other operating expenses resulting in the $1 billion loss.
Fuel alone will cost the JUTC $1.3 billion which is nearly double the $718 million expected to be spent for 2009/2010.
Following Tuesday's announcement of the fare increase the Parliamentary Opposition warned that the adjustment would not result in a turnaround in the JUTC's financial position
The government was required to implement a new fare table for the JUTC in keeping with conditions set by the International Monetary Fund.
Although commuters will in a few days begin paying more to travel on the company's buses, the JUTC will suffer more than $1 billion in losses in the new financial year.
This was revealed in a report on public sector bodies tabled by Finance Minister Audley Shaw in Parliament on Thursday.
It showed that the bus company will rack up $1.3 billion in operating losses during 2010/2011.
This is a reduction from the $1.7 billion loss the entity is projected to incur for 2009/2010.
The company is projected to earn $3.7 billion, a 97$ percent increase over the $1.9 billion expected for 2009/2010.
The Finance Ministry report said in an addition to the hike in fares the JUTC will experience an increase in passenger loads with the arrival of 100 new buses.
However, the increase in earnings will be eroded by soaring fuel costs and other operating expenses resulting in the $1 billion loss.
Fuel alone will cost the JUTC $1.3 billion which is nearly double the $718 million expected to be spent for 2009/2010.
Following Tuesday's announcement of the fare increase the Parliamentary Opposition warned that the adjustment would not result in a turnaround in the JUTC's financial position
The government was required to implement a new fare table for the JUTC in keeping with conditions set by the International Monetary Fund.
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