Last Tuesday, the signing of the Agreement Act took place at Casa Rosada to seal the redesignation of the jurisdiction of the lines that operate exclusively in the City of Buenos Aires.
In this context, the district led by the Head of Government of Buenos Aires, Jorge Macriafter having starred in the event together with the president Javier Mileireleased a statement highlighting the main points of the agreement.
In the brief document, they clarify that CABA will assume responsibility for all subsidies from September 1stwhich will allow bus fares to remain at current price levels “for the time being.”
What represents a relief for passengers – in August the demand for travel fell by 6% due to the increase in ticket prices – remains a problem for companies representing the sector.
As explained Luciano Fusarohead of the Argentine Association of Motor Transport Entrepreneurs (AAETA), the companies maintain that between rates and subsidies, a ticket of $870 is recognized, when the actual cost rises to $1,400.
Does that mean that passengers should pay $1,400 every time they take a bus ride? It will depend on two factors.
Firstly, the administrative one. Once the transfer has been completed, It will be the responsibility of the City to set rates, routes and supervise the system.
For this to happen, the agreement between the Nation and the Buenos Aires government must be endorsed by a Law of the Legislaturewhich should include the creation of an organization with a function similar to that of the National Commission for the Regulation of Transport (CNRT).
Until then, the decision on these aspects is up to the Nation and City will comply by disbursing the corresponding subsidies. Even if CABA proposed changes, the National Government would have to approve them in such a case.
The second factor is linked to the cost structure. Not only AAETA and CABA recognize a delay in this regard, but also the city itself University of Buenos Aireswho wrote a report on the subject. The UBA warns of a mismatch between coverage of real costs and the costs recognized by the regulator, “which was increasing throughout the period analyzed”.
Based on the estimated costs, the regulated rate and the assigned subsidies, “a difference was identified that affected the concessionaires’ income”
According to the document, signed by the economist Alejandro Eistossin the period between December 2015 and December 2019, 7.9% of the estimated service costs were not recognized by the regulator and were offset by revenues not received by dealers.
Then, between January 2020 and November 2023, they were left without compensation. 12.6% of service costs at market values. Finally, in the last stage between December 2023 and July 2024, the percentage of costs not recognized by the implementing authority reached 34%.
Anyway, Fusaro clarified to Scope that the UBA study analyzes “all values without VAT”, while the $1,400 proposed includes the 10.5% VAT in this case that the user would pay if everything were transferred to the tariff.
What will happen with the Integrated Ticket?
A third factor that indirectly affects the cost of the ticket It is the Integrated Ticket programwhich provides discounts of between 50% and 75% on the second and third trip. The Government rejected the subsidies dedicated to this system for both CABA and the Province of Buenos Aires.
This benefit will continue to be maintained in the City with its own resources. In the Province, however, the governor Axel Kicillof appealed to the Supreme Court for the withdrawal of subsidies “to claim this new assault“.
The provincial leader said that the end of the Integrated Ticket program “It is an arbitrary and illegal decision“, considering that the National Executive”It has laws, budgets, allocated items and taxes” to solve it and, however, the Province does not have the “legal tools” to do so.
“Between January and August, Banco Provincia invested more than $454 billion in the Tariff Compensation policies of AMBA and Interior; River Transport and Special Educational Ticket,” explained the Governor.
On Tuesday, after signing the Agreement Act, Macri assured that in a first stage There will be no changes to the ticket and that the City will assume the cost that the national Government stops paying in the form of subsidies and the difference due to the discounts from the SUBE Network.
This amount is around the $7 billion per monthwhich is added to another $8 billion already allocated to subsidize the sector.
However, the Head of Government of Buenos Aires explained that fully allocating two thirds of the cost of the operating system “It will be reviewed, it will not be forever”.
The same is indicated in the statement shared by Nación that same day: “A permanent 66% subsidy of the rate for the City is not sustainable. On the other hand, it will be necessary to postpone investments and other expenses.“, the Government acknowledges.
Source: Ambito
