cuts-crew philippines diagnostic country report methodology for the passenger transport sector (bus)
TRANSCRIPT
CUTS-CREW Philippines Diagnostic Country ReportMethodology for the Passenger Transport Sector (Bus)
Structure of Analysis1. Identification of components of competition
reform2. Institutional responsibility in reform
implementation and actual performance review▫ Coordination issues across agencies (DOTC, LTO,
LTFRB, MMDA) and government units (LGUs)3. Impact of competition reforms on market
structure4. Impact of competition reform on consumer and
producer welfare5. Assessment of consumer and producer
concerns6. Further suggested reform initiatives and likely
benefits
Methodology
1. DESK BASED RESEARCH2. FIELD WORK 3. ANALYSIS4. REPORT WRITING
Step 1: Desk-based Research
i. Thorough literature review, discussion with expert of competition policy, reform initiatives, previous studies
ii. Collection and analysis of secondary dataiii.Stakeholder identificationiv.Selection of impact/welfare issues to be
covered , hypothesis formationv. Selection of variables on which data to be
collected, identification of data sourcesvi.Development of questions and discussion
points for Focus Group Discussion (FGD)vii.Development of guidelines for in-depth
interview
STEP 2: FIELD WORK i. Data collection on price, routes, alternates,
etc.ii. FGDiii.In-depth interview
STEP 3: ANALYSISiv. Quantitative PLUS Qualitativev. Impact of reformvi.Changes over timevii.Comparison across city/ routes
STEP 4: REPORT WRITING
Competition Reform and Welfare Analysis: Producer Welfare
• EASE OF ENTRY FOR PRIVATE OPERATORS At policy level as well as industry structure level (e.g. issues
like “colorum” operators)
• FREEDOM AND TRANSPARENCY IN OPERATIONAL DECISION Process of fare determination Process of route identification Decision on number of buses to ply on each route, across
different time points, etc. Price adjustment in response to input cost (fuel price, financing
cost, etc.) changes
• COMPETITIVE NEUTRALITY Whether level playing field exists for all players
• PREDICTABILITY OF REGULATORY ACTIONS, GOVERNMENT POLICY FORMULATION AND INTERVENTION, ETC.
• EASE OF DOING BUSINESS Whether the business is subject to significant regulatory,
procedural, etc. burden hampering the productivity
• ACCESS TO ESSENTIAL SERVICES ▫E.g. road infrastructure, finance, etc.
Competition Reform and Welfare Analysis: Producer Welfare (cont)
Competition Reform and Welfare Analysis: Consumer Welfare
• AVAILABILITY OF BUS TRANSPORTo Coverage by bus transport as a share of total passenger
movemento Overall as well as frequency across different hours of the
day/weeko Certainty of availabilityo Demand-supply gap
• PRICE SETTING MECHANISM o Evaluation of the price setting mechanism in terms of its
fairness towards the end consumers vis-à-vis the transport operators’ interest
• PRICE DYNAMICS o The bus fare dynamics in actual/historical experience and its
welfare impact
Competition Reform and Welfare Analysis: Consumer Welfare (cont)
• PRICE-QUALITY INTERACTIONo Choice to consumers in terms of alternate bus transport
modes availableo Comparative evaluation of pricing structure of alternate
modes
• SERVICES AVAILABLE TO CERTAIN SECTIONS OF THE SOCIETY
• ENVIRONMENTAL STANDARDS FORMULATION AND IMPLEMENTATION
• PASSENGER SAFETY STANDARDS
Competition Reform and Welfare Analysis: Consumer Welfare (cont)
• TIME DELAYS DUE TO TRAFFIC CONGESTION
o Productivity losses of consumers due to time delays
o Congestion as the population of vehicles (including buses) grows faster than the capacity growth of roads
o Current situation of oversupply of buses: evaluation not just by assessing the total number franchises issued but also by looking at oversupply "where" and "at what time" e.g., oversupply in EDSA during the morning peak periods and
afternoon peak periods
o Comparative evaluation of alternate mode, i.e., MRT-3 Erosion of the time-saving advantage of the alternative as
passenger growth outpaced the capacity of the rail system
Study Area: Bus TransportBus transport
•Intra-city: Metro Manila▫Muntinlupa City-Makati City-Quezon City-Commonwealth/Lagro via EDSA
▫OR:▫Baclaran (Pasay City) to Bagong Silang (Quezon City) via EDSA
•Inter-city: City in CALABARZON to Metro Manila▫Origin (Rizal): Antipolo City- Pasig City- Makati
City and▫Origin (Cavite): Dasmarinas City-Paranaque City-
Makati City
Sampling FrameBus transport In-depth Interview FGDIntra cityInput Suppliers (petrol,diesel)Bus Operators: Public & Private*State Government Officials Inter cityInput Suppliers (petrol,diesel)Bus Operators: Public & Private*State Government Officials Total*: distribution of 10 samples into public and private operators will vary in accordance to the nature of local transport network.
Field workData collection - Primary
•No Field/Perception Survey▫Manpower and budget constraints
•In depth interview Guideline based open ended discussion
•Focus Group Discussions
Analysis
•Competition Policy Reforms:▫2005 Moratorium on issuing bus franchises
(DOTC Department Order No. 2005-57)▫Coordination issues among DOTC, LTO,
LTFRB, MMDA and LGUs
Analysis•Quantitative (estimate producer surplus
and consumer surplus)▫Comparison across time: impact on select
variables pre and post reform before and after the 2005 moratorium on issuing bus
franchises
▫Comparison across city, route▫Impact comparison across different reform
initiatives▫Possible Cost-benefit analysis (?)
•Qualitative▫FGD▫In depth interview of relevant stakeholders