Ministry officials oppose canceling the hike through state subsidies and would prefer spending the money on improving services.
The 12% public transport fare hike, which was due to come into effect on July 1 has been postponed until August 1 following a meeting of the Ministry of Transport and Ministry of Finance inter-ministerial committee. Until then the Ministry of Transport and Ministry of Finance will seek agreement on how a budget can be found to subsidize and avert the fare rise. But if implemented, a single bus fare will cost 6 NIS instead of 5.5 NIS, but the increase will also apply at the same rate to longer journeys on buses and trains.
Government officials believe that it is not right to subsidize the fare rise which stems from a rise in the public transport inputs index, which includes fuel, drivers' salaries and other expenses, because the subsidies would cost the taxpayer NIS 300 million. The officials argue that the price of a bus ticket does not persuade the public to use buses but rather availability, frequency, speed and reliability and the money would be better spent improving these issues. Moreover, Israel's public transport fares are relatively low by OECD standards and already subsidized more heavily.
However, any fare hike would hit the public and government ministers are pressing for a solution as part of its campaign against the rising cost of living.
Published by Globes, Israel business news - en.globes.co.il - on June 26, 2023.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2023.
Egged bus credit: Shlomi Yosef