NROCC, JUTC and CAP to rack up $18.47 billion in losses for 2020-21

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NROCC, JUTC and CAP to rack up $18.47 billion in losses for 2020-21

New toll road construction and 50 new buses to be funded

BY DURRANT PATE
Observer business writer

Sunday, February 16, 2020

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Jamaica's three most financially burdened state agencies will rack up $18.47 billion in losses during the upcoming 2020/2021 fiscal year.

The National Road Operating and Constructing Company Limited (NROCC), which is responsible for overseeing the design, construction and maintenance of Jamaica's highways, will be the biggest loser with losses for 2020/2021 projected to be $7.8 billion.

NROCC is followed by the public bus company, Jamaica Urban Transit Company Limited (JUTC), with losses for the next fiscal year estimated at $5.7 billion.

Clarendon Alumina Production Limited (CAP), which manages the Government of Jamaica interest in the joint venture Jamalco bauxite company in Clarendon is set to incur losses of US$35.06 ($4.97 billion) in the next fiscal year.

The projected losses are contained in Public Bodies Estimates of Revenue and Expenditure for the Year Ending March 2021, which was tabled in parliament on Tuesday (February), along with the national budget of $852.7 billion. The projected losses for 2020/2021 represent an improvement over previous years when it amounted to more than $20 billion.

 

NROCC

In the case of NROCC, most of the losses will come from finance cost for the construction of the planned toll roads and highways that will be carried out during this year. The finance cost has moved from $4.88 billion in 2018 to $5.21 billion in 2019 and now projected at $5.32 billion in 2020/2021.

In total, NROCC's project losses of $7.8 billion is better than the current loss of $11.67 billion. NROCC's primary focus over the short to medium term will be administration of the construction of Phase 1C — May Pen to Williamsfield segment — of Highway 2000, and the Montego Bay perimetre road.

Key activities and targets during 2020/21 will include completion and review of the designs, provision of access to lands for construction, development of a financial model, identification and relocation of utility structures, and submission of environmental permit documents to the National Environment and Planning Agency.

 

JUTC

The JUTC is forecasting a net deficit of $5,782.50 million for 2020/2021, reversing the $2.26 billion surplus projected for the current fiscal year. The government subvention for the upcoming fiscal year is estimated at $5.34 billion compared with the $6.63 billion for the current fiscal year.

The company is projecting to increase staff to 2,168 compared to the present staff complement of 2,034. The JUTC will continue to pursue a number of activities aimed at improving operational efficiencies, which should enhance the service to commuters and contribute to a reduction in operating costs.

The activities that are being pursued include the implementation of an oil filtration system in 300 buses (2019/20: 150 buses) aimed at improving the efficiency and operational life of the buses' engines and the refurbishment of 15 damaged buses to facilitate their return to service.

The JUTC's operational plan assumes total passenger carry of approximately 50 million people (2019/20 – 41 million people) from an average bus run out of 391 daily (2019/20: 350).

To facilitate the increased passenger carry, the JUTC will seek to enhance its fleet management and bus tracking system to provide real-time information to assist with efficient decision making and service delivery. This is in addition to improvements to the fare collection system to support the efficient collection of revenue as well as increase the fleet by fifty new buses.

 


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