The space resembled a typical “tambayan.” Equipped with a wall fan, and a water and a charging station, it was enough for the weary riders to rest and recharge before the “merienda” and dinner orders trickled in.

A former security guard, a factory worker, and a barangay employee were all brought there together by an app. Every day, they crisscrossed the bustling city, waited at their designated spots in restaurants and cafes, and brought food to customers right at their doorstep.

Rico (not his real name) joined GrabFood in 2019. The platform gave him a way out of his rigid and gruelling job as a bank security guard. (GrabFood is one of the more popular food delivery services in the Philippines and among those offered by the superapp Grab.)

Melinda (also not her real name) joined the platform, which gave her the flexibility she needed as a mother of two aside from its promise of better pay.

Another rider, Lara, was doing OK with her job in a barangay, but she got enticed when Grab came in. The idea of not having a boss was undeniably appealing to her.

Having no boss, the freedom to choose working hours, and the promise of a higher income have drawn Rico, Melinda, Lara and many more Filipinos to the growing gig economy.

The term “gig” used to refer to a band’s performance typically scheduled after work hours or on a weekend. Now it has expanded to a wide variety of tasks, often done through digital platforms 24/7.

Gig work is driven by a confluence of several factors. Customers—those who can afford—increasingly want convenience and services on-demand. Workers are seeking alternatives from the traditional 9-to-5 job. Companies aim to cut costs.

Digital platforms have bridged all these needs. They capitalize on this trend by connecting merchants like restaurants and cafes to customers. In between are the so-called gig workers.

In the gig economy, workers carry out task-oriented and time-bound delivery services without signing long-term contracts. This allows them to choose when and where to work, making it an ideal side hustle for those with regular jobs.

From October 2023 to June 2024, the Philippine Center for Investigative Journalism (PCIJ) interviewed dozens of workers for this report. The benefits are indeed undeniable for riders and drivers who treat this kind of work as a sideline to earn extra income in their spare time. But for many Filipinos, gig work is not simply a “raket”—it has become their main source of income.

This is a big deal especially when unemployment and underemployment persist. But because tech-driven services have far outpaced existing rules and regulations, workers are often disadvantaged.

Food-delivery and ride-hailing workers in the Philippines, whose daily routine is dictated by an algorithm, struggle with uncertain pay, indebtedness, and the physical toll of chasing incentives.

The risks of gamification

Lara, the former barangay worker, earned more than P1,500 the day before she was interviewed by PCIJ. For the 22 deliveries she made that day, she earned P1,372, plus P200 in incentives for making a certain number of trips, and a P20 tip, for a total of P1,592.

The minimum daily wage in Metro Manila was P610 at the time. At first, it would seem that Lara earns a lot, but after all expenses—gas, food, maintenance, etc.—her take-home pay could be lower.

In cases where they do earn more than the minimum wage, the riders complain about the gruelling 12-15 hours they had to hurdle.

For customers, it might seem as simple as thinking about what we want for lunch, opening the app, searching for a restaurant, choosing from the menu, and in a few minutes, a rider will be assigned to get your food for you. But there’s a lot more going on behind the scenes than we realize.

At the heart of these apps are algorithms that suggest merchants to customers, assign riders and drivers to passengers, and compute fares and incentives. This innovation makes things efficient and convenient for everybody. But it’s also intended to make money.

Our research shows that platforms like GrabCar, GrabFood, MoveIT, Joyride, and Angkas implement various incentive schemes designed to encourage workers to complete more orders and bookings every day. These incentives are offered on top of their standard pay, functioning as “bonuses” awarded to workers who meet specific delivery or ride targets—much like a game.

And because companies can restructure or reduce fares or for example, more recently, deduct the senior citizen and person with disability discounts from the workers’ pay, many workers really go for the app’s incentive program.

The implications are potentially serious. It could pose health risks and occupational danger to the workers and by extension, customers.

These incentive programs may also discourage workers from “multi-homing” or the practice of working on different platforms, which further limits their flexibility and earning potential.

Out-of-town drivers

Arnold (not his real name) spent two decades as an overseas Filipino worker. Now, he drives a GrabCar. The car is owned by his sibling to whom he remits a P1,000 “boundary” (a quota fee) daily.

Arnold is from Batangas, a province south of Manila. To save on costs and complete as many trips as he can, he sleeps in his car and goes home to the province only during Wednesdays, his coding day. There are others like him who by now already know most of Metro Manila by heart and the places where they can park their car and not get towed, take a bath, and rest.

Arnold says he is looking for a place to rent. The problem however is finding parking space too.

“Kasi mahirap naman tutulog ka nang sarap na sarap ‘yung tulog mo. Hindi na sasakyan naman eh, iiwan mo lang kung saan, ah, hindi safe. Para hindi ka rin makatulog ng, ano, hindi kagaya dito, kahit na, dito na, tulog sa kalsada,” he said.

Because he practically lives in his car, he gets to drive whenever he can. Admittedly, sleep is far from comfortable.

Arnold is able to reach his target income, including the P1,000 boundary a day. Not all drivers own their vehicle. Many drive other people’s cars and remit a boundary at the end of the day. Another setup is called “boundary-hulog” where a driver pays both boundary and “hulog” for the car so they get to own it after a few years.

Silver, gold, platinum

With GrabCar, drivers can reach higher tiers—silver, gold, or platinum—based on the number of rides they complete. The higher the tier, the lower the “kaltas” or the commission Grab deducts from their earnings, with the standard rate being 21%.

A driver needs to make 450 rides a month to reach platinum, the highest tier; 400 for gold, and 250 for silver.

Food delivery has a similar incentive scheme. In rider parlance, they call it “butas.” On their phone screens, there are round icons that can be unlocked by earning gems. One ride earns 10 gems. The more rides they take, the more gems, the higher the incentive.

In 2019, the riders interviewed said they could easily earn P800 in incentives a day. But Grab has changed this scheme several times. The same number of rides would earn them a lower amount now.

Riders also try to reach a higher tier to earn other rewards such as insurance, which at the time of the interview, was provided to those who have gold and platinum status. Similar to GrabCar, workers first enter as members, and can then move up to the silver, gold, and platinum tier. To reach platinum, a rider must make 480 rides in one month.

“Mangyayari hindi ka na matutulog kasi isang buwan, 480 rides,” Rico said.

“Ako po sa personal, ilang beses ko po naranasan na tumatakbo po ako, minsan hindi, nakaidlip, nasa gutter na po ako,” Carlos said.

“Saka minsan, minsan nga, pag nagbibiyahe ko, naka-pikit lang ako yun,” Lara said.

“Pinipilit na bumiyahe para mahabol yung… target na incentives. Yung gems,” Rico said.

Now, the riders said this number is hard to reach especially if they serve an area outside the most busy cities like Makati, for instance.

Grab: ‘Safety first’; Joyride, Angkas: mum on issue

PCIJ reached out to Grab about the incentive program. We asked how the company ensures that the app’s algorithm does not cause harm or encourage behavior that might pose risks to its workers.

Grab said it has always prioritized passenger safety.

“… we have implemented several measures to safeguard our drivers and passengers. Our platform includes features that monitor driver activity and prompt breaks if prolonged driving hours are detected. Safety features are part of our commitment to preventing fatigue-related incidents,” Grab said in writing.

Grab also said that it “continuously assesses and evaluates the safety records of our drivers to ensure that only drivers with excellent driver safety records are allowed to service commuters.”

PCIJ also asked the company if it has tested these kinds of incentive programs and their potential impact on workers before implementing them. For instance, does the company track the number of hours workers spend on the road?

According to the response: “Our incentive programs are designed with the well-being of our driver-partners in mind. We regularly review and refine these programs to ensure they promote safe and sustainable driving practices. While specific operational details are confidential, we assure you that our policies are aligned with the industry’s best practices and regulatory requirements.”

Angkas had initially entertained our request for an interview but did not grant one eventually.

Joyride has not responded to a similar request as of press time.

Fairwork Philippines findings

A 2023 study published by Fairwork Philippines, a project led by the De La Salle University with the Ateneo de Manila University, University of the Philippines Diliman, and partners from the University of Oxford, reflects PCIJ’s findings.

The report evaluated Angkas, Borzo, GrabCar, Grab Food and Grab Express, FoodPanda, Joyride, Joyride Car, Lalamove, Maxim, and TokTok, and how these platforms meet the five principles of “fair work.”

The five principles of “fair work,” composed of fair pay, fair conditions, fair contracts, fair management and fair representation, were developed through an extensive literature review of published research on job quality and meetings at UNCTAD and the International Labor Organization and in-country meetings with local stakeholders.

The table below shows what each principle corresponds to. A platform is awarded a first point if evidence suggests that it does meet the condition. The second point under each principle can only be awarded if the first point for that principle has been awarded. If there is no verifiable evidence available that meets a given threshold, the platform is not awarded that point. A platform can score a maximum of 10 points.

Only GrabCar, Grab Express, GrabFood, Lalamove, and Angkas managed to earn points but even these are too few for the workers in these companies to be considered as receiving fair work.

While these platforms offer workers the opportunity to secure their families’ needs in the context of poor employment alternatives in the country, they face “multiple occupational health and safety risks” daily on the road, along with shortcomings in terms of basic safety protections from accidents, illnesses and death, the report found.

Similar to our research, Fairwork Philippines found that “(g)ig workers tend to stretch their working hours to secure more gigs to earn what they need to remain afloat amid fluctuant rates, opaque pay structures, rigid ratings, and increasing competition.”

In addition, the report emphasized that workers are compelled to do this not only as a “free” choice, but also due to unfair or predatory pay and incentive structures. “The lack of measures to protect workers’ safety heightens their vulnerability, and the absence of safety nets implies that any sudden inability to work redounds to livelihood insecurity,” the report said.

Inherent ‘asymmetries’

According to a Philippine Institute for Development Studies (PIDS) research, the problems encountered by the riders and drivers are caused by “asymmetries” inherent in many apps or platforms.

These asymmetries give rise to “structural inequalities,” where companies—like Grab, Angkas, Joyride, and FoodPanda—benefit the most. Followed by merchants—like our go-to restaurants and cafes—and then, us, the customers.

At the bottom would be workers, who also grapple with having the least information and understanding about how things work on the platform such as how fares are calculated, why they are getting pick-ups that are too far, how to contest low ratings, resolve disputes, address account suspension and termination.

Read more: Displacement, commute woes plague communities near delayed MRT-7 project

The post When apps are gamified, workers rarely win appeared first on CoverStory.

Having worked with local government units and partnered with key cities such as San Juan, Taguig and Manila in building more bike-friendly infrastructure, Allianz now expands the initiative with a program that promotes livelihoods in bike repair.

Ride Safe 2.0 offers specialized livelihood support to selected beneficiaries of the Family Strengthening Program of SOS Children’s Village Pilipinas, who wish to pursue bike-related enterprises. 

It is designed to empower the participants, particularly women, with the necessary skills in setting up their own bike shops, and is aimed at addressing their daily needs while providing a pathway to establish a sustainable income source.  

The project’s core components include technical entrepreneurship skills development through training programs on business management, financial planning, and bike maintenance and repair at the Hermann Gmeiner National Training Center in Lipa City. The participants are able to gain knowledge through apprenticeship opportunities with experienced bike mechanics and entrepreneurs. 

Ride Safe 2.0 also grants successful participants seed capital to cover essential start-up costs.

“Our aim with Ride Safe 2.0 is to establish a solid foundation on economic independence and sustainability through bike-related ventures,” says Ramon Lee Cualoping III, the national director and CEO of SOS Children’s Village Pilipinas.

Ride Safe 2.0 was launched in partnership with SOS Children’s Village with family participants in certain cities in the Visayas. 

In Barangay 97-Cabalawan in Tacloban City, three beneficiaries of SOS Children’s Village became bike-repair entrepreneurs after undergoing comprehensive training. They were supported in their learning journey with allowances to cover food and transportation.

In Purok Avocado, Barangay Tawason, Mandaue City, aspiring entrepreneur Joseph Salonoy received technical and entrepreneurship skills training, plus P120,000 in two tranches as his capital for his bike-repair business. 

The Ride Safe 2.0 grant also empowered Jeram Tubongbanua, Regen Rubin, Renato Gadot Jr., Ricky Natalio, and Fermin Lintuco Jr. to establish thriving bike shops in Iloilo. Armed with initial seed capital, essential tools, and comprehensive training, they not only secured additional income to support their families but also became vital contributors to their communities. By offering essential bike-repair services and affordable bike parts, they have filled a critical gap in the market while promoting sustainable transportation.

“Their success stories underscore the power of collaboration, skills development, and community engagement in driving progress,” Allianz CEO Joe Gross said, adding: 

“The Ride Safe 2.0 grant has empowered them, ignited a ripple effect of positive change, inspired others to pursue entrepreneurial ventures, and contributed to the betterment of their communities. This is aligned with Allianz’s global strategy and commitment to investing in communities to foster resilience and confidence for a better tomorrow.” 

Allianz PNB Life is a joint venture between Allianz Group headquartered in Munich, Germany, and the Philippine National Bank. It was established in the Philippines in 2015 and currently operates 12 business centers in key cities nationwide.

For more information on Allianz PNB Life and the Ride Safe 2.0 campaign, visit www.allianzpnblife.ph.

The post ‘Ride Safe 2.0’ expands the initiative on bike safety appeared first on CoverStory.

“It’s suffering before the success,” 19-year-old Abad said. He leaves his home at 4 a.m. to get to his 8 a.m. class at the University of the Philippines Diliman. 

Soreto also wakes up early to arrive at her 8 a.m. class at Polytechnic University of the Philippines. She anticipates and dreads the heavy traffic. 

In true Manila fashion, both students allocate an extra hour in their commute “in case” the already grueling journey is further disrupted. Ironically, what has now become a long-distance commute for residents in San Jose del Monte north of Metro Manila is attributed to a railway project that is decades in the making. 

The Metro Rail Transit Line 7 (MRT-7), a 22.8-kilometer railway link between Quezon City and San Jose del Monte, promises to provide better commutes with faster and more convenient travel. Yet, its long overdue completion has exacerbated existing transportation problems. Construction has left roads torn up, disrupted familiar routes, and significantly extended travel times.

For example, to get to school now, Soreto has to take at least three rides.

“I take a tricycle to the highway, then a jeepney to Tungko, and another to Litex. Before the MRT-7 construction, it took about 30 minutes to reach SM Fairview. Now, it’s over an hour,” she said in Filipino. 

For Abad, the eldest of seven siblings, the additional expense strains his P320 ($5.47) daily commute allowance, which often means skipping lunch.

The railway’s development also raises concerns about its impact on local communities. Its proposed route cuts through residential areas, threatening to displace many families. Homes along the planned path have been marked with red lines, reportedly placed by contractors. To residents, this is an ominous sign of uncertainty.

For many in San Jose del Monte, the MRT-7 project represents more than just a faster commute. It’s a lifeline to opportunities in the capital, allowing access to better jobs and education without uprooting their lives. However, it is also emblematic of the growing pains of a region striving to keep pace with its burgeoning population.

See: Timeline of the MRT-7 as of 2024

Right-of-way issues

Universal LRT Corp. (ULC) set the groundwork for what would become one of the country’s most ambitious railway projects back in 2001. MRT-7 promised decongestion of the roads of Metro Manila, more efficient and reliable transportation along its corridor, and better economic opportunities for investors due to its connectivity. 

In 2004, the National Economic and Development Authority (NEDA) approved the MRT-7 budget of $1.2 billion, supposedly moving the project towards its first phase: a 22.8-km line from Quezon City, one of the densest cities in Metro Manila, to San Jose del Monte in Bulacan, a highway and an intermodal transport terminal.

The railway would carry 850,000 passengers per day and shorten travel time from Bulacan to the Metro from two hours to just 34 minutes. Its capacity would be more than double that of the MRT-3, which runs along Edsa with an average daily ridership of 357,198 in 2023.

As an unsolicited public-private partnership project, most of the project funds come from foreign assistance loans. 

In 2012, San Miguel Corp. (SMC), one of the largest conglomerates in the Philippines which later acquired ULC, secured funding from the Japan International Cooperation Agency (JICA) and a P100-billion loan from Philippine banks.

Construction commenced only four years later, toward the end of President Benigno Aquino’s term, formally marking the beginning of the project in April 2016. Right-of-way issues, however, continue to stall the project.

The first station, North Avenue, is meant to act as a grand central terminal connecting three train lines—MRT-3, LRT-1 and MRT-7. Its original location, according to survey plans, was supposed to be in front of SM North EDSA, a shopping mall owned by the Sy family. When construction began, it was relocated in front of the adjacent Trinoma Mall with the Department of Transportation (DoTr) citing economical reasons. Ayala Corp., owned by the Ayalas, operates the Trinoma Mall. 

SM Prime Holdings Inc. filed a temporary restraining order, which the Supreme Court later lifted, seeing that the construction was already ongoing.

In 2020, Quezon City Mayor Joy Belmonte issued a cease-and-desist order on the construction of the second station to be built aboveground inside Quezon Memorial Circle. Belmonte ordered a reevaluation of the project since the plans greatly exceeded the proposed area it would occupy.

The mayor lifted the order after the design for the aboveground structure was revised. This was done so as not to obscure the Quezon Memorial. But according to official alignment maps, the train station is planned to be built underground.

The land-use plans of both Caloocan City and San Jose del Monte reflect the original alignment of the MRT-7 along Pangarap Village. In 2021, the project was realigned to run along the Quirino Highway.

As of this writing, the station in Tala, Caloocan, has not yet been completed, while the location of the SJDM station has not yet been resolved. 

On the red line

The MRT-7 is expected to be fully operational by 2028 at the latest. Remarkably, despite the reported completion progress of 69.7%, construction of the 13th station at Tala has yet to start. 

The proposed railway connecting it to the final destination in Bulacan is expected to pass through Barangay 185, potentially displacing numerous families. Homes along the planned route have already been marked with red lines.

Among those who would be affected is Myla Lopez, 43, a barbeque vendor whose home and livelihood are now at risk. For the past 20 years, the mother of two has lived in the community within the marked zone for the new railway.

“The National Housing Authority called a meeting. They did not ask us if we were in favor of the new zoning. They just said our homes would be affected,” Lopez said in Filipino. “Asking questions would be useless since there were no MRT officials present during the meeting.”

Last March, the lines were redrawn near her house. She recalled asking the officials why? They told her that the space required for the MRT-7 has increased, engulfing their entire property.

“I said, ‘I already know that, what the changes in the measurements mean that all of my house will be taken, even up to the end.’ So, I wasn’t wrong, they marked it up to here,” she added, pointing to the newly drawn lines.

In its 2019 guidelines on involuntary resettlement, the Asian Development Bank (ADB) recommended a holistic approach that includes financial compensation, livelihood restoration programs, and continuous monitoring of resettlement outcomes.

“Involuntary resettlement safeguards call for meaningful consultation with affected people; compensation of losses and provision of assistance to and benefit sharing with displaced persons, and special measures for the poor and vulnerable,” according to the ADB.

The relocation threat brings more than logistical challenges. This is particularly pertinent for individuals like Lopez, who was concerned about the safety and the inconvenience on her children in going to school. 

Despite the promises of compensation, the seller remains skeptical. 

“For me, honestly, they can just keep their money because I won’t leave here. Do you know that I’ve always expected that in my life, I will die here?” she said.

Even with potential support, she believes that the emotional toll and disruption to their lives are more significant.

Like Lopez’s case, Jay Arniño’s home stands in the path of the planned railway. When asked about his feelings on his situation, he said he felt that his father’s efforts would be wasted “since he put a lot of effort into building our house.”

“When I found out that the house would be demolished to make way for the MRT, I felt regret and a little anger,” he said in Filipino.

Other San Jose del Monte residents—mostly farmers—have also expressed concerns about the effects of urbanization on their livelihood and homes. They cited fears of being ousted from their farmlands once the landowners decide to convert their property for commercial use.

Berto Monteroyo, a farmer in Barrio Bisaya, Tungkong Mangga, has a farm a few kilometers away from the initial proposed location of one station. But he still worries about the impact of the MRT-7’s construction and the urbanization that comes with it on the lives of farmers like him. 

“The thing about MRT-7 is that they will establish buildings and establishments once it’s here. Where will we be placed then?” the 75-year-old farmer said in Filipino.

Project delay entails economic cost

Cresencio Montalbo Jr., a professor at the UP School of Urban and Regional Planning, explained that addressing these constraints required a thorough study of both opportunities and challenges, with corresponding costs for remedies.

“They will have to be compensated for the resettlement, for the relocation. May cost lahat ‘yan (Everything has a cost),” he said, underscoring that the financial implications must be weighed against the benefits.

Montalbo cited a 2019 JICA study on the severe traffic congestion in Metro Manila. The study estimated that the daily cost of transport was P3.5 billion, or $69 million. “Mobility in large cities the size of Mega Manila is impossible without a network of mass rail transit system[s],” it said.

With the MRT-7’s prolonged delay, its promise to alleviate traffic and economic gains are yet to be realized. 

“The fact that the project is still under construction means that the project is not yet generating the intended benefits … [the MRT-7] cannot carry passengers to their destination simply because it is not finished,” Montalbo said. “That is [a] huge economic cost because of the delay.” 

Transport economist Robert Siy of Move As One Coalition, a civil society transport group, echoed the concerns of many about the project’s delays. 

“When you count the hundreds of thousands of people who are stuck in traffic, waiting in queues and also stalled in whatever public transport they’re using, this is where we are actually wasting so much of our resources, wasting opportunities,” Siy said. “We are also, I think, foregoing many economic opportunities when people suffer that type of inefficiency and that type of delay.”

Ways forward

Since the project had been put on hold for years, several things should have been done, according to Montalbo. “Three things: persistent [and] consistent communications; very strong, very close collaboration among the different stakeholders; [and a] champion.”

To avoid delays such as the one experienced by the MRT-7 project, communications strategies must have been put in place to make sure that the different stakeholders are on board or are supportive of the project, he said.

These include those affected by the project, like the residents and the local government of San Jose del Monte.

“[First], there must be clear knowledge on who the stakeholders are,” Montalbo said. “Second, it’s important to know what the issues of each of these stakeholders are … Third, how do we address such issues? … Based on that we develop a good communications plan.” 

The longer the delay, the farther the project strays from the solutions it promised to the people. In the time that it takes from project proposal to completion, several local government administrations would have already changed hands.

“Many people misinterpret what the project is all about because of the long time … the young people who used to support before are now older, there are now more people who have no knowledge about the project,” Montalbo said.

He attributed San Jose del Monte’s pushback on the proposed location to the lack of proper education from the MRT-7 proponent. He said that information about the project needed to be conveyed to the people affected so they could understand its rationale and benefits. This, he believed, was missing.

Furthermore, the national government must closely collaborate with the local government, he said. As the MRT is to be built on a national road, there will have to be cooperation from the local governments where its rail line passes. 

Lastly, the project needs personalities to face the public and endorse the project. Montalbo cited the mayors of Quezon City as being generally supportive of the project. In contrast, SMC, which won the bid to construct the MRT-7 and is one of the proponents of the PPP, rarely mentions its progress.

“Any big change that is introduced to disrupt the status quo would need a physical leader,” said Montalbo. 

Ideally, for projects of this magnitude, the right-of-way ought to be secured before the budget is approved. Montalbo admits that “it is next to impossible to secure the entire right-of-way,” especially for mass transits.

The urban planning professor expects that once the Quezon City segment starts operating, the local leaders of San Jose del Monte will see that the rail system works and that they are preventing their constituents from benefiting from the MRT-7. He added that the operation may soften their “hard stance,” allowing the MRT-7 to be completed.

From the Grand Central Station to the 12th Station, the Quezon City segment will operate approximately 18 kilometers, about 80% of the total length. 

‘Transport is transformational’

Looking at the already existing train lines in the Philippines, one might notice that wherever there are railways, there is significant economic activity. 

“Transport is transformational,” Montalbo said, pointing to the economic benefits of a mass-transit project to its location. “You make an area accessible, that area will change.”

Even before transport projects become operational, the approved locations of the terminals/stations already attract investors and real estate developers in anticipation of the increase in population and foot traffic. 

In Barangay Tungkong Mangga, the site for the initially approved location of MRT-7’s last station, several commercial establishments have been built as the construction progressed over the years, with more on the way. 

In 2013, Ayala Land Inc. launched Altaraza—a 71-hectare development which now has three neighborhoods namely Amaia Steps Altaraza, Avida Settings Altaraza, and the newly-established Miravera Altaraza.

SM Prime Holdings Inc. opened its third mall in Bulacan in San Jose Del Monte back in 2016.

However, as the wheels of progress and development continue to roll through SJDM, there is a group of people that are at risk of being run over and left behind. 

Responses to delays

San Jose del Monte Mayor Arthur Robes said in a recent interview that the route was realigned without informing the local government.

He said the city called the attention of the DoTr to request for a consultation when they realized that construction had already begun.

Transportation Secretary Jaime Bautista recently addressed the issue during an interview with reporters. He acknowledged the opposition to the construction from building owners along Quirino Highway because it will cause a heavier traffic flow, given that it’s a narrow road.

“They provided us with options which we are going to study,” he said.

According to the original plan, MRT-7 was not supposed to traverse Quirino Highway, but the plans have been revised due to conflicts. 

“In 2016, the route was not supposed to cross Quirino Highway. They were supposed to traverse the land of the Araneta, along Pangarap, which is why they fall under the aforementioned 33 hectares and why Tala Station would not be utilized,” Robes said in Filipino.

The original plan was revised due to disagreements in the supposed settlement fees that would be given. 

The plan in 2007 was to complete the project in 2012. When the project broke ground in 2016, it was targeted to be fully operational by 2019-2020. As of this writing, the latest target date for the partial operations (first 12 stations), with the pandemic severely affecting construction, was set to the end of next year, with full operations eyed by 2027-2028. The MRT-7 is projected to be fully operational by 2028, according to the DOTr.

Bautista said they will explore options provided by the San Jose del Monte local government. “We are not in a hurry because our target is really to operate up to the Lagro station by 2025,” he said.

Robes stressed that the city was not against the construction of MRT-7. “In fact, we are very much in favor. We would like to, however, be part of finding a better location where the posts of the train tracks will be placed.”

Reporters requested interviews with the DoTr’s and SMC. Nicole Alfiler, officer-in charge of the DoTr’s Right-of-Way and Site Acquisition Division, responded through Viber, saying they have an inter-agency committee for right-of-way committees that are collaborating with other agencies for all national railway projects.

SMC has yet to respond as of this writing.

Still waiting at platform’s edge

For Montalbo, travel is a means to an end, not the end itself. It is important to realize that commuters do not travel for the sake of traveling; they struggle with their daily commute to reach their destination.

With that in mind, it is vital that the authorities prioritize mass transportation systems to provide reliable modes of transport. Noting the transformative power of transportation, an efficient railway system equips the country and its people with less travel time, less traffic congestion and more room for economic opportunities.

However, that was not the case for the MRT-7 project.

Since the project’s approval in 2004, two decades have passed. Commuters have yet to hear it barreling down the tracks, carrying the 850,000 daily passengers it promises to transport.  Every delay costs not only the contractors more, but also the commuters who were promised a fast and efficient mode of transport.

While many citizens view the infrastructure project that will pass through the heart of the metro and act as an artery to the upper provinces of San Jose del Monte as ultimately beneficial, its delay and construction has caused much distress on the commuters in the form of heavier traffic—the complete opposite of what it aims to accomplish.

From a student’s perspective, Jay Arniño said, “The time I spent in traffic, I could’ve used to do my assignments instead.”

This story project was produced with support from the Earth Journalism Network.

Read more: Humanizing Metro Manila’s transport system

The post Displacement, commute woes plague communities near delayed MRT-7 project appeared first on CoverStory.

“I don’t want my son to go through all those because it saps his energy or sours his mood. He should be in high spirits and excited for school, but because of the commute, he might not look forward to studying anymore,” the mother of two said in a mix of English and Filipino.

Torres took taxis from time to time, but she often avoided them because of drivers known for gouging passengers with high fares. “Hangga’t maaari, Grab ‘yung kinukuha namin (Whenever possible, we always take Grab),” she said.

The Torreses’ experience is a common example of what it’s like to navigate Metro Manila. Notorious for its poor public transportation, the metropolitan region composed of 16 cities and a lone municipality had the world’s worst metro traffic in 2023. 

A traffic index found that a motorist spent 240 hours driving on average last year, with almost half of that time stuck on the road. So, when ride-hailing firms like Uber and Grab entered the Philippines, they thrived. The service they offered simply made sense for commuters like the Torreses.

But the family’s travel routine wasn’t sustainable. While their home is only seven kilometers away from school, booking a GrabCar ride meant leaving very early to avoid rush hour. They also spent at least P600 a day on the app alone. That’s roughly the minimum daily wage in Metro Manila.

Torres said she used to pay Grab about P270 going to school and roughly P290 going home at the start of the school year. A few months later, she noticed the fares rising to P310 and to as high as P350. She couldn’t understand the increase when she and her son took the same route every day. 

At one point, Torres got curious. She checked the receipt sent by the Grab app to her email, but she had no way to verify the amount.

“I didn’t have any basis or a reference to compare the fare, whether it could still go down or if there’s anything I could contest, so I just let it be. Besides, I didn’t really have another choice. I would take it (Grab) anyway,” she said.

For years, Grab’s seemingly steep fares driven by surge pricing have become a common commuter woe. Because no other firm has been able to threaten Grab’s dominance in the four-wheel transport network vehicle service (TNVS) market, customers are often left without other options. As of April 2024, there are 23,000 TNVS units, and the majority of those are Grab’s.

Behind Grab’s multibillion-dollar business is its data and algorithm-based approach to matching drivers and customers. This is how it is supposed to work, according to Grab: “When demand outpaces supply, the higher fares help to signal for more driver-partners to turn on their apps and join the flow.”

The idea makes sense. After all, Grab offers a service that isn’t the same as those offered by taxis, for instance. But the lack of transparency on how its algorithm defines surge rates has left many customers like Torres baffled.

An algorithm is a sequence of rules performed to carry out a certain task. It generates an output from a given input, similar to solving a mathematical problem or cooking a meal through a recipe. However, there is little people know about how these algorithms really work. This is why they are often called “black boxes.” 

While the inputs and outputs of an algorithm are often known, the process that turns the input into output is unknown. In the case of Grab, the firm uses driver and customer data to derive the surge rate. But how it computes those rates is unclear.

To test and learn more about how this algorithm works, PCIJ collected Grab’s pricing information by attempting to book rides for 10 routes across Metro Manila nearly every hour from 6 a.m. to midnight for one week. PCIJ also obtained data from Grab’s Farefeed application programming interface (API) every 15 minutes every day for the same routes during the same period.

Our investigation revealed that GrabCar rides always included surge fees, and when fares were high, waiting times did not always become shorter. The data suggested that the algorithm behind surge pricing did not always work the way Grab had advertised it to work. Customers still often had long wait times even when surge rates applied. 

Since its founding in 2012 by Harvard Business School graduates Anthony Tan and Tan Hooi Ling, Singapore-based Grab has become a multinational company. Originally designed as a ride-hailing app, Grab has since expanded into a “super app” offering food delivery and mobile wallet services. In the Philippines, Grab’s local subsidiary is MyTaxi PH, a homage to the app’s original name, “MyTeksi.”

Pricing probe still pending

Lawyer Ariel Inton was not surprised by PCIJ’s findings. It reflected the same complaints that his organization, the Lawyers for Commuter Safety and Protection, has been receiving. 

In 2022, the lawyers’ group raised questions about Grab’s surge fees along with other pricing concerns to the Land Transportation and Franchising Regulatory Board (LTFRB), the government agency that regulates public transport utilities. They wanted to know how Grab’s surge rates were determined.

There is still no information about how the LTFRB will resolve the questions about surge pricing. PCIJ’s interview and records requests with the agency have not been granted as of posting time. LTFRB only acknowledged our letter.

Inton said his group filed a motion to resolve the matter in January. There has been no news since.

“Two Christmases passed by already and there’s still no decision… We want to know when the surge [charges] should be implemented. Our focus then was that Grab supposedly applied surge charges because of supply and demand. But is it true every minute of the day? What we’re telling the LTFRB was for them to define surge. There has to be a limitation,” Inton said.

Ronald Gustilo, spokesperson of advocacy group Digital Pinoys, said he didn’t think the LTFRB was able to check how the Grab algorithm worked because of the fact that a complaint about it had been filed. 

“The fact that they are not addressing the complaint only shows that they don’t really know how or when surge pricing should be activated. Grab always says it depends on supply and demand, but in the first place, how do we know if there are indeed fewer drivers,” he said. 

In a written reply to PCIJ, Grab’s Philippine operations said it had “fully cooperated with the LTFRB’s inquiry” by participating in the hearings. “We remain committed to working with the LTFRB and other regulatory bodies to ensure our pricing mechanisms are fair, transparent, and compliant with all regulations,” the response stated.

Grab said it “strictly follows the fare matrix” set by the LTFRB, which includes provisions for surge pricing. The company also claimed that fares were shown upfront on the app “to provide transparency and allow for informed choices.”

The infographic below shows the information provided by Grab upon booking and when the ride is completed. The cost given by the app can indeed be broken down using the government-approved fare matrix, but only up to a point. 

Like other modes of public transportation, Grab’s fare is a combination of the base fare (P45) and increments based on distance (P15 per kilometer) and duration (P2 per minute). But unlike jeepneys, buses, and taxis, the company applies “surge pricing” that is supposed to be based on supply and demand. This part is opaque.

Grab had applied surge rates even before the guidelines for TNVS were drawn up, said Inton, who used to serve as board member of the LTFRB. When the LTFRB stepped in, surge pricing was retained in addition to the standard base fare and distance and duration rates. The LTFRB approved a surge that could only be up to twice the cost per kilometer and per minute.

Data: Grab rides always include surge fees

PCIJ’s data gathering yielded 1,328 data points from the Grab app and 6,720 through Grab’s fare check API. While our collection represented a small portion of the ride-hailing firm’s data, it offered useful insights into the inner workings of its algorithm.

Across all the rides we tried to book that week in February, data showed that surge charges were always included in the fares. Following Grab’s explanation, this suggested that booking requests always exceeded available cars nearly throughout the entire day—even early in the morning and late in the evening, even on weekdays and weekends. But it’s difficult to find out if demand did outpace supply because only Grab has access to this data.

According to data obtained from the app, the surge multiplier averaged at 1.51 times taking into account the rates for distance and duration of all the rides we had attempted to book. The rate tended to be in the lower range for a few hours in the morning.

The lowest surge multiplier we found was 1.19 times and the highest, 1.98 times, or almost twice the per-kilometer and per-minute cost. This is the maximum surge rate allowed by the LTFRB.

A Flourish heatmap

The surge charges customers paid for trips significantly differed depending on where they got picked up, the data showed. Passengers from Makati, Taguig, Las Piñas City, and Pasig paid higher surge rates on average. Meanwhile, lower multipliers were recorded in pick-up locations in Manila, Parañaque, Pasay, and Valenzuela.

For example, a six-kilometer ride from Makati to Taguig on Feb. 17, 2024 at 5 p.m. cost P381. Without a surge, the ride should cost about P215. The estimated surge rate was P166 or 1.98 times the distance and duration fees. ​​The surge fees on this day ranged from 29% to 44% of the whole fare.

Roughly the same trip distance within Valenzuela on the same date and time incurred a P64 surge fee. This was 1.5 times of the per-kilometer and per-minute cost. Grab charged P239 on the app. The surge fees on this day ranged between 23% and 31% of the entire fare.

A Flourish table

Verifying app fares with API data

As a way to verify, we compared the data collected manually from the Grab app with the data collected via Grab’s fare check API. The online tool as shown below provided estimates of the minimum and maximum fare and the duration of the trip.

When compared, the app fares were consistently above the minimum fare approximated by Grab in its own fare check page. This supports the finding that the rides PCIJ tried to book on the app always incurred surge fees. Moreover, it tended to be on the high side. 

The chart below shows that each booking (see black line) was also close to or more than the maximum fare estimated by Grab across the 10 routes.

A Flourish chart

API data: No surge?

Based on data collected from Grab’s fare check API, the company tagged each ride as “high surge,” “low surge,” or “none.” The same notices are not shown on the app, although it sometimes prompts customers to “beat high fares by booking later.”

Nearly two in three rides had a “None” surge notice in the API data, while the remaining rides were mostly “high surge” with a few “low surge”. This was inconsistent with what we found on the app where the surge fees were always added. Based on our data, there was always an extra amount charged on top of the P45 base fare, P15 per kilometer, and P2 per minute costs set by the LTFRB.

Curiously, the Makati-Taguig route in the API data registered a “high surge” throughout the week 24/7, every hour, even past midnight of the research period.

Grab did not directly address PCIJ’s question on why there was always a surge, but it did say that surge pricing was not predetermined by time but by real-time conditions.

“The discrepancy in surge notice(s) may result from variations in demand and supply at specific times and locations. The ‘High,’ ‘Low,’ or ‘None’ indicators are dynamic and can change rapidly as the system continuously processes new data to maintain balance and efficiency,” Grab said.

Grab added that its algorithm took into account a variety of factors, including traffic congestion, geographic location, the supply of drivers, and demand for rides.

“It operates dynamically to ensure that fare adjustments reflect the real-time market conditions. Surge is not manually set, but run by a real-time algorithm,” Grab wrote.

Gustilo, for his part, said that because algorithms are programmed by people, they need to be checked. Decisions driving their design will affect those who use the technology, he said.

Like Inton, Gustilo has been on the receiving end of complaints from both customers and drivers using the app. He himself found surge pricing puzzling as he had done his own fare monitoring. One time he checked the rate from his location to a destination hourly, from 5 a.m. until midnight. The data he collected showed that prices did not change much throughout the day, which led him to think that either no surge pricing was in effect or there was always a surge the whole day. 

“My point is, is Grab always on surge all day? Which is the same question asked by many passengers. Kasi nga, sobrang mahal na mag-Grab ngayon e (Taking a Grab now is so expensive.) Grab’s justification with surge pricing is demand. But drivers tell me, ‘Matumal ‘yung biyahe.’ So how do you reconcile that?” he said.

Does surge pricing get more cars on the road?

According to Grab Philippines, surge pricing is “an industry-accepted, sophisticated and scientifically developed algorithm-based feature driven by real-time supply and demand dynamics.”

“It ensures optimal allocation of resources by incentivizing more driver-partners to meet high demand, thereby enhancing service reliability. This mechanism is similar to economic principles applied in various sectors to balance supply and demand effectively,” the firm added.

If the algorithm was working as Grab had advertised, wait times should stay the same or become shorter when surge pricing took effect. However, relatively high surge multipliers lasted several hours without reducing wait times, the API data showed. This was not helpful for commuters because to realize a significant drop in the fare, they would have to wait much longer. 

For example, on Feb. 20, 2024 (a Tuesday) from midnight to 11:45 p.m., the Makati to Taguig City route recorded a notice of “High Surge” the whole day. The estimated average wait time was 3.4 minutes that day. It peaked at 11 minutes at 7:45 a.m., but didn’t go back to the average until 10 a.m. From 3:15 p.m. to 9:45 p.m. on the same day, the wait time averaged at four minutes. It wasn’t until past 10 p.m. when wait times generally dropped to a minute or two.

A Flourish table

Statistical analyses conducted by PCIJ did not yield conclusive results. The routes exhibited both positive and negative correlation between surge rates and wait times, which suggested that surge pricing did not always work to improve service quality, measured roughly as a reduction in wait time.

The routes that resulted in a positive correlation were pick-up points in the central business districts like Makati and Taguig. The surge rate and wait times in these areas tended to go in the same direction. It could be inferred that customers in these cities ended up waiting for a long time even with surge pricing.

Meanwhile, some routes did result in a negative correlation, meaning higher fares could be associated with shorter wait times. However, they were not substantial, which could mean that surge pricing had a minimal effect.

Grab acknowledges PCIJ finding

Sought for an explanation, Grab confirmed that surge rates could become “prolonged.”

“In some cases, high demand periods may persist, leading to prolonged surge pricing. The aim is to attract more drivers to areas with high demand, thereby reducing wait times over time. Continuous adjustments are made to ensure optimal service delivery,” Grab wrote in its response.

The firm said surge pricing was designed to address supply-demand imbalances but was not a static solution. The duration and impact of surge pricing depended on factors such as driver availability, demand surges in specific locations, and traffic congestion, it said.

On May 28, 2024, about a week after PCIJ wrote to Grab, the ride-hailing company was reported as asking the government to increase the number of TNVS vehicles in Metro Manila back to the pre-pandemic level of 65,000 to keep up with growing demand.

“Grab is struggling to serve the ride-hailing demand in Metro Manila, lamenting that TNVS supply is short of the pre-pandemic high of 65,000. The TNVS supply is around 40,000 slots as of end-2023,” PhilStar.com reported.

Persistently long wait times could also mean that drivers were not encouraged by surge pricing. At least a dozen drivers interviewed by PCIJ said that they didn’t necessarily go to “surge” areas or the areas marked red on the app map because that would mean getting stuck in traffic. 

They simply relied on the “bato” or the booking provided by the app, the drivers said. They spoke to PCIJ on condition of anonymity for fear of retribution.

Unchecked algorithms

PCIJ reached out to four relevant government agencies to learn more about how algorithms are regulated. Of the four departments, only the Department of Information and Communications Technology (DICT) and the Philippine Competition Commission (PCC) responded.

PCIJ has sent several requests and made follow-ups to the LTFRB since November 2023. The letters were acknowledged but not addressed. We wanted to ask the transport regulator about the status of its surge pricing inquiry and other related regulatory concerns.

The Department of Trade and Industry’s Consumer Protection Group asked for and was given a list of interview questions but did not respond to our request.

Only the DICT agreed to an interview. Assistant Secretary Philip Varilla said the department did not have a regulatory framework for ride-hailing applications. Its focus is on information shared by customers, he said. 

“Our attached agency, the National Privacy Commission, does some Privacy Impact Assessment. Basically, it is in relation to personally identifiable information. And with cybersecurity, we have our Cybersecurity Bureau, and they follow our Cybercrime Prevention Act, the National Cybersecurity Plan, as well as the Consumer Act of the Philippines to protect consumers. So, as for a regulatory framework specifically for ride-hailing applications, we don’t have one,” he said.

Making algorithms accountable

In the absence of regulations about algorithms, risks abound, according to experts. 

Dominic Ligot, co-founder of social impact technology company CirroLytix, said that while the Data Privacy Act and the Cybercrime Law cover abuses using technology or abuses on data, they do not cover algorithmic bias or algorithmic abuse. New laws are needed to cover algorithmic liabilities, he said.

Apart from legislation, designing an Algorithmic Impact Assessment or AIA might be helpful, Ligot said. It’s similar to the Privacy Impact Assessment under the Data Privacy Act. PIAs are a checklist of data being gathered, how they are processed, and who’s going to be accountable when there’s a data breach, for example.

An AIA can be a checklist that includes risks posed by an algorithm, among others, Ligot said. 

“Let’s spell it out. And then if we’re comfortable with the risk, sign, so that later if it blows up, ‘Okay, wait, who assessed this? And then we learn.’ At the bare minimum, we should have something like that for accountability and transparency,” he said.

This problem is not unique to Grab. Ride-hailing companies in other countries, like Uber, have been criticized for using surge or dynamic pricing to make a profit instead of managing supply and demand. 

Researchers have warned against algorithmic abuse in cases where companies raise surge rates more frequently than required due to weak regulation or the lack thereof. 

The Organization for Economic Co-operation and Development (OECD) for instance has highlighted concerns about the widespread use of algorithms in digital markets exhibiting characteristics that may lead to anti-competitive behavior.

Grab’s market dominance remains unchallenged

Grab not having a competition adds another layer to the problem. 

In 2018, the Philippine Competition Commission cautioned against Grab acquiring the Philippine operations of its lone and credible rival, Uber, stating that it would undermine competition. But the antitrust body later cleared the merger when Grab committed to address service quality and transparency concerns. Six years later, Grab’s market dominance remains unchallenged.

Indonesian ride-hailing startup Go-Jek, the only potential competition to Grab, tried several times to enter the Philippine market, but faced numerous roadblocks. 

The LTFRB in August 2018 imposed a moratorium on new applications from ride-hailing platforms, saying it needed to review the effect of the cap on the pool of the 65,000 approved TNVS units. 

Go-jek re-applied several times but was rejected because of the 40% foreign ownership limit for public transport services, according to Bloomberg. 

The Philippine Constitution requires companies to be least 60% Filipino-owned to operate public-utility services. Go-jek has a local subsidiary, Velox South-East Asia Holdings, but only about 20% of it was reported to have been owned by a Filipino shareholder.

Go-jek’s car-hailing unit, Go-Car, helped push Uber out of Southeast Asia and outgrew Grab as the most popular ride-hailing service in Indonesia, the Financial Times had reported.

Former LTFRB board member Inton said the exit of Uber ultimately favored Grab. 

“Why? Because it’s only Grab. There’s nothing else. But that situation should be regulated. Otherwise, Grab will be over and above regulation already. And Grab is so big now. The perception is that it is untouchable already, which should not be the case,” he said.

Inton urged the LTFRB to start scrutinizing surge pricing.

Grab violates commitments

Since the 2018 merger, the PCC has been looking into Grab’s operations and issuing penalties on the company because of its failure to comply with its commitments, particularly with pricing issues. 

The PCC explained in a written response to PCIJ’s queries that in principle, Grab must keep fares within a range as if a competitor like Uber were present in the market.

Asked how it monitors Grab’s compliance with its merger deal commitments, the PCC said it tracked Grab’s compliance through third-party monitors using reports generated by Grab. Grab submitted quarterly reports to the PCC. 

The PCC, in turn, furnished the monitor with copies of these reports. The monitor then informed the PCC of its assessment, including any findings of non-compliance. (The PCC declined PCIJ’s request for a copy of the quarterly monitoring reports because these are supposed to be “confidential.”)

The PCC said it had penalized and fined Grab for violations of its commitments in multiple instances. Fines have totaled P86.7 million over the years since the merger. The amount includes a P16 million fine in October 2018 for violating key provisions of the Interim Measures Order (IMO) during the merger review period and a P9 million fine in February 2023 for providing incorrect and misleading information in compliance reports and failure to comply with PCC orders.

The PCC has also ordered Grab to refund a total of P25 million to its riders for violating price monitoring commitments. Of this amount, P4.7 million will be remitted to the National Treasury because it was not claimed by eligible Grab riders.

According to Grab, all fines have been paid in full and on time, but the PCC clarified that Grab had yet to settle a P16 million fine, which is the subject of a petition for review before the Court of Appeals.

However, the PCC pointed out that Grab’s commitments to service quality and fare transparency have expired and were no longer being monitored by the PCC. The only remaining commitments under monitoring, it said, were about non-exclusivity and incentives. These pertain to drivers who are not supposed to be tied to just one ride-hailing company.

Grab buys Move It

Digital and transport advocates also claim that Grab has monopolized the four-wheel transport service and that the company will soon monopolize the transportation sector. This is in context of Grab’s acquisition of motorcycle taxi firm Move It.

Grab Philippines has a different perspective, pointing to a “competitive” market of 18 Transport Network Companies (TNCs) accredited by the LTFRB. As regards its acquisition of Move It, Grab stressed that the PCC, the competition watchdog, had cleared the transaction. 

“Digital ride-hailing services, both four-wheeled and two-wheeled, are just one segment of the entire transportation landscape. The sector remains competitive, with numerous players and options available to the public. Grab’s acquisition of Move It does not alter the conditions that have contributed to the competitiveness and dynamism of the transportation sector,” Grab claimed.

While it’s true that there are several other players in the Philippines, none have the financial and technical resources to threaten Grab’s market dominance.

Apart from legislation and setting up AIAs, the government needs to foster innovation, especially now when there isn’t much incentive to build competing apps, Ligot said. If there are no incentives, the Philippines will be beholden to foreign companies, he said.

“Grab had this first-mover advantage. Or rather second. Uber came first. And you can see how it really shredded the taxi industry. Partly because of the taxi industry also. It’s an ugly experience, right? They rig the meter. It’s inefficient. Suddenly, an algorithm comes and makes it efficient. But now we’re hostage to the algorithm,” he added. 

That’s a hard pill to swallow for many commuters, drivers, and riders to whom ride-hailing apps have become a lifeline. 

Torres’ family eventually decided to move to a place near the son’s school. She no longer takes GrabCar every day.

But she still takes it whenever she’s with her kids or family. “I would rather that I take Grab. (One main reason) is the traceability, in the event something happens.”

She’s hoping for alternatives. 

“Hopefully, once my kids are a bit older, maybe they can take a cab instead. But for now, that’s not the case yet,” the mother said.

This story was produced by the Philippine Center for Investigative Journalism in partnership with the Pulitzer Center’s AI Accountability Network. 

It was reported by Pulitzer Center’s AI Accountability Network fellow Karol Ilagan and data specialist Federico Acosta Rainis. 

Jabes Florian Lazaro contributed reporting and research for the article.

Data collection was done by Angelica Alcantara, Jay-ar Alombro, Donna Clarisse Blacer, Lyjah Tiffany Bonzo, James Kenneth Calzado, Gina de Castro, Maverick de Castro, Dominique Flores, Lois Garcia, Guinevere Latoza, Aya Mance, Faith Maniquis, Karmela Melgarejo, Gabriel Muñoz, Arone Jervin Ocampo, Matthew Raralio, Arriana Santos, and Angelica Ty.

Felipe Salvosa II was the lead editor. 

Photographs were taken by Bernard Testa. Illustrations were created by Joseph Luigi Almuena.

Data visualizations were designed by Karol Ilagan, Federico Acosta Rainis, and Kuang Keng Kuek Ser.

The post Grab fares surge under opaque algorithm appeared first on CoverStory.

When eFrancisco Motor Corp. chair Elmer Francisco rattled off their ejeep’s accessories during a virtual launch on the night of Nov. 30, Bonifacio Day, some viewers gasped in awe.

There’s nothing like it yet on the market. It’s got Wi-Fi, GPS system, CCTV, video and audio system, dashcam, AC. But that’s just the bling. 

The real deal lies under the hood: full-electric powertrain from Tembo e-LV, a global provider of electric utility vehicles. Unlike its aging, diesel-fueled cousin, the ejeep has no emission. It can travel up to 150 km after full charging, rev up to 120 kph, climb slopes at 50 degrees, and load up to 5,000 kg. 

With a gearbox nominal torque of 475 Nm, the ejeep can outmuscle traditional jeepneys even on Kennon Road’s tortuous zigzags. Traditional jeepneys’ torque is only up to 275 Nm. 

“It’s brand-new. No need to change oil after 5 or 10 kilometers. It has no motor oil,” Francisco told the crowd of mostly jeepney drivers, operators and members of transport cooperatives via Zoom. 

Unsurprisingly, a unit comes with a high price tag. 

That night, Francisco, 45, a Wharton-educated entrepreneur who cut his teeth in assembling jeepneys at 14 in the shadow of his father Jorge, made a special announcement: He’s selling a unit at a discounted P985,000 for the first 1,000 buyers.

“Francisco Motor is not selling a jeepney; it’s selling a livelihood,” he told the Zoom viewers, echoing his father’s sales pitch. (Jorge Francisco, together with his brothers Anastacio and Fernando, built Francisco Motor by churning out thousands of vehicles modeled on US military jeeps from 1947 onward.)

Economies of scale 

It’s the cheapest one can get on the market. 

To lower the cost to below P1 million from P3.3 million five years ago, Francisco got rid of extraneous fees—he ditched the idea of a showroom, among others—and transferred operations from Las Piñas to an export processing zone in Camarines Sur that offered tax breaks.

“We’re able to achieve that because of the economies of scale,” he said. “Economies of scale means we’re not going to make 100 jeepneys, or 1,000 jeepneys. We’re going to manufacture hundreds of thousands of jeepneys.”

To replace the 250,000 15-year-old traditional jeepneys plying Philippine roads, Francisco unveiled a plan to manufacture 25,000 ejeeps a year, or a total of 250,000 in 10 years. He plans to roll out 100 units by the second quarter of 2024.

In a sense, he’s offering both the government and the transport sector an eco-friendly solution to the years-long conundrum called the public utility vehicle modernization program (PUVMP). His solution also ensures that the “king of the road” isn’t written off the map, or the road. 

No doubt, Francisco Motor’s ejeep retains the iconic features of its “high-flying cousin”—the hood, headlights, and grill guard—but like a mini-bus, it has more head room.  It can seat 11 passengers on either side but leaves ample space in the middle for at least eight others to stand.    

Charging stations, powered by renewable energy such as wind and solar power, will be set up on the jeepney routes. The cost of charging will be twice as low as the cost of diesel for a 15-km route. But there’s a caveat: Don’t charge a unit at home, it’s going to cost a leg. 

“You’re going to regret it when your Meralco bill comes,” Francisco said.

The company is introducing an ewallet, called eFMC, for passengers to pay for their fare as well as for the jeepney drivers to pay for charging. 

What to do with the dilapidated jeepneys once the modernization is underway?

With some scrubbing and fresh paint, they can be turned into food vans by the government, and parked at tourist destinations or inside airport terminals and seaports, Francisco said. 

37,500 letters of intent 

But has anyone grabbed his offer of a discount?  

Francisco expressed hope that some 37,500 letters of intent he received from consolidated transport cooperatives and single operators in the runup to the virtual launch—including 701 from Lucena City—would translate into purchase orders. 

He acknowledged that only 15% of the jeepney market was “bankable,” or able to buy their own unit, but 85% could not.

Financing concerns were raised during the launch. One operator wondered if Francisco could help them secure bank financing and another asked if the “boundary payment” scheme would be an option given the long queues for bank-loan applications.  

“We want EVs too, but the price looks good, too,” one of them remarked.  

Francisco encouraged them to create an account at https://jeepney.io and earn commission from referring fellow operators to Francisco Motor, and from their “unli-rides” program.   

“If you’re able to refer many, you might get your jeep for free,” he said. 

To operators and drivers fretting about the government deadline to file their petition to consolidate themselves into cooperatives by Dec. 31, Francisco advised that they form one-person corporations.

“There’s now such a thing called sole corporation. Even if you’re just one person, you can form a corporation,’’ he told CoverStory.ph hours before the launch. “If you’re a single operator of one jeepney, you can form a corporation.”

Then you buy your own electric jeep, he added. 

Transport strikes

The past two weeks saw transport groups Manibela and Piston mounting separate transport strikes to protest the Dec. 31 deadline for the franchise consolidation applications under the PUVMP. They have announced plans for more such protest actions.

The goal of consolidation is to enable franchise holders to pool enough resources together to buy modern jeepneys. 

As of Oct. 31, 56.7% of public utility jeepneys and UV Express vans have consolidated to form cooperatives or corporations, according to an Inquirer report. The rest are still resisting the idea of consolidation that requires the surrender of their franchise—in essence, the sole power to run their own business.  

This early, Francisco said, the government should move the deadline and introduce the idea of “milestones” to the cooperatives and operators by way of cajoling them into embracing modernization. 

“That deadline has been moved three times because the government knows it’s impossible for all to consolidate by Dec. 31,” he said. “Surely they’re going to move it again. Why not move it now, in the spirit of Christmas?”

Francisco said that instead of imposing deadlines, the government should initiate ways to help cooperatives, operators and drivers “modernize” their units in batches. 

“If there’s anything that the Maharlika Investment Fund should invest in, it should be PUV modernization,” he said, referring to the controversial sovereign wealth fund established by the government. “It’s nation-building.”

Read more: Needed: a just transition for jeepney drivers and operators

The post Why not electric jeepneys to modernize the ‘kings of the road’? appeared first on CoverStory.

Related: Transport groups ‘will continue to make noise’ vs modernization plan

These are conservative estimates; it can be argued that they can carry more passengers.

If the government can take on the burden of vehicle procurement and financing costs, then it may also enable lower fares that can benefit commuters. It can also speed up the timeline for modernization, enabling our society to reap the benefits of cleaner air and better road safety more quickly.

If the government can provide a large budget to railways, roads and airports, then why can’t we provide a similar outlay to PUJ, which currently carry so much more passengers and have a wider-reaching network?

Let’s help PUJ drivers and operators. We should treat them as partners toward common goals. If the government can provide substantial financial incentives and subsidies to large companies (for example, the energy sector, to become cleaner/modern/renewable), then we should also be able to provide the same level of support to the public transport sector.

If we help them, then ultimately we help commuters and the public in general.

Jedd Ugay is a transport economist and a founding member of AltMobility PH (which advocates making transportation sustainable and inclusive) and Move as One Coalition (which was formed during the early days of the pandemic to promote the interests of commuters and public transport workers).

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This, in essence, is jeepney driver Rey Escanilla’s stance on the government’s fresh push to modernize the Philippines’ iconic “king of the road” that moved thousands of drivers to declare a weeklong strike from March 6, until Malacañang quickly intervened with a promise to review the program. 

The government’s Public Utility Vehicle Modernization Program, crafted in 2017, entails the replacement of diesel-fueled jeepneys that are 15 years old with newer, cleaner minibuses, and the consolidation of operators and drivers into cooperatives. 

Operators have to cough up P2.8 million to comply with the requirements—P300,000 paid-up capital and P2.5 million for a new unit. They must have a fleet of 15 jeepneys to start a cooperative. The government is offering a subsidy of 5.7% of each vehicle’s cost.

As good as new   

Escanilla, 54, who has been plying the Tandang Sora-Quezon City Hall route for 30 years, said operators could undertake their own modernization by buying, say, a new Sarao or Francisco Motors jeepney fitted with a surplus engine worth P500,000, with a bank loan. 

Related: Transport groups ‘will continue to make noise’ vs modernization plan

“That’s as good as a new jeepney,” he said.

Escanilla spoke with CoverStory.ph in an empty jeepney parked at a station near the Tandang Sora public market in Quezon City on Wednesday, the day transport groups ended their strike after a dialogue with Palace officials on Tuesday night.

He is a member of an association of drivers plying the same route, and was serving as the day’s dispatcher, ticking off the names of the arriving and departing drivers and their jeepneys’ license plates. 

In his case, Escanilla said, he could hack an arrangement with his jeepney operator (his sister-in-law) to take out a loan from a local bank to buy a new jeepney. He said he could gradually pay off the loan with his daily remittance of a quota fee through the so-called boundary system.   

“Yes, let’s modernize, but let’s do it individually. I’ll buy the new unit, manage and maintain it, and pay off the loan,” he said. “The boundary will be mine, and I can bring the jeepney home.” 

In this way, one can keep track of the daily earnings and adjust the quota fee accordingly, he said, adding that this could be the way forward for all parties.

On Mr. Marcos’ directive, agency officials promised during Tuesday’s dialogue to review the 2017 Omnibus Franchising Guidelines, which serves as the framework of the modernization program.  

Officials of the Land Transportation Franchising and Regulatory Board have aired willingness to discuss with transport groups ways of improving the program, but stuck to the declared Dec. 31 deadline for the phaseout of older vehicles.

‘It sounds unfair’

Escanilla’s beef with the modernization program is the formation of a cooperative that will supersede the current system, in which an individual holds the franchise to operate one or more jeepneys and employs drivers to ply a certain route. 

In the end, the cooperative, or the people running it, will not only control operations but also hold the power of the purse, Escanilla said.   

“It’s difficult to join a coop because in the first place the jeepney will be in their name. All the jeepney’s income will go to the coop. Only after all the expenses have been deducted will you be paid. It sounds unfair. This puts the operator at a losing proposition,” he said.  

He wondered whether the cooperative could really make the short 3.5-kilometer Tandang Sora-Quezon City Hall route profitable, with a maximum 80 jeepneys operating, and pay each driver a reasonable amount after a day’s work. 

But his and his colleagues’ main opposition has to do with the prospect of operators and drivers surrendering their franchise in favor of the cooperative, Escanilla said 

“If the coop acquires our line, we will lose our franchise. That’s why we don’t want to join the coop,” he said. Then he declared: “I might as well go back to being a family driver. I will answer to only one boss.” 

‘Simple arithmetic’

Escanilla, who raised his three children aged 31, 18 and 11 by dint of his work as a jeepney driver, said the cooperative system would eat hugely into the daily income that operators and drivers are earning at present. 

Operators and drivers earn a daily net income of P700 and P500, respectively, or P21,000 and P15,000 a month. Compare that with, for instance, a cooperative earning a net income of P100,000 a month, and each of its 15 members getting only P6,666, Escanilla said. 

“Simple arithmetic will show you the big difference,” he said. 

Besides, organizing operators and drivers into a cooperative is challenging work, according to Escanilla. 

He cited the case of an operator who owns a fleet of 15 jeepneys: The operator formed a cooperative months ago, registered it with the Securities and Exchange Commission, and applied for a bank loan to purchase 15 new minibuses worth P2.6 million each. The bank denied the application after computing that the operator would be unable to pay the loan with his gross earnings from the short Tandang Sora-Quezon City Hall route.   

Escanilla also said he saw something sinister in the push to form cooperatives. He pronounced it profit-driven, more than anything else.

“There’s money in the coop,” he said. “There’s someone behind it who wants to control the transport industry in Metro Manila … It’s the coop that should go. If there’s anything that they should stop, it’s the coop.”

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Manibela chair Mar Valbuena said the protesters were banking on President Ferdinand Marcos Jr.’s directive to concerned agencies to fully review the jeepney modernization program alongside dialogue and consultation with drivers and operators. Valbuena said another protest action would be considered if the review process fails to meet earnest expectations.

This piece, written before the strike was ended, examines the reasons behind the resistance and offers solutions to protect both transport workers and the environment.   

For the first time since the Covid-19 pandemic, a tigil-pasada has been launched to call for the scrapping of the public utility vehicle (PUV) modernization program. 

The mere threat of the jeepney strike led the government to move the deadline for the consolidation of jeepneys into corporations or cooperatives to the end of December. How the latest phase of a long-running struggle over the fate of the iconic Filipino jeepney ends is being settled on the streets, not at a negotiating table.

Protesting jeepney drivers and operators oppose what they believe is a phaseout. The government argues that modernization is necessary to solve public transportation woes and mitigate climate change.

Modernization of public transport is rationalized as a step towards climate mitigation and formalization of the industry. The aim is to have formalized and quality public transport characterized by fleet renewal, higher-capacity vehicles, more operational efficiency and improved service. 

Another key objective is decreasing the greenhouse gas emissions (GHG) of public transport, lessening rapid motorization, and limiting the shift to car usage. The strategic vision is full decarbonization through the electrification of public transport. As part of the Philippine Nationally Appropriate Mitigation Action, railways are to be developed but road transport reform is needed as short- to medium-term mitigation.

Exact number unknown

The exact number of public utility jeepneys (PUJs) nationwide is unknown; estimates vary from 180,000 to 250,000. In Metro Manila, around 50,000—or more, given the prevalence of colorum units—are operating on more than 700 routes. Whatever the number, there is no doubt that the livelihood of hundreds of thousands of Filipinos is at stake in the phaseout of traditional jeepneys.

Studies show that in Metro Manila, around 80% of operators own just one PUJ. The average operator owns 1.3 vehicles and only 2% own more than five units. This fragmentation is a symptom of the informality of the sector. Jeepney operators are part of the self-employed poor and often are drivers themselves. Operators may employ drivers under the boundary system. 

Both jeepney operators and drivers are informal workers. Still, they are required in the modernization program to shoulder the burden of the transition. This is a key issue of the controversy. 

Of the P2 million or more price of the modern jeepney, the government will only provide a subsidy of P160,000. A modern jeep is required to have GPS, WiFi, EPS and cameras. The cost would be prohibitive for an operator who earns a boundary of P700 per day, or a driver whose income is P1,000 for more than eight hours of work per day. 

Moreover, the fleet requirement of 15 units per operator is steep. Then there are overhead expenses, such as formal organization as cooperative, fleet management, and salaried workers.

Related: Jeepney driver says: Let us run our own show

Scapegoat 

The modernization program as conceived should cover all public transport but in practice has targeted jeepneys—an apparently easy scapegoat because of problems in the sector. 

PUJs are frequently blamed for road congestion. Yet these make 80% of all trips in Metro Manila but occupy only 17% of the road space. Due to cheap fares, PUJs carry 40% of commuter traffic, equivalent to 40 million person-trips per day. 

Despite the reputation of jeepneys and buses as smoke-belchers, they are more efficient in terms of carrying capacity and thus lead to a reduction in traffic, fuel cost, GHG emission and air pollution, according to the International Labor Organization (ILO) Regional Office for Asia and the Pacific.

Of the total GHG emissions for transport, jeepneys generated only 15% in 2015. 

Private vehicles outnumber PUVs by 25-1. PUJs comprise only 2% of all registered vehicles: 50,000 of 2.5 million vehicles in Metro Manila, and 300,000 of 12.75 million vehicles nationwide. 

It does not make sense to single out jeepneys among the different PUVs, and certainly not without regulating private-car ownership.

Pandemic as opportunity

A series of tigil-pasada has occurred over the years since PUV modernization was first proposed more than a decade ago. 

In June 2017, a three-year transition for all PUVs—not just PUJs—was provided for in the modernization program. Yet then President Rodrigo Duterte wanted all traditional jeepneys phased out by the end of 2017. A nationwide strike once more proved successful in pushing back this plan.

The pandemic presented the government with the opportunity to enforce the modernization program without opposition from jeepney drivers and operators. In one fell swoop, PUJs were banned from plying the roads along with other modes of public transport. That jeepneys had been singled out was eventually exposed when restrictions were relaxed and modes of public transport were allowed back except for PUJs.

The declaration of the strict lockdown, or enhanced community quarantine, in Metro Manila on March 16, 2020, put 120,000 PUVs out of commission, including some 50,000 PUJs, according to one estimate. 

After two and a half months, on June 1, 2020, the shift to the more relaxed general community quarantine allowed a limited number of PUVs—such as city buses, point-to-point buses, taxis, the Transport Network Vehicle Service, and shuttles—to operate at 50% capacity.

Finally, on June 22, 2020, PUJs complying with the PUV modernization rules were permitted to run. By July 3, 2020, 6,002 traditional PUJs were authorized to operate.  But by Aug. 4, 2020, with the imposition of a stricter modified enhanced community quarantine, only 968 PUJs had been allowed back. 

In sum, the conservative estimate is that P2 billion was lost as income for PUJ drivers at the height of the pandemic ban on traditional jeepneys.

Jobs and environment

In a sense, the modernization program is a case study of the jobs and environment conundrum. Still, it is not a choice between employment and the environment, but protecting both at the same time. The labor movement’s framework of just transition serves precisely to bridge these concerns into a unified position that advances both workers’ welfare and environmental protection. 

Combining traditional advocacies with new imperatives, the ILO argued in 2015 that a process of social dialogue and an outcome of decent work should animate the just transition to a low-carbon future. The jeepney modernization program must be reformed and informed by the principles of just transition towards the aim of a public transport system that is safe, efficient and convenient, and protects the environment and promotes decent work.

As the crucial first step, the government must stop imposing its deadlines and design for modernization that is skewed towards corporatization. Instead, it must engage in social dialogue with jeepney associations and consider the demands of drivers and operators. There must be active listening and good-faith negotiations with jeepney associations, as well as commuter advocates.

Among these key demands is lengthening the period for the consolidation of jeepneys into cooperatives. Aside from the overhead costs of fleet consolidation, there is a steep learning curve for jeepney associations to transform into a cooperative. Capacity-building and organizational development are necessary requisites.

The state must shoulder its fair share of the costs of modern jeeps. The original measly subsidy of P80,000 has been increased to P160,000. But jeepney groups insist on a subsidy of P500,000 at the very least, if not half of the total cost.

Social protection must be extended to those who cannot transition to modern jeepneys or who opt out of the sector. Drivers and operators begging for alms during the pandemic lockdowns should not happen again.

Small price to pay

All of these just-transition interventions are costly. But generous government subsidy and support is a small price to pay if modernization is genuinely aimed at mitigating climate change and traffic congestion, which benefits all Filipinos.

Finally, service contracting must be institutionalized as a mechanism to formalize the public transport sector and its workforce. As implemented, service contracting has morphed into financial assistance to drivers and free rides for the public. Turned on its head, service contracting unfairly competes with unenrolled units. 

Instead of temporary ayuda, service contracting should be the new normal in public transport. The local government or a national agency contracts the modern PUJs to service a route, and collects the fare from passengers who use automated payment cards. In this way, service contracting is sustainable.

Service contracts of jeepney cooperatives must be long-term—five years, for example—so that investments are incentivized. Such a scheme would be akin to how local governments regulate and run public markets as a public enterprise. 

Workers in a modernized jeepney sector are guaranteed wages and benefits without the pressure to compete for passengers, as happens under the boundary system. 

Service contracting is the future of mass public transport: Workers are in formal employment status, commuters enjoy comfort, and operators are guaranteed an income in return for a public service.

Benjamin B. Velasco is assistant professor at the School of Labor and Industrial Relations (Solair), University of the Philippines Diliman, and co-convenor of the Alternative Development Program, UP Center for Integrative and Development Studies (UP CIDS AltDev). —Ed.

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Having lived on the fringes of Metro Manila—for a long time in North Caloocan and in recent years in Las Piñas City—I have experienced all sorts of misfortunes and difficulties while commuting to Manila and Makati where I studied and worked.

In fact, I must have ticked all the boxes representing the difficulties that commuters in the metropolis go through in getting to school or work or home, such as clinging to the back of a packed jeepney or hanging on to the door of an overloaded bus, or walking for kilometers because of a public transportation strike. I endured all these countless times.

Sometimes it was the driver’s fault: I once got off a bus dazed after our bus hit a tree when the driver miscalculated a sharp curve.

Whenever there’s heavy downpour, I always pray that my ride does not get stalled and that I be spared from having to negotiate the murky, waist-deep floodwaters of Manila.

Brief respite 

When the light rail transit (LRT) was added as a commuting option, I thought the situation would improve. And it did for a time. The rail system cut my travel time by 30 minutes or even an hour, and it also protected me from getting stranded due to flooding after heavy rain. 

But the respite was brief. After only a few years, breakdowns started to happen, resulting in longer waiting times for the trains, chaotic scenes at the passenger ramp, and serpentine queues approaching the stations.

 There were even times when a train would lose power several meters short of the next station, forcing passengers to disembark and walk on the tracks.

It’s unfortunate that after more than 30 years, things have remained difficult for many commuters. The situation got worse during the pandemic-induced metro-wide lockdown that began in 2020 when all public transport services were suspended for weeks and months and commuters were left to fend for themselves.

Necessary shift

Not unless we shift from building new roads and skyways to building a public road-based transport system—rail-based, preferably—can the lives of commuters change for the better.

Despite the fact that public transport makes up three-quarters of the total trips taken in Metro Manila, a study made by the Move As One Coalition (composed of 140 organizations and 77,000 concerned citizens and taxpayers), titled “Move People, Not Just Cars: Correcting the systemic underfunding in national road-based public transport in the Philippines (2010 – 2021),” made a distressing finding: A measly 1 percent was budgeted to expand the metropolis’ road-based public transport supply and capacity.

The government’s car-centric approach to infrastructure development, according to the study, has had a deleterious effect on urban mobility. From 2010 to 2021, almost all—or 99 percent—of the P2.8-trillion road program budget went to road construction, widening and maintenance that ended up mostly serving private motorists.

The authors of the study urged that a greater share of scarce road space be allocated to pedestrians, cyclists, and users of road-based public transport. Sadly, the government missed the chance to do something right during the pandemic as only bicycle lanes were added to the roads, and most were not even laid out properly. 

But beyond bicycle lanes, our urban rail system should be expanded. The authors of the study believe that the government cannot merely “build, build, build” its way out of this public transport crisis. “National and local governments must spend a greater share of their time and budget on improving road-based public transport supply and capacity and active transport infrastructure,” they said.

At the moment, Metro Manila’s LRT-1, LRT-2, MRT (Metro Rail Transit)-3, and the Philippine National Railways can barely serve the Philippines’ 11.5 million to 12 million commuters.

While these lines are now being rehabilitated and extended, additional ones are still years away from completion: MRT-4 which will run from San Juan City to Taytay City in Rizal via Ortigas Avenue is expected to be operational by 2028; MRT-5 or the Metro Manila Subway that will run from Valenzuela City to FTI in Taguig City and Ninoy Aquino International Airport Terminal 3 is only about 30-percent done; LRT-6 that will serve commuters of Cavite is targeted for completion in 2040; and the segments of the North-South Commuter Railway Project that will serve Central Luzon, Metro Manila, and Calabarzon are in varying stages of construction. 

Only MRT-7 is expected to be partially operational by the end of 2022. 

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