Chile transport subsidies again accounting for lion's share of ministry's budget

Subsidies will continue to take the biggest bite out of the budget of Chile’s transport and communications ministry (MTT) next year, with an allocation of 1.47tn pesos (US$1.56bn) for operating costs.

The figure is equivalent to 85% of the total earmarked for the ministry next year of 1.73tn pesos, assuming the budget bill is passed as submitted. 

The amount for transport subsidies is 10.1% up on the 2023 budget, and private sector transport operators would receive 1.46tn pesos, documents presented to a congressional budget committee show. 

The amount is earmarked for public transport outside Santiago’s metropolitan region (18bn pesos), national public transport (412bn pesos), lower transport fares for the elderly in regions (31bn pesos) and Santiago (59bn pesos), and the capital’s Transantiago system (946bn pesos).

“It is not a resource issue. The ministry must solve an extremely cumbersome bottleneck problem, which is dramatic for transport operators,” senator David Sandoval, who represents the southern Aysén region for the right-wing UDI opposition party, said during a public hearing with MTT authorities.

He said that because subsidies must also be authorized by the comptroller, some small and medium-sized transport operators are seeing delays of up to five months in payments, which is impacting their operations. 

Sandoval also questioned the resources allocated to the Santiago metropolitan region compared to the rest of the country.

Because of the large amount allocated to subsidies, the budget committee agreed to hold a separate session dedicated to the issue on October 23.