Case Study v3.0

TECHNOLOGICAL INSTITUTE OF THE PHILIPPINES

1336 Arlegui St., Quiapo Manila

CEP 423 – TRANSPORTATION ENGINEERING

THE EFFECTS OF P.N.R. CHARTER EXTENSION

CHAPTER I

INTRODUCTION

A. BACKGROUND OF THE STUDY

The charter of the Philippine National Railways will expire on June 20. If its

corporate life is not extended, PNR will be dissolved, any stoppage of the rail

service will be of huge inconvenience for our commuting public, especially for our

countrymen who hail from provinces and who have to travel to Metro Manila on a

daily basis.

PNR charter extension primary reforms are: Improve the efficiency of its

existing Metro Manila Commuter Line and expand the line northward to Malolos.

Automate the present fare collection system. Revive the mainline south to Bicol

and extend the south line onwards to Sorsogon. Introduce freight service for goods

via the existing at-grade PNR tracks. Improve the utilization of PNR real estate

assets. Implement the highest standards of governance in its financial and

management operations. Those reform commitments will hopefully reduce the

yearly subsidy provided by the government for PNR’s operations.

PNR should consider to improve its operations and increase its contribution

to national economic development by: Conducting a full-blown study for the overall

PNR railway modernization plan, looking into the viability of extending the existing

PNR lines to routes that are possible sources of increases ridership. Determining

most advantageous or appropriate rail transit technology for the PNR lines.

Utilizing of improved ticketing, safety, and security systems. Settling all its

obligations to positively contribute to the nation economy. Continuing efforts in

venturing into other means of increasing its revenues to help cover outstanding

obligations. And lastly, better managing its operation.

B. STATEMENT OF THE PURPOSE

Can modernization of the PNR alleviate the problems in transportation system?

Do this rehabilitation project helps to continue the economic development our

country?

Can the government sustain and maintain the progress of this particular

project?

C. SIGNIFICANCE OF THE STUDY

The findings of this study will rebound to the benefit of society considering

that PNR plays an important role in our community today. The greater demand of

people who wants to travel using rail transit justifies the need for more safe and

efficient transportation system. By understanding the effect of this charter

extension we can definitely tell the future of our transportation industry. Moreover,

this research will provide recommendations on how to evaluate the performance of

a certain agency in accordance to transportation system and this will be also

helpful to government because it can serve as a future reference for their

upcoming rail transportation projects. And finally, this research will educate the

people in deciding whether the government is really fulfilling its responsibility to the

community or is just showing off to promote its administration.

D. SCOPE AND LIMITATION

The scope of this case study is the development of the operations and

facilities PNR. The study takes the following area into consideration: The

amendments on the former and latter PNR Charter. The PNR track records of the

former charter. And the allotted budget in the previous operation of the PNR.

The study is bound within the limits of Bicol Commuter Service, the Metro

Commuter Line, and the expansion of PNR service throughout the Luzon.

CHAPTER II

THEORETICAL FRAMEWORK

This chapter presents the related literature and studies after the thorough and

in-depth search done by the researchers. This will also present the synthesis of the

art, theoretical and conceptual framework to fully understand the research to be

done and lastly the definition of terms for better comprehension of the study.

A. REVIEW OF RELATED LITERATURE AND STUDIES

In March 2012, India announced its biggest railway budget in history to tackle

network capacity and safety issues. Looking into some of the most significant

Indian railway projects up to 2017, Railway-Technology asks whether the

measures will be enough to modernize a network which is still one of the most

dangerous in the world.

India's 64,000km rail system, the fourth largest in the world, transports more

than ten billion passengers and 1,050 million tons of freight every year. But the

network is perhaps best known for its capacity and safety issues, which make it

one of the most dangerous globally.

The Indian Government has been striving to tackle the problem and has

injected billions of dollars into new projects and tracks. In its March 2012 railway

budget, it pledged to invest $147bn into major projects during the next five years,

in an effort to finally catch up with its neighboring.

The main focus of the investment to 2017 is on improving tracks, bridges,

signaling, rolling stock and stations throughout the country. In addition, 700km of

new railway tracks are to be added to the network to link some of India's more

remote regions with the rest of the country, making it one of the biggest

investments in India's long history of railway transport.

In the next five years, India will set the whole railway industry towards one goal:

better, bigger, faster and safer rail links which cater to the needs of the country's

prospering middle class. In an effort to gain more economic and geographical

mobility, the government is planning to spend vast amounts of money to overhaul

its creaky network.

In total, it has sanctioned ten new electrification projects and 17 new gauge

conversion projects in its Railway Budget 2012-2013 alone. In addition to the

hundreds of kilometres of new tracks, it will also upgrade stations and add a

number of new express and passenger trains.

One of the biggest expansion projects currently under construction is

theKashmir railway, officially called the Jammu-Udhampur-Katra-Qazigund-

Baramulla link (JUSBRL). At the beginning of 2012, the government announced a

cash injection of $3.5bn, with which the originally estimated cost of $13bn will most

likely be exceeded. The project, which is due for completion in 2017, already

received National Project Status in 2002 but has encountered substantial

engineering challenges over the years, in particular through the Pir Panjal

mountains area, where an 11km tunnelling section took more than six years to

complete.

A massive part of India's railway investment goes into its densely populated

cities, in particular the capital New Delhi. The approval of a new $327 monorail

extension to the overcrowded Delhi Metro was announced in January 2012. The

new line will have 12 stations and interchanges with three existing metro lines and

is expected to come online by 2017, serving about 150,000 passengers a day.

In Mumbai on the other hand, the Mumbai Metropolitan Region Development

Authority (MMRDA) set aside $244m out of the $1bn yearly budget for the

development of the metro rail and monorail, with $176m going into a new monorail

project. Apart from that, the authority has also decided to invest $58m for the

Mumbai Urban Transport Project-II (MUTP-II) for the improvement of the suburban

rail system.

Another major mass rapid transit system is being constructed for the city of

Hyderabad, scheduled to become operational in 2017. At the beginning of May

2012, officials announced that the first phase is likely to be completed in three

years’ time.

It is one of the world's largest public private partnership (PPP) projects in the

metro sector, involving 71.16km of elevated metro rail lines in three corridors, with

65 stations crisscrossing throughout the capital of the state of Andhra Pradesh.

The Indian Government has most definitely realized the need to upgrade its

railway network to bring it in line with its neighboring countries. But the officials

also know that track connection with countries such as Bangladesh, Pakistan,

Nepal and China will be vital.

In April 2012, Indian Railways therefore announced that it will take part in the

80,900km Trans-Asian Railway Network (TARN), which soon could connect 28

countries between Europe and south-east Asia. For India, taking part in the project

is essential for its strategic development and will boost economic activities in the

years ahead.

Indian Railways will initially invest $580m to link about 97km of new rail

connections between Jiribam and Tupul (Manipur) in the first phase of the project.

The entire project, which is being considered by the United Nations Economics and

Social Commission for Asia and the Pacific (UNESCAP) under the Asian Land

Infrastructure Development Project, is expected to be completed by 2025.

The importance of building transnational links with other countries was also

highlighted by former Railway Minister Dinesh Trivedi during his budget

announcement on 14 March 2012, claiming that this approach will significantly

develop relations with neighboring countries to "improve bilateral ties" and help to

establish connectivity with inaccessible areas.

But while India has shown the hunger to implement even the most ambitious

railway projects, its authorities sometimes fail to mirror this in their approach to rail

investments from private and foreign investments. Currently, public-private

partnerships only represent four percent of investments in India's railway sector,

even though the industry has demanded clear guidelines to attract private

investments for many years.

"Improved project implementation, streamlined and time-bound approval

processes, providing terms in projects that will allow investors to gain 'reasonable'

returns on capital, and more efficient vendor management are some of the areas

that can be addressed by the Indian Railways to ensure the growth and

sustainability of the sector," said Confederation of Indian Industry (CII) director

general Chandrajit Banerjee just days before the budget announcement in March.

Opening up the sector for private investment however requires a new mindset from

India's politicians. But until now, railway is still treated as the crowd-pleasing,

super-cheap state transport, as some experts believe.

"There is a lot of scope to come in and a huge amount of investment can

come in from the private sector but the railways have to open up. Till now the

Indian railways had been much closed," Hermant Kanoria, Kolkata-based Srei

Infrastructure chairman and managing director, told news agency Reuters in

March, pointing out the much-needed change in the sector

Perhaps the biggest problem has however been highlighted by the

resignation of Railway Minister Dinesh Trivedi, only days after his budget

announcement in mid-March. In his budget speech, he pledged to increase

passenger rail fares for the first time in eight years in a move to improve network

efficiency and safety. His party however protested against the decision, forcing him

to quit and make way for Mukul Roy.

Commenting on his decision, Trivedi said: "I'm worried about safety. I did

what I did because of safety." All this came on the back of the publication of a

report by a government-appointed panel that reviewed the country's railway safety

after some major accidents in recent years.

The results were shocking: every year, around 15,000 people die

somewhere along India's extensive rail tracks, usually slum-dwellers and poor

villagers who live near the lines or passengers who fall off overcrowded commuter

trains. Mumbai's suburban rail network alone accounts for as many as 6,000

deaths a year.

The panel said that although these deaths are not from train collisions, they

cannot be ignored by railway authorities and called on the government to invest

$20bn over the next five years to upgrade technology and infrastructure. This

should include safe coaches, anti-collision devices, advance warning systems and

the strengthening of ageing tracks and rail bridges.

Indian Institute of Management professor and transport and infrastructure

expert G Raghuram, a member of the panel, suggested several measures to

address the issue: "There are various solutions possible - better fencing, more

opportunities to cross the tracks through overpass bridges. In suburban areas, at

least, there is no reason why Indian Railways cannot just floodlight the entire

railway track," he said.

He added that modernizing the network will also help reduce train accidents.

"In terms of international benching, and given the technologies and systems that

are available, the Indian railways can do a lot more Railways have just to move,

take a quantum jump in terms of the systems and technologies they need to

adopt."

However, without real governmental support to even impose the simplest safety

measures, improving some of these death traps still seems a long way off. Trivedi

most definitely has paid a high price. It also shows that without the right political

environment even the biggest railway investments seem to be money thrown down

the drain.

In researcher point of view, this case of India’s investment for railway

development can relate in the topic discussed in this research paper. Just like

India, the Philippines National Railway will set the whole railway industry towards

one goal: better, bigger, faster and safer rail links which cater to the needs of the

country's prospering middle class. In an effort to gain more economic and

geographical mobility, the government is planning to spend vast amounts of money

to overhaul its creaky network.

B. CONCEPTUAL FRAMEWORK

The researchers wants to test the Cost-Benefit Analysis Process. The

Cost-Benefit Analysis is a process use in quantifying costs and benefits of a

decision, program, or project (over a certain period of time), and those of its

alternatives (within the same period), in order to have a single scale

comparison of unbiased evaluation. In cost benefit analysis decisions are

analyzed. The benefits of a given situation are summed and then cost

associated with taking that action are subtracted.

The pursuit for understanding was done through the following process:

data collection through the use of questionnaires and interviews; data analysis,

clarifying statistical statements; and data interpretation, findings, conclusions,

and recommendations.

The output of this pursuit was proposed implementing guidelines for

monetary and non-monetary benefits of the Philippine National Railway.

INTE

RPRE

TATI

ON

GOAL AND SCOPE DEFINITION

INVENTORY ANALYSIS

IMPACT ASSESSMENT

DIRECT APPLICATIONS:

Product development and improvement

Strategic Planning

Public policy making

Marketing

Other

C. DEFENITION OF VARIABLES

Charter - a written grant by a country's legislative or sovereign power, by which

an institution such as a company, college, or city is created and its rights and

privileges defined.

Common Railway - From the first moments that steam engines started rolling

across the fields of England, standard configuration of railway began spreading

across the world.

Congestion - too crowded or blocked.

Cost-Benefit Analysis - a process use in quantifying costs and benefits of a

decision, program, or project (over a certain period of time), and those of its

alternatives (within the same period), in order to have a single scale

comparison of unbiased evaluation.

Economic Evaluation - is to evaluate alternative strategies stage construction

or full construction. There are different methods of economic evaluation, the

cost benefit ratio, net present value method, and internal rate of return method.

Electrified Railway - is a locomotive powered by electricity from overhead

lines, a third rail or on-board energy storage such as a battery or fuel cell.

Freight - A charge paid for carriage or transportation of goods by air, land, or

sea.

Freight Operations - Freight or cargo trains are loaded and unloaded in

intermodal terminals and at customer locations.

Intelligent Transportation Systems (ITS) - are advanced applications which,

without embodying intelligence as such, aim to provide innovative services

relating to different modes of transport and traffic management and enable

various users to be better informed and make safer, more coordinated, and

'smarter' use of transportation.

High-speed Rail - is a type of rail transport that operates significantly faster

than traditional rail traffic, using an integrated system of specialized rolling

stock and dedicated tracks.

Maintenance of Way Operations - The presence of a work train on a given

section of track will temporarily decrease the capacity of the route. The normal

method in such operations is to cease other traffic altogether during the track

'occupation'.

MMCL – Metro Manila Commuters Line

Monorail - railways that are not using maglev design are today most often used

in urban environments, with slow trains and trams that transport usually only

people.

PNR – Philippines National Railways is a state-owned railway company in

the Philippines, operating a single line of track on Luzon.

PPP – Public Private Partnership. An economic theory that estimates the

amount of adjustment needed on the exchange rate between countries in order

for the exchange to be equivalent to each currency's purchasing power.

Rail System - line that is the commercial organization responsible for operating

a system of transportation for trainsthat pull passengers or freight.

Rail Tracks - a structure consisting of a pair of parallel lines of rails with their

crossties, on which a railroad train, trolley, or the like runs. a wheel rut.

Evidence, as a mark or a series of marks, that something has passed.

Usually, tracks. Footprints or other marks left by an animal, person, or vehicle.

Rail Transport - is a means of conveyance of passengers and goods, by way

of wheeled vehicles running on rails. It is also commonly referred to as train

transport. In contrast to road transport, where vehicles run on a prepared flat

surface, rail vehicles are also directionally guided by the tracks on which they

run.

Railway - a permanent track composed of a line of parallel metal rails fixed to

sleepers, for transport of passengers and goods in trains.

Signaling - is a system used to safely direct railway traffic in order to

prevent trains from colliding. Trains move on fixed rails so they are uniquely

susceptible to collision; the weight of trains and momentum makes it difficult to

stop before reaching the impending obstacle.

TARN - is a project to create an integrated freight railway network across

Europe and Asia. The TAR is a project of the United Nations Economic and

Social Commission for Asia and the Pacific (UNESCAP).

Traffic Engineering - focuses into the techniques on how to achieve a safe and efficient movement of people and goods on the roadways. It is divided into different parts, namely: transportation engineering, pavement engineering, bicycle transportation engineering, highway engineering, urban planning, and human factors engineering.

Transportation System - All the land, water, and air routes and transportation

assets engaged in the movement of US forces and their supplies across the

range ofmilitary operations, involving both mature and immature theaters and at

the strategic, operational, and tactical levels of war.

UNESCAP - The Economic and Social Commission for Asia and the

Pacific (UNESCAP or ESCAP), located in Bangkok, Thailand, is one of the five

regional commissions of the United Nations Economic and Social Council,

under the administrative direction of the United Nations headquarters.

CHAPTER III

METHODOLOGY

This study was aimed at determining the possibility of re-amendment of the

PNR charter and whether the said amendment is sustainable, attainable, and long-

term. In this Chapter, the researchers attempted to describe the research

methodology used throughout the conduct of the study. At the same time, it is also

in this Chapter that presentation was made on how sample was selected as it

endeavored to outline the procedure used in designing the instrument and how it

gathered and collected the necessary data.

A. RESEARCH DESIGN

This study employed a combination of both descriptive qualitative and

quantitative research design. A researcher-made survey was used to determine

the extent of the stakeholders’ knowledge about the said charter and the PNR

operations itself.

B. RESEARCH LOCALE

This study was undertaken in the metropolis. Under uncontrollable

circumstances, the study was conducted specifically among the students from

the Technological Institute of the Philippines, Manila and the Technological

University of the Philippines, Manila.

C. SAMPLES AND SAMPLING TECHNIQUE USED

In order to approximate the actual number of respondents the researcher

adopted the Fraenkel and Wallen’s (2007) idea in the determination of the

appropriate sample size needed in this particular study. Fraenkel and Wallen’s

(2007) suggested that for a descriptive design, ten (10) to twenty (20) percent

of the population is enough to constitute a sample. For a population of less

than 100, however, total enumeration is recommended, and if the population is

about 500, sample will range up to 50%.

D. INSTRUMENTATION

The instrument was composed of set of questions and statements

pertaining to the impacts of the amendment of the PNR, answerable with yes or

no. It was assumed that from the series of questions and statements that were

answered by the respondents that the PNR charter

E. PROCEDURE

The survey consisted of five (5) questions, in which the respondents have to

readily answer with a simple Yes or a No.

1. Do you use/have used PNR as a means of transportation?

2. Did you know that the charter for PNR has expired on June 20?

3. Is the fare affordable for students like you?

4. Does PNR help answer the congestion problem in the country?

5. If ever there will be a price hike in the PNR usual fare, would you still utilize

the train?

F. STATISTICAL ANALYSIS OF THE DATA

Descriptive statistics such as frequency counts and percentages were used to

analyze the data specifically in determining the answers of the respondents given

the survey.

CHAPTER IV

RESULT AND DISCUSSION

A. RESULTS

The group conducted a survey regarding the knowledge and the usefulness

of the PNR to the Filipino commuters. Twenty random people are requested to

answer questionnaires in the previous weeks. Only a three out of the twenty

commuters included in the survey use the PNR as their mode of transportation,

while the rest do not use it as their mode of transport. Whether the commuters

know that the PNR’s charter has been extended, all of them responded that they

were not aware. All of them also agreed that the PNR’s fair is reasonable and

affordable. When asked if the PNR could be one of the ways to lessen the traffic,

only four among the commuters answered no. Lastly, if the PNR’s fair will increase,

only seven of them said they will not ride the PNR again.

B. DISCUSSION

The PNR is one of the modes of transportation in the Philippines. It has long

been built in the country and is still now being used and has been improved.

Routes are added and the stations and destinations were also developed. The

survey conducted aims to understand the knowledge and opinion of people

regarding the said topic. The results show that only a few of the commuters asked

use the PNR as their mode of transport. Also, only a few people are aware of the

extension of the charter of the PNR. Despite the low count of users according to

the survey, most of them still believe that the PNR helps in lessening the grave

condition of the traffic in the country, as it plays an important option or mode in

travelling. Also the users agreed that the fair of the train is reasonable and

affordable. As the PNR developed during the course of time, it has also been made

flexible as it connects bordering provinces in the country. All in all, the survey

results suggest that some of the commuters still consider the benefits of the PNR

up to this day.

C. GLOSSARY

Amendment - the act of changing for the better, improvement.

Baggage - personal belongings or large amount of objects that passengers

take with them on trips.

Bicol Commuter Service (BCS) - one of the two commuter services that PNR

provides but is currently unavailable.

Bicol Express Train - the train system used in trips going to Provincial

stations.

Charter - a document defining the formal organization of a corporate body;

organization

Commuter - One that travels regularly from one place to another.

Department of Transport and Communication (DOTC) - is the executive

department of the Philippine government responsible for the maintenance and

expansion of viable, efficient, and dependable transportation and

communications systems as effective instruments for national recovery and

economic progress.

Derail - the cause of train to go off track due to accident

Government-Owned Railway - railway system where the government

manages the operations

Intercity Operation - the regular trips conducted throughout the stations

located on cities in the country.

Interprovincial Operations - trips formerly conducted wherein the travel to

stations on provinces.

Locomotives - rail transport vehicle that provides motive to trains

Metro South Commuter Service (MSCS) - the remaining active commuter

service the PNR offers.

Operations - the act or process of operating or functioning

Operators - are individuals assigned on operating a certain type of mechanical

system

Passenger- A person who travels in conveyance, such as a car or train.

PNR (Philippine National Railways) - is a state-owned railway company in the

Philippines, operating a single line of track on Luzon.

Railway - A track providing a runway for wheeled equipments

Routes - a way of travel from one place to another

Safety certification - are certifications provided by agencies to facilities when

they comply to guidelines.

Stations - designated loading and unloading locations.

Track structure - the physical element of a train track

Traffic - the passage of people and goods along routes of transportation

Train - A series of connected railroad cars pushed or pulled by one or more

locomotive

Train Coach - are parts of train that carries the passengers.

Transport Agencies - agencies designated for organizing transport systems

Transportation - A means of conveyance

Trip – a journey

TÜV Rheinland - worldwide provider of technical and safety certification.

D. BIBLIOGRAPHY

https://www.google.com.ph/search?q=derail&oq=derail&aqs=chrome..69i57j0l3.1354j0j4&client=ms-android-samsung&sourceid=chrome-mobile&ie=UTF-8#safe=off&q=locomotive

http://www.pnr.gov.ph/index.php/about-contact-us/who-we-are/corporate-profile

https://www.google.com.ph/search?q=train+coach&oq=train+coach&aqs=chrome..69i57j0l3j69i60.4157j0j4&client=ms-android-samsung&sourceid=chrome-mobile&ie=UTF-8

https://www.google.com.ph/search?q=tuv+pnr&oq=tuv+pnr&aqs=chrome..69i57.3119j0j4&client=ms-android-samsung&sourceid=chrome-mobile&ie=UTF-8#safe=off&q=tuv+rheinland

http://www.pnr.gov.ph/index.php/news-media/press-releases/180-pnr-suspends-its-metro-manila-operations

http://dictionary.reference.com/browse/charter

https://en.wikipedia.org/wiki/Department_of_Transportation_and_Communications_(Philippines)

http://www.thefreedictionary.com/route

CHAPTER V

SUMMARY, CONCLUSION, AND RECOMMENDATION

A. SUMMARY

The main purpose of extending the charter of Philippine National Railways

is to: Improve the efficiency of its existing Metro Manila Commuter Line and

expand the line northward to Malolos. Automate the present fare collection system.

Revive the mainline south to Bicol and extend the south line onwards to Sorsogon.

Introduce freight service for goods via the existing at-grade PNR tracks. Improve

the utilization of PNR real estate assets. Implement the highest standards of

governance in its financial and management operations. Citing the position of the

National Economic Development Authority (NEDA) and PNR, it is said that

extending the PNR charter will yield economic benefits: It supports the

government’s thrust in improving connectivity and efficiency among urban centers

and regional growth hubs. It offers the cheapest mode of transportation to a wide

geographic area, with fare amounting to P0.71 per kilometer as compared to

jeepneys and buses with P2 per kilometer. “It is worth noting that PNR has not

increased its fare matrix in the last 20 years.” Discontinuing the PNR service will

displace passengers who come from “the lowest earning C and D economic

bracket” of the population. The scope of this case study is the development of the

operations and facilities PNR. The study takes the following area into

consideration: The amendments on the former and latter PNR Charter. The PNR

track records of the former charter. And the allotted budget in the previous

operation of the PNR.

B. CONCLUSION

The role of railway systems in bringing growth and development to our less-

developed areas in far-flung provinces. It can-not be overemphasized that

railways directly contribute to economic growth as demand for transport is

directly and positively correlated to growth of gross domestic product. The

passage into Iaw ensures the continued operation of the cheapest form of

transportation for Filipinos. Compared to jeepneys and buses that charge P2 per

kilometer, PNR

provides the cheapest mode of transportation to our people by charging only 71

centavos per kilometer. In congested nations with large urban populations like in

our country, the effort to match road capacity with exponential growth of vehicular

traffic will always be a challenge. Rail-ways use less land than the mad sector,

less polluting, and can generate high capacity at that.

The PNR is one of the modes of transportation in the Philippines. It has long

been built in the country and is still now being used and has been improved.

Routes are added and the stations and destinations were also developed.

C. RECOMMENDATION

PNR should consider to improve its operations and increase its contribution

to national economic development by: Conducting a full-blown study for the

overall PNR railway modernization plan, looking into the viability of extending

the existing PNR lines to routes that are possible sources of increases

ridership. Determining most advantageous or appropriate rail transit technology

for the PNR lines. Utilizing of improved ticketing, safety, and security systems.

Settling all its obligations to positively contribute to the nation economy.

Continuing efforts in venturing into other means of increasing its revenues to

help cover outstanding obligations. And lastly, better managing its operation.

The Philippine National Railways should use the Cost-Benefit Analysis

Process. The Cost-Benefit Analysis is a process use in quantifying costs and

benefits of a decision, program, or project (over a certain period of time), and

those of its alternatives (within the same period), in order to have a single scale

comparison of unbiased evaluation. In cost benefit analysis decisions are

analyzed. The benefits of a given situation are summed and then cost

associated with taking that action are subtracted.