PORT OF BATANGAS — Around 10 million maritime commuters are expected to benefit from government fare subsidies as the Maritime Industry Authority (Marina) officially launched Monday the "Layag" program to cushion the impact of volatile fuel prices. Formally known as the Lakbay Alalay ng Gobyerno Program, the initiative rolls out at a critical juncture as an ongoing Middle East crisis severely squeezes domestic shipping lines. Speaking at the official roll-off ceremony here on Monday, May 25, Marina Administrator Sonia Malaluan revealed that fuel expenses have spiked to comprise roughly 50 percent of average vessel operating costs.
"Profitability in the sector is at a low of about 5 percent to 20 percent, though many operators are on a break-even level," Malaluan said. "Others are greatly meeting the bench for profitability, solvency, and liquidity. We recognize that to some shipping operators, it has become an issue of survival." According to Malaluan, the financial strain had triggered immediate, urgent consultations from vessel owners even before the agency issued its initial advisory on March 6.
She noted that Marina has been placed in a difficult position, balancing the need to sustain vital maritime services with the economic realities facing operators. Under the newly launched Service Contracting Program, the government will directly subsidize recent fare hikes across key routes, shielding everyday commuters from the rising costs of sea travel by ensuring they continue to pay only pre-increase base fares. "This aims to provide assistance to those passengers who are dependent on travel and gain maritime transport to go to work, go to school, or even get their basic supplies and necessities from the outer islands," Malaluan added, noting that the program marks a significant step in the maritime sector receiving crucial legislative and executive backing.
The agency issued Marina Advisory 2026-20 to officially jumpstart the subsidy-based initiative, implemented in compliance with Department of Transportation (DOTr) Department Order 2026-008 and guided by DOTr Department Order 2026-006. Under this initial phase, participation is strictly limited to pure passenger services with travel times under two hours. To qualify, routes must serve commuter-heavy traffic, utilize vessels carrying maximum passenger capacities, and lack any alternative land-based modes of transport.
Transportation Undersecretary for Road Transport and Infrastructure Mark Steven Pastor explained that adapting the land-based Service Contracting Program framework for the maritime sector was a logical step to protect vulnerable commuter corridors. "The economic impacts of volatile fuel pricing do not stop at the coastline," Pastor noted, emphasizing that the strict under-two-hour criteria ensures that state funds are hyper-focused on high-density daily transit lines rather than leisure routes. "By matching the operational guidelines of the contracting program to these vital inter-island connections, we are delivering the same standard of public transport insulation to our maritime commuters that our land-based passengers receive."
The official rollout follows months of legislative debates and transport sector lobbying, previously reported by The Manila Times, regarding a P4.5-billion transport subsidy allocation originally contested during the late 2025 bicameral budget hearings. While initial proposals focused heavily on land-based public utility vehicles in Metro Manila, domestic shipping groups successfully argued that island provinces were being left behind. The DOTr subsequently expanded the scope of the Service Contracting Program to include critical inter-island links, preventing a looming halt in maritime operations that threatened to isolate island communities and disrupt regional supply chains.
The subsidy program initially covers 11 high-traffic and essential routes nationwide, including Batangas to Puerto Galera, Batangas to Calapan, Jordan Wharf in Guimaras to Parola Wharf in Iloilo City, Buenavista Wharf in Guimaras to Parola Wharf in Iloilo City, Sta. Rosa in Olango Island to Angasil in Lapu-Lapu City, Liloan in Cebu to Sibulan in Negros Oriental, Zamboanga City to Basilan, Sta. Cruz in Talicud Island to Poblacion Kaputian, Surigao City to San Jose in the Dinagat Islands, Socorro to Hayanggabon, and Socorro to Dapa.
A total of 33 shipping operators managing 93 passenger vessels have qualified to participate in this initial phase. Under the guidelines, subsidies will be calculated based on actual passenger volume per trip and approved fare differentials regulated by Marina, allowing the government to directly reimburse operators while maintaining stable ticket prices. The program is funded under Republic Act 12314, or the Fiscal Year 2026 General Appropriations Act, with Marina regional offices closely monitoring compliance to ensure transparent implementation.
