Bus Companies Sue Transport Ministry Over Fines Amid Fraud Allegations

Fifteen public transportation companies, including Egged Tours, Metropolin, Electra Afikim, and Superbus, have filed a NIS 34.6 million lawsuit against the Ministry of Transport. The companies claim the ministry has imposed fines on them in violation of their agreements, citing discrepancies between their system reports and passenger complaints, as well as fines for route changes due to pre-approved events. They argue the ministry is unfairly deducting large sums from their compensation as "agreed damages" when these do not qualify as such.

In response, the Public Transport Authority asserts it possesses evidence and recordings of a "systematic fraud process" by these companies. The authority alleges that drivers were instructed to conduct partial routes to receive full payment, a claim the companies deny. The authority stated that the fines are an attempt to halt the companies' alleged practice of "fictitious trips," where systems report full service while buses fail to arrive, leaving passengers waiting.

The authority further explained that the NIS 10,000 penalty for such violations is proportionate to the severity of the offense, aiming to eradicate issues like skipping stops and false reporting. This dispute arises amidst a backdrop of increasing complaints about buses not stopping at designated stations. A semi-annual control report indicated a rise in negative findings related to "stopping" issues, from 244 in the first half of 2024 to 750 in the second half of 2025.

Historically, drivers had little incentive to stop at all stations, as bus companies were primarily compensated based on mileage rather than passenger numbers. However, a regulatory reform initiated in 2024 aims to address this. By January, discussions in the Economics Committee proposed increasing compensation based on passenger exposure from 7% to 15%, with 85% still tied to mileage. The conflict escalates as companies accuse the ministry of arbitrary fines, while the ministry alleges systematic deception.