Saturday 28 May 2022

Uncertainty for Riteve employees and the country

Comptroller's Office denies having endorsed the extension of the agreement with a Spanish company while the future of the vehicle technical review is defined

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28 May 2022 - At The Banks - BCCR

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QCOSTARICA – In less than two months Carlos Alvarado leaves office and assures that he will leave the contract on vehicle inspection resolved before the end of his government.

Riteve employs about 500 people directly, as well provides indirect employment to suppliers, parts sellers and auto workshops. (Rafael Pacheco Granados)

Riteve’s concession began in 2002 and on July 15, 2022. the contract with the State will expire.

The government has options. They include contracting a new operator, the government taking over the service, extending the contract with Riteve, or doing nothing, leaving it for the next administration that takes office on May 8, among others.

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However, a permanent solution has so far not been easy. There are many hands playing in the process, the Comptroller’s Office, Cosevi, MOPT, Minae, the Ministry of Health, the Public Registry, and the INS, among other entities.

In the case of extending the contract, the Ministry of Public Works and Transportation (MOPT) and the Contraloría (Comptroller’s Office), the two principal players in the process, are in disagreement.

On the one hand, on Tuesday, the MOPT announced that the Board of Directors of the Road Safety Council (Cosevi) approved a plan requested by the controlling entity that, among other measures, proposes to extend the contract with the Riteve company “in order to guarantee the continuity of the service ”.

However, a few hours later, the Comptroller’s Office denied in a statement that it had issued said provision or authorized the possible extension of the agreement, whose request has not even been formally presented to its Contracting Division.

In an action based more on populist than technical criteria, in the reform of the traffic law, a regime of “authorizations” was established at the time, which is unfeasible, since it would imply the real disappearance of the activity and would turn it into a simple business, at a cost for vehicle owners without any positive impact on the country and at potential risk.

If the government would take over the vehicular inspection, critics say the solidarity system would disappear whereby even unprofitable stations, in particular in rural areas may not be able to offer the same service and quality standards as those in the Greater Metropolitan Area, and Cosevi’s control and supervision would become impossible and would open the doors to corruption.

If the Riteve is not extended, come July 15, the 17 Riteve stations and their equipment will pass into the hands of the State. (Rafael Pacheco Granados)
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For its part, the National Registry would have to modify the system used for several decades to supply information on imported new and used vehicles, and for changes in the characteristics of the vehicle fleet, since the data it would receive would not be reliable.

The Organismo de Investigacion Judicial (OIJ) would no longer have the technical review to combat vehicle theft, on the contrary, it would be putting its actions at risk; That’s not to mention the health toll from the almost immediate increase in air pollution, which would derail efforts toward carbon neutrality. A single month without review will have negative consequences for everyone.

The entry into operation of Riteve was revolutionary in Costa Rica, since it was possible to regulate the status of imported used vehicles; promote the updating, renovation and modernization of repair shops; boost the purchase of new vehicles; and create in people a culture of vehicle maintenance.

In addition, it became a source of direct and indirect jobs, not only for about 500 people who work for Riteve, but also suppliers of goods and services to the concessionaire (security, cleaning and sale of supplies) and thousands of jobs in the automotive sector (repair shops, importers and sale of vehicles and spare parts, etc.).

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The former manager of Riteve, Fernando Mayorga Castro, is firm that failure to renew Riteve’s contract will result in the immediate unemployment of thousands of people, with the social and economic consequences that this entails.

“I experienced it ten years ago when I was in charge of the company. Those who depend on Riteve, have specialized and acquired impressive experience (many of them for 20 years), the suspension would condemn them to unemployment.

“Forcing thousands of people and their families (if direct and indirect jobs are considered) to spend the next few months in the uncertainty of whether they will have a job after July 15 is inhumane and undermines the provision of the service; you have to make a decision now.

“If officials and institutions have failed in their obligations, they must proceed administratively and sanction them, of course; however, the cancellation of the contract with the Riteve company is not a punishment for MOPT, Cosevi or their officials, but rather a huge and very costly loss for the country, which must be avoided at all costs,” writes Mayorga Castro in an opinion column in La Nacion.

Back to the Comptroller’s Office, it assures that it is not possible to make more extensions, since it only gave the possibility of granting a single extension that was the one that was made 10 years ago.

At the Cosevi, it alleges that an action of unconstitutionality filed last October and that was accepted by Constitutional Court for study prevented them from advancing the process of tendering a new contract.

Comptroller’s Office points out that the constitutional action did not suspend the application of the articles of the Traffic Law that regulate vehicle inspection, so this should not be an impediment to advancing in the tender process.

According to Cosevi, if Costa Rica does not extend the contract with Riteve, it is exposed to two years without vehicle inspections.

The vehicular inspection is a mandatory requirement that vehicles must meet to circulate in the country.

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