Tuesday, July 12, 2011
The poor get poorer thank you SMRT and SBS
These people decide on your public transport fee.
Transport operators seek fare increases
GPC chairman to ask Transport Ministry to review fare adjustment formula
SINGAPORE - Public transport operators SBS Transit and SMRT have applied for the maximum fare increase of 2.8 per cent for rail and bus fares, citing "uncontrollable" and "significant" cost pressures but a more fundamental review may be on the cards.
Beyond this year's exercise, Member of Parliament Cedric Foo, who took over as chairman of the Government Parliamentary Committee for Transport, has signalled his intention to engage the Transport Ministry to review the fare adjustment formula.
With public transport playing a bigger role in Singapore's land transport system, Mr Foo toldMediaCorp a review of the formula would be timely as it was drawn up in 2005. The fare adjustment formula was last reviewed in 2008.
The Public Transport Council (PTC) - which is responsible for regulating fares - said yesterday it would study and deliberate on both operators' applications and would inform the public of the outcome as soon as a decision is reached.
Commuters can expect some time to adjust to any fare changes, as it was said this year - once by the PTC in February and again by Transport Minister Lui Tuck Yew in June - that any consideration of fare increases should be done in relation with the opening of the Circle Line's final two stages in October.
SMRT executive vice-president for trains Khoo Hean Siang said yesterday that non-fare businesses from commercial activities - such as retail rentals and advertising - have contributed to productivity gains but they could not mitigate the "uncontrollable cost pressures due to fuel prices and manpower costs".
SMRT's energy cost increased 17.5 per cent for the year to March 31, due mainly to higher electricity and diesel prices as well as the expansion of rail network with the opening of the first two phases of the Circle Line.
The SMRT said a higher employer's CPF contribution rate contributed to higher manpower costs.
"In addition, more staff had to be hired due to the opening of Circle Line Phase 1 and 2, and to operate additional train and bus trips from various service enhancements efforts implemented to meet the rising commuting demand," the SMRT added.
Besides rising fuel and energy costs, SBS Transit said it "continues to face significant cost pressures despite increased efforts to lower costs and increase productivity".
In particular, SBS Transit cited its investments in new buses which began in 2006, with some 600 buses - bought at a cost of S$268 million - scheduled for delivery over this year and next year.
"In all, our 2,050 new buses are costing us some S$854 million," SBS Transit added. The company said more details of the application, which is subject to the approval of the PTC, will be announced at a later date.
The PTC's fare revision formula takes into account inflation, average wages and productivity of the operators to arrive at a cap to fare adjustments.
Mr Foo felt any review would need to look at two objectives - balancing an affordable public transport system with operators earning enough to invest in improving service.
"I would like to look at it holistically," he added. "We need to ask ourselves what has worked, what has not worked, how we may re-look at this formula and make it more relevant to its objectives."
Last year, overall fares were up 0.5 per cent. In 2009, the transport operators decided to reduce fares by 4.6 per cent because of the severe economic downturn, even though the formula allowed for a 5 per cent rise.
In 2008, fares rose 0.7 per cent. And in 2007, the council approved a 1.8-per-cent rise in bus fares but kept train fares unchanged.
SMRT's net profit dropped 1.1 per cent to S$161.1 million for the year to March 31 as staff, energy and operating costs rose.
Meanwhile, SBS Transit's net profit for the full year ending December 31 last year was S$54.3 million, down a marginal 0.6 per cent from the year before.
This is what you get when there is complete monopoly of the market. It’s the same for politic.
With “rising cost” as a reason both SMRT and Transit Link wanted to raise fare. Note last year both companies have a profit of $161.1miilons and $54.3million respectively.
So I guess the real reason for fare increment is to protect or increase this profit.
I have no confident in the Public Transport Council as well. The council are all made up of Elites, we have several professors and directors. How many of these people take public transport daily? So any fool will predict there will be an increase in fare and after this more increase in private bus fare too and then taxi maybe.
So folks welcome back to reality, Election is over and cost of living is going up and wages are coming down. To those who voted for PAP in the last election you have no right to complaint as for me I can still say #@!%$!$#@!%$!@$#.