Monday, March 9, 2009 16:36
Fares up but pay down?
In Main Stories, Top Story, Uncle Leong, Uniquely Spore • 2,258 views • 32 Comments

Leong Sze Hian
I refer to the article, “How to help cabbies: cut fares or reduce rent?” (New Paper, Mar 6) and Paul Chan’s letter, “High cab rentals and surcharges akin to price fixing” (ST, Mar 4), and media reports that taxi ridership has been declining and that taxi drivers’ earnings are also dropping.
The Ministry of Transport has clarified that public transport fares are not linked to oil prices.
What about taxi fares? Is it linked to oil prices?
Since the price of oil has dropped a lot, and last year’s taxi fare hikes are being maintained, the question that may be on some Singaporeans’ minds may be whether the earnings of taxi drivers have increased?
I understand that there are more than a thousand taxis that are lying idle in warehouses.
This may be an indication that taxi drivers’ earnings may not have gone up very much. Otherwise, why are there so many taxis that nobody wants to rent?
In order to help taxi drivers in the deepening recession, I would like to suggest that the amount of road tax and COE rebates for unrented taxis that the taxi operators are getting, be given directly to all taxi drivers instead, to supplement their reduced earnings.
According to media reports in April, the largest taxi operator here with about 15,000 of the country’s 24,000 taxis, said that there was a 16 per cent increase in takings for a cabby’s full day of work. For a full-day shift, cabbies are earning $187.92, up from $162 before the fare revision, after deducting the cost of fuel and renting the cab.
“A cabby’s full day of work – for a full-day shift, cabbies are earning $187.92”, means that the monthly net earnings is about $4,510 ($187.92 times 24 days).
I have talked to some taxi-drivers and friends who are taxi drivers, and they tell me that those who work on two shifts, eight to ten hours a day, are earning about $2,000 or less a month.
For example, one of my friends drives about 14 hours a day, six days a week, to earn about $115 a day net after rental, fuel and parking, to earn about $2,800 a month.
So, is there something wrong with the monthly earnings figure of $4,510?
How are diesel prices and rebates determined?
Do taxi companies still make a profit on the sale of diesel, after the rebate?
How much does this profit amount to, relative to the individual earnings of drivers?
What is the tax on diesel? Is it the same 41 cents per litre like that for standard petrol?
With the recession, why not reduce the tax on diesel, since the originally projected Budget deficit has become a $6.4 billion surplus?
With the rising price of oil over the last year, how much more in diesel taxes were collected ?
Motor Vehicle Related Taxes and Vehicle Quota Premiums for FY 2007 was $2.7 billion.
This is an increase of about 47 per cent over FY 2006’s $1.84 billion.
In this connection, I would also like to suggest that the Land Transport Authority (LTA) re-consider its 10-year ban on granting taxi licenses to ex-offenders, which I estimate to be about 200,000 people.
Perhaps the only solution to taxi drivers’ declining earnings in the current recession is to reduce the road tax, COE, ERP and diesel tax for taxis.
Maybe taxi fares can also be reduced?
By the way, are there any other countries in the world that have road tax, COE and ERP on taxis?
——-
Related posts:
32 Comments
anon
“In this connection, I would also like to suggest that the Land Transport Authority (LTA) re-consider its 10-year ban on granting taxi licenses to ex-offenders, which I estimate to be about 200,000 people.”
Don’t agree with this – I don’t want to start worrying that the taxi my my mum, sis or girlfriend got into is driven by an ex-offender
squidsquid
times are hard and not many pple will take taxi unless really necessary….furthermore we are being encourage to take public transport…..
Good call Sze Hian!
currypaper
““A cabby’s full day of work – for a full-day shift, cabbies are earning $187.92”, means that the monthly net earnings is about $4,510 ($187.92 times 24 days).”
is this just revenue w/o taking into cost into consideration??/
=www.currypaper.tk
curious
By the way, are there any other countries in the world that have road tax, COE and ERP on taxis?
I think we are the only country with COE, so it is safe to assume that no other country has COE on taxis.
Jackson
ERP, higher surcharges and fares are not the solution to solving traffic congestion and increase benefits for all at the same time. Generally everything is expensive in Singapore.
SZ
and the cost will keep rising…and in the end, it will be some companies that are ripping the profit
neversaydie
the transport companies will be the one that lose out if the ERP etc charges are reduced and that they would not do.
Since most of these public transport companies are owned by the govt, them making huge profit is equivalent to the govt taxing the people.
So, you now know how we can have a huge public service and an apparently low tax rate… the other “tax” monies are collected from these public companies’ profit. Now, you know why the govt people keep defending these companies making profit even though they are supposedly representing the people’s interest.
shortsentence
Don’t agree with this – I don’t want to start worrying that the taxi my my mum, sis or girlfriend got into is driven by an ex-offender
hey, what’s wrong with ex-offenders??? i spent 1 year in the prison in 2004 and i learned my lesson. are you trying to say that you are a perfect person??? maybe, one day, you may be sent to jail, then you will remember what you had commented..
I always feel that our transport fares esp on public transporation are way too high.
For e.g. I used to take cab fr Tampines to Pasir Ris to visit my mum. The fare beforethe revision was around $3.50 for a less than 5 min ride.
Nowadays, it costs around $5.00 or more if there is peak hour charges.
Once you stepped into the cab, the fare meter is already $3.00 and if it is peak hour you are slapped with 35% peak hour charges.
If you entered CBD you have to pay extra $2 to $3 depending on the number of entries inside the CBD zone.
I am sure many commuters dislike taking cab unless it is necessary.
For a country that is so slow to raise salaries and with poor labour laws to protect salary revision, the way we charge the public for so high transportaion pricing is somewhat ridiculous.
Though Australia charges mroe for train rides (minimum one train stop ride is $2.50) their salaries are high and they have minimal salary afjustment.
Every Aussis is paid at least $520 a week even if you are a cleaner! That is why they often have less than 3 cleaners in a big food court unlike ours which have dozens of them working as cleaners in a similar size foodcourt. Our cleaners’ pay can be as low as $600 a month for 6-day work week.
Citizen
NTUC Comfort and City Cab is milking the cab drivers and commuters by not lowering the peak hour surcharge and cab fare.
The company interest is not to help the commuter and taxi drivers but to make as much profit as possible from the people. This is our Singapore, milk the people as much as possible solely for profits.
Dounai
According to the article, media reports that a cabby who works full-day shift, earn a net of $4,510 monthly…. yet many are earning about $2,000 or less a month??
In light of the spate of inaccurate media reports in the past few weeks, I think we need to approach MSM with a drum of salt till we get hypertension…
On a side note (which is totally irrelevant to the article)… as nations press on to cut pollution and carbon emmisions (im not sure what sg’s stand on this is though) cabbies may (or may not) suffer again in the near future until a cleaner and more economical technology and/or fuel source is developed… and so will private cars…
Poor Retiree
My two younger brothers are taxi drivers. Yes, times are hard and they have to work extra hard to get a decent pay. But they told me all is not doom and gloom. As long as they are willing to work hard and put in extra efforts, they can still earn a decent pay. Cabbies must be willing to work hard and not to pick and choose customers. I do take taxi on some days and have met few taxi drivers who are not willing to pick me up for reasons best known to themselves. Most will like to avoid going to Orchard Road because of the jam and far away places like Jurong West. During this difficult time, taxi companies should reduce their rental fees and taxi drivers should put in extra effort and provide better service.
SZ
but what’s the probability of the taxi coming doing that? like what Citizen is saying @ post 12, both cabbies and passengers are been milk dry…
a first world public transport yeah
why yellow top cabs so rare nowadays?
last time ppl can own their own taxi licence and there were lots of yellow top taxis.but somehow our elites stop issuing such licences and now our taxi drivers are exploited by the taxi companies.
I think they were wrong to stop giving taxi licences to individuals.we should have more yellow top taxis like last time.
Zeitgeist
Mr. Leong
What you see with your own eyes, what you’ve heard from a taxi driver friend or two and what you had garnered from media reports will only give you half the real picture of the state of affairs in the Taxi Industry.
The other half will have to come from the taxi drivers themselves, not all, just a couple of hundred randomly picked active full timers, Christopher Tan of ST and hopefully whistle blowers from LTA, taxi companies in that order.
Then you will get the full picture!
And as for the given figures of income. It’s always in a form that is meant to mislead and when questioned denied as being quoted out of context. I don’t remember any instance of official figures being question and request asked for a detail ed breakdown.
Just take note of this. A newly minted driver will always take to the job with the enthusiasm of adventure and aspirations. He will believe that he can prove to be different and could do better than the drivers before him.
He is like a new fully charged battery. But like all batteries, eventually it will not able to hold it’s charge as long and also it will take a longer time to recharge and it will never be able to reach it’s original amperage of charge . Those more technically inclined will understand my analogy.
So to gauge a driver’s income, new drivers should not be part of a survey if you ever intend to conduct one..
no lah
Do you want the roads swamped with Taxis and choosy taxi drivers who pick customers at their whims and fancy and use Taxis as private cars to chauffer their kids and wife?.
I agree with all these cuts, only if the number of taxis on the roads are contained. And it should be expensive high end product. (with subsidies for handicapped)And yes, there should not be dead weight where taxi operators are pimping themselves off these taxi drivers.
ACACIA
I used to supply the equipment in the taxis but still in touch with the industry.
Laid up taxis are above 2000 to 3000 taxis, maybe more.
It makes no dent to their earnings as long as they have a critical mass of hirers.
Well today they can also apply not to pay for the road tax too.
They stopped issuing private licenses, this was so that Comfort could buy them up when these uncles retired or passed on and hence forth increase their fleet.
Its really tough driving a taxi, you need alot of gumption and sacrifices. Health also suffers in the end.
when declare 1st world....
Does it mean can use other 1st world as reason to up the fares ?
wkc
[12 Citizen]
Good observation, Citizen. Yes, I agree, high taxi fares in Singapore is the result of greed of taxi operators for high profits, with cooperation of our govt, the prime example for greed in Singapore.
Watchman
What a sloppy article posing as analysis.
“In this connection, I would also like to suggest that the Land Transport Authority (LTA) re-consider its 10-year ban on granting taxi licenses to ex-offenders, which I estimate to be about 200,000 people.”
- Cab drivers already fighting for a smaller pool of passengers in the recession and you want to add in more cabs?
Whatever. The fact is that now is the recession, people are cutting back on taxis. Can increase the profit margin of taxi drivers all we want but people still won’t take taxis now unless they think they can afford it.
Anyway, reduce ERP for cabs? I thought passengers pay, not the cab drivers? SMRT cabs are that way for one.
Reduce COE for cabs? The rental company pays right, not the cab driver unless he owns the cab?
Reduce diesel tax for cabs? Diesel already cheaper than petrol. If there is any reduce diesel tax specifically, it should be private and school bus operators. They carry more people than cabs.
Why this bleeding heart case for cab drivers per se? Everybody is hit in this recession, not only cab drivers. The subsidies etc should be for people to use public transport e.g. citizens to get ez-link top-up etc.
MMSMPMMC
When you look at the recent “cut pay, kep the job” approach, many SME had resort to cut up to 30% wage.
Now, some of these poor employee who get that 30% paycut had just received a total of 25% raise over the last 5 years with 5% increment each year. With the 30% cut now, their pay are lower than what they received back 5 years ago.
Now, is that a “fair” game when the public transport fare has been increasing over the last 5 years and it has yet to get a substantial cut to bring it back to fare rate 5 years ago.
Correct me if I am wrong about this unfair pay-cut not not fare cut pain here.
jan
can’t believe today, Singapore with well-known for great infrastructure and advance technology that the bus operators are still using some 1970s or 1980s old buses for some bus route like 178 while charging at first class bus fare.
Hal
11) “high” is relative. Taxi’s are private hire transport for the public, and they take up road space. Also common to have expensive taxis in developed countries. Take a cab from Heathrow to London and you get what I mean.
13) I can’t believe that taxi drivers can earn more than $4,000 a month like what the MSM said. Nothing like feel good news.
16) Agree that yellow tops should be back into the picture. They can undercut and drive prices down, giving the big companies competition and us, choice.
18) Yes, agree that taxis should be a high end product as they are private chauffeurs. Passengers should expect to pay more. How much more is debatable.
22) Finally someone points out the Emperor’s New Clothes and that Sze Hian’s commentary is actually shallow.
Was privatizing our public transportation a good move since operators are only concerned with increasing shareholder value via higher returns?
How can any company increase overall service quality (high-cost) and still at the same time, keep prices low enough for the masses and maintain ever higher dividend returns to investors?
Somethings just got to give. Make a guess which one.
Jackson
I believe LTA, SMRT and SBS are making profits, in fact too much profits. I also believe that they all hire too many workers, in the end economies of scale is not met. For eg. in some bus interchanges, many bus drivers can be seen walking around while waiting for next schedule. This is an example of inefficient use of resources.
tan jin bian
i hope taxi drivers income is improved. they work very hard and the work is tough.
Greed
27) Jackson on March 11th, 2009 3.59 pm I believe LTA, SMRT and SBS are making profits, in fact too much profits
One word .
Greedy !!!!!!!!!!!!!!!!!!
Single objective – Take as much as possible from the people and blame external factors beyond their control
This is large companies in Singapore works
Pai Miah
It is possible for cabbies to make $4000 a month provided that he worked 24 hours a day non-stop.
http://singaporecabbies.blogspot.com/search/label/suddendeath
I drive for 12 hours a day, taking one hour break. Provided that I do not have to cruise empty for more than 30 minus or queue at the taxi-stand (not possible at current situation)
The most I can make is $100 net after rental and diesel cost. That worked out to be less than $10 per hour.
At the end of the day, I sleep like a dead dog.
15/3/09
Time has come for us to make a real effort to boycott taking taxi and if possible stop taking taxi and converserly take public buses and then walk and this is what I have been doing. The Global Financial Crisis is very real and has hit Singapore very badly and let us do our best to save money as much as possible and survive this crisis.
Regards
Andrew Chuah
Tea-break
How to make more than S$4,000/= driving a taxi? Ask the media person who wrote the article to be a taxi driver for six months before writing nonsense. Be more honest and objective in your writings, otherwise you are getting a lot of people into trouble. Just because a media person makes a lot of money doesn’t mean other people will make a lot of money too.

“Perhaps the only solution to taxi drivers’ declining earnings in the current recession is to reduce the road tax, COE, ERP and diesel tax for taxis”
I see. But the decline in their earnings – attributed more to high costs or fall in demand for taxi rides? Reduction of road tax, COE etc may increase their net profit, but if demand continues to slide, their net profit will continue to be marginal.