By Leong Sze Hian

I refer to the report “LTA announces changes to Vehicle Quota System” (Channel News Asia, Mar 11).

The report states that the number of COEs is likely to be reduced, which means car prices may go up.

Will higher COE prices mean more revenue for the LTA?

The report also states that the annual allowable growth rate of vehicles halved from 3% to 1.5% last year. This begs the question: Why did we take so many years to finally decide to half the allowable growth rate?

Transport Minister Raymond Lim explained to Parliament on Thursday how the LTA persistently over-projected the amount of cars to be scrapped each year.

He said that the reason was that LTA persistently over-projected every year.

In his own words:

“Let’s say last year we over-projected for the current year, if we over-project it again, we add to the problem”.

So, it would seem from the remarks in Parliament that the LTA allowed the vehicle population to grow at double the sustainable rate, because it persistently “over-projected” the number of vehicles to be scrapped year after year.

Has the LTA performed to expectations in managing sustainable vehicle growth?

Probably not.

Minister Lim also said: “This direct replacement system is similar to that implemented before 1999. But back then, as quota numbers were released annually, there were complaints from industry players that the time-lag was too great”.

Why are we going back to the original system we used before 1999? Since, according to Minister Lim, “there were complaints from industry players that the time-lag was too great”, why didn’t LTA simply change it its policies earlier?

What has been the outcome of all this “self justification”? Why is it assumed that what didn’t work in the past would once again become the best way to make it work in the future?

Well, perhaps a lot of money?

Let’s look at the Budget.

Which ministry has the highest estimated Operating Revenue (other than the Ministry of Finance at $35.9 billion) for FY2010 of $2.7 billion? Answer: The Ministry of Transport.

For revenue from Excise Duties, the highest contributor is Motor Vehicles at $425 million, a whopping increase of 17.5 per cent over FY2009.

For Licenses and Permits, the highest contributor is Transport and Communication at $1.2 billion, a whopping increase of 34.1 per cent.

What Key Performance Indicators (KPIs) do we use to evaluate our transport ministry?

Maybe there is something wrong with the KPIs?

Did persistently over-projection resulting in much higher vehicle population growth lead to higher revenue?

Would reducing supply of COEs now also lead to higher revenue?

Would returning to the original system before 1999 lead again to higher revenue?

As an analogy, if a company pays its CEO more money when the traffic that he is supposed to regulate becomes more congested, when customer satisfaction declines because they keep having to pay more for a deteriorating service, and alternative public transport options are also declining in service standards and public transport fares keep rising, what is the incentive for the CEO to improve his performance?

Perhaps we need to align the KPIs with the desired outcomes.

How about penalizing the LTA when traffic congestion increases by transferring some of its revenue to subsidize or improve public transport, give more incentives for “green” vehicles if vehicle pollution increases, demand more subsidies if public transport service standards decline, and demand more transport infrastructure spending if traffic benchmarks deteriorate, etc ?

Normally, most countries have to spend money to solve a problem, but in Singapore, too often, the solution makes more money instead, and the problem never seems to go away! Uniquely Singapore!

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72 Responses to “COE: Another solution that may make more money, but may not solve the problem?”

  1. COEs may not help to cure traffic flows as more and more Singaporeans are getting affluent.

    Reply
  2. chiper 13 March 2010

    yet another scheme to force singaporeans into taking their crappy public transport. want to be treated with human dignity? don’t want to feel like sardine or cattle? then be prepared to pay through your nose!
     
    they are unwilling to clamp down on those greedy fatcats running the transport companies, so instead of making public transport more attractive, which will entail *GASP* LOWER PROFITS for the rich bastards, they punish the drivers and make driving unattractive instead.
     
    well done, PAP. more crowded years ahead.

    Reply
  3. This is clear demonstration that the COE system doesn’t work in containing congestion because it depends on some manual/judgemental inputs from the LTA which had not been doing its work right over the last decade as indicated by this pig minister. (whom we all remember to cock up his ministry’s stand on oil prices and transport fee)
    How this error has been committed for so many years and overlook is sickening and demonstrates that this govt is not servicing its citizen well.

    Reply
  4. LeekingUrine 13 March 2010

    “Let’s say last year we over-projected for the current year, if we over-project it again, we add to the problem”

    You mean you are being paid MILLION $$ALARIES per annus to do OVER-PROJECTION ?  Guess you are no different from your master dog aka FORECASTER EXTRAORDINAIRE who is paid thrice your salary just to forecast shitt.

    Reply
  5. aiyahh... 13 March 2010

    It kept me wondering for a while whether these  fellas are in control of the situation or not. I mean how can there be persistent over-projection? Really can happen at that level in the ministry? Really? Quite sickening i’d say. On the other hand, it is even more sickening if actually these fellas are in control (which is more likely, right?) and know exactly what they want and how to get there. So now we seem to be ”there” already – congestion and more congestion.  Actually it is kind of  confusing for me but either way i am not happy with the results. Roads and expressways are congested on weekdays, carparks near amenities are congested on weekends. Aiyahhhh…..i think say what also no use. Just vote lah. 

    Reply
  6. i actually have not much sympathy for car owners for the COE and ERP they pay.
    If they can’t afford the car, then just squeeze with us mere mortals, who take bus and trains every morning.
     
    rich, also complain.

    Reply
  7. lets get real.
     
    roads packed with vehicles is good business for the government.
     
    because, they will have the justification to raise road taxes, ERP, extend the ERP operation hours, and putting up more new ERP gantries everywhere.
     
    how else do u think the very intelligent and talented people at the GIC can keep making billions of losses and “just move on”? lol…

    Reply
  8. What the crap 14 March 2010

    BTW, did you and your MIW also over-projected your own salaries and cover up the ‘error’??!!
    So how are you going to ‘re-project’ the numbers which have been multiplied by X times all these years??
    By your own comment, you knew the numbers were ‘over-projected’ but did nothing to correct the ‘error’  at the expense of the road users’ inconveniences and adding on LTA’s coffer. Is this another
    so-called ‘honest-mistake’?? And we are to ‘move on’??
    How convenient!!  

    Reply
  9. DavidSeeLeongKit 14 March 2010

    PAP  =  Pay And Pay

    ERP  =  Everyday Rob People

    COE See Hor Yee [Hokkien for "Pay And Pay Until Die Standing"]

    GST  Gasak Sampai Teruk [Malay for "Pay And Pay Until Drop Dead"]

    Reply
  10. logic & reasons 14 March 2010

    Can TOC writers write more articles on the COE & ERP issues ?

    I recall some years back our PM ( can’t recall was it National Day Speech ) spoke on TV regarding the ERP system along with other issues …..

    It was said that with ERP systems, people can buy more cars ( ( display w Statistic Bar Charts & Data ) & release more COE.  Now seems that things may be U-turning …..

    Reply
  11. thinktok 14 March 2010

    LTA should review its vehicle scrapping system.  If you have a 15 year old Hyundai  and a 10 year old Honda, which would you scrap?  We are forced to scrap the 10 year Honda because we can get PARF rebates.  The 15 year old Hyundai gets nothing so not worth scrapping. 
    LTA should allow a one for one substitute with whatever admin charge they set.  The net effect is the older car will be scrapped in lieu of a newer car.  If newer cars are scrapped instead of older cars then something is wrong and LTA should put it right.  

    Reply
  12. Philip 14 March 2010

    Is this a rant or proper policy analysis?

    Is this yet another opportunity for TOC to make snide remarks, or to push the discussion in a positive direction through rational arguments?

    The question of timing will always be ‘wrong’ for those who wishes to rant only and not argue the case on points of merit. I challenge you to do better.

    And the same goes for the snide remarks about ‘making money’. Is that all you got? Sarcasm?

    Reply
  13. philipballstucked 14 March 2010

    The question of timing will always be ‘wrong’ for those who wishes to rant only and not argue the case on points of merit. I challenge you to do better.
    And the same goes for the snide remarks about ‘making money’. Is that all you got? Sarcasm?
     
    your pap boss the ministers bein paid millions to ruin singapoor..you bein paid over $13.500/month to assist him..yet you hav done nothin includin your overpaid ministers
    so you might care to explain why with so many erp poles in which we cannot says don’t pay yet got stucked in traffics..it liked starhub scv mobile broadband whose guranteed me a 7.2mbs surfin speed in which i paid for it..yet it run @ an average speed of 1.8mbs but still pay 4Xs the amount… it that acceptable to you?

    Reply
  14. ludwig 14 March 2010

    If u do not have COE and ERP, u will have traffic congestion, very bad slow moving traffic with your car at 1st or 2nd gear. No chance to use 3rd or 4th gear. U will be stuck in the jam for hours.
    If u want to experience bad traffic conditions, take a holiday in Manila, Kuala Lumpur or Bangkok.
     
     

    Reply
  15. Anson and Rochor 14 March 2010

    ludwig,
    do u drive ? and do u take buses and the over-packed MRT, the fact is that govt monoplozing public transports and over manipulting taxis companies, try go taipei and hongkong which their traffic is not miuch slower than Sg, they have no COE and ERP

    You are simply using PAP tactics, compare us with teh worst, well, enlarge your sample size and compare with the better, or since you are doing well under PAP, travel wide tos ee the world before u talk

    Compare tokyo rather than BKK, go compare with Swiss rather than Grek, then you etll us what PAP with the multiple million $ salary have brought to Sg ?!

    Reply
  16. And we the taxpayers pay LTA a billion dollar a year to judge it incorrectly? For goodness sake, 2008 and 2009 is an economic downtown, surely they can predict what the man of the street can predict?

    The whole oversupply is a big lie, because of the downtown, less ppl could afford a car and there are so many ERPs too, yet LTA expected the supply to be fully in demand , hence the COE will be high too. Bad mistake.

    Reply
  17. if the government were serious about combating traffic congestion, it would:
     
    1) get SBS, TIBS, SMRT to make their transport come more frequently. get a whole lot of banglas to finish the SMRT lines that are not done yet, and then kick them out.
    2) price the ERP for PRIVATE vehicles at ridiculously high prices. 1 time pass the gantry costs $100. public transport, including taxis, school buses should not be affected. give company that deliver goods concessions.
     
    people will not feel the pain if the ERP just takes a few dollars each time.
     
    therefore, it is apparent to me that the PAP government just want to earn the money, knowing that people can tolerate the cost of going past the ERP gantry each time.

    Reply
  18. 3) set aside a few billion dollars to buy people’s vehicles on the condition that the husband and wife may not own a vehicle for x number of years, where x depends on the amount that is paid by the government to the people.
     
    but of course, the PAP government is not likely to listen to people that bo tak chek, like myself.
     
    so, it is all just for naught.

    Reply
  19. 55cents 15 March 2010

    They warn about traffic congestion; yet they issue even more COEs. Its just politics. Use the automobile as a way to swing the yuppies/wannabe yuppies their way.
    The only solution is to make the COE & ERPs ridiculously high. Exempt taxis from COEs & ERPs. That way if you need to go somewhere urgently, take a taxi. The PAP says taxis are a luxury. I beg to differ. Taxis are a necessity, most of the time, not all. Useful when you’re with kids or old folks or carrying heavy items. Instead of more private cars, make it taxis instead. With no COEs or ERPs or any other extra charges, then taking a taxi will be more affordable to the general public.

    Reply
  20. 55cents 15 March 2010

    @objective – You obviusly own a car that’s why you can say that. For those that don;t own a car, a taxi is an expensive alternative. Yes, we poor folks take the buses/mrt almost all the time but sometimes, whether we like it or not, we have to take a taxi. And taxis nowadays, obviously you don’t know since you own a car, are very very expensive.
    Nope..what we need are less and less private cars.

    Reply
  21. taxis are considered public transport. the government can introduce legislation after INDEPENDENT studies by non government/PAP linked organisations to determine the maximum size of the taxi companies.
     
    public transport should be exempted from paying the ERP.

    Reply
  22. ojective
    ya taxi buses all had to pay not only that   now LTA still looking a  IU device to hang ppl body and bicycle need to install IU next time all the road user all had to pay include animal

    Reply
  23. because there should be a way for people to take these forms of “premium” transport since normal people can no longer afford to drive into ERP areas during operation times. services are not equal to private owners.
     
    congestion is caused by volume. law breaking should be dealt with separately. if taxis stopping suddenly is such a big problem, the PAP government can employ a few banglas to make an area where vehicles may stop temporarily to load/unload passengers along the road. the cut in type thing.

    Reply
  24. oh, btw, i bo tak chek one.
     
    i have no money to take taxi. but let us not get personal.

    Reply
  25. I cannot even indulge in my only comfort which is smoking let alone talk about a bloody car. Even if I die of cancer I will still be happy if I can have some joy smoking than worry about a stupid car. Please don’t make life for smokers so bad – you dumb government and heatlth nuts. 

    Reply
  26. if people see that services are better, there would not be a problem with traffic congestion.
     
    how many taxis are in SG? how many private cars?

    Reply
  27. btw, normal people means people that arent filthy rich and will be affected by the ridiculous ERP pricing.
     
    i thought it is very obvious. heh.

    Reply
  28. 1. the objective here is to reduce traffic congestion. therefore, it does not matter how long the taxi is on the road.
     
    3. i have talked about the road side thing.
     
    4. taxis are not premium. cars are. if, as u say, taxis are better than cars, then we wont be having this talk and the problem of traffic congestion would not exist.
     
    5. like i said. the government can have a independent study to limit the number of taxis.
     
    6. yes. can u tell me how many cars are in SG and how many taxis there are?
     
    lastly, do not twist my words. i said the normal people that drive will be affected. u r playing stupid, childish, word games here and i have no interest in that.

    Reply
  29. preston loon 15 March 2010

    Dear S.H. Leong.
    I strongly disagree with you on the last paragraph.Rather,it is quite the opposite.Most countries spend(i would like call it throw)money not to solve problems but, at the problems.Their solutions always create a money deficits and problems never solved.These type of politicians in most countries do it simply out of concern of their own political careers.If you can name me one country that believe by spending public money,the problem will go away and I can give you 5 countries that believe in by spending public money and yet  problems never seems to go away.It is not normal and hardly one finds a country that can do both.

    Reply
  30. Anybody noticed that there doesn’t seem to be any more “off peak” hours? No matter at what time you take the train, it’ll be 99.9% crowded. Or am I just imagining it?

    Reply
  31. Misfit 15 March 2010

    Who is accountable for such “persistent over projection”?  Car owners and road users??

    Reply
  32. So much for papies govt. LTA over project, now want to cut back, end result people pay more for coe. HDB underestimate the demand for public housing, again people pay more.  

    Reply
  33. why don’t they pass a law that says “Only vehicle with even number plates can drive on Mondays, Wednesdays, Fridays ”,  “Vehicles with odd number plates are allowed to drive on Tuesdays, Thursdays, Saturdays”.  On Sundays, everyone can drive, no restriction. 

    Straighaway, you cut down traffic by 50%!  Those who mati mati must drive on those days, must pay a fee to allow them to do so.   

    Better than COE system ?

    Reply
  34. @ Misfit
     
    constant over-projection is done because congested roads are good business for the PAP government. therefore, over-projection will ALWAYS happen, unless they decide to wayang one day and under-project.
     
     
    @ joe
     
    i think China’s idea for the Olympics is good.
     
    however, to do this as a permanent policy, it would suck. this is because cars and the maintenance of cars are way overpriced in SG. unless the government is willing to pay people (NOT going to happen) x amount of money for spending 100% on the car but being able to use it 50% of the time, and reducing the costs of new cars drastically, it is bad policy.

    Reply
  35. for my fourth suggestion on how to reduce traffic congestion in SG, i suggest a market system
     
    first, have a independent study by a non government and/or PAP linked company to study how many cars can the roads on SG support at any one time, given the distribution of residential areas and jobs that are available in the “hot” areas.
     
    then, have SGreans buy the rights to drive at peak hours. the market will determine who and when, people will drive. however, this must not be applied to services, or else the economy of SG may be affected adversely.
     
    even a bo tak chek, non talented, non foreign dreg of the society (by not being elite) can come up with plenty of things. however, i do not see the government doing ANY study of ANY kind.
     
    this means that they WANT the current system to tax SGreans in order to earn money.
    money, money, money, money. that’s what it is all about. for the PAP government.

    Reply
  36. “then, have SGreans buy the rights to drive at peak hours. the market will determine who and when, people will drive.”

    Something like the electricity prices… worthwhile to look into.  Then the ERP prices is market determine rather than government determined….

    Reply
  37. mybrainthinkfaster 15 March 2010

     unless the government is willing to pay people (NOT going to happen) x amount of money for spending 100% on the car but being able to use it 50% of the time, and reducing the costs of new cars drastically, it is bad policy.

    donkey years ago..in a galaxy not so far away..as a matter of fact it was in manila and another few countries..the transport ministries comes up with 1 brilliant idea..onced again it was catered for the have$ have$ but @ the very lea$t it solved the conge$tion problemo
    it was known as odds and even..on odd days only odd number plates are allowed to park drive into central business districts while even plates allowed on even days..so for tho$e that can afford it meant buyin 2 car$ 1 odd plates 1 even plates there was no COEs or erp poles needed @ all..it was so $ucce$$fool that nobody complaints..its a fair $y$tem$.. did the tran$port minini$ter earned more than $100,000/month? yet he can run his lta ministry faster better and cheaper….

    Reply
  38. The traffic situation in Singapore is getting worse everyday. There are simply too many cars on the roads. It is high time that growth in car population is slowed down. There are close to 1 million cars on the roads in our small country.

    I have never have qualms over the COE system from the time that I could not afford a car to the time that I can afford one. Simply because if cars are too cheap, too many people can afford them and the traffic will be crippling. However any solution directed at cars to reduce traffic congestions seem futile in view of the huge increase in population to the 6.5million mark. I have a feeling that our country is bursting at its seams.

    Reply
  39. mybrainthinkfaster 15 March 2010

    if u want to experience bad traffic conditions, take a holiday in Manila, Kuala Lumpur or Bangkok.

    do the 3 countries above charged COEs/erps poles?
    yes no? polled the audience$ perhaps… do you see the riched demandin a road tolls or the coe/erps as well? so ludwig ole boi what are YOU complainnin? unless you are the sultans lark..then all roads will be cleared 15 mins before you even arrived 2 a red stop traffic light junctions

    Reply
  40. Everybody is talking about controlling car population.. One solution to traffic congestion is to have staggered working hours..
     
    Divide the country into several zones, e.g. Jurong, Bedok, etc.. Have 1/3 of the companies in a certain zone starts at 8am, another 1/3 at 9am and rest at 9.30am, for example..
    Of course, for this to work, the childcare centres, etc need to be more flexible…
     
     

    Reply
  41. @ joe
     
    yeah. if there’s anything i’ve learnt in life, it is “the market is always right”.
     
    let the statement “the opposition is just opposing without giving any solutions/suggestions” NEVER be heard in SG again.

    Reply
  42. @lim

    Yeah.  This is what they call a systemic problem.  There are various contributory factors that give rise to the problem of car congestion.  Besides using taxation or monetary measures (like ERP, COE, etc), the other factors include town planning, working hours, road capacity, car usage, accessibility of public transport, public transport level of service, punctunality, etc.

    Unfortunately, our “brilliant” leaders are not putting in the efforts to study this systemic problem carefully.  They are just concentrating on the crude measures of ERP and COE to control traffic.  We pay them tonnes of money for their salaries and all they can come up with is this  ??

    I say sack all of them !

    Reply
  43. LeekingUrine 15 March 2010

    joe , Mar 15, 2010 14:14 – Unfortunately, our “brilliant” leaders are not putting in the efforts to study this systemic problem carefully.  They are just concentrating on the crude measures of ERP and COE to control traffic.  We pay them tonnes of money for their salaries and all they can come up with is this  ??”

    Agree. It all boils down to this culture of “fear and punishment” that has been inoculated into our society. Everything is and can be punishable by law. There is no reward for good behaviour or system.

    Thus, car congestion, no problem, just “punish” car owners with more islandwide ERP & COE.  There is no “reward” for ditching cars via excellent public transportation system.  The only “reward” I see is incessant fattening of their million dollars wallet.

    Reply
  44. @ objective
     
    u still did not tell me how many cars and how many taxis there are in SG.
     
    passengers do not pay COE or road tax. they pay their fare.
     
    i did not answer number 2 because i think that question is a stupid one.
     
    the offpeak car scheme, ERP, and ALL other measures are not effective. if ANY government policies to combat traffic congestion were effective, we will not be here. they are all just money making schemes.
     
    is it that difficult to understand that to combat traffic congestion, there needs to be a limited number of cars on the road?

    Reply
  45. @ objective  :

    A few broad suggestions :

    (a) Advocate working from home
    (b) School commence later
    (c) Decentralised business districts
    (d) Advocate private bus operators to pick customers direct from home
    (e) Review bus routes and capacity such that there is no overcrowding
    (f)  Cheaper taxis as an alternative to private cars ?
    (g) LRT for more housing estates and even private estates
    (h) Road Tax rebates for car pooling

    Since i boh tak chek, maybe brighter ideas from leaders and supporters of PAP ?

    Reply
  46. how objective thinks that paying for a car, COE, taxes, fuel, license, maintenance, insurance, etc is cheaper than taking a cab is beyond me.

    Reply
  47. If you are taking a car to and from work in Singapore, probably taking a cab is cheaper.
    However if you travel extensively by car every day, driving will be cheaper. There are something like 30k+ taxis in Singapore but 900k+ vehicles. Taxis definitely utilise the roads much more often than regular cars, however some people commute by taxis hence doing away with owning cars. I believe there is no data to show how having more taxis  affects traffic congestions.

    I am one who probably taking a taxi to and from work is cheaper than driving a car. But I drive to gain the convenience and buy the time (0.75 hour less of commuting by public transport). I will probably give up my car when the down town line is up if I am staying where I am staying and still working where I am working. 

    Reply
  48. wake up singapore! 15 March 2010

    If COE and ERP are that good and effective as what our government claimed, ever wonder why no major cities of the world are implementing it?? Our goverment said that if roads are jammed business will suffered etc etc. The only other city  we usually get to hear who is using it is London, but why quote an example so far away? why not HK, Tokyo, Seoul, Taipei, KL etc.. Trafic jams are part and parcel of any city, but lives goes on. There is no suffer of business in these places. Another of PAP insidiuos con job to milk us.  

    Reply
  49. but when will the traffic be congested? the whole day, or parts of the day?

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  50. when are the traffic jams? that is the question.

    Reply