The following is Transport Minister Lui Tuck Yew’s Facebook note.
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Thank you for your comments, feedback and suggestions. Many have expressed concern and wondered whether fares would increase by 2.8% as per the applications by SBST and SMRT under the fare adjustment formula. Let me reassure you that the Public Transport Council has been judicious in approving fare increases over the years as we can see from the data below.
I know that the PTC looks out for the interests of commuters in all fare reviews. The fare cap system itself ensures that SMRT and SBST cannot increase fares beyond the cap. And, if there is no inflation and no wage increase for the year, the formula allows the PTC to impose a fare reduction of 1.5% on the operators. Hence, they know they have to improve productivity and innovate. Such measures have helped to increase their revenue (and hence profits) through non-fare sources. I checked and found that close to 45% of SMRT’s operating profit and 50% of SBST’s operating profit in the two recent years came from non-fare sources which include rental and advertising.
While we ponder over the fare adjustment, let me share that it is the Quality of Service (QOS) delivered by the two operators that I am paying the most attention to. Improving capacity, addressing crowdedness on buses and trains, frequency and reliability of service – these are among the key aspects. I have experienced the discomfort and frustrations that commuters faced because of the congestion and the sometimes unreliable service and I share your desire to see improvements to our public transport.
The operators SMRT and SBST have added a total of 590 weekly trips from Mar 2011. There will be further improvements later this year when more trains are added. Since LTA began the regular quarterly bus improvement process with the operators in June last year, 64 bus services were improved. Frankly, much more needs to be done. While we are already running trains at the limit our signalling equipment currently allow during peak hours, we are examining how much further to shorten the intervals between trains during off-peak period. The LRT system at Bukit Panjang needs to be significantly improved and I will find an occasion to share more with you soon. Our current QOS standards for buses is not sufficiently stringent. MOT and LTA are in the midst of a study on how to tighten this. We will pay particular attention to feeder services. To bring about these improvements, we will need to increase the number of buses and the government will work with the operators to make sure this is done.
Let me end here for the time being. I will share with you on another occasion some transport systems which are doing well and others which are not doing so well and why. Good night.
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Dear God,
Could you tell me what’s the job of a transport Minister. Is he looking out for the welfare of the people, who can afford to own a car or to increase the profit of the transport year after year – is there a baseline.
I would like to pray for our kind and understanding Transport Minister to widen his scope of understanding of the nature of his job, although it is diffcult for him – cause he had to answer to his master. Please do master him on our poor humble Singaporeans behalf.
Thank you, God.
Action speaks louder than words!
I may appreciate that the new transport minister personally experience travelling on the buses and trains, so as to understand the issues faced by the commuters. However, I certainly hope he would use his position as the transport minister to bring about improvements to the service standards provided by the transport companies.
Until improvements are felt on the grounds, then it will justified any fare adjustment. Until then, i will reserved my judgement for the new minister.
Well, this is Singa-sore.
If you do not have Lui, Tuck Yew!
As we have all commented here, the real issue LUI has to tackle is to decide whether transportation is a public or private service.
Apparently, he is trying to circumvent this key issue by diverting public attention to so-called quality of service which of itself is so loose a concept is neither here nor there.
What a shame, our million-dollar talent minister simply misses the wood for the tree.
Again the same stale song: balancing the books. If public administration is a simple matter of making everything self-funding, all we need is a small trim 19th century laissez-faire government – small civil service and certainly no overpaid ministers.
Government involves making diffcult value judgments and re-allocating wealth and resources – yes, taking from some to fund others if you think the cause important enough. We feed our troops and do not ask the armed forces to grow their own vegetables, do we???
If you keep transport as a private business, they need to profit and the public will complain. Even if it is not a nationalised service, the issue of subsidy certainly has to be considered.
Petty Authoritarian Party never had the guts to make this type of decision.
Minister Lui should open a tender for a few more transport companies to submit proposals for more competitive transport service.
Come on, we are not as daft as Minister Lui thinks, both SMRT and Delgro are Govt GLCs,
who are working in cahoots behind the scene, like all the petrol stations in Singapore, and the Transport Committee is just a front for a wayang show to hoodwink the commuting public. After the show, fares would still go up, better first aim for a higher 2.8%, like bookmaking for an IPO, then the increase has more leeway to be higher.
same old…same old…
nothing has changed since the last GE.
Different persons in charge of the ministries but same mentality.
Have to wait for some of the 60.1% to realize their mistake.
Service quality is only the tip of the iceberg
Look into the affordability of public transport to the masses.
Bring down the price for the elderly and full time students, in particular those that are in Polytechnics who pays adult fares compared to JC and IT students. Why this disparity of unfairness???
We should start the TEA party and reduce the BIG GOVERNMENT
If quantity is the “lesser challenge” compared to quality, let’s at least have that for a start. What’s the point of quality when we have to wait long time and squeeze with foreigners? Is there quality in the first place?
Yes, productivity gains is a real challenge. But profitability is just an application away……
It is not HOW much the fares have beeen decreased or increased.
The fares have been too high from the start.
The crux of the problem is that the Transport Companies have been ripping of the citizens.
The far have been to high to begin with
Now with their unbrided greed they want to increase their obscene profits even more by increasing fares again.
The Minister OWE the citizns the duty to ensure that Public Transport Companies CANNOT MAKE OBSCENE PROFITS…the FUNDAMENTAL OBJECTIVE is to provide efficient and cheap transportation to citizens and not maximise profits.
It has no business making those obscene profits.
Efficiency has a finite ceiling for improvement.
Capacity & Infrastructure are the main problems, and these are affected by Loads (aka FTs, Commuters, Tourists, Population Planning).
As long as our problem solving attempts are constrained by what we have now, without looking at the bigger picture or cause, we are doomed to paying ever higher fares.
If the GDP growth resulting from bringing more people into Singapore has benefitted Singapore, and the Capacity & Infrastructure cannot cope, then the Government (Not only Ministry) is obliged to intervene to correct or alleviate the situation.
Otherwise the Commuters using Public Transport and Roads will surely slowly be boiled to death (like frogs).
Talk and talk. No action!
This just shows that PAP needs waking up and be more aware that its standards have dropped tremendously. Current Transport operators need more competition. They are not world class.
Good luck to Mr Lui. With 40% of this country HOPING that he will fail to solve our transport problems, its going to be a tough task indeed.
40% of this country hopes you will fail, because then it’ll be easier for them to convince others to vote in more opposition.
Gotta love the “maturity” of our electorate.
Duopoly is not competition.
The argument that nationalizing our public transport system will affect efficiency holds no water.
In the current duopoly where every operator is guaranteed a piece of the pie, where is there stimulus for improvement? To meet the needs of the people, some issues have to be forced by nationalization. We have suffered too long under Singapore Inc.
Cost of living is contributed in part by transport costs. Commuters are paying the shareholders of SMRT. Only problem is, there are more commuters than shareholders. As a listed company, it is clear what SMRT does in drafting all its corporate strategy – increase shareholder returns.
The result of this is plainly visible to all who actually bother to, or have to take the MRT or bus at peak hours. Or for that matter, get desperate enough to try to hail a cab.
Mr Lui, a major revamp of the thinking behind transport policy making is in order. The status quo is not sustainable.
Privatising SMRT and SBS does not create competition to improve service or control cost in a monopoly protected by government.. Submission to PTC for fare is anything but a wayang show.
One reason for privatisation is to let govt-link companies to bid for projects overseas. Eg. SMRT to build subways outside of Singapore. Our domestic market is too small to milk anyway.
If SMRT is not profit-driven, why the go for public listing? Mr Lui certainly can’t ask for our “understanding” publicly.. He’s screwed but can’t scream in short.
No amount of debate will convince them once they have made up their minds. Never happened before, and will never happen. They have 60% of citizens’ backing. It is the 40% that are complaining on TOC, TRE, etc.
A pro PAP President will reaffirm their position even further. Frankly, all these online platforms TOC,TRE, etc serve to let the 40% let off steam, and ventilate their repressed anger & frustration harmlessly. That’s all. They know that too well. Just let the 40% folks have an avenue to vent all that suppressed energy. Nothing’s changed, as one expat told me the other day. Singaporeans love to whine.
The fare formula is
“Maximum Fare Adjustment = 0.5 CPI + 0.5 WI – 1.5%”
(Source: http://www.ptc.gov.sg/regulation/annualFareReviewProcess.htm)
Nowhere is there in the formula to factor in productivity improvements. Instead, the “productivity extraction based on a sharing of productivity gains achieved by PTOs” is fixed at 1.5%
So, to all intents and purposes, the formula guarantees price increase.
So how can the transport minister claimed that “I know that the PTC looks out for the interests of commuters in all fare reviews.”
By stating that 45% of SMRT’s operating profit and 50% of SBST’s operating profit in the two recent years came from non-fare sources which include rental and advertising is not enough. The net operating profit for providing public transport must be minimal and must not exceed 5% of the companies overall net profit.
Profits from non-fare sources is only limited by the operators’ innovativeness and creativity in utilizing their existing resources.
I agree with some of the comments here. Minister appears, whether rightly or wrongly, to be defending public transport companies & the PTC instead of defending public interest.
Rather than justifying such perceptions, the Minister should instead directly address people’s gribes over long queues, overcrowded transport and poor public transport service.
Increasing capacity is not the solution if that is in tandem with increased population, foreign or otherwise. The assurance cuts no ice.
Any increase in capacity has to not only outstrip population growth but to catch up on the capacity gap.
Also, more importantly, the Ministers including today’s ST is totally silent on the transport inflation issue.
Any increased capacity burden/investment will be borne by tax dollars whilst profits go to shareholders. Clearly, the argument for nationalisation is very much still appealing for people like me. In a nationalised system, profits (perhaps lower) will at least be reinvested.
Will Singapore’s public transport system, like its housing and car prices, end up with world’s best ie highest (aka affordable in govt terms?) prices?
I don’t believe those figures. They are not audited.
Just look at the audited profits. Every year, the return on equity is 20%. Even for 2009.
All other figures are bull.
it takes him so long to realise?
SMRT
http://info.sgx.com/webcoranncatth.nsf/VwAttachments/Att_0C60D72241F3EA7648257881002F6AEB/$file/finalresult.pdf?openelement
- page 13, rental+advert = 32%
SBS transit
http://info.sgx.com/webcoranncatth.nsf/VwAttachments/Att_B4DDC7790D9FCFC04825788E000BE911/$file/SBST_1Q2011.pdf?openelement
- closely to 50% yes. but why staff costs so high?
what do you expect from them? nothing new,i am not surprised,they are a bunch of money suckers,worst and more irritating than bed bugs,at least the bugs will go away when they suck enough.
tell me anything they do that does not involved money,sick and tired,how i wish they are kicked out in 2011,maybe in 2016 it can’t be help.
As so many readers have been pointing out, the incompetent Minister’s explanations just does not hold water. It is incredible that the Minister still insists on the correctness of his position despite so many citizens’ arguments that he is utterly wrong. How can it be that he has the monopoly of wisdom on public transport?
The deception and lies spun by the PAP to hoodwink us is outrageous. From CPF, MAS losses to GIC/Temasek black box operations, etc. Nothing seems to jive.
It is imperative that a NON-PAP linked President be voted in. Otherwise, we will have 6 more years of unchecked deception.
fpc 22 July 2011
“it takes him so long to realise?”
—————-
He realises nothing. All he is doing is switching to PAP SOP. When cornered, do double talking. Just like one presidential hopeful’s “Singaporean first, but not Singaporeans’s only” double talk.
RADM Lui, this service quality is such a revelation isn’t it? So much of a revelation that the PAP didn’t even believe the transport system was bursting before the elections? So much so you had to take public transport to see for yourself and have it reported in the press?
Why weren’t such things considered before asking for the fare increases?
Lee Kuan Yew wants another 900,000 FWs into Singapore in the immediate future. So, SMRT how many more trip did you say you have in plans?
And Mr. Lui, you most urgent concern is not about raising service quality as this was promised before every past fare hike but then has only deteriorated instead. Your main concern must be to think out fresh tricks to beguile Singaporeans…thats what PAP is good at..masters of subtefuges..dissimulations..Scru you all PAP!!!
Previous minister already got kicked out because of all the anger of the people. This new minister still not doing anything and still not listening it seems. Here we going through the whole same cycle every single time where our Government is trying to justify everything that they are doing are correct. Seriously why can’t they just listen to the public for once?
they really think people really so free to keep complaining if there is nothing wrong with the whole transport system? The ground sentiment is already so strong yet they once again choose not to listen and tackle the problem head on but just have stop gap measures. They keep saying they have increased number of trips but how do we know whether that increase is consistent or faster than the increase in our population? If the increase is already sufficient, then why is it that people cannot feel it at all and only keep complaining that situation is getting worse? So where has all these trip increases gone to?
Don’t u all see the deja vu everytime elections are over? Prices of things will all start to increase over the next few month now that elections are over. The fact that the government is so fast and always the first one to come out to defend the fare increase may be the case that the transport companies are together with the government in the first place to justify maximising returns for shareholders (which in this case the government will benefit). What voters or opposition failed to do is to get the government to not increase public transport fares and taxi fares, etc So its the opposition’s fault for not pre-empting this. No wonder our government say opposition today still not good enough. I hope things will change at next election. Let’s wait to see what is the next thing that they will increase fares on.
The policies of our govt in the last decade or so have been less than satisfactory, and the outcome is that many Singaporeans have been made scapegoats, with no choice but to face rising cost of one sort after another.
Solution? For the 40% – vote , in 2016, as you did in 2011; for the 60% – maybe it’s time for you to think deeper, taking into account the current proposal for transport fare increase.
@debbie 27 July 2011
Dear All
D’ont bother to respond to that IvoteAhMeng. ‘It’ is an incorrigible and unemployable dropout who has too much time on its hands and takes random potshots at all and sundry. Being semi-demented, ‘it’ is also racist and capable of extreme vulgarity.
The model of intellectual discussions whether pro or anti- PAP is zero, doppleganger, Alvin Chua, fairplay, Robert Teh, Andrew Leung . I apologized if I have missed a few others. But these people, whether pro or anti-PAP virtually never resort to personal, racist & obscene diatribes to make their point.
Doppleganger is notable for his polished use of the language. I am awed by the vigor of his intellectual logic even when he disagrees and criticizes my view point – it is never personal nor vulgar.
When you can think and articulate like these guys, what need is there for rabid, racism and vulgarities, as practiced by that insane IvoteAhMeng . Those whom the gods wish to destroy, they first make mad.
Having said that, we respect that this is a democratic platform and that even the retarded and insane have the right to rant their madness here. So, folks, just ignore his drivel. Responding will only give him the rabid attention that he seeks.