SMRT, SBS – BT
Bus fares to go up from Oct1, no change for train
Rise of 1 to 2 cents; PTC says majority of commuters will see no increase or small increase
LISTED public transport operators (PTOs) SMRT Corp and SBS Transit have succeeded in their application to raise bus fares but not train charges. Bus fares will go up by one to two cents from Oct 1 after the Public Transport Council (PTC) approved a 1.8 per cent increase, but train fares will remain unchanged.
The PTC said the majority of commuters will see no increase or a small increase. It said 52 per cent of all public transport trips by bus and rail will see no increase. But for 10 per cent, there will be a rise of one cent, while the remaining 38 per cent will see an increase of two cents.
In August 2007, SMRT and SBS Transit – which is part of the ComfortDelgro group – had applied to the PTC to increase bus and rail fares.
The council approved an overall fare increase of 1.8 per cent for adult EZ-link bus fares, but no rise for rail fares this year, after taking into account the fare adjustment cap formula introduced in 2005. ‘The PTC has to strike a balance between safeguarding commuters’ interests and ensuring the financial viability of the public transport operators so that they can continue to improve their services over time and sustain their capital investments,’ said PTC chairman Gerard Ee.
He said as part of PTC’s deliberations, the council compared the PTOs’ Rota (return on total assets) with the prevailing Rota figures of companies with similar industry and risk profiles. ‘The comparison suggests that our rail industry is doing much better. Hence, on balance, the PTC decided against raising rail fares, to the benefit of commuters,’ said Mr Ee.
The council also considered Singapore’s economic outlook and the affordability of public transport. It said the economic outlook is positive with the latest GDP growth forecast for 2007 revised upwards to 7 to 8 per cent and the unemployment rate for June 2007 at 2.4 per cent, the lowest in five years.
The public transport affordability indicator has also been on a downtrend for the past four years, indicating that fares have remained affordable for most commuters.
SBS Transit, which operates three-quarters of the public bus fleet, said that one in three of its commuters will not have to pay more. It said that the fare adjustment will yield $9.3 million for a full year but that will only bring partial relief from higher costs. Fuel costs, for example, rose 21.5 per cent or $18.2 million in 2006.
As for SMRT, it said that about 30 per cent of its bus trips will be unaffected by the fare revision.
‘Bus fares continue to remain affordable for the general public even with the 1.8 per cent increase as this is considerably lower than the annual increase in average monthly income per household of 5.7 per cent in 2006,’ said SMRT chief operating officer Yeo Meng Hin. ‘However, the adjustment does not cover the cost increases posted by the two-percentage-point increase in GST and the 1.5-percentage-point increase in employers’ CPF contribution.’
SBS Transit and SMRT have jointly contributed $0.6 million worth of transport vouchers to help needy families. Together with $2.4 million from the government’s Public Transport Fund, vouchers worth $3 million will be given out this year.