Transport – BT
SBS, SMRT apply to raise bus and train fares on Oct 1
Reason cited: Higher cost pressures because of rising energy prices
SINGAPORE’S two largest public transport operators have applied to raise bus and train fares later this year. Yesterday, SBS Transit and SMRT Corp confirmed they have applied to the Public Transport Council (PTC) to lift fares, citing the same reason: higher cost pressures because of rising energy prices.
SMRT said in a statement that even the maximum fare adjustment of 3 per cent – about four to five cents – would not fully offset cost increases due to an ‘inflationary and higher operating cost environment’.
However, any increase is likely to be kept below one per cent, even though this year’s fare adjustment formula allows for a maximum 3 per cent jump, according to comments made by PTC chairman Gerard Ee last month. Any fare changes will kick in on Oct 1.
In FY 2008, SMRT’s energy costs soared 18 per cent to $89.7 million due to higher electricity and diesel prices. Of this amount, electricity accounted for $47.5 million, an increase of 19 per cent from the previous year.
Diesel costs for bus operations rose 17 per cent year-on-year to $42.2 million. SMRT said that it also fully absorbed the Goods and Service Tax increase of two percentage points.
SBS Transit said that it faces mounting operating costs from running the North East MRT line and most of the island’s bus services. Its spokeswoman Tammy Tan said that the company is trying to keep concession, children and student fares unchanged.
The PTC has said that it will carefully evaluate the proposals from SMRT and SBS Transit before making a decision this month. It said in a statement that it is considering the need to increase transfer rebates, preferring to have both transport operators bear part of the cost to soften the blow on passengers. The council has said that it will take into account an increasing ridership – which can boost operators’ revenue significantly – when firming up its decision.
Last year’s fare increase cap pushed bus fares up by two cents. SBS shares closed unchanged at $2.15 yesterday while SMRT was up by two cents to $1.80.