| |
SINGAPORE: The Public Transport Council (PTC) will review the fare adjustment formula for subsequent years after 2012 when the validity of the current formula ends.
The Ministry of Transport (MOT) says this will be done, bearing in mind the interests of commuters and long-term viability of the public transport operators.
Mr Cedric Foo, the chairman of the Government Parliamentary Committee (GPC) for Transport, had called for the review, after SBS Transit and SMRT submitted proposals for a maximum fare adjustment of 2.8 percent earlier this week.
Writing on his Facebook page, Transport Minister Lui Tuck Yew said the PTC should be allowed to deliberate on the fare adjustment proposals properly and to come to its decision.
He also weighed in on the recent suggestion by the Workers' Party for the transport system to be nationalised.
He said such an idea has serious downsides as commuters and taxpayers - including those who do not take public transport - are likely to end up paying more. They may also see lower service standards over time.
He added there will be little incentive to keep costs down, if a nationalised public transport operator works on a cost-recovery basis and depends on the government for its funding.
Cost increases could also be passed down to commuters. Mr Lui said it is usually the profit incentive of commercial enterprises that spurs efficiency and productivity improvements.
On concerns that public transport operators should not be making so much profit, Mr Lui said it is not unreasonable for them to earn fair returns from their investments to sustain operations and invest in future public transport needs.
What is important is for a commuter's interest to be safeguarded, he said. One way is to have a robust framework to regulate bus and rail service levels through service quality and operating performance standards so that public transport operators do not pursue profit at the expense of commuters.
The Land Transport Authority (LTA) will also continue to work with the public transport operators to deliver improvements to the public transport system.
The Ministry of Transport says that as a reality check on profitability, the PTC will assess if a public transport operator's profits are deemed to be excessive before granting any fare increases. This, it says, will ensure that the transport operators cannot increase fares at will and maximise profits at the expense of commuters.
The ministry says that since 2005, the fare adjustment formula has been based on the fare review mechanism recommended by the GPC-led Fare Review Mechanism Committee.
It adds that the fare formula is not meant to be static.
In 2008, to take into account the higher productivity gains by the public transport operators, half of the gains were shared with commuters through a higher extraction of 1.5% in the revised formula. This revised formula is valid until 2012.
- CNA/ir
|
