Government to own, fund all bus infrastructure

SINGAPORE — Under the bus contracting model, announced in May last year, the Government will own and fund all bus infrastructure — such as buses, depots, and fare systems — while contracting bus routes out via a competitive tendering process.

This shake-up from the current privatised model — where SBS Transit and SMRT own their buses and keep all fare revenue — is aimed at raising service standards by increasing competition and creating more flexibility in response to changes in ridership and commuter needs.

Under the new model, the Land Transport Authority (LTA) will determine the bus services to be provided and the service standards. For example, the waiting period for all buses should not exceed 15 minutes during peak periods.

While revenues from bus fares will go to the Government, operators will be paid a fee to run and maintain the bus services, and also pocket non-fare revenues such as advertising on buses.

Three packages, making up about 20 per cent of routes, will be tendered out first. The inaugural package of 26 routes was awarded to London-based operator Tower Transit Group yesterday (May 8).

These routes originate from three bus interchanges — Bukit Batok, Clementi and Jurong East — and end at five other interchanges — Bedok, Boon Lay, Marina Centre, Shenton Way and Toa Payoh.

The 26 bus services will be rolled out in three tranches from June next year, with the buses to be operated out of the new Bulim Bus Depot off Jurong West Avenue 2. The tender for the second package of 25 bus services, which mainly covers the Punggol and Pasir Ris areas, was called last month and is expected to close in August. The remaining 80 per cent of routes will be grouped into nine packages and run by incumbents SBS Transit and SMRT on negotiated contracts under the contracting model for about five years, after their Bus Service Operating Licences expire on Aug 31 next year.