Ministerial statement: S Iswaran on one-off exercise to redistribute COE supply to curb volatility

The supply of Certificates of Entitlement (COEs) is expected to start increasing substantially in the coming months, with more cars reaching the 10-year mark, said Transport Minister S Iswaran. But the Ministry of Transport and Land Transport Authority (LTA) have also looked into doing more to smoothen the supply of COEs in Categories A and B while adhering to the cap on the overall car population over the 10-year cycle, he added. Replying to MPs’ questions in Parliament on Monday (May 8), he announced that the Government will roll out a “one-off” exercise to redistribute the supply of COEs. LTA will bring forward and redistribute the supply from five-year COEs which are due to expire in the next projected supply peak. As these five-year COEs cannot be extended and have to be de-registered, LTA will be able to identify the exact number with certainty, said Mr Iswaran. This supply will be re-distributed over several quarters, starting from the next bidding exercise. This move will increase the quota supply in the next bidding exercise by about 24 per cent in Category A and 15 per cent for Category B. Mr Iswaran said such a move will help to lessen, but will not eliminate, volatility. There will still be a degree of supply fluctuation due to historical factors and broader market conditions, he said. He stressed that the long-term upward trend of COE prices due to rising incomes and zero vehicle population growth will not be abated. Mr Iswaran said the Government is committed to developing the policies and infrastructure to build a car-lite, accessible, inclusive and sustainable transport system to meet the diverse needs of Singaporeans. “Ultimately, our success in realising that vision rests in the commuting choices that every Singaporean makes every day,” he said.