The Prime Minister pointed out that measures such as a reduction in road tax and improving the public transport system were made simultaneously so as to soften the impact of ERP changes on Singaporeans.

Yet these might have gone unnoticed by many people, he said yesterday when tackling what he called the 'hottest topic' of the day.

He was speaking six weeks after five new ERP gantries went up in the city, with each charging up to $2 during evening peak hours. Rates at existing Central Business District gantries also went up by 50 cents to $2.

The changes sparked complaints from motorists, a number of whom questioned if the ERP system was a revenue-generating measure for the Government.

Responding last night, Mr Lee said he hoped to set right 'misconceptions'.

The Government had, in fact, taken steps to cushion the impact of the ERP rate increases.

Speaking on this in Mandarin, Mr Lee said: 'At the same time that we increased the number of ERP gantries, we also improved the public transport system and reduced road tax. Perhaps many people have not realised this.'

He was referring to the Land Transport Authority's moves to improve bus and train waiting times for commuters.

Almost 800 extra train trips have been added to rail lines so far. Waiting times for feeder buses during peak hours have been slashed. At least 85 per cent of such services are now running at a frequency of 10 minutes or less during peak hours.

Commuters taking public transport are not the only ones to benefit. Vehicle owners received a 15 per cent cut to their road tax from last month.

Stressing that the ERP policy was a decision by the Cabinet - not the Transport Ministry - Mr Lee explained the rationale behind the increase in ERP charges.

Over the past eight years, the Government has progressively reduced vehicle-related taxes to enable more Singaporeans to own cars. It succeeded in doing this. As a result, there are now more cars on roads, which have become more congested.

'Therefore we have to increase the number of ERP gantries and increase the ERP rates,' he explained.

But the overall revenue collected by the Government from vehicle-related taxes has been reduced, said Mr Lee.

'The purpose is to help Singaporeans, including motorists,' he said.

While the Government will collect $70 million more a year in ERP revenue, the cut in road tax will cost it $110 million in revenue foregone. This is on top of the $200 million that it will lose from the 10 per cent cut to the Additional Registration Fee for new cars from March.

ghimlay@sph.com.sg