The Straits Times
Published on Dec 29, 2012

Fines should reflect social cost of transport disruptions


THE common consensus seems to be that the public transport system needs improving. Managing editor Han Fook Kwang puts it well when he said that the high certificate of entitlement price is a reflection of how much people are prepared to pay to avoid having to take public transport ("Should transport system go the HK way?"; Oct 7).

The Government is stepping up by investing in more infrastructure, such as train lines and bus routes.

At the centre of the storm of criticism is SMRT - the main operator of MRT lines, half of the duopoly for bus routes, and a member of the oligopoly of taxi operators. Seen as being too profit-driven, its failures and stumbles have caused so much inconvenience and angst that there have even been suggestions of nationalising the company.

Nationalisation, however, may be unfair to the many ordinary Singaporeans who own SMRT shares and look forward to its dividends.

I suggest placing a dollar value on the social cost of disruptions in service. This can come in the form of materially significant fines on a sliding scale for each disruption, based on frequency and magnitude, with the ultimate sanction being the loss of the licence to operate.

The social cost can be computed through public surveys - for example, what level of delay is acceptable, how much more one is prepared to pay for a higher frequency of train or bus service, what is the cost of each hour of delay or disruption to the ordinary commuter in terms of lost sleep or pay docked.

Based on these answers and the number of people using public transport per day, the appropriate level of fines can be computed.

The level of fines and sanctions will encourage SMRT to make the appropriate investments. It will also stop making extraordinary profits which do not reflect the true social costs of disruptions and failures.

The fines collected can be passed on to commuters in the form of fare top-ups on their ez-link cards.

This way, all stakeholders in public transport have a say and ownership of the eventual outcome.

Josephine Chong (Ms)