Consider dynamic pricing for public transport

Perhaps it is time the public transport sector also starts to use dynamic pricing strategies, where fares rise during peak hours, just like fares for taxis.

There will always be a demand for public transport.

Even if each commuter is charged a few cents extra during peak hours, people will still use public transport because the surge in taxi fares at the same time would be much higher.

The two other alternatives - walking or using a personal mobility device - are also not practical for long distances.

Such a pricing system can make a big difference in revenue.

It can help Singapore cover the cost of the $573 million upgrade and renewal of the power supply and track circuit systems on the ageing North-South and East-West lines, as well as the purchase of new buses under the Bus Service Enhancement Programme.

Overall, the simple economics of cost-benefit analysis and price inelasticity of a service could help Singapore make higher revenues without losing anything.

Riddhiman Sarawgi

A version of this article appeared in the print edition of The Straits Times on July 25, 2018, with the headline 'Consider dynamic pricing for public transport'. Print Edition | Subscribe