Temasek supports SMRT on rail system renewal

We note recent commentaries on SMRT, including some useful observations by senior transport correspondent Christopher Tan (Lessons for MRT from the NY subway; Nov 30).

He noted "there is no reason why our MRT cannot be among the best - if not the best - in the world". We agree.

Temasek took ownership of SMRT in 1987, just as it started operations with five stations over 6km of track, between Toa Payoh and Yio Chu Kang. Many SMRT staff still remember with pride their role in its inaugural service.

Temasek listed SMRT 13 years later, in July 2000.

Now 30 years old, SMRT operates 106 stations over 148km, with two million commuter trips daily.

One key reason Temasek took SMRT private in October last year was our assessment that SMRT needs to prioritise renewal of a fast-ageing system, and complex upgrades like re-signalling, and win back the trust and confidence of the commuting public.

The New York Times article referenced by Mr Tan had noted that the "mean distance between failure... has worsened almost every year since 2010" for the New York subway.

This engineering reliability measure is the first critical indicator of system health. SMRT is rightly monitoring and aiming high on this.

SMRT has successfully completed its multi-year sleeper and power rail renewals. These are the first of over 100 renewal projects, big and small, to be done for systems over 30 years old, to improve reliability.

Renewals are not just about replacing end-of-life systems. They are precious opportunities to re-examine and re-design for better system reliability, maintainability and availability.

It takes time to plan and execute renewals, and upgrade safely and sustainably. We seek public understanding, government and regulatory support, and SMRT commitment, to do these well.

Mr Tan also mentioned dividends from SMRT to shareholders.

Since the initial public offering (IPO), Temasek has paid SMRT-related dividends to our own shareholder. We also paid over $1 billion to some 50,000 minority shareholders to take SMRT private.

These payouts total more than the dividends Temasek received from SMRT since its IPO, including the $540 million special dividend declared prior.

As a shareholder and steward, we want SMRT to be viable, both financially and structurally.

Taking SMRT private is part of our journey to support it in its focus to be among the very best in the world, through operational and engineering excellence.

Juliet Teo (Ms)

Head, Transportation and Logistics

Temasek


What it should have been

In our Forum letter on Tuesday, "Temasek supports SMRT on rail system renewal", we said: "Since IPO, Temasek has paid SMRT-related dividends to our own shareholders." This is incorrect.

Temasek has only one shareholder, who is the Minister for Finance.

A version of this article appeared in the print edition of The Straits Times on December 05, 2017, with the headline 'Temasek supports SMRT on rail system renewal'. Print Edition | Subscribe