The rising cost of operating public carparks here would have spelt big shortfalls for the Housing Board and the Urban Redevelopment Authority (URA), if parking fees had not been hiked.
Since 2002, when the rates were last raised, the cost of operating carparks has risen 40 per cent, the two agencies told The Straits Times.
Without the latest rate hike, HDB stood to lose $100 million a year. This was despite the two agencies earning a total of $667 million from their carparks in their latest financials for 2014/2015.
Last week, both agencies announced that short-term parking charges will be increased by 20 per cent islandwide from December.
This means that outside of the restricted zone (RZ) in the city area, parking will cost $1.20 an hour, up from $1. Within the RZ, parking will cost double that - at $2.40 an hour, up from $2. Season parking rates will also go up.
In a joint statement to The Straits Times, the agencies said operating costs "which include maintenance, financing, depreciation and overall operating expenses" have risen by 40 per cent since 2002 and, at the current carpark rates, they would not be able to recover the full cost of parking provision.
They pointed out that HDB alone spends over $700 million a year operating carparks - building, maintaining and improving them.
"Without the increase in the carpark charges, HDB will face an average shortfall of more than $100 million for its carpark activity in the coming financial years," said the agencies, adding that URA also faces higher operating costs, and would run a deficit if fees were not revised.
URA also has to price parking appropriately to manage demand in its carparks, which are mostly located in the city centre, they said.
In the financial year that ended in March this year, HDB reported an income of over $595 million from its carparks. The figure has risen gradually from $523 million in the 2009/2010 financial year.
Over the same period, URA has seen its income from parking fees and related charges rise from $62 million to $71 million.
An industry source said operating costs in the carpark business have increased by about 20 per cent to 30 per cent for private operators since 2002.
"The electronic parking systems (EPS) are the most expensive - it can cost up to $150,000 when we install them at a single carpark so, definitely, costs have increased," said the source, who is from a private parking operator.
The EPS is progressively being installed in HDB carparks, and has so far been implemented in 1,200 of the 2,000 HDB carparks.
Some motorists pointed out that the EPS should help agencies save on manpower costs, given that fewer parking attendants are required.
"High operating costs could instead mean URA and HDB are not using their resources efficiently," said Mr Scott Leong, 27, a ship chartering officer.
Mr Lim Biow Chuan, the MP for Mountbatten who sits on the Government Parliamentary Committee for Transport, said there are other "maintenance costs you cannot run away from".
"Cleaning, resurfacing, ensuring that the lines are drawn and lights are working... Some multistorey carparks have lifts as well," said Mr Lim. "These are maintenance costs that are not easily just written off like that."