How are public transport fares decided in Singapore? 5 things you may not know

SINGAPORE - The Public Transport Council (PTC) announced on Wednesday that bus and train fares will go up by 2.8 per cent from April 5.

For adult commuters, this translates to an increase of between two and five cents per trip, depending on the distance travelled. Student concessionary fares will also increase by one cent.

Despite the hike, more than 1.1 million commuters will not see any changes in their fares. Senior citizen fares will remain the same, as will prices for existing travel concessions passes, including student monthly concessions and the $120 adult monthly travel card.

Here are five things about the factors that influence public transport fares here.

1. Public transport fares are decided based on four main factors

The fare formula is centred on transport operators' costs and productivity, energy costs, core inflation and wages. The energy component accounts for 20 per cent of the fare adjustment quantum, while core inflation and wages make up the rest. The formula determines how much fares will be raised or adjusted.

Read more about the fare formula here.

Find out how the latest round of fare increase announced on Jan 21 was calculated.

2. The Public Transport Council reviews transport fares annually

Transport operators first submit their application for fare hikes to the PTC for fare adjustments. The PTC, an independent body that regulates bus services, bus service operators, ticket payment services, and bus and rapid transit system fares, reviews fares annually.

The PTC was set up in August 1987 under the Public Transport Council Act. The PTC provides policy directions and makes decisions on issues related to the regulation of bus services, transit ticket payment services and public transport fares.

3. Mechanism behind fare adjustments is reviewed every few years

A review on the mechanism behind fare changes is held every few years to ensure the fare formula remains relevant. The last review by a Fare Review Mechanism Committee headed by former district judge Richard Magnus, started work in June 2012 and submitted a report in November 2013. It proposed several recommendations that were accepted by the Government. The changes in formula include the smoothening of fare increases by rolling over part of increases to the following year and new concessions aimed at the low-income earners and people with disabilities.

4. The fare formula does not take into account service standards

The FRMC did consider including quality of service in fare changes, but concluded that it would be preferable to continue to treat the two issues separately, with service-quality issues to be addressed by the Bus Quality of Service Standards and Rail Operating Performance Standards.

Operators are punished for lapses and breakdowns in service, and supported by a more stringent penalty regime. The PTC said in January 2014 that if fares are not adjusted to take into account operating cost increases, the operators would have less and less resources to maintain and improve services.

5. Public transport fares are based on distance

The distance-based fare structure was introduced in July 2010. Under the fare structure, commuters travelling the same distance pay the same fare for the same type of service, whether they travel direct or make transfers.

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