Public Transport Council starts review of fare formula; PTC chairman says 'service improvements come at a cost'

A commuter tapping his card at the fare gate at Ang Mo Kio MRT station.
A commuter tapping his card at the fare gate at Ang Mo Kio MRT station.PHOTO: ST FILE

SINGAPORE - The Public Transport Council (PTC) has started a review of the formula that is used to adjust bus and train fares.

Announcing this on Wednesday (April 5), the council said it will "focus on maintaining a good balance in keeping public transport fares affordable while ensuring the financial viability of the public transport system".

The PTC said it targets to complete the review by the first quarter of 2018, and apply the new formula starting from that year's fare review exercise.

Citing its terms of reference, the PTC said it shall "review the effectiveness of the current fare adjustment formula and mechanism, and propose improvements in consideration of the changes to the public transport industry".

The current formula - which takes into account changes in the inflation rate, wages and an energy index that charts oil and electricity costs - will continue to be used for this year's fare adjustment exercise. It has been used since 2013.

 
 

Using the formula, bus and train commuters enjoyed an overall fare reduction of 4.2 per cent last year, which took effect on Dec 30.

In a blog post, PTC chairman Richard Magnus said the council will consult widely, and engage commuters, public transport operators, experts and other stakeholders.

He noted how the public transportation system has evolved, with the introduction of more trains and buses, and improvements in service reliability.

He also highlighted that the Government has taken over the ownership of bus and rail assets under the Bus Contracting Model and New Rail Financing Framework, and is now "bearing the cost of improvements" to the public transport system.

"As highlighted during the Committee of Supply debate, the Government expects to spend close to $4 billion over the next five years to subsidise public bus services, and another $4 billion over the next five years on replacing rail assets," he said.

Noting that this is in addition to the $20 billion the Government has committed to building new infrastructure, Mr Magnus said: "Service improvements come at a cost."

"There will need to be equitable cost sharing among commuters, taxpayers and public transport operators," he said.

Last month, Transport Minister Khaw Boon Wan said in Parliament that it was not sustainable for taxpayers to increasingly subsidise the costs of running Singapore's public transport system.

While commuters had benefitted from the recent harmonisation of train fares between above-ground and underground MRT lines, Mr Khaw said the "PTC cannot always bring good news".

"Sometimes, they have to adjust fares upwards. If they do, I hope commuters will be understanding," Mr Khaw said then.