SINGAPORE - Bus and train fares will go up by 2.2 per cent from Dec 26, said the Public Transport Council (PTC) on Wednesday (Nov 3) following its annual fare revision exercise.
This translates to a fare hike of 3 to 4 cents for adults who pay their fares by card and a 1-cent increase in concessionary fares for seniors, students, people with disabilities and low-wage workers.
Prices for cash fares, single trip tickets, monthly concessions and travel passes will remain unchanged, said the PTC.
Adult fares for journeys of up to 14.2km, for instance a train ride from Sengkang to Raffles Place, will go up by 3 cents. This covers about 75 per cent of public transport journeys taken by adults.
Adult fares for journeys of more than 14.2km will increase by 4 cents.
PTC said that while it recognises the "difficult economic circumstances" that Singaporeans are facing due to the Covid-19 pandemic, a key consideration for this year's fare review was the sharp plunge in public transport ridership last year.
"We seek commuters' understanding that it is not possible to keep deferring fare increases as they are needed to support the rising operating costs, such as energy and wages, for our public transport system," said PTC chairman Richard Magnus. "Lower fare revenue with higher operational costs cannot continue indefinitely."
Public transport ridership dropped to as low as 25 per cent of pre-pandemic levels during the circuit breaker period last April and May.
For the whole of last year, the average daily ridership for buses and trains fell by 30 per cent and almost 40 per cent respectively - the same levels as more than a decade ago.
In September this year, Transport Minister S. Iswaran said ridership was around 60 per cent of pre-pandemic levels.
Despite this, the operators have continued to run trains and buses largely at pre-pandemic frequencies, the PTC said, adding that they also incurred a few million dollars in costs a year from cleaning and disinfection regimes as well as the deployment of staff to ensure public safety on the ground.
SBS Transit and SMRT would have incurred significant losses in 2020 without broad-based Government support, the PTC added.
Both operators have asked for the full 2.2 per cent fare adjustment.
The maximum allowable fare adjustment this year is -2.2 per cent, according to the current fare formula which takes into account core inflation, energy prices, productivity and network capacity.
But the final adjustment is 2.2 per cent after adding the 4.4 per cent fare increase that was carried over from 2020. The PTC had decided to freeze public transport fares for that year.
PTC said it decided to grant the full 2.2 per cent increase to help mitigate the rising costs of running public transport services, noting that energy prices in particular have risen by over 30 per cent for the first half of this year.
It noted that the fare hike could have been up to 60 cents had it not excluded the network capacity factor (NCF) in the fare formula for 11 out of the 12 months last year. The NCF is a measure of the cost of expanding public transport capacity relative to ridership.
This comes after the PTC reviewed whether to include the NCF in this year's fare calculations, given the exceptional circumstances of the pandemic.
The PTC said the NCF for the whole of 2020 - if fully factored in - would have been 50 per cent compared with 3.9 per cent in 2019 and 1.6 per cent in 2018. This would have meant a 51.5 per cent, or 60-cent, fare increase.
Instead, the PTC derived an NCF of 0.7 per cent after it decided to consider only January 2020 - the sole month unaffected by Covid-19.
Mr Iswaran said in a Facebook post on Wednesday that the PTC took into account rising costs, potential losses by public transport operators if not for government support, the impact on commuters, and help for vulnerable segments of society in this year's review.
The 1-cent cap on hikes to concessionary fares means more than half of all Singaporeans will continue to enjoy substantial discounts of up to 70 per cent off adult fares. This is to protect the vulnerable and heavy public transport users, he added.
"The PTC will continue to do its best to safeguard commuters' interest while ensuring a financially sustainable public transport system," he said.
This year's fare hike translates to a $34.2 million rise in annual fare revenue - $4.6 million for SBS Transit Rail, $10 million for SMRT Trains and $19.6 million for the Land Transport Authority, the PTC said.
The two operators will contribute about $2.23 million to the Public Transport Fund to share their gains with commuters.
The Government will tap this fund to provide 600,000 public transport vouchers worth $30 each to help households to cope with fare increase.
This is the largest number of public transport vouchers issued to date, the PTC added.
Correction note: An earlier version of this story said this year's fare hike translates to a $34.2 million rise in fare revenue collected by the Government per year. This is incorrect. The $34.2 million increase in annual fare revenue includes the $4.6 million and $10 million increase for SBS Transit Rail and SMRT Trains respectively, as well as $19.6 million for the Land Transport Authority. We are sorry for the error.