Sunday, March 23, 2014

Transport Fare Hikes: A necessary but untimely affair. (2nd February 2014)

Our Singapore Happenings 
2nd February 2014 

Transport Fare Hikes: A necessary but untimely affair. 

                Recently the Public Transport Council (PTC) has approved both Public Transport Operators' (PTO) request of a 6.6% fare adjustment. The PTC then decided to roll over 3.4% of the increase to spread out the impact of any large increase in cost. Thus fares will hike 3.2% this year and kick in on April 16. The 3.2% hike is lower than the expected 4-5% increase in average national wage last year, and thus can be said to be reasonable. However, this announcement was met with an outcry amongst Singaporeans, with many speaking up and some protesting against it. I believe this reaction is expected and understandable from the point of view of a commuter, which I will explore more later. However, if we look from the operators' point of view, this fare hike is necessary and expected. Furthermore, this is the first fare hike since 2011. 

                 This tension between commuters and transport operators can be understood if seen through each other lenses. 

                 Through the transport operators' lenses, over the past two years, their operational costs have sky rocketed. With higher fuel cost and staffing wage increment amongst others, their financial accounts have been in the red over the past years. Thus this fare hike could well be the only way to make this service possible and sustainable. This 3.2% increment will also mean an estimated 53.5 million in extra revenue for these PTOs per year. Hopefully a good part of this 53.5 million will go towards improving transport reliability and systems as well. I believe this increment has been modest. If you look at transport cost in comparison with your wage increment year on year, transport cost has actually gotten more affordable - proportion of total spending spent on transport has decreased. 

                  Apart from the fare hike announcement, a slew of subsidies were also announced. There was a long list of subsidies with two new concession schemes targeted at those suffering from disabilities and those with lower income. These two new schemes are expected to cost the government a good estimated $50 million. Traditionally the government will be the one funding these subsidies, together with funds from the Public Transport Fund (PTF), which is topped up when PTOs are fined with failure to provide reliable service and the PTOs' public service contributions. However, with the fare hike, PTOs have to contribute more to this PTF. They will now contribute 11.58 million in a one-off contribution which is significantly more as compared to previous occasions. Thus this whole scheme may well be a move to build a more inclusive society where the needy and less fortunate are taken care by the working population. 

                Amongst all the new subsidies announced, one of them stands out in my opinion. Prices for concession passes for polytechnic students would be cut by more than 40 percent. This is actually a breakthrough for those who have been urging for transport fares for poly students to be on par with those in Junior Colleges. Simply phrased, the government is acknowledging the equally significant role polytechnics and junior colleges play.

               Next if we look through the commuters' lenses, their anger and frustration is understandable. Few can opine that train and bus service reliability have improved over the past 3 years since the major breakdown in late 2011. Train disruptions have almost become a second nature every few weeks. Bus timing reliability is still an issue. Many commuters are frustrated that the situation is not improving despite it being 3 years and are thus not willing to pay for the fare hikes. It did not help that there was an untimely string of train stoppages during the period when the fare hike was announced. From a private consumer point of view where choice is an option, no rational consumer will pay even more for poor service. The idea that we need to pay more now so that PTOs will have the funds to invest in new technologies and systems is absurd. As private companies, the operators are responsible for providing affordable and reliable transportation to the people. When such objectives are not met, the operators should acquire the necessary resources to fix the problems, instead of relying on hand outs from the government. Furthermore, the government has contributed $1 billion of taxpayers’ money to the private companies to assist them in improving their service. Such an act has provoked a small number of people into calling for the nationalisation of the transportation system.
The PTOs' need for an increment in fare and commuters' resistance to it essentially boils down to the difference between commuters' expectations and the current reality. I believe Singaporeans will be willing topay extra for good transport service. Thus I think now is the time for the PTOs to set things right once and for all and slowly regain the public's trust once again. The first step in this direction is being accountable to the public with its future actions. 

                Firstly, the PTOs have to reassure the public that a good percentage of the fare hike will go towards improving the transport system. They need to explain the specific steps that they will be taking to fix the situation with a time frame and an expected completion date attached to it. They will be held accountable by the PTC which will then monitor their progress and ensure that these measures are effectively carried out. The PTOs can also do a quarterly press release to inform commuters of the progress of these new implementations. As such, commuters can be assured that definite steps are taken to resolve the issue and change is imminent. 

               Secondly, to resolve the issue, the PTC could take up an additional role as an independent investigative auditor to assess the reasons behind these train faults. This investigative body could comprise of international experts on transport systems or retired rail/bus engineers who have the depth of experience and technical skills to assess and diagnose the root cause of these problems. Next, recommendations as to how to resolve the issues will then be submitted to PTOs for implementation. The PTC will then take on a big brother role of overseeing the successful implementation of these recommendations. This is possible as the PTC holds the trump card to the game - any PTOs who fail to comply with the given timeframe of implementation will be denied any request for fare hikes in the future. Definitely, plenty can be done to improve service reliability, such as improving the signalling systems of trains, retraining staff members, increasing the purchase of trains, and replacing worn out rail lines. The options are endless but experts need to recommend what is necessary to nip the problem in the bud. 

                The people have a desire to see that the additional money from the fare hike is put to good use, and that results are obvious. The patience of commuters’ is running thin, with confidence in the system at an all-time low. The PTOs certainly need to be held accountable, and improvements must be clearly shown. One can only wonder the duration which it will take before the system is fundamentally changed in a crucial manner. If there has to be a starting point, I would think it should begin today.


No comments:

Post a Comment