Opinion

Public Transport Fare Hike: What You Should Really Be Concerned About

mrt-singapore-header (1)

Peter Lin

0 Comments

9
Shares

Oh look, the annual public transport fare hike is here again. Although it’s something generally expected, people still have the same reactions to it as finding a rat in a salted vegetable dish. What, too soon?

Also, we won’t deny that it was pretty silly for Lui Tuck Yew to even suggest that we might get lower public transport fares just before the announcement. Excellent timing, sir.

But even with the fare hike, we were assured that children, senior citizens, low-wage workers and persons with disabilities would not be affected. So for the rest of us average commuters, what is the real financial cost of the fare hike to the average commuter?

Let’s take a step back and be objective about it. Here are three typical commuting scenarios for a working adult:

1. From a HDB in Sengkang to workplace in CPF Building (LRT, transfer to MRT) – 16.7km

Currently, the fare per trip would cost $1.86.

With the fare increase in April, such a trip would cost $1.91, or 5 cents more per trip. That’s generally 10 cents more a day. If you were to make this same trip everyday for a whole month, it would cost you about $3.00 a month.

2. From a condo in Bukit Batok to workplace in Anson Road (Bus, transfer to MRT) – 17km

Currently, the fare per trip would cost $0.77 + $1.49 – transfer rebate of $0.65 = $1.61.

With the fare increase in April, such a trip would cost $1.65, or 4 cents more per trip. That’s generally 8 cents more a day. If you were to make this same trip everyday for a whole month, it would cost you about $2.40 a month.

3. From landed property in Serangoon Gardens to workplace in Bukit Merah (Bus, transfer to MRT, transfer to Bus) – 18.2km

Currently, the fare per trip would cost $0.77 + $1.58 + $0.87 – transfer rebate of $1.40 = $1.82

With the fare increase in April, such a trip would cost $1.87, or 5 cents more per trip. That’s generally 10 cents more a day. If you were to make this same trip everyday for a whole month, it would cost you about $3.00 a month.

(All computations done using MyTransport.sg’s Fare Calculator)

So MP Lim Biow Chuan is a little off the mark when he says the fare hike will only cost about $1 a month. But you have to agree that he’s not wrong when he says, “It’s still bearable”.

This means, if your complaint is about the AMOUNT of the fare increase, then you’re barking up the wrong tree. If having to pay a maximum of only $3 more a month, which isn’t enough to even buy your daily Starbucks fix, is causing you to lose sleep and spasm uncontrollably, then maybe you should do some intense self-reflection (and perhaps stop consuming so much caffeine).

So what’s the real issue here?

This morning, I waited at the Circle Line platform for 7 minutes before the train showed up. As one colleague said, “Why do the trains always slow down as soon as a fare hike is announced?” It’s almost a reminder that even though the public transport fare hike will only be 2 to 5 cents more come April this year, it’s really just the tip of the unhappy commuter iceberg.

Public transport in Singapore is a necessity. It’s become such a crucial part of our lives, especially with our small land area and ridiculously high COE prices. We really don’t have too many alternatives, regardless of how unhappy we are with the service standards. As a beloved MoneySmart writer put it, “What the [email protected]#$ are you going to do? WALK? LOL”.

Yet, because it is PUBLIC transport, there will always be certain expectations that the public has whenever there is a fare increase, even if it’s just a few cents. An expectation that your trains will run on time and that they won’t break down, for starters. These aren’t unrealistic expectations, surely.

What about the rising operational costs?

According to SBS Annual Reports, the transport provider has still been enjoying an increase in revenue and the number of commuters that use their services over the past four years. SMRT’s latest Annual Report also shows that revenue for buses and trains has also been steadily increasing over the same time period. Yet both companies have reported operational losses in the past year.

In their 2012 Annual Report, SBS cited “higher staff costs, higher depreciation, higher repairs and maintenance costs and higher fuel costs” as the reason for their rising operational costs. When the fuel costs went down in 2013, “higher fuel costs” was conveniently replaced with “higher premises costs”. Presumably, the fare hike is supposed to cover these operational costs.

So, put simply, the number of people using your service is going up. Your overall revenue is going up. But you’re STILL making an overall operational loss? I can’t be the only person who thinks there’s something wrong with the picture here.

If SBS or SMRT were a private company, someone would already have been sacked for incompetence. Oh wait, that’s right, these ARE private companies. So why does it become society’s problem when operational costs have gone up? Why are we supposed to pay SBS and SMRT more to still be incompetent?

At the end of the day, after each annual fare hike, if there’s still no improvement in service, then something needs to change. We as commuters shouldn’t be paying more, even if it’s only a few cents, if the issues that have plagued public transport continue to exist.

What do you think of the public transport fare hike? Share your thoughts with us.

Image Credits:
Anil Wadghule

Keep updated with all the news!

Tags: ,

Peter Lin

I am the poster boy for reinventing one's self. I've been a broadcast journalist, technical writer, banking customer service officer and a Catholic friar. My life experiences have made me the most cynical idealist you'll ever meet, which is why I'm also the co-founder of a local pop culture website. I believe ignorance is not bliss, and that money is the root of all evil only if you allow it to be.

  • You’re Stupid

    If you’re going to preach about being objective then at least BE objective.

    “Yet, because it is PUBLIC transport, there will always be certain expectations that the public has whenever there is a fare increase, even if it’s just a few cents. An expectation that your trains will run on time and that they won’t break down, for starters. These aren’t unrealistic expectations, surely.”

    Yes, your expectation that public transport will never breakdown (because we all know trains are machines and machines never break down, right?) is unrealistic.

    “So, put simply, the number of people using your service is going up. Your overall revenue is going up. But you’re STILL making an overall operational loss? I can’t be the only person who thinks there’s something wrong with the picture here.”

    Let me give you a little lesson on accounting here. Revenue does NOT equal to profit. I can sell you 10 more cupcakes and my revenue will increase. But if I have to hire an additional baker whose wages obviously cost more than those cupcakes I’m selling you then I will be making a loss, understand?

    • Hi, “You’re Stupid”.

      1) I’d like to think it’s realistic that any machine, if given proper and regular maintenance and replaced after a certain level of usage, should not breakdown. This is especially so in a modern society like Singapore, where there is an immediate public outcry as soon as any machine, from buses to mobile networks, from trains to ATM networks breaks down. Sorry we disagree, “You’re Stupid”.

      2) Thanks for your little lesson on accounting. “You’re Stupid”, let me give you a little lesson on business here. If you hire a baker whose wages are more than you can afford, is it the customer’s fault? Does the customer have any say over how much you’ve decided to pay your baker? No. So why should the customer bear the cost of your hiring decision?

      Your comments are appreciated, “You’re Stupid”.

      • Thoughts_Clarity

        i want to move away from the name calling and focus on crucial points.

        1) it is a fallacy that with proper and regular maintenance and replacement, nothing breaks down. they still do, just less frequently. plus, companies need to strike a balance between maximising “useful” lifespan of equipment and replacement. more frequent replacements mean higher costs. higher costs need to be recouped somehow, whether through price increase, productivity increase, or whatever.

        2) revenue increase does not mean profits because there is costs. if costs rise more than revenue then there is loss.

        One reason why transport companies not making money on operations is nowadays fewer people want to be bus drivers. no point buying more buses when there are not enough drivers to drive them.

        Bus drivers can work for public transport companies or pte bus companies (including tour buses operators). So transport companies need to offer attractive pay and benefits to attract and retain drivers.Then transport company would need to increase prices to recoup plus make profit. though i used bus drivers, the increase in staff costs could also be due to other staff like mechanics, office workers, etc.

        one way to look at this transport operating losses is that the PTC is keeping prices lower than what the profit driven transport companies would like to return on their business. hence they are making operational losses.

        it is a mistake to say that since the customer has no control over how much a company wants to pay for its resources, the customer should not bear the cost increase. the company don’t increase costs for costs sake, it does so with an eye on increasing profits (margin or absolute amt) through sales to customers.

        it is a dynamic (and complex) relationship between business costs and the price that customer pays.

        if customers find bus fares expensive, then some questions to ask ourselves are:
        1) can we revert back to non-aircon buses?
        2) can we accept less comfortable seats? maybe change to those plastic seats on the MRT which are cheaper to maintain?
        3) can we accept less number of seats so that there are more standing space to load more passengers per bus?
        4) can those of us who work for public bus companies(mechanics, engineers, office staff etc) accept lower pay (to lower costs) ?

        the above would lower costs.

  • Pingback: In-depth research on Singapore’s Transportation (history) | thedingdongz()

  • Almondsfast

    If I were the one doing the calculations, I would take the daily increase x20 days rather than x30 days in a month (because weekends no need to go to CBD/workplace !)