Nov 06, 2013

    Fare concessions proposed with twist

    IT PROMISES to be an interesting balancing act between transport economics and social sharing. Up to one million commuters stand to get more concessions on public transport, if the recommendations of the Fare Review Mechanism Committee (FRMC) are accepted.

    Full-paying passengers may shoulder some of that burden. Meanwhile, heavy users could see a new monthly travel pass lower their bills.

    Two new concession schemes were mooted yesterday. One was for low-income workers and the other for persons with disabilities. Between them, they could help 500,000 commuters. The 1.2 million commuters already enjoying concessions could get even more help that would benefit some 500,000 of them.

    The FRMC proposed that the new schemes be funded by the Government to avoid imposing a financial burden on the public-transport operators (PTOs). Meanwhile, the enhanced schemes will be cross-subsidised by full-paying commuters.

    The chairman of the FRMC, Mr Richard Magnus, said: "It is useful...for full-paying commuters to be able to contribute to fellow citizens with regard to this area."

    Among those getting more help are about 100,000 adult commuters who travel long distances or make multiple journeys daily. A monthly pass would cap their bills.

    Cheaper monthly concession passes have also been proposed for polytechnic students. Singaporeans studying at local private schools also become eligible for student concessions.

    Transport Minister Lui Tuck Yew said in a Facebook post that he was grateful that the committee's recommendations focused on ensuring that public-transport fares remain affordable for all commuters.

    Mr Lui noted that the last fare exercise was in 2011 and said: "No fare exercise is ever popular but periodic fare adjustments are necessary, especially in the face of rising wages and fuel costs."

    The committee also wanted fares to be adjusted more regularly through annual fare-revision exercises.

    It proposed that the Public Transport Council (PTC) be given the discretion to roll over a portion of the quantum of fare adjustment in a particular year to the next fare-review exercise.

    This, Mr Lui said, would "avoid excessive fare hikes in any one year".

    "My own view is that any fare increase should be below the average national-level wage increase that year," he added.

    The FRMC said fare increases have lagged income and inflation since 2005, and that fares have to be adjusted regularly to address the mounting pressure from operating-cost increases.

    It proposed a new fare formula to be applied from this year to 2017. The formula will have a new Energy Index component, in the light of energy cost becoming a significant part of PTOs' overall operating costs.

    PTOs may be asked to contribute, too. The committee wants the PTC to ask operators to contribute 20 to 50 per cent of the expected increase in fare revenue each year to the Public Transport Fund. This was set up to help needy families adjust to transport fare hikes.