,Public Transport Council (PTC) has announced in a media statement on 13 September that the 2016 Fare Review Excercise has commenced.
PTC said that the date line for train operators to submit fare adjustment applications for consideration is 7 October 2016.
PTC noted that with the transition of the public bus industry to the bus contracting model, bus operators will not be required to apply to the PTC for approval of fares.
PTC wrote in its statement that it will be guided by the existing fare adjustment formula – which is valid until the end of 2017 – for the 2016 fare review exercise. And on this ground, the allowable fare adjustment quantum may not be greater than -5.7%.
In the consideration of the applications, PTC stated that it will ensure that the fares will reach a balance between ensuring that the public transport system is financially sustainable and maintaining fares affordable for the customers.
The PTC will announce its decision on the fare adjustment quantum in the last quarter of 2016.
Transport Minister Khaw Boon Wan is also expecting a reduction in fares. He wrote to reply to a Parliamentary question on Tuesday, that he expects the PTC to consider ‘a maximum fare reduction of 5.7 per cent’.
Mr Khaw was responding to a question posed by Member of Parliament Gan Thiam Poh, if the council will consider a reduction in fares in the annual review.
He said this fare reduction amount is ‘due to the sharp fall in energy prices over the last year’.
But he emphasized that energy prices could be unstable, it may bounce back sharply in the following years.
CNA reported that Dr Park Byung Joon, a senior lecturer at SIM University's School of Business said, “It is very likely that fares will go down, but what will remain to be seen is whether they're going to allow the 5.7 percent reduction to happen fully this year, or are they going to reserve a little bit and postpone it for next year, as a buffer for the future.”
Mr Khaw had earlier raised eyebrows when he commented that the new bus contracting model which will take effect on 1 September 2016 may result in the raising of bus fares.
He said that the bus contracting model will raise service standards. Hence the improvements would raise the fees. However, he ensured that the fees would still be affordable.
The statement by PTC on the non-requirement to apply for fare adjustment in the new bus contracting model is a concern. Who will determine the fare adjustments in the future then? Land Transport Authority? Another case of ownself, check ownself?