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Senior Minister of State for Transport Lam Pin Min told Parliament on Monday (6 November) that the plan to curb the growth rate of the car and motorcycle populations to zero will not significantly affect Certificate of Entitlement (COE) prices and supply.
Land Transport Authority (LTA) had announced earlier on 23 October that in view of Singapore’s land constraints and its commitment to continually improve Singapore's public transport system, it will lower the vehicle growth rate from the current 0.25 percent per annum to 0 percent with effect from February 2018 for COE Categories A, B and D.
The Minister stated that COE quota is calculated based on factors such as the number of vehicles that are scrapped, and adjustments to account for past over-projections, among other considerations, in addition with the allowable vehicle growth rate.
Responding to the question filed by Mr Saktiandi Supaat, Member of Parliament (MP) for Bishan-Toa Payoh GRC, who asked about the impact of the move to reduce growth rate to zero, including whether the public transport system can handle the increased passenger load, Dr Lam answered that the quota, which is revised on a quarterly basis, is largely determined by the number of vehicles that are scrapped or de-registered.
He stated that the Government has made heavy investments to improve bus and train services and will continue to do so.
Dr Lam said that there will be less need to own a car since the rail network has been expanded by almost 30 per cent to 230 kilometres over the last five years, which means that 8 in 10 households will be within a 10-minute walk to a train station by 2030, adding that the fleet size for existing MRT lines has also increased by close to 50 per cent.
He also stated that there are eighty new bus routes and 1,000 new buses will be added to the roads by the end of this year through the Bus Service Enhancement Programme which started in 2012 and subsequently the Bus Contracting Model, which took effect last year (2016).
Tampines GRC MP Desmond Choo also asked how the Government will ensure that the changes in the vehicle population growth rates does not adversely impact e-commerce businesses.
Dr Lam stated the Government has maintained the existing 0.25 per cent growth rate for commercial vehicles which will last till the first quarter of 2021, saying, "This is to provide businesses with more time to improve the efficiency of their operations."
Dr Lam also said that an urban logistics taskforce comprising of members from various agencies was convened last year to develop a more efficient logistics system in Singapore.
One such project is the development of a “federated locker network” to improve the distribution of goods from businesses to end consumers, adding that the Government is also mulling other innovative ideas, including the deployment of drones.
Mr Choo also asked if the ministry will consider a separate COE category for commercial motorcycles.
Responding to this, Dr Lam said that the current COE system sets aside Category D as a separate category for motorcycles so that motorcycle buyers need not compete with other vehicle buyers for COEs, saying, "Splitting Category D further would result in a smaller quota in each sub-category, which may lead to more volatility in prices."