Yesterday (7 March), Transport Minister Khaw Boon Wan said in Parliament that the fare formula for public transport is being reviewed in view of the upcoming infrastructure upgrades.
He said that while Singapore’s transport fares are currently “affordable”, the Government also needs to ensure the sustainability of the transport network.
“We must be careful that (fares) are not priced too cheaply, as maintaining a high-quality transport system requires resources. Cheap fares are popular, but they are not sustainable,” he said.
He noted that the current formula is “inadequate” and the Public Transport Council (PTC) is reviewing it to take into account of “total costs”, saying, “I am confident that they can work out a fair and sustainable arrangement. Please support the PTC when they make their recommendations.”
“Over the past five years, improvements to public transport services have increased operating costs by about 60 per cent. One major contributing factor is the large increase in network capacity as we opened new lines and added more buses and trains,” he added.
“This huge cost increase has been borne by the Government. Against such rising cost, fares have gone down by 2 per cent over the same period.”
In other words, Minister Khaw is “hoping” that retired judge Richard Magnus who is currently chairing the PTC would take hint from the current Parliamentary debates to increase fares.
This is despite what Minister Lawrence Wong said in Parliament on Tuesday (6 March) that $5 billion of the current huge budget surplus would be set aside for a Rail Infrastructure Fund “which will benefit all MRT commuters”. He considered this surplus used for MRT lines as a “give back” to Singaporeans.
New MP Cheng Li Hui puts pressure on PTC to increase fares
During the Parliamentary debates, new PAP MP Cheng Li Hui stood up to give her two cents.
She criticised PTC for lowering the transport fares in recent years.
She said, “the additional operating cost was clearly not captured in our current fare formula setup as a result, operating cost has increased drastically while fares have lagged behind a for the last few years. This needs to be urgently addressed for a more sustainable public transport system and to prevent increasing burden on taxpayers.”
She said, “Given that operating costs have increased drastically, it is surprising to see the Public Transport Council has granted three consecutive fare decreases.” and asked for the explanation of why fare decreases were granted despite significant increase in operating cost for the last three years.
Ms Cheng is one of the new PAP MPs who stood in Tampines GRC during 2015 GE.
Indeed, Minister Khaw was delighted with Ms Cheng’s speech. He agreed with her wholeheartedly that fare adjustments had lagged rise in operating cost.
“I agree with Ms Cheng Li Hui that the current formula is inadequate,” he said. “It can be improved to better track total costs.”
Indeed, the last time PTC announced to lower transport fares was 5 months ago in October last year. This was for the 2017 Fare Review Exercise.
With the roll-over quantum of -1.5% from the PTC’s 2016 Fare Review Exercise, the fare adjustment quantum to be considered for 2017 was -5.4%.
PTC then decided to lower the rail fares for morning pre-peak travel by up to 50 cents, amounting to a fare adjustment quantum of -2.2%, with the roll-over quantum of the remaining -3.2% to be used in this year’s review at the end of the year.
MP Cheng Li Hui comes from a well-to-do family
Ms Cheng herself comes from a very well-to-do family. She is the daughter of founder and Executive Chairman of Hai Leck Holdings, Cheng Buck Poh.
Established in 1975, Hai Leck Group is one of the leading Singapore companies which provides engineering, procurement and construction services to the oil & gas, petrochemical, pharmaceutical and utilities industries. It is a public listed company commanding a workforce of more than 2000. It undertakes projects as well as maintenance services on routine and turnaround basis, according to its website.
In fact, Ms Cheng used to be the Deputy CEO of Hai Leck Group. In January this year, she was re-designated as a Non-executive Director on the Board of the company.
Prior to joining politics, Ms Cheng was involved with PA’s grassroots activities, helping out in PAP’s Bukit Panjang branch. She was later transferred to Tampines GRC to become the vice-chairman of PA’s Citizens Consultative Committee in Tampines East.
During the 2015 GE, she recounted how her father was poor and started out as a shipyard painter. Presumably, when her father started out as a painter, she wasn’t born yet. But she did talk about the need to “give back” to the society, like what Minister Lawrence Wong said about “giving back” to Singaporeans.
At the time during the campaigning for 2015 GE, she was already the deputy CEO of public listed company Hai Leck Ltd. It’s not known if she took MRT or was driven to work.
According to WSJ, she is also a board member of:
- Hai Leck Vietnam Engineering Co. Ltd.
- Hai Leck Overseas Investments Pte Ltd.
- Industrial Services Pte Ltd.
- Allied Construction Pte Ltd.
- Hai Leck Engineering Pte Ltd.
- Cheng Capital Holdings Pte Ltd.
- Enzo Investment Pte Ltd
- Hai Leck Development Pte Ltd.