Hougang Central Bus Interchange on a cloudy day. It is located directly above Hougang MRT Station. The bus interchange was planned to be an integrated transport hub (Photo by Kae Lee from Shutterstock.com)

PTC approves biggest fare hike since 1998 while SBS Transit’s net profit surges 70% to record $80m

The Public Transport Council (PTC) announced yesterday (8 Oct) that starting 28 Dec at the end of this year, commuters will be subject to a 7 per cent increase in bus and train fares.

“We have a transparent and objective fare formula that allows us to cap the fare increase and balance sustainability with fare affordability for Singaporeans,” PTC Chairman Richard Magnus said.

“We also considered that the Government continues to finance the public transport infrastructure heavily, and provide financial assistance for the lower-income households.”

PTC also noted that the Government will continue to subsidise “close to $1 billion per year” for the renewal of rail operating assets, and an additional $1 billion for bus operations annually. “This translates to more than $1 in subsidies for every journey,” it added.

The 7 per cent increase in bus and train fares was derived using a new formula introduced last year, which included a measure of Network Capacity Factor (NCF) that measures capacity provision relative to passenger demand for the entire public transport system.

SBS Transit’s operating profit increases by 28% in first half this year

Meanwhile, it was reported earlier this year that the new government bus contracts secured by SBS Transit drove up its earnings sharply last year. It posted a 70 per cent surge in net profit to a record $80.1 million (‘SBS Transit’s net profit surges 70% to record $80m‘).

Revenue rose 16.1 per cent to $1.38 billion for the 12 months to Dec 31 last year.

And for the first half of this year, operating profit rose 28.2% from $44.3 to $56.8 million when compared to the same time period of last year.

Despite the huge profits made by SBS Transit, the PTC went ahead to approve the fare hike, which is the maximum allowed in the formula, and the biggest percentage jump since 1998.

In any case, it was also reported that SBS Transit would be contributing $1.88 million to help lower-income households to cope with the fare increase.