SINGAPORE – Singapore’s regulator for public transport fares intends to continue taking a “gradual approach” towards future fare adjustments to mitigate the impact on passengers, said Transport Minister Chee Hong Tat.
Mr Chee on Oct 16 set out the Public Transport Council’s (PTC) approach to fare reviews in response to questions from MPs about the upcoming fare increase announced in September.
Bus and train fares will go up by 10 cents from Dec 28 for adults who pay by card, after the PTC decided to raise fares by 6 per cent in 2024 to help operators cover rising costs. Fares were also raised in 2023, 2022 and 2021.
The latest fare hike means that an adult passenger taking the MRT from Tampines to Raffles Place will pay $2.02 from Dec 28, up from $1.92 now.
Public transport fares are likely to continue rising due to a 12.9 per cent hike that the PTC has rolled over to future fare review exercises.
The Government will provide an extra $250 million in subsidies to cover the deferred increase in 2025, on top of the $2 billion it already forks out to fund bus and train services. This is to ensure the financial viability of the public transport operators here, and ensure service standards, including any planned improvements, are not compromised, Mr Chee told MPs.
Responding to Mr Saktiandi Supaat (Bishan-Toa Payoh GRC), Ms Poh Li San (Sembawang GRC) and Nominated MP Neil Parekh, Mr Chee said the promise of additional government subsidies gave PTC the assurance to grant a smaller fare increase in 2024, knowing that the higher costs of providing public transport would be accounted for.
The minister noted that the 6 per cent hike that the PTC granted this time is less than a third of the maximum allowable increase of 18.9 per cent for 2024.
This 18.9 per cent figure comprised a 3.3 per cent hike based on the fare adjustment formula, which takes into account core inflation, wage growth and changes in energy prices, as well as a deferred 15.6 per cent hike that had been rolled over from 2023.
However, while the Government has stepped in over the past few years to cover deferred fare hikes, Mr Chee said these additional subsidies are ultimately borne by current and future generations of taxpayers.
“We should therefore gradually close the gap over time where possible, which is what PTC is doing for this year’s fare review,” he added.
Asked by Mr Parekh what steps the operators have taken so far to improve their service levels given the recent fare increases, Mr Chee said the Land Transport Authority (LTA) has put in place different measures to hold them accountable.
Operators will be fined for lapses and given incentives for good performance, he added.