Netizens on social media are fuming after Transport Minister Khaw Boon Wan asserted in Parliament on Monday (8 July) that higher public transport fares are necessary to combat rising subsidies for the young, elderly and underprivileged.
The ruling People’s Action Party (PAP) politician said that higher fares are needed to keep subsidies in check. Revealing that the Government is currently subsidising more than 30 per cent of public transport operations, Mr Khaw said:
“Between 2016 and 2017, the total cost of running the rail network has increased by around $270 million. As the fares paid by commuters do not cover operating costs, the rail companies are operating at a loss.
“In the latest reported financial year, SMRT Trains incurred a loss of $86 million. SBS Transit’s train division also lost tens of millions of dollars.”
The increased expenditure in the public transport sector has been due to the Government’s efforts to raise rail reliability, in the wake of the many train breakdowns, service disruptions, MRT tunnel flooding and Joo Koon train collision in recent years.
There is speculation that these issues erupted in recent years due to poor maintenance practices in the past.
Asserting that the MRT network has improved seven-fold from 2015, Mr Khaw said that the Government expects to spend S$4.5 billion on operating subsidies over the next five years, on top of the S$25 billion it has set aside to build new MRT lines.
Mr Khaw added that the Public Transport Council (PTC) fare adjustments were not implemented to the full extent of what the formula allowed until recently and said that “we must have the discipline to implement the formula fully”.
He asserted: “If we had strictly followed PTC’s fare formula, the operators would have been better able to cover the costs of the intensified maintenance. But we must have the discipline to implement the formula fully, as we adjust fares over the next four years.
“In due course, the PTC will need to review the fare adjustment mechanism to reflect the increased operating cost to support the intensified maintenance, and the additional operating subsidies from the Government to the MRT system.”
Until the time the next fare hike is announced, Mr Khaw said the Government will provide public transport operators with “a temporary enhanced maintenance grant”.
Singaporeans have sharply criticised the Minister for making an assertion, that the people need to compensate for the subsidies the needy receive, especially when transport costs are high to improve the reliability of public transport in the wake of the recent debacles.
Some agreed that this was an example of “privatising profits and socialising losses,” while many others called on Mr Khaw and the top management of SMRT and SBS Transit to reduce their large pay packages to compensate for the subsidies themselves: