SINGAPORE: As prices for COEs (Certificate of Entitlement) that allow people to own a vehicle in Singapore reached record highs last month, it’s time for changes to be implemented, Sengkang GRC MP Jamus Lim said in Parliament on Tuesday (Nov 7). Assoc Prof Lim’s speech was part of the full motion on rising costs of living in the country, which The Workers’ Party has deemed a crisis.
Assoc Prof Lim said that the high price of COEs affects not only people who legitimately need a car—such as those with children or who have disabled family members—but also anyone else who takes a cab or private hire cars (PHC). And while Assoc Prof Lim acknowledged the efforts the government has made to address rising COE prices, he said that these are insufficient in solving underlying issues. Furthermore, he noted that in 2022, the Transport Ministry said the Land Transport Authority had no plans to review COE rules.
“COE prices hit a new high in October, following repeated new records set in prior months. The open category now changes hands at S$152,000, more than five times the recommended retail price of a brand-new Honda Civic or Toyota Corolla sold elsewhere. This is one of the major drivers of ever-rising pressure on our nation’s cost of living, and COEs were implicated in the most recent increase in headline inflation,” he said.
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“The recent cyclical high in COE prices has come at an inopportune time, and has contributed to already rising costs of living. The existing VQS-COE system is broken, and while the government has made tweaks to the system, these do not address the true underlying problem that has led to boom-bust cycles in COE prices. Let’s not ignore the most important driver of supply—the imbalanced monthly quota—and some of the most prominent sources of demand, from PHCs and wealthier multiple- car buyers. Let’s better manage the COE system, an important driver of rising costs of living, consistent with the goals of the motion, which I support,” said Assoc Prof Lim.
He put forth a number of proposals for tackling the issue, which include segmenting the COE market into more specialized categories and creating a category specifically for vehicles driven for commercial purposes and for Electric Vehicles (EVs), which he had already proposed in Parliament last year. He also proposed removing PHCs from regular Category A and B bidding, proposing that car dealers should no longer be allowed to bid and that second car purchases should be required to be in the open category.
The Sengkang GRC MP also proposed solutions for addressing high COE costs for motorcycle owners, many of whom are from lower-income families. He reiterated what fellow WP MP Faisal Manap (Aljunied GRC) said on the matter and proposed subcategories in Cat D by engine capacity could be introduced. Replacing the bidding system for Class 2B with a balloting one could also be considered. /TISG