Home News Featured News Khaw: fare increases are needed to sustain improvements in service standards

Khaw: fare increases are needed to sustain improvements in service standards

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By: Kheng-Liang Tan

In an email interview with Lianhe Zaobao yesterday (28 Aug), Transport Minister Khaw Boon Wan said that the government’s Bus Contracting model – which comes into effect on Thursday – will raise service standards.

Under the new model, the government will own all operating assets – such as buses – which are leased out to operators. The revenue will be collected by the government and the operators will be paid by the LTA according to their tender bids.

Mr Khaw said that such a model will enable the government to respond to changing commuter needs while shorter contract period will make the industry more competitive.

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Such improvements are possible due to operators being free from large capital investments and are able to focus their resources more on operations.

However, the Minister also added that such improvements in service standards cannot be sustained without increasing fares. Such increases – if any – will be moderated by the Public Transport Council to ensure that they remain affordable.

SIM undergraduate Ong Liang Wei, commented that the current “bus timing interval sucks” and feels that “before [the minister] says [anything] about fare hike, [the government should] get [their] substandard service on par first.”

Last year, SBS Transit boosted a full year profit of $16.7 million – up 17% from the year before – due to higher revenue and lower fuel costs. Average daily ridership was up 2.8 per cent to 2.8 million passenger trips last year.

 

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