School bus fares set to go up next, thanks to elevated fuel prices

SINGAPORE: School bus operators in Singapore will be allowed to impose a temporary fuel surcharge of up to 20% on fares for July and August, the Ministry of Education (MOE) announced on Friday (Jun 26), as elevated fuel prices continue to drive up operating costs.

The ministry said operators are currently discussing any fare adjustments with schools and informing parents during the June school holidays, allowing families time to make transport arrangements before the new school term begins.

The move follows earlier government support introduced after fuel prices climbed sharply during the conflict in the Middle East. The assistance covered school bus services provided between April and June.

In May, the level of support was increased from the equivalent of 13% of transport fare revenue to 20%. At the time, MOE said operators could introduce a temporary fuel surcharge from July if fuel prices remained high.

The ministry had also advised schools to reasonably consider requests from contracted transport operators seeking fare increases for off-site activities to help offset rising costs.

On Friday, MOE said it would continue monitoring developments in fuel prices and review the 20% surcharge cap if necessary.

Families receiving assistance under the MOE Financial Assistance Scheme will not have to pay more out of pocket despite the temporary surcharge. The ministry said these students will receive additional school bus subsidies to fully cover any increase in fares.

Parents who are not eligible for the financial assistance scheme but require extra help have been encouraged to approach their schools for school-based financial assistance.

Fuel prices rose during the conflict between the United States and Iran, which lasted for more than three months before both countries signed an agreement on Jun 17 to end the war. Although prices have eased from their peak, they remain elevated, continuing to put pressure on transport operators.

The Singapore School and Private Hire Bus Owners’ Association welcomed MOE’s announcement, describing it as a timely measure that would ease some of the financial burden faced by school bus operators.

The association told CNA that the decision on whether to impose the surcharge is entirely up to individual operators and that many operators are conscious of the financial impact on parents and may choose to levy a smaller surcharge than permitted, or none at all, despite facing substantially higher operating costs.

It also noted that although diesel prices have fallen slightly in recent days, they remain significantly above the levels operators had budgeted for when entering into fixed-price transport contracts.

According to the association, the recent moderation in diesel prices does not erase the heavy losses that many operators and subcontractors have already absorbed over the past several months, with many continuing to experience considerable financial strain.

The association said continued government support and broader assistance measures would remain important to ensure the long-term sustainability of Singapore’s school bus industry and the uninterrupted provision of essential transport services.

It remains unclear how many contracted school bus operators intend to implement the temporary fuel surcharge in the coming months.