Service levels expected to rise with wider coverage and shorter waits
By Christopher Tan, The Straits Times, 4 Oct 2014
SINGAPORE took the first concrete step towards overhauling its public bus industry yesterday by calling a tender for operators to run a package of routes for five years starting 2016.
By Christopher Tan, The Straits Times, 4 Oct 2014
SINGAPORE took the first concrete step towards overhauling its public bus industry yesterday by calling a tender for operators to run a package of routes for five years starting 2016.
The tender is expected to draw about a dozen bids, mostly from overseas firms. The move will effectively break up a three- decade-old duopoly held by SBS Transit and SMRT - paving the way for substantially higher service standards on the back of direct government subsidies.
Twenty-six bus services operating from the Bukit Batok, Clementi and Jurong East interchanges were bundled into the Bulim package - named after a new depot to be built off Jurong West Avenue 2 - for the inaugural tender.
It includes two new routes that will serve Jurong East and neighbouring towns.
Commuters can expect wider coverage and shorter waits. The current fleet of 290 buses serving the zone will grow to about 380 when a new operator takes over from the second half of 2016.
By the end of its five-year contract - which can be extended by two years for good performance - the fleet would have reached 500, or more than 70 per cent larger than it is today.
Modification to some of the routes could be on the cards, but the Land Transport Authority (LTA) would not comment.
It said service levels will rise significantly. At least half of all buses will arrive within 10 minutes, up from 30 per cent today. And intervals between buses will not exceed 15 minutes on any route, down from 30 minutes now.
These standards are believed to be unattainable with the current regime because bus fare rises are said to be perpetually lagging behind rising costs.
In the new model, operators bid for government-awarded contracts to run route packages for fixed periods. The Government also pays for operating assets such as buses and depots, but collects and keeps bus fare revenue. If revenues are insufficient, it will dip into state coffers for subsidies.
In the new model, operators bid for government-awarded contracts to run route packages for fixed periods. The Government also pays for operating assets such as buses and depots, but collects and keeps bus fare revenue. If revenues are insufficient, it will dip into state coffers for subsidies.
On the paradigm shift, LTA group director of public transport Yeo Teck Guan said: "We hope to get the best value for money."
Transport operators will submit bids in two envelopes: In one, they will outline how they plan to achieve service standards, and, in the other, they will cite the sum of money they need to do so.
LTA will open the second envelope only if it is satisfied with proposals in the first. It said "higher weightage will be given to quality".
The first tender closes on Jan 5, and will be awarded by the second half of next year. The winner will have around a year to start operations.
Mr Yeo said several companies had expressed interest, "but we don't know how many will actually bid". Among the firms are transport operators from Britain, France, Australia, Hong Kong, Japan and China.
French transit operator Keolis, which is present in 15 countries, said it will bid.
Senior adviser Dominique Siret said: "We never say we're the best, but when we make a promise, we keep it.
"We believe our expertise will help LTA achieve what it wants to achieve for passengers. We think like the passenger."
Another French group, Veolia Transport RATP, said it is "studying the tender in detail".
Project manager Mark Harbridge said: "Singapore's well- developed public transport infrastructure makes it a very attractive market."
Bid director Heather Haselgrove at Australia's Tower Transit Singapore said: "We look forward to submitting a competitive bid."
Singapore private bus operators are also keen.
Woodlands Transport general manager Roger Wong said his company "will definitely participate". He said the new model is attractive because "we don't carry revenue risk or heavy assets".
Mr V. Anilan, managing director of local operator Bus Hub, said: "We will study the tender carefully before proceeding."
Both operators will have nine other route packages to run when their current operating licences expire in August 2016. Their operating contracts are expected to be similar to the Bulim contract, but the exact terms - such as whether the Government will take over their existing assets and, if so, at what price - will be negotiated.
When the nine contracts expire in 2021, the two operators must jostle for rights to run them thereafter, like everyone else.
Fare revisions will continue to be regulated by the Public Transport Council.
* First bus tender draws 11 bidders
They include 4 local firms, 6 foreign players; winner to be announced in April
By Christopher Tan, Senior Transport Correspondent, The Straits Times, 20 Jan 2015
They include 4 local firms, 6 foreign players; winner to be announced in April
By Christopher Tan, Senior Transport Correspondent, The Straits Times, 20 Jan 2015
THE Land Transport Authority (LTA) has received bids from 11 companies for its inaugural public bus contract, signalling strong interest in a business that has long been deemed to be barely profitable.
By the time the tender for the Bulim package of 26 routes closed at noon yesterday, four local companies and six foreign players had submitted their bids. There was also one joint bid from a local and foreign operator.
The local bidders are Aedge Holdings and Woodlands Transport, as well as incumbents SBS Transit and SMRT Corp. The foreign entities are Busways (Australia), Jinan Public Transportation Corp (China), Keolis (France), RATP Dev Transdev (France), Go-Ahead (Britain) and Tower Transit (Australia).
The joint venture is between local tour bus operator GSH and China's Jiaoyun Group.
Said an LTA spokesman: "All bidders will be evaluated based on the same set of criteria, such as quality factors and price, which will allow us to enhance the service levels of our bus industry and get the best value for money."
The Straits Times understands the winner will be announced in April, allowing the successful bidder about a year to prepare to start operating the Bulim package - named after a new depot to be built off Jurong West Avenue 2 - from as early as July 2016. Insiders reckon the five-year contract is worth around $100 million a year.
Woodlands Transport general manager Roger Wong said the company submitted its bid "on the belief that we have spared no effort and have put together a competitive, convincing and sustainable package".
Added RATP Dev Transdev Asia's bid director Mark Harbridge: "A high level of research has been carried out for the bid, and it has been put together by a large and experienced team."
Observers said the advantage may lie with the two incumbents as they know the cost structure and service requirements best. Even so, others said the threat of competition would have encouraged the two to make much more attractive bids than they would otherwise have. Chairman of the Government Parliamentary Committee for Transport, Mr Cedric Foo, has said a contracting model allows for "price discovery", where the true cost of providing a service is arrived at via competition.
While the tender evaluation is under way, The Straits Times understands the LTA is already preparing to put two more route packages up for bidding - one in Mandai and the other in Loyang.
Separately, SBS Transit and SMRT will have nine route packages to run when their current operating licences expire in August next year. When the nine expire in 2021, the two must jostle for rights to run them thereafter, like everyone else.
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