Saturday, 29 October 2016

Bus, train fares to be cut by up to 27 cents from 30 Dec 2016

Annual fare review: Bus, train fares to go down 4.2% as system is simplified
Fares based on shortest route; no difference between underground and above-ground lines
By Adrian Lim, The Straits Times, 28 Oct 2016

Public transport fares will have their deepest cut in years from Dec 30, even as the system for calculating them is radically simplified.

Fares will be levelled down so commuters pay the same amount for the same distance, regardless of whether they hop on a train line that is underground or above-ground.

They will also be charged on the basis of the shortest route between boarding point and destination. Till now, fares have been based on the fastest travel path, not the shortest.

As a result of last year's falling oil prices, and calculated through the new system, bus and train commuters will enjoy an overall fare cut of 4.2 per cent from Dec 30, the Public Transport Council (PTC) announced yesterday. It is the biggest reduction in recent years, after 2009's fare cut of 4.6 per cent.

The last major change to the fare structure was in 2010, when distance-based fares were rolled out, helping those making transfers.

For adults using travel cards, the fare adjustments will mean savings of between one and 27 cents for a journey. Senior citizens will have their fares lowered by one to seven cents, and students by one cent across the board.

Fares for fully-underground rail lines, such as the North-East Line (NEL), Circle Line and Downtown Line, will be lowered to be the same as those for above-ground lines, such as the North-South and East-West lines.

Trips on fully underground lines currently cost five to 25 cents more for adult commuters, but this differential - to reflect higher operating costs such as air-conditioned station platforms - will be removed. This higher charge started in 2003, with the opening of the NEL.

PTC chairman Richard Magnus said commuters will benefit as more new fully underground lines are opened in the coming years.

The move will better distribute commuters across the MRT network, as some take above-ground lines only for savings, the PTC said.

"Commuters will enjoy more flexibility in choosing the most convenient travel path, without worrying they have to pay more," PTC said. This will result in commuters always paying the lowest fares possible.

The PTC is guided by a fare adjustment formula in its annual fare review. While the allowable fare reduction this year is 5.7 per cent, the PTC decided to grant only a 4.2 per cent cut out of prudence.

The remaining 1.5 per cent reduction will be rolled over to next year's fare exercise, to spread out the impact of volatile energy prices over time, the council said. Mr Magnus also noted that this prudent approach is necessary for the longer- term sustainability of the system.

The fare reduction will mean a cut in revenue of $8.9 million for SBS Transit and $34.6 million for SMRT. Revenues for bus fares, which now go to the Government under the bus contracting model, will drop by $35.6 million.

The Government will cut fares for lower-wage workers and persons with disabilities, by a level proportionate to PTC's adjustments. Concession card fares for lower-wage workers will be lowered by one to 25 cents, while those for persons with disabilities will be lowered by one to seven cents.

Simpler fare structure a boon for commuters, say observers
But long-term sustainability of the public transport system needs closer study, say observers
By Adrian Lim, The Straits Times, 28 Oct 2016

The simpler fare structure announced by the Public Transport Council (PTC) yesterday is a boon for commuters. However, industry observers say the long-term sustainability of the public transport system warrants closer examination.

From Dec 30, train commuters will pay the same fares regardless of which MRT line they use.

Adult commuters using travel cards currently pay between five and 25 cents more if they use fully underground rail lines - such as the Downtown, North East and Circle lines - to reflect higher operating costs such as air-conditioned station platforms. This additional charge will soon be removed.

This restructuring of rail fares is part of a 4.2 per cent fare reduction granted by the PTC, under its annual fare review exercise.

Mr Sitoh Yih Pin, chairman of the Government Parliamentary Committee for Transport, said the simplification of fare structures will go a long way in allowing commuters to understand what they are paying for.

SIM University senior lecturer Park Byung Joon said: "The PTC is taking this rare opportunity to harmonise the fare system, without increasing fares for any commuter."

Dr Park said this is possible only because of the substantial fare reduction percentage allowed during this year's exercise, on the back of falling energy prices last year.

"Everybody will get some reduction in fares, with some more than others," he said.

Across the board, bus and train fares will be cut by 4.2 per cent - translating to savings of between one and 27 cents for adults.

About one in five of all public transport trips involves fully underground MRT Lines, and commuters are expected to benefit from this.

Economist Walter Theseira of SIM University said the current fare formula, which applies until the end of next year, will have to be re-examined with regard to the sustainability of the public transport system.

"The current fare formula merely reflects the changes in the operating costs year on year," he said.

However, he noted that the Government has made massive capital injections in recent years - such as an ongoing $1.1 billion programme to enhance bus services and the takeover of SMRT's rail assets for $1.06 billion. These have changed the costs of the public transport system "tremendously".

He added: "There is a longer- term question of how we want to apportion the costs of the system. Historically, we have been holding to the principle that commuters cover the operating cost. But it's quite obvious the Government is moving away from this model to one of subsidising more of these costs."

The Dec 30 fare reduction will see revenues cut by $8.9 million for SBS Transit and $34.6 million for SMRT. SMRT said it will continue to focus on improving service and reliability for commuters. SBS would say only that it was guided by the PTC's decision.

Mr Melvin Yong, executive secretary of the National Transport Workers' Union, said fares impact the income of public transport workers. "To maintain service reliability and long-term sustainability of our public transport system, large fare fluctuations should be minimised where possible," said Mr Yong, who is an MP for Tanjong Pagar GRC.

But he added that with the simpler fare structure, front-line public transport workers will be better able to advise on fares when asked.

Fairer rail fares the way to go
By Adrian Lim, The Straits Times, 29 Oct 2016

Much public debate was stirred before the launch of the North East MRT line back in 2003.

Commuters taking Singapore's first fully underground, automatic train system had to pay fares of up to 25 cents more, compared with using the older North-South and East-West lines, which are primarily above ground.

The justification was that a fully underground line would cost more to operate - station platforms are air-conditioned, for example. But commuters also argued that a driverless system would allow operator SBS Transit to save on manpower costs.

Still, this practice of charging a fare premium became the norm for subsequent underground MRT lines launched, such as the Circle and Downtown lines, which started running in 2009 and 2013, respectively.

But this will be scrapped from Dec 30, the Public Transport Council (PTC) announced two days ago, in a radical move to simplify the rail fare structure. This equitable treatment of rail fares is a welcome move to commuters for several reasons.

Two upcoming MRT lines- the third stage of the Downtown Line (DTL3), which is targeted to open next year, and the Thomson-East Coast Line, which will launch progressively from 2019 - will also be fully underground.

Removing any fare disparities will allow commuters to travel freely across the MRT network without having to bear an extra cost of using fully underground lines.

This is complemented by another change in the way train fares are calculated. From Dec 30, train fares will be derived based on the shortest path between the commuter's start and end points. This ensures commuters will always pay the lowest fares.

Commuters who happen to live in a part of the island which is served by a fully underground MRT line should not be made to pay more to use it.

The rationale that fares should be charged to help operators cover costs is becoming less relevant, given the huge reforms in the public transportation sector, with the Government investing in bus contracting and taking over rail assets.

Lower Fares for Lower-Wage Workers and Persons with Disabilities

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