SINGAPORE — Freezing any future public transport fare increases will mean that taxpayers will have to keep paying more to help subsidise these fares, Acting Transport Minister Chee Hong Tat said on Tuesday (Oct 3).
He was responding to questions from Members of Parliament (MPs) on whether the Government had plans to expunge the 15.6 per cent public transport fare hike that was deferred to a later time, or freeze any future fare hikes by imposing a moratorium.
This is in light of the upcoming 7 per cent increase to bus and train fares decided by the Public Transport Council (PTC), even though the total maximum allowable fare adjustment this year was 22.6 per cent. This leaves the remaining 15.6 per cent of fare adjustment to be implemented later on.
“We should not pretend that the deferred fare increases can somehow be expunged and magically disappear, or assume that future fare increases can be frozen without consequences to our public transport system,” Mr Chee said.
“Making such populist moves will further enlarge the funding gap over time, which must be supported by higher government subsidies funded by taxpayers. It is not the responsible thing to do.
“We need to be clear that government subsidies are ultimately borne by current and future generations of taxpayers,” he added.
Without fare increments, public transport operators would have to absorb rising operational costs, or else taxpayers would have to bear a larger cost burden to provide higher government subsidies on a permanent basis.
Mr Louis Chua, Workers’ Party MP for Sengkang Group Representation Constituency (GRC), then asked if the Government would consider moderating the fare increase instead, just as it did in the fare review exercise in 2021.
Mr Chee responded that the fare formula takes into account inflation, but that there are other factors that need to be considered.
“However, we also need to look at other components that affect the costs of the operators,” Mr Chee said, adding that these include wages and energy costs, which are significant contributors to the costs of public transport operations.
Mr Gerald Giam, Workers’ Party MP for Aljunied GRC, noted that the public transport fare increase coincided with the record high Certificate of Entitlement (COE) prices and came soon after taxi and private-hire vehicle fares were raised in July.
“Singaporeans cannot help but feel squeezed, no matter which mode of transport they take,” Mr Giam said, asking if PTC had considered these recent increases in private transport costs when approving the public transport fare hikes, and the impact this would have on Singapore’s plans to be a car-lite city.
Mr Chee said that PTC was mindful of these concerns and so, had made the judgement call to allow less than a third of the maximum allowable fare increase amount.
CORRECTION: An earlier version of this report gave the impression that the Members of Parliament suggested freezing or expunging the latest 7 per cent increase to public transport fares. The suggestions were about freezing future fare increases. We are sorry for the error.