Friday, March 24, 2017

Offer public transport subsidies to help S’pore become car-lite

[I am beginning to suspect a conspiracy. But let's go with the Forum Letter to TODAY first.]

Francis Cheng

March 11, 2017

If Singapore is aiming to be a car-lite nation where Singaporeans and non-Singaporeans alike, regardless of class, travel on public transport, then subsidies to ensure affordability may be a necessary element (“Khaw signals that transport fares will go up in future, TODAY March 9”).

Subsidies to public transport are common in many countries. A shift towards greater use of public transport can help reduce emissions and congestion. Public transport subsidies are all the more necessary for low-income households and the elderly.

If there are no subsidies, would people switch to private transport — adding to congestion — because they no longer feel public transport is good value, with the increased cost?

Instead of looking at reforming the fare structure, we should turn to corrective taxes, the way we levy high cigarette taxes to reduce the level of smoking, or fuel taxes reduce emissions from burning fossil fuels. We can, for example, raise taxes for private vehicles.

Maintaining fare affordability — with the help of subsidies — is crucial to reducing the negative externalities of private vehicles.

The state could strike a balance between its social and financial responsibilities by adjusting its subsidies according to different income classes, so that it still recovers some costs from fare revenue, while ensuring help reaches the targeted groups.

[Here is the news article he referred to.]
Khaw signals that transport fares will go up in future
Tan Weizhen

March 9, 2017

SINGAPORE —
Taxpayers have been increasingly subsidising the higher operating costs of the public transport network, a situation that is not sustainable going forward, Transport Minister Khaw Boon Wan said on Wednesday (March 8) as he asked commuters to be “understanding” when fares have to go up.
Although the Government would continue subsidising public transport heavily, in the long term, a balance must be found for the fiscal burden to be borne by commuters, taxpayers and operators, he added.

The Public Transport Council (PTC) would be reviewing the fare formula, set to expire after the 2017 fare exercise, Mr Khaw said in Parliament during the debate on his ministry’s budget. 
“But, remember, the PTC cannot always bring good news, sometimes they have to adjust fares upwards. And when they do, I hope commuters will be understanding.”
In his speech, he also laid out the projected higher investments and expenditure for the public transportation network in the years ahead. 
The Government expects to subsidise public bus services by close to S$4 billion over the next five years under the new Bus Contracting Model, where it is responsible for buying and replacing buses. 
Another S$4 billion is expected to go into replacing rail assets under the transition to the New Rail Financing Framework, on top of the S$20 billion it is spending on building new public transport infrastructure. 
Fare revenue, Mr Khaw said, is not enough to cover operating costs, which incurs a huge deficit. In earlier years, taxpayers were funding the construction of transport infrastructure, and commuters bore the operating costs through transport fares.

“But over the years as fares have not kept up with rising costs, taxpayers have to subsidise more and more of the operating costs, especially as we have been raising service standards significantly. This is clearly not sustainable,” he added. 
In its financial-year (FY) 2016 report, rail operator SMRT’s operating expenses increased by 5.4 per cent to S$1.2 billion, compared with the year before when it was $1.17 billion.
Passenger revenue was $929.5 million, up from $892.14 million in FY2015. 
Operating expenses for bus company SBS Transit similarly increased, from $930 million in FY2014, to S$998 million in FY2015. Fare revenue for buses — from contactless cards and cash — was $620 million in FY2014, and $645 million in FY2015. 
Commenting on the possible increased spending, transport analyst Park Byung Joon, senior lecturer at SIM University, said that operating costs would go up even further with the new model, due to the intent of offering better service levels to commuters.

“The service levels we are getting now are higher, which cost more to run. Better public transport does not come cheap,” he said. 
Assistant Professor Terence Fan, a transport expert at the Singapore Management University, said that operating costs for the Government should at least stay the same as compared to the old model, due to more competitive bidding expected under the new model. 
He added, however, that while there is the financial impact of changing to the new bus contracting model, it should not be a reason to raise prices. Having said that, the Government has been putting in a lot more new buses under the new model in order to improve services, “so there’s a cost to that”, he explained.

I love readers with selective memories and comprehension. They enable the newspapers to survive by raising non-issues for "public debate" - which seems to be operationally defined as "an issue (or issues) misunderstood (inadvertently, or deliberately for personal, political, ideological, or selfish reasons), and put up as a straw man to be effortlessly knocked down by the 'proposition' (letter writer) in the debate".

Take the claim or assertion of this writer - that there are NO subsidies for public transport. And he cites, apparently (and ironically) as support for his assertion, the news article quoting the Minister for Transport.


What did that article report? Did the Minister for Transport actually say that there can be NO subsidies for public transport? This is the first two para of that news report:
"Taxpayers have been increasingly subsidising the higher operating costs of the public transport network, a situation that is not sustainable going forward, Transport Minister Khaw Boon Wan said on Wednesday (March 8) as he asked commuters to be “understanding” when fares have to go up.
Although the Government would continue subsidising public transport heavily, in the long term, a balance must be found for the fiscal burden to be borne by commuters, taxpayers and operators, he added."
Note the first line of each para: "Taxpayers have been increasingly subsidising the higher operating costs of the public transport... Although the Government would continue subsidising public transport heavily..." (And there are more instances in the rest of the report that clearly indicate that the govt does and will continue to provide subsidies for public transport.)

Somehow from that, the author of the strawman argument that is this article, concluded that the govt is not subsidising public transport. From that I should conclude that the govt has been stinge-ing on subsidies and funding for education especially for simple reading and comprehension skills.

There is no further point in this meaningless debate. No point in pointing out that the current Bus Contracting Model decouples the link between revenue (fares collected goes to the government), and operating costs (operators are paid based on their contract bids), and capital depreciation (all buses and infrastructures are owned by the government).

The complexity and "business" of government are very important and we should be critical of government and government practices, and we should question underlying philosophies or ideologies. However, when what passes for public debate are such strawman fallacies, inaccuracies and falsehoods, it mires "public debate" in factual "corrections" rather than focusing on real issues. Of which this is NOT one.


In other words, the conspiracy theory I have is this: There are a lot of people complaining about non-existent issues and problems. Or problems that have been solved or are in the process of being solved. The mainstream media knowing that these are hot-button issues that seize the imagination and fury of the people, publishes letters that raise these non-issues. And waste the time of civil servants, bureaucrats, MPs and ministers in answering these questions. 

Meanwhile important questions that should be asked and issues that should be discussed, are not.


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