Are we justifying the new transport fare formula with “fare revenue” with no mention of “total revenue”?
I refer to Christopher Tan’s article “New fare formula raises questions about transparency” (Straits Times, Mar 23).
It states that “The latest revision to the public transport fare formula is a clear departure from formulae Singapore has relied on thus far to ensure bus and train fares are equitable to all.
This is somewhat puzzling.
Firstly, there is the matter of directly linking fares to cost – not only operating cost, but the cost of building up our public transport network. This flies in the face of a longstanding principle of not allowing such costs to trickle down to commuters, so as to instil efficiency among operators, and financial prudence in the Government.
The Public Transport Council, which announced the revised formula yesterday, would not even give a hint of what some of these numbers look like. Neither would the council say how fares would have been affected if the new formula had been in place last year.
This is uncharacteristic of the council, which has thus far been quite transparent.”
After reading the above – it got me thinking about “transparency”. So, let’s try to dig deeper in respect of – “Annual operating costs increased by more than $900 million between 2012 and 2016 while fare revenue increased by only $230 million during that time”.
This is the primary reason given for the change in the fares formula to introduce the new NCF component.
I looked at the annual reports of SMRT and SBS Transit and found that Revenues increased by about $548 million from FY2012 to FY2016 (SMRT $240 million, SBS Transit $308 million).
So, does “while fare revenue increased by only $230 million during that time” refer only to “fare revenue” and not “total revenue”?
If this is the case – isn’t it in a sense like telling half the story to make a justification?
Also, what about profits?
Leong Sze Hian