70% more capacity on peak-hour trains by 2017: Lui Tuck Yew

Lui: Singapore's PTOs must stay privatised.

[UPDATED to include Lui's outlined plans for public transport by 2030]

Transport Minister Lui Tuck Yew shared in Parliament Tuesday his plans and vision for Singapore's public transport system by the year 2030.

Outlining his ministry's introduction of plans to ramp up its bus and train systems during the population White Paper debate on Tuesday evening, Lui said commuters will observe a "gradual but noticeable improvement" in their travel experience.

By 2030, said Lui, the current rail network will be doubled to 360 kilometres, with five new lines -- the Downtown Line, the Thomson Line, the Eastern Region Line, the Cross Island Line and the Jurong Region Line -- joining the existing four. This, he said, will allow some eight in 10 households to be within a 10-minute walk from a train station, and 90 per cent of buildings in the central business district to be within a five-minute journey on foot to one.

He also explained that in the past, the government's failure to accommodate sufficient rail infrastructure was due to "very challenging economic circumstances" as well as a significantly lower-than-expected ridership for the North East Line when it first opened in 2003, admitting that "we now find ourselves doing a lot of catching up" as it was too conservative in its infrastructure investments previously.

Sharing further details about the Downtown Line, which will open in stages in the next five years from this year onwards, Lui said it will relieve congestion that is experienced along the East West Line, particularly in Chua Chu Kang, Bukit Panjang, Tampines, Bedok Reservoir and Ubi.

He also promised that by 2017, ongoing resignalling projects on the North South and East West Lines will increase capacity by 20 per cent, and with the delivery of new trains by 2015, the North-East and Circle Lines will experience a 70 per cent and 60 per cent increase in capacity as well.

"And so in total, what this all means is that during the busiest one hour in the morning, our assessment is that we will have the capacity to carry 70 per cent more passengers into the CBD in five years' time compared to what we have today," said Lui. "However, I do not expect such a sharp increase in ridership... (so) what this implies is that for most commuters taking the train into the city, the journey will be less crowded by train."

Turning to buses, Lui said his ministry has added about 90 buses, improved 50 bus services and added five new bus routes since September, when the Bus Services Enhancement Programme was introduced. He also shared his aim to add a further 190 buses to the roads by the end of this year, forming half of the promised 550 within a five-year trajectory.

He also shared about an incentive-and-penalty system for bus operators that is practiced in London and Seoul that serves to better regulate waiting times for commuters, and said he hopes to be able to implement that for Singapore as well.

Should public transport operators remain private, profit-seeking, commercial entities?

Earlier Tuesday, Lui tackled questions from a number of MPs about whether public transport operators (PTOs) should be nationalised instead of remain profit-seeking, commercial entities, and whether or not this arrangement benefits Singaporeans on the whole.

He said restricting the profit-making abilities of public transport operators (PTOs) will result in less incentive to increase productivity and keep costs down, eventually resulting in higher fares and the need for larger government incentives, leading to a lose-lose situation for Singaporeans.

"Our PTOs are profit-making entities and are, on an overall basis, profitable. Unlike many of the nationalized systems, like the London Underground or the New York Metro, our PTOs also develop new revenue sources such as rental and advertising, so that they remain financially viable," said Lui.

MPs Lily Neo and Baey Yam Keng both asked for an in-depth examination of Singapore’s PTOs with the view to move away from a profit-orientated approach should be called.

Neo cited the recent illegal strike as a sign that a review was necessary, while Baey questioned if SMRT’s retail operations at the Singapore Sports Hub would distract from its primary role as a PTO. Baey also wanted to know how the revenue and profits from SMRT’s non-core businesses would be channeled into subsidizing public transport operations.

Lui responded that SMRT and SBST’s current Return On Total Assets (ROTA) rates are about 7.6 and 4.9 per cent respectively, putting them within the same range for most other public transport systems. Profits from non-fare revenue like retail operations, he said, are included in these figures.

SBS Transit and SMRT earned full-year net profits of S$235.6 million and S$119.9 million in 2011 respectively.

He cautioned against focusing on how high the ROTA rates are, saying that much of it would be plunged back into the transport system, as in the case of SMRT.

“Under current financing arrangements, SMRT needs to invest in more trains for NSEW lines, Circle Line and Bukit Panjang LRT. SMRT also needs to pay for re-signalling project for NSEW lines. These are all major investments to which SMRT has committed or are already in the midst of implementing,” said Lui.

“In addition, under CCL licence SMRT has to buy over from the govt the first set of operating assets in 2019.”

Lui also tackled the issue of transport fare hikes, pointing out that while fares have increased by just 0.3 per cent from 2006 to 2011, diesel prices have gone up by about 55 per cent and national wages by 25 per cent in the same period.

“This has caused a significant shortfall between fare increases and operating cost increases and put downward pressure on wages for public transport employees,” he said.

“While PTOs have increased bus driver salaries recently, against the backdrop of worsening bus industry financials, I expect that going forward it will be a challenge for the PTOs to do so without more fare increases or government subsidies.”

Lui added that the fare increases introduced by Singapore’s PTOs have been ‘lower than cities like Hong Kong, London and New York’.

“Our fares today are comparable, and in fact, generally lower. The bottom line is this: the government is fully committed to keeping public transport fares affordable. We want to carefully study this issue in greater detail for different income levels and various special groups. This will be a priority for us, moving forward.”

A recent Y! SG Poll of 3,000 readers showed that a whopping 84 per cent oppose bus fare hikes for higher driver wages.

Reported with Jeanette Tan at Parliament

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