An honorable member of the Coffee Shop Has Just Posted the Following:
The latest arbitrary, non-transparent and unreasonable public transport fare hike creates a severe Crisis of Public Trust with serious far-reaching social consequences. Despite facing sharply reduced fuel and energy costs and expecting to earn huge bumper profits for this year (2014-2015) into possibly 2017 and beyond, it is reported that both ComfortDelgro and SMRT have cited incredulous rising costs and lower profits to justify a public transport fare hike of 2.8% effective April 2015. And surprisingly, the Public Transport Council (PTC) agreed to the unjustifiable and indefensible fare increase.
Indeed, their Betrayal of Public Trust has finally come to a head as our public transport operators (PTOs) traded social conscience and responsibility for profits as they gradually erode the sacred Social Contract in Public Transport with Singaporean commuters.
The Betrayal of Public Trust
The PTO case in support of their claims of rising costs and lower profits has not been made available by the PTC to the commuting public. Never mind that the formula used by the PTC to “compute” fare increase is mathematically flawed and the summation of unrelated indices of unequal base further makes their derivative meaningless.
No valid reason can be evinced to justify the application by the PTOs, ComfortDegro and SMRT, to increase bus and train fare at this time (January 2015). At worst, there should be no fare increase, and at best a voluntary fare reduction of at least 2% should have been made by the PTOs for 2015 onwards.
According to an independent DBS Bank report BEFORE the fare increase announcement, earnings by ComfortDelgro and SMRT are estimated to increase by 4% and 7% respectively, mostly resulting from the sharp 50% oil price drop over the past 6 months and which is expected to remain low and lower in the near future. Energy and fuel account for 9% to 14% of our PTO costs. DBS Bank estimates that every US$5 per barrel drop in oil price could translate into 6% and 3% increase in earnings for SMRT and ComfortDelgro respectively, all else being constant.
DBS Bank has in fact revised SMRT earnings upwards to 4%-9% for its strong earnings recovery in 2014 and further expects SMRT to benefit more from the slump in oil price than ComfortDelgro. ComfortDelgro is also projected to grow a strong 15% in 2014, as well as in 2015 and the following years, also on the basis of lower oil prices. It also benefits from the $1.1billion the Singapore Government agreed in 2013 to provide for the purchase and maintenance of new buses over 10 years from 2014. In 2015, it would therefore receive another $110 million from this public handout, thereby subsidising its hitherto huge corporate profits.
The truth is that the PTO awaits huge public subsidies and do not provide reserves from their profits for public transport operating assets development, investments and timely replacement. As further evidence of grossly negligent management due diligence and responsibility, their Annual Reports also provide no indications to confirm any long-term strategic planning, fiscal prudence, and the efficient allocation of resources for assuring commuter quality in public transport services. Commuters are therefore constantly plagued by overcrowding, delays, breakdowns and other manifestations of inefficiency, poor management and poor service standards.
In further violation of their public duty commitment to make all fare increase “affordable”, the new fare increase has to be subsidised by a further $7.5million in the form of 250,000 public transport vouchers @ $30 each to help “needy” commuters. It would have been a better commonsense not to increase fare at all! In making unjustified and un-affordable fare increases,
http://miko-wisdom.blogspot.sg/2015/...singapore.html
Click here to view the whole thread at www.sammyboy.com.
29-01-2015, 11:10 PM
Restoring Public Trust in Singapore
