http://www.smrt.com.sg/SMRT%20APPLIES%20FOR%20FARE%20ADJUSTMENT.pdf
1. SMRT
has submitted its application for fare adjustment (read ...
increase!) to the Public Transport Council (PTC) today, 1
August 2008.
2. As with previous years, the annual fare adjustment is capped
based on a formula that takes into account consumer price index
(CPI), wage index and productivity gains. In 2007, consumer price
index (CPI) rose 2.1%, and wage increased 6.9%. Without factoring
in productivity gains, the maximum fare adjustment would have been
4.5% this year. However, in the last five years, the public
transport operators had achieved higher productivity gains.
3. Mr Vincent Tan, Vice President, Planning and Rail Operations,
SMRT Corporation Ltd noted, “SMRT’s efforts in growing non-fare
revenue from commercial activities like retail rentals and
advertising, and constant cost control and productivity drive have
yielded good results. This contributed to a higher industry
productivity extraction of 1.5%, compared to 0.3% in 2007. As a
result, the maximum fare adjustment quantum is reduced to
(+)3% this year.”
4. Even a maximum fare adjustment will not fully mitigate cost
increases due to an inflationary and higher operating cost
environment. For FY2008, SMRT’s energy cost increased 18% to $89.7
million due mainly to higher electricity and diesel prices. Of the
$89.7 million, electricity cost accounted for $47.5 million, an
increase of 19% compared to FY2007. Diesel costs for bus operations
amounted to $42.2 million, 17% higher than last financial year.
Besides higher electricity and diesel costs, SMRT fully absorbed
the increase in GST by two percentage points. The increase in
employers’ CPF contribution by 1.5 percentage points further added
to operating costs (so now you're blaming us eh!).