[h=1]LUI TUCK YEW: IT'S NOT A GOOD IDEA TO STOP TRANSPORT COMPANIES FROM MAKING PROFITS[/h]
Post date:
13 Feb 2015 - 3:49pm
Transport minister Lui Tuck Yew said that they government should not be putting in policies which affect the profits that transport companies can make. He suggested that they should be allowed to make big profits so that they will have incentives to improve productivity and efficiency.
He said that this could ultimately lead to better outcomes for Singaporeans.
He said this in parliament in response to questions about why SMRT and SBS are allowed to continue increasing fares when they both report millions of dollars in profit each year.
MP Lee Bee Wah had asked why transport companies are not being forced to absorb the costs of rising costs when they report such good profits.
Minister Lui said that the companies' bus operations are still losing money and they have not been making huge profits on their fare business. He explained that the reason why these companies are reporting large profits is because they are making these profits in their non-fare businesses.
“If we say that you stifle every possibility of a private operator (from) making some profit, improving efficiency, productivity...if you stifle all that, then ultimately if it results in an even larger increase in fares, is that of benefit to everybody? That to me must be the question we must always ask,” he said.
He also said that the current system is intended to ensure long-term financial sustainability of the public transport system.
He said that they are already trying to keep fares affordable and this is fine.
Mr Low Thia Khiang had said that if, as Mr Lui claims, the operators were efficient and productive, they would not need to raise fares at all.
Without elaborating, Mr Lui also revealed that the Ministry of Transport has plans for the remaining amount in the Public Transport Fund, after setting aside some S$7.5 million to fund Public Transport Vouchers for needy households. It will announce the details later.
Post date:
13 Feb 2015 - 3:49pm
Transport minister Lui Tuck Yew said that they government should not be putting in policies which affect the profits that transport companies can make. He suggested that they should be allowed to make big profits so that they will have incentives to improve productivity and efficiency.
He said that this could ultimately lead to better outcomes for Singaporeans.
He said this in parliament in response to questions about why SMRT and SBS are allowed to continue increasing fares when they both report millions of dollars in profit each year.
MP Lee Bee Wah had asked why transport companies are not being forced to absorb the costs of rising costs when they report such good profits.
Minister Lui said that the companies' bus operations are still losing money and they have not been making huge profits on their fare business. He explained that the reason why these companies are reporting large profits is because they are making these profits in their non-fare businesses.
“If we say that you stifle every possibility of a private operator (from) making some profit, improving efficiency, productivity...if you stifle all that, then ultimately if it results in an even larger increase in fares, is that of benefit to everybody? That to me must be the question we must always ask,” he said.
He also said that the current system is intended to ensure long-term financial sustainability of the public transport system.
He said that they are already trying to keep fares affordable and this is fine.
Mr Low Thia Khiang had said that if, as Mr Lui claims, the operators were efficient and productive, they would not need to raise fares at all.
Without elaborating, Mr Lui also revealed that the Ministry of Transport has plans for the remaining amount in the Public Transport Fund, after setting aside some S$7.5 million to fund Public Transport Vouchers for needy households. It will announce the details later.
