Full speech:
http://www.thegovmonitor.com/world_...nce-fares-fairer-for-all-commuters-37101.html
Sir, Members have raised several issues on Distance Fares. Let me start by explaining the rationale for Distance Fares.
Use the calculator here:
www.publictransport.sg/distancefare
Distance Fares is a fairer fare system. Previously, commuters making transfer journeys were effectively paying more to keep the fares lower for commuters who take direct journeys.
The Public Transport Council (PTC) has now removed this cross-subsidy or transfer penalty so that all commuters pay the same fare for the same distance travelled.
This way, commuters can choose the best way to reach their destination without having to worry about paying extra fare if they make a transfer.
The concept of Distance Fares is therefore a good one. The issue now is in the implementation. In this regard, the PTC had to consider how to distribute the costs associated with implementing such a system. PTC sought to reduce the burden on commuters by having the operators bear the lion’s share of the costs.
Dr Lim Wee Kiak asked if the operators would consider returning a portion of their profits to the commuters. The operators are in fact already bearing the larger part, about two-thirds, of the costs of the transition to Distance Fares. Overall, the operators have borne a permanent reduction in fare revenue of about $88m per year, as a result of Distance Fares.
For the remainder of the cost, the PTC had the unenviable task of distributing the costs amongst the various commuter groups – between direct and transfer travellers, short and long distance travellers as well as Adults, Senior Citizens and Student/Child travellers. If the PTC lowers the costs for one commuter group, another commuter group would have to pay more.
Thus if fares were to be lowered for commuters travelling long distances as Er Lee Bee Wah and Ms Irene Ng had suggested, it would mean that the fares for another group of commuters who travel shorter distances would go up. To find the appropriate balance, PTC followed the principle of benefiting as many people with lower fares as was possible.
However, as Distance Fares corrects the earlier inequity of fares between direct and transfer journeys, the fares for some direct journeys have to go up in conjunction with lower fares for transfer journeys with the removal of the transfer penalty.
In studying the impact of Distance Fares on commuters, the PTC used actual travel data from the fare system, which represented the prevailing travel patterns of commuters. This is far more comprehensive than a survey, as the data is derived from actual fares paid by the entire population of commuters using contactless smartcards.
The PTC’s projected impact analysis showed that 63% of all commuters would see fare savings in their weekly public transport spending under Distance Fares compared to the restored fares upon the expiry of last year’s temporary rebate of 3%.
As for the commuters who do not see the immediate benefits in terms of lower fares now, they may benefit in the future as their travel patterns may change and new rail lines and connections open. We are already seeing this happening with the opening of the Circle Line from Dhoby Ghaut to Marymount.
Mr Zaqy Mohamad asked if surveys were conducted to validate the projected impact analysis since the distance-based fare system was introduced. The PTC has indeed conducted a post-implementation validation exercise, not based on just a survey, but using the actual fare data collected in July under Distance Fares.
In all, PTC took data from 24 million journeys made over a one-week period for this analysis. The exercise confirmed that the impact of Distance Fares on commuters is very close to what PTC had expected. Overall, 68% of all commuters saw average weekly fare savings under Distance Fares, slightly above the 63% originally projected.
This may indicate that some commuters have already started to optimise their journeys by taking advantage of the flexibility under Distance Fares to choose less circuitous routes to their destinations.
Ms Irene Ng, Dr Lily Neo and Mr Zaqy Mohamad have asked about the impact of Distance Fares on senior citizens. For senior citizens, the PTC had in fact tried to do as much as possible to ensure there is a clear majority who would benefit from Distance Fares. Under Distance Fares, senior citizens enjoy a 25% discount from adult fares.
To reduce the impact on senior citizens travelling long distances, the fares were set such that they do not have to pay any additional fare for journeys longer than 7.2km. The outcome was a fare structure that would provide 7 in 10 senior citizen commuters (70%) with fare savings.
Again, these projections have been validated by the actual fare data collected in July, which show 74% with fare savings and 26% with fare increases. At the extreme ends, 5% of Senior Citizens save more than $2.30 weekly, while 5% see an increase of more than $0.77 weekly.
Ms Irene Ng mentioned that the elderly may find it physically taxing to make transfers to enjoy the benefits of Distance Fares. It is a misconception that commuters need to make transfers to benefit from Distance Fares or that the PTC is forcing senior citizens to make transfers.
What the PTC has done in introducing Distance Fares is to ensure that transfer journeys do not result in higher fares than equivalent direct trips. There is therefore no financial incentive under Distance Fares for commuters to transfer if the direct journey is of the same distance.
However, if a commuter is able to shorten his travelling time or distance by making transfers, Distance Fares gives him the option to do so. This increases the flexibility for commuters rather than reducing it.
On Ms Sylvia Lim’s question on whether Distance Fares will increase travel stress during peak hours by encouraging more commuter transfers and creating more congestion points, our assessment is that the opposite would occur. Commuters would now be incentivised to choose the shortest distance possible – be it a direct or transfer journey – to get to their destination, thus making the most efficient use of public transport resources.
Dr Lim Wee Kiak has asked about the extent and impact of the distance discrepancies and the measures taken to prevent such errors in the future. Given the scale of the exercise in introducing Distance Fares, it is inevitable that there would be teething issues during implementation.
LTA has acted on commuters’ feedback and made the necessary adjustments to the system. To date, errors have been found in the distance data for 13 bus stop pairs which represent 0.2% of the total number of bus stop pairs in the system.
These were due to errors in the dataset caused by ground changes, such as road diversions. Most discrepancies were in the range of 0.2 to 0.3 km, which is only a fraction of the 1-km fare band. The number of commuters affected by these errors is likely to be small as only journeys that cross over to the next fare band as a result of the discrepancy are affected.
As at 9 August, TransitLink has provided refunds for a total of 38 claims due to distance errors. Going forward, the PTC has put in place a regular review process to ensure that the fare system is updated and reflects the changes that occur on the ground.
Dr Lim also asked whether there should be a review of the distance-based fare structure. This initiative was previously debated in this House in 2008 and there was strong support for it as a fairer system for all. Distance Fares is a sound concept that will serve us for the long run.
As PTC Chairman Mr Gerard Ee has said, it would take time for people to get used to it and feel the benefits. We recognize that there are adjustments involved in the transition to Distance Fares, and that some commuters have to pay higher fares because of the change. However, we ask for commuters’ understanding as we are moving towards a fare system which is fairer for all.
For low-income families including senior citizens who may need assistance with fare increases under Distance Fares, the Government will continue to assist them through various community-led initiatives and work support schemes under the Community Development Councils and the CCC ComCare Fund.
Questions on Distance Fares
Dr Lim Wee Kiak: To ask the Minister for Transport in light of the dataset error resulting in miscalculations in the bus fares between North Bouna Vista Road and Commonwealth Avenue (a) whether there are errors in the fare structures in other locations; (b) how many commuters have lodged refunds for being overcharged; (c) what is the estimated total amount overcharged before the error was rectified; and (d) what are the measures taken to ensure that this does not recur.
Dr Lim Wee Kiak: To ask the Minister for Transport with the unhappiness expressed by various commuters following the recent introduction of the distance-based fares: (a) what is the Ministry doing with the feedback given by the commuters; (b) when can the public expect a further review of the current distance-based fare structure; and (c) whether the Ministry will consider having the transport operators return a portion of the profits to the commuters through a rebate or loyalty scheme.
Er Lee Bee Wah: To ask the Minister for Transport following the implementation of the distance-based fare system (a) why do commuters have to pay more for single bus or train ride when these services are designed precisely for such single trips; and (b) whether commuters should be rewarded with lower fares for choosing longer and more inconvenient routes.
Ms Irene Ng Phek Hoong: To ask the Minister for Transport in view of the travel patterns of the elderly in Singapore (a) what will be the impact of Distance Fares on them; and (b) whether the maximum long-distance fare for the elderly can be lowered as they may find it physically taxing to make bus-MRT-bus transfers to enjoy the benefits of Distance Fares.
Dr Lily Neo: To ask the Minister for Transport (a) what is the percentage of senior citizens who have to pay more for their public transport since the introduction of Distance Fares; (b) what is the percentage of such increased fares; and (c) whether he will consider implementing measures to reduce their burden.
Mr Zaqy Mohamad: To ask the Minister for Transport (a) whether the Ministry has conducted any formal surveys on the actual percentage of commuters who have had increases or reduction in their fares since the distance-based fare system was introduced; and (b) what is the impact on senior citizens.
Ms Sylvia Lim: To ask the Minister for Transport (a) whether the new system of distance-based fares will increase travel stress during peak hours by encouraging more commuter transfers and creating more congestion points; and (b) prior to implementation, what assessments were made of its impact on specific groups of commuters, such as senior citizens.
