Minister Chee Hong Tat outlines gradual fare increases and additional government subsidies
Singapore’s Public Transport Council (PTC) is set to continue its “gradual approach” to public transport fare increases, aiming to minimize the impact on passengers while maintaining the financial health of public transport operators. The PTC’s recent decision to raise fares by 6% in 2024 follows a previous increase in 2023 and will see a 10-cent hike in bus and train fares for adult card users, effective Dec 28.
Future Fare Increases and Subsidies
The government has rolled over a 12.9% fare increase for future reviews, ensuring that public transport remains viable for operators while minimizing the burden on commuters. To help absorb the financial impact, the government will provide an additional $250 million in subsidies in 2025, on top of the $2 billion already allocated to fund bus and train services.
The 2024 fare increase is notably smaller than the maximum 18.9% hike allowed, which would have been based on a fare adjustment formula that considers inflation, wage growth, and energy prices. By introducing a gradual increase, the PTC hopes to strike a balance between affordability and covering rising operational costs.
Government Support for Lower-Income Households
In recognition of the rising cost of living, the government has increased the eligibility for public transport vouchers. In 2024, more households will qualify for these vouchers, with the income threshold rising from $1,600 to $1,800 per person. This change will benefit an additional 60,000 households and help mitigate the impact of fare increases for lower-income passengers.
Service Improvements and Accountability
Addressing concerns about the service quality in the wake of fare hikes, Minister Chee Hong Tat explained that the Land Transport Authority (LTA) has implemented mechanisms to ensure that public transport operators remain accountable for service standards. These include fines for poor performance and incentives for high-quality service.
The PTC also monitors the proportion of household income spent on public transport to ensure that fares remain affordable. For the average commuter, the proportion of household income spent on public transport dropped from 2.2% in 2014 to 1.7% in 2023, with projections for 2024 to remain stable.
