Our local paper The Straits Times reported on Tuesday October 27 that "More Cars, so public transport trips down". The interesting news is that the public transport's share of total number of trips made during the morning peak period is moving away from the 2020 target of 70%. It was 67% in 1997, 63% in 2004 and 59% in 2008.
Quoting from the article:
Dr Lim Wee Kiak, head of the Government Parlimentary Committee for Transport, believes transport planners should have been more aggressive in reducing the supply of certificates of entitlement (COEs) when premiums started falling three years ago.
He said: "They have an inflexible system. They tend to stick to the growth rate once they have announced it. I think they should be a bit like how the Ministry of National Development releases land - according to demand and the economy."
It is uncommon to hear a Member of Parliament bluntly criticized the Land Transport Authority. However, I do not agree to his viewpoint to have the supply of COEs controlled like land sales by the Singapore Land Authority (SLA).
SLA can release more reserve sites or move reserve sites to confirm sites when cooling measures need to be taken to prevent a real estate bubble. Conversely, SLA can also suspend land sales during an economic crisis as the developers are unlikely to bid above the reserve price (near the Estimated Market Value). Confirmed sites may also not be sold if the highest bid is below the reserve price.
Is Dr Lim suggesting that the supply of COEs be managed in the similar structure as land sales? In that case, LTA could make regular adjustments to the supply of COEs based on current variables relevant to meeting its objectives. Local motorists will be keen to know what are the objectives in such a structure. I am trying to picture different scenarios:
1. Booming economy - LTA releases more COEs for bidding and reaps record revenue for the government since demand is up and bidding is competitive. Prevailing Quota Premium is also high and discourages COE renewal for old vehicles. Lower income residents have no choice but to use public transportation and low performing businesses go bust due to the higher operating (goods delivery) cost for transportation.
2. Economic crisis - LTA sets a reserve price according to the estimated market value and thus, fewer COEs are awarded. Prevailing Quota Premium is supported by the reserve price and is still effective in discouraging COE renewal for old vehicles. Lower income residents have no choice but to use public transportation and low performing businesses go bust due to the higher operating (goods delivery) cost for transportation.
Why are the outcome in both scenarios similar? If getting to 70% by 2020 is the single goal, increasing the ownership cost and operating cost of private transport will surely drive up the usage of public transport.
It is extremely complex to meet the needs of businesses, public transport users, private transport owners and other players in the transport industry. I think hard about this problem and also do not have a simple solution that can please everyone.
I would suggest two areas of improvement to be considered:
1. Usage distribution - work with other parts of the Government to drive the spreading of demand on our transportation system e.g. tax incentives for companies to supply shuttle service from their offices to the MRT stations, flexible working hours, subsidy for onsite childcare, etc.
2. Connectivity redesign - overhaul the design of bus routes around the island, frequent reviews and adaptive changes. LTA manages the routes while the operators bid and passengers vote on the service level.
I am personally happy using public transportation during off-peak hours. But I have heard enough horror stories of the daily rush hours ..... And to members of the transport GPC, I am very willing to give up my car when we have a world-class public transportation system!