Singapore General Election 2016: Facts Singaporeans Must Know - Public Transport Fare Increases (article reproduced from Channel News Asia)
Public transport fares not tied closely to oil prices: Boston Consulting
Boston Consulting tracked changes to bus and MRT fares over the past 17 years and found these increased much more slowly than oil prices.
SINGAPORE: Bus and MRT fares in Singapore are not tied closely to changes in oil price. That is a key finding of a study by Boston Consulting Group, which shared the report exclusively with Channel News Asia.
Boston Consulting tracked changes over the past 17 years and it found that bus and MRT fares increased at a much slower pace than oil prices.
The survey also showed that wages rose steadily between 1997 and 2014 - the Consumer Price Index (CPI) rose at a slower pace for the first 10 years, before picking up pace from 2008. And according to the study, fare increases have lagged behind wages and consumer prices. Boston Consulting said fare increases kept pace with CPI for about the first 10 years, before slowing down. It added that Singapore is one of few cities in the world that keeps its transport costs low.
"The state actually invests in majority of the infrastructure - so the MRT, LRT lines, the bus interchanges, they have been built by the state there is an expectation that the public transport operators should achieve efficiency and productivity improvements every year," said Partner and Managing Director of Boston Consulting Group Singapore Dinesh Khanna.
"So even if you are expecting inflation to go up, fares should be growing at rates lower than inflation. Over the past few years, the state has also subsidized and put in place more concession fares for the senior citizens and other important interest groups."