What makes the transport companies think that it is their god damn right to make millions in profits every year? And when profit is not enough, they simply apply to the LTA to raise fare? Is it a business that guarantees them profit year after year? Is there a business that has such a privilege status? Pow chiat business!
If they cannot make decent profit they should not be in the business and let someone else runs it. Don’t give the crap that they are answerable to the shareholders. They are answerable to the commuters too. Just because they are privatized, they can claime shareholders interests as the number one priority. Have they paid back the huge infrastructure cost of constructing the lines from public money?
In whatever guises, it is a public transport system and has a national duty to keep transportation cost low and to run efficiently. Making profit is secondary. The most important thing is that it is not running at a loss. For the last 10 to 20 years, how many billions have the transport companies been making, at about $200m to $300m annually?
It is time they think of the interests of the nation and the commuters. No business has a god damn right to be profitable year after year. Allow real competitors to run alternative routes and break down this monopoly.
Redbean
ReplyDeleteWould say that you are a little bit too harsh on them, on time scale basis, the transport companies have not increased that much.
Frankly, it is arguable, unless you are saying that the bus/train drivers/admin staff/maintenance staff/it staff/rank & file staff do not deserve a pay rise.
Further, if you were to dissect the financial statements, you would find the transport side not actually making that much money.
A fair chunk comes from the retails side within the buildings owned.
To ameliorate the increase, fine, to state that any increase should be below inflation, fine.
To say no increase, well, unless we wish to revert back to the early 70s/80s,would say that it would be a tad impossible.
Hi Wang,
ReplyDeleteMany people are trapped by this miraculous growth myth. The economy must keep growing by 5-10% or else die. The company profit must keep going up by 5-10% or else bad.
A continuous 5-10% growth is unsustainable. What is important is real gain. Is my income allowing me to purchase more goods than before?
Look at ministers and all the CEOs, with that kind of income, they are also expecting increments every year.
It is nonsense. If they can manage inflation, a 3% growth is much more than a 10% growth if inflation is more than 10%.
For the transport companies, what is a reasonable profit? How much did the bus drivers and ordinary workers get in terms of pay increases and how much did the top management get in their increases?
Where did the profits go to or who is getting the biggest share of the profits?
Dear Wang,
ReplyDeleteyour comments seem a tad too harsh too.
Noting your point about pay rise, the point is public transportation should not be a profit generating concept. Being listed, ipo-ed, having CEOs that have pay linked to profits is totally out of the point.
This creates the inherent conflict of serving the customers (public) and serving the shareholders.
Have you seen any private corporation apply to increase prices? eg Comfort Delgro taxis
If they think, its justified to increase fare due to inflation, staff costs, fuel costs, yadda yadda then by all means do it. Afterall its a private corporation.
Market demand-supply will ensure the proper correction and balance in a fair market.
Unfortunately we have a quasi-private corporation in SMRT and SBS Transit. And this unhealthy, incestous relationship they have with the "you-know-who" created an unfair market who preys on the public for their silly $200-300 million dollar profits a year.
rex comments as follows,
ReplyDeleteto wang, you pointed out that smrt profit wasnt really profit and most of the gains in 2010 come from the side business.
Is this a valid argument?
We look on SMRT as a whole. If they made $162 million in 2010 and it was NOT IN THE RED, on what basis they apply for increase in fares?
They have diversified to retail rentals, good, Management has foresight. IF they want they can even reward their staff with increment, it does not matter at all if the profits came from rentals.
So, because overall they are not in the red, they have absolutely zero reason to ask for increased fares.
A simple way for the Transport Council to manage is to stipulate that "No transport company shall be allowed to request for fare increase if their Net Profits of the preceding year is XXXX and their growth percent &&&&" the numbers XXX can be discussed but you get my point.
rex
The transport companies are working mainly in the interest of share holders.They have to make profits consistently and, as far as possible, attain higher profits this year than the last, year after year. If they cannot then the simplest solution is to raise fares.
ReplyDeleteHi so1trg, welcome to the blog.
ReplyDeleteSingaporeans are basically screwed by the silly logic of the day. The logic goes like this. If one invest $1m and earns 5% annually. This is not acceptable. It is bad. The profit must be more and more than the previous year.
In a commercial business, it is okay as they compete in the market by improving services and products to give better value than their competitors. In a monopolistic case, you cannot use the same logic. Neither can one use the same logic in public services.
The medical services is another case in point. The consumers will be squeezed dry to feed the ever hungry operators what wants more and more.
Hi Redbean,
ReplyDeleteUnfortunately, in SG, our dear govtmin intervene not for the welfare of the people who elected them but to suck every last dollar from us. So long as GDP is growing they say.
Well, maybe they have pre-empted us many-eons year ago, we are no welfare state. Every man for himself.
This spirit has perpetuated itself down to the strata of the society making Sporeans cold and hard towards each other.
Haizz ... Guess just have to suck it up and wait for the day when the environment rights itself.
Reversion to the mean. I hope it happens.
Monopolistic conditions do not favor Self Regulation. The only way is to inject consumer participation into an elected management.
ReplyDeleteThe Government should review their formulas for price increases with regard to Public Services.
Disallow the price increases & let the companies go bankrupt or else learn to Self Regulate to survive !!
In the early days, one had to pay for toilet use in MRT stations. Of course, it was scrapped since long time ago. Just curious to know whether it is feasible for operators to consider making 'level headed' profits so as to service all relevant costs entailed in keeping the public transports run efficiently and at commuters' satisfaction, in all sense of the word.
ReplyDeletePublic transport has to serve pple who can't afford private transport.Where is the conscience - squeeze $$$ from lower income people to increase profits.Only top mgt will benefit plenty from increased profits, not the lower level staff.
ReplyDeleteso1trg
ReplyDeleteUnsure why you would deem my comments are harsh, considering i just commented on factual basis and respectfully
Redbean
as a ex civil service, you would be aware that the transport infrastructure(especially MRT Network) was basically borned by government/people, so the rate of return is basically out of whack for the 2 main transport companies.
So1trg/Redbean
That the rate of increase should be below inflation rate, would agree.
To request that increase be in line with improvements make sense, but your present arguments does not compute when even you as individual if working in those firms would request for increase and all of us can live on fresh air and love.
For CEO and top management in fact all staff, unless we live in communist society, your proposal is unlikely to work.
Even China has given up.
Considering the scandal that even China communist senior leaders receive specials above and beyond.
As I take the train daily, it definitely hurts the pockets but i would rather see a gradual increase rather than one time hit.
Regards
Mr Wang, you seemed like a smart person with your responses thus I am rather surprised you fell for the foot in the door trick of slow fare increases instead of an election losing one-time increase.
ReplyDeleteWould you also mind going to your nearest hawker centre and noticing with your elitist unforgiving eyes the poor aunties and uncles aged 80 who are clearing your plates? Do you think it is fair for them to subsidise the PROFITS of a transport operator?
Show some compassion my friend, by a twist of faith, that cleaner could have been you or your parents.
Pity the daft Singaporean. Pity you.
Hi Wang, there are a few myths and self serving logics that must be put to rest.
ReplyDeleteBecause people are greedy or tend to corrupt, so the best way is to pay till they stop corrupting, or pay to corrupt them legally.
Essential services must not carelessly be privatised for profits. The medical services, education, public transport, public services etc must be carefully managed to provide efficient and effective services with minimum profit. Once the rationale is mainly profit, it becomes cancerous.
You don't need to pay millions for anyone to run a public service like the public transport system. And there is no need to keep the public transport companies making $200m every year as if it is a right or a right thing to do.
Cut away $100m of profits and they will still Have $100m of profits to run the same system as it is or better.
So why the increases? Justifiable?
Hi tom lim, no need such drastic measures when the companies are chalking hundreds of millions of profits.
ReplyDeleteMaybe should hold the prices till the profits drop to $10m or $20m then let them apply for fare adjustments, assuming that they do not know how to increase their revenue and profits from other means.
No need to pay millions to manage such a organisation.
The Last Two Comments by Mr Chua say it all.
ReplyDeleteHowever, liked the 60.1%, some will not be able to see it clearly, maybe 'public service' has to be clearly defined.
Public Service is essential service provided for the masses' health, shelter, employment, education, movement(transport), safety and other well-beings as an obligation of the State. Public Service may even requires the State to borrow in order to save its' people in a catastrophe!
Damn it! In Sin, it seems that some maybe looking after their parents and offsprings with expectations of monetary reward and return and not because it is their duties.
A hypothetical case. If tomorrow we were hit by a deadly and contagious disease, worst than SARS, and everyone needs a jab that cost $1k each.
ReplyDeleteWould the govt say pay up or no jab? Or would the govt give everyone a free jab or heavily subsidised jab and those that cannot pay will still get a free jab?
If this happens in real democratic countries, there wd be a hue & cry & protest. Its CARTEL action . CASE should look into this There should be a protest in HongLim Park to register this unjust quick & ez way to increase profits - it happens automatically always after the general elections.THEY hope that by the next election, pple wd have forgotten about this.
ReplyDeleteAnon 2:28 PM could also add that it is the duty of rulers to ensure that no rogue, individual, organization or business, bullies, exploit, plunder or cheat the people.
ReplyDeleteProfiteering when sanctioned may not be a crime, however it is a sin nonetheless.
Talking about crime, the ruler is duty bound to prevent them and bring to justice whoever has violated the law and good order, this includes sexual offences, robbery and theft, homicide and other transgressions.
Every government has to perform public service as a duty as well as a motto for a healthy nation.
Public service more often than not incur expenditures funded by the taxes paid by the people.
When public service is provided with the aim of making revenue and profit, it can hardly be called PUBLIC SERVICE.
Gentleman & Ladies
ReplyDeletePlease stick to the discussion points, if you want to bring politics into it, will stop for now.
I did not state any points on concessionary travel or the poor, I only referred to normal paying commuters.
for redbean, understand where you are coming from, having been based in a few countries, would just state that unless you expect the govt to be "gods", you are expecting the impossible.
For the senior management pay issues, pick it up with the USA who unfortunately lead the way in this.
The US is a bad example, rotten to core, like a bad apple. We chose a bad apple as a role model.
ReplyDeleteA govt can't run away from its responsibilities to provide efficient public services. That is why they are called govt and not gangsters or mafias.
Public transportation and essential services must be provided with profit not as a primary objective. The myth of calling them private, privatisation, can't deceive the people for long. It is still a govt responsibility and govt controlled service.
If they want to really run like private enterprises, make it real and allow real competition. The people are not daft. They are just bearing with the deception for a little longer.
/// Anonymous said...
ReplyDeleteA hypothetical case. If tomorrow we were hit by a deadly and contagious disease, worst than SARS, and everyone needs a jab that cost $1k each.
Would the govt say pay up or no jab? Or would the govt give everyone a free jab or heavily subsidised jab and those that cannot pay will still get a free jab? ///
Actually, this is not really hypothetical at all. Not long ago, I was at TTS Hospital. I saw a grown man crying at the reception counter because he has not enough medisave to admit his wife. And the nurse refuse to admit the patient.
Well, a man in the USA robbed a bank so that he can be afforded Medicare.
ReplyDeleteI hope our lovely country does not deteoriate to this extent.
Is Lucky Wang going to compete with Lucky Tan on satire ?
ReplyDelete