I had a good discussion over drinks with a few Bedok residents near the Blk 58 Bedok Market and Food Centre this morning. A larger-than-expected group of about 10 residents joined the discussion. Also present was Mohd Fazli, my fellow East Coast GRC candidate during the last elections.

We discussed various local and national issues. Some were unhappy with the overcrowded feeder buses to Bedok interchange, even during the early hours of the morning. As many of them were in their 60s or older, they were disappointed that fare concessions for the elderly did not kick in until later in the morning, even though many elderly workers (esp cleaners) had to take public transport to get to work. On the issue of healthcare, they lamented that despite paying so much in Medishield insurance coverage, there were often unable to make any claims when they had to undergo treatment because of the high deductibles and co-insurance payments required.

It was a very fruitful and enjoyable session. I noted down a lot of feedback which I will study further and raise in Parliament where appropriate. I hope to have many more of such discussions in the future.

———-

Do you live in Bedok, Fengshan, Simei or Changi areas? Do contact me if you’d like me to come down to meet you and your friends/neighbours over drinks at a kopitiam near your place. My email is gerald.giam {at} wp.sg.

—

Get my latest updates. Join my Facebook Page.

This was an op-ed that was published in the Straits Times Review section on 19 July 2011, under the title “Consider the economic reality of transport here”. I would like to express my appreciation to my friends and fellow Party members who contributed to this article. It was a team effort.

————-

Minister for Transport Lui Tuck Yew recently criticised the Workers’ Party’s (WP) proposal for a not-for-profit National Transport Corporation to replace the current two listed public transport companies.

Mr Lui claimed that WP’s proposal had “serious downsides, chief amongst which commuters and taxpayers (yes, even those who don’t take public transport) are likely to end up paying more, and possibly, for a poorer level of service over time”.

He added that “it is the profit incentive of commercial enterprises that spurs efficiency and productivity improvements”.

Market failures in public transport

These are simplistic and tired old arguments about the virtues of private enterprises which fail to fully appreciate the economic reality of the public transport industry in Singapore.

Firstly, taxpayers who do not take public transport already contribute to the provision of public transport in the form of taxes that pay for the construction of roads, the development of rail lines and the purchase of the first set of trains on every new MRT line.

Secondly, public transport is an industry rife with market failures which the Minister seems to ignore.  The current regime where SMRT Corporation (SMRT) and SBS Transit (SBST) each provide both rail and bus services provides an illusion of competition.

The reality is that SMRT and SBST have clearly delineated areas of responsibility with no route overlaps.  This makes each of them a de facto monopoly provider in their own particular areas.

Commuters do not have the freedom to switch between providers whenever they choose to, nor do we see public transport operators (PTOs) fighting to acquire and retain customers like airlines do with promotions, discounts and loyalty programmes.

The monopoly status is also reflected in the consistent high returns these companies earn. Freed from the discipline of genuine market competition, they have few incentives to raise service standards and keep prices low.

To say that shareholder discipline will create such incentives is naïve at best, and wrong at worst.  Shareholders seek higher profits, not better or more affordable services.  The government must examine whether a public utility should be owned and operated by what are effectively private monopolists earning monopoly rents.

Mr Lui claims that the current regulatory regime is a “robust” one that does not allow operators to benefit at the expense of commuters.  This is a remarkable assertion once we consider the profits of PTO’s—$215.4 million last year alone.  The fines imposed for not meeting service standards pale in comparison to these profits.

Read more »

—

Get my latest updates. Join my Facebook Page.

This was my response to media queries I received on Tuesday (12 July 2011) regarding public transport fare increases:

———

The Workers’ Party (WP) has, in our 2006 and 2011 Manifestos, called for the MRT and public buses servicing major trunk and inter-town routes to be brought under a National Transport Corporation which will oversee and provide universal transport service to all. The National Transport Corporation should not be profit-oriented but should aim to provide public transportation services on the basis of cost and depreciation recovery.

This would avoid a situation like we have seen on Monday (11 July 2011) where, despite earning profits of $215.4 million* last year, the two public transport operators are still applying for what threatens to be the single biggest fare increase to hit commuters in recent years.

Having a National Transport Corporation would not necessarily mean higher subsidies or a loss-making endeavour. If competently run, the Corporation could reduce costs associated with the duplication of functions and roles.

We have seen many examples of efficiently run publicly-run service providers in Singapore in the past. It is a fallacy to think that the two public transport operators today represent genuine competition which imposes market discipline that ensures efficiency and good performance.

—–

* SMRT Corporation’s and SBS Transit’s profits for the year ending March 31 were $161.1 million and $54.3 million respectively.

—

Get my latest updates. Join my Facebook Page.

Ms Sangeetha Bysheim wrote in to the TODAY newspaper on 7 July appealing for her 75-year old diabetic father to be allowed to use his Medisave to pay his full bills for his regular check-ups and medication. Currently only about 20 per cent of his bill can be charged to Medisave and the rest has to be paid in cash. She explained that her father has a lifetime’s worth of savings in his Medisave and argued that this was a perfect age to start tapping fully on the funds.

In their reply today (July 9th), the Ministry of Health reiterated the government’s long-standing position that they want to “manage the extended use of Medisave funds carefully to prevent the premature depletion of members’ funds”.

The Workers’ Party (WP) had in fact proposed in its 2011 Manifesto that “Medisave withdrawals for outpatient medical treatment should be further facilitated (e.g., for specialist and major outpatient services), subject to a cap on usage” and that “patients above 75 years old should be allowed to use Medisave for medical treatment without restriction” (Healthcare chapter, pg 37).

I had also raised this proposal during my General Election Rally speech on May 2nd at Moulmein-Kallang GRC. The proposal came at the tail end of a long list of other proposals on public housing and healthcare that I had expounded on in my speech.

At the time, I thought that it might have been a more niche issue that wouldn’t find much resonance with the crowd. To my surprise, when I read out that line, there was a huge cheer from the crowd (even though I didn’t exactly deliver it with much emotion or emphasis).

Read more »

—

Get my latest updates. Join my Facebook Page.

Many people were pleasantly surprised to learn about my Workers’ Party (WP) colleague Chen Show Mao’s announcement that he will be giving up this law firm partnership to focus on his duties as an MP. He was a partner of a major international law firm, Davis Polk, who has chosen instead to devote his time and energies to a noble endeavour that he believes in.

Show Mao has in one fell swoop demolished the PAP’s long-standing argument that you need to pay million dollar salaries to attract good people into politics. This was in addition to his pivotal role in demonstrating that the opposition–and the Workers’ Party in particular–is able to attract our country’s best into its ranks.

I applaud his move and I hope many more captains of industry and top professionals will follow his example and step forward to serve Singapore in the political arena.

A friend recently posed this question to me: If you were the managing director or country manager of your company, would you give it all up like Show Mao did?

My answer: I didn’t wait to find out.

Read more »

—

Get my latest updates. Join my Facebook Page.