COS 2012: Vehicle Quota System improvements

Many working families with young children or elderly parents seek to own a car, not for a status symbol, but as a utility to help them cope with their busy schedules and multiple responsibilities. There have been concerns expressed by Singaporeans in newspapers and online that the inclusion of taxis in COE Category A could have an effect of pushing up the Quota Premiums for this category. This is because the private car owners have to compete with taxi companies for a limited number of COEs. In addition, buyers of these smaller cars are often less well-off than large car buyers.

Parliament

Committee of Supply Debate (Ministry of Transport), 7 March 2012

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Mr Chairman,

The Vehicle Quota System (VQS) exists to limit Singapore’s vehicle population growth rate. This is necessary because of Singapore’s limited land area and growing population.

The VQS is managed through the issuance of a limited number of COEs each year.

There are currently 5 categories of COEs—of which Categories A and B are for private cars. Category A is for taxis and small cars below 1,600cc; and Category B is for larger cars above 1,600cc.

Sir, many working families with young children or elderly parents seek to own a car, not for a status symbol, but as a utility to help them cope with their busy schedules and multiple responsibilities.

There have been concerns expressed by Singaporeans in newspapers and online that the inclusion of taxis in COE Category A could have an effect of pushing up the Quota Premiums for this category. This is because the private car owners have to compete with taxi companies for a limited number of COEs. In addition, buyers of these smaller cars are often less well-off than large car buyers.

The Ministry of Transport has said previously that taxis bid for COEs in Category A in recognition of the fact that they are part of the public transport spectrum albeit at the high-end.

Could the Minister explain why taxis are in Category A (smaller cars) and not Category B (larger cars), even though many taxis, like the Hyundai Sonata, in fact have an engines larger than 1,600cc?

Sir, in 2002 there were 378,706 private cars, distributed among 35% of local households. By 2008, the vehicle population had risen by 26% to 476,634, but the proportion of households which owned cars only grew by only 3%.

Does this suggest that the private car population is becoming more concentrated in a certain segment of the population?

Could the Ministry look into ways to adjust the way COEs are allocated, so that families with children are not competing directly with individuals and companies who are able to afford to place higher bids for their COEs?

Author: Gerald Giam

Gerald Giam is the Member of Parliament for Aljunied GRC. He is a member of the Workers' Party of Singapore. The opinions expressed on this page are his alone.

4 thoughts on “COS 2012: Vehicle Quota System improvements”

  1. Hi all, I would like to share with you some comments which I have posted on the straits times, which seems to have been taken down.

    In response to the COE:

    While the COE may artificially suppress car growth through rationalizing car ownership to a few rich people, it has failed to address the root cause of the problem, the real cause of congestion.

    For instance various source of research have indicated that the level of service for public transport is inversely proportional to the latent demand for car usage.

    In Singapore, a profit-oriented public transport system has resulted in unreliable services, evident in overcrowding of many buses and long waiting time. Similarly, taxi are also extremely unreliable, with commuters unable to board one during certain period.

    Disheartened by a public transport system that values profit at the expense of the level of services, Singaporean seeks to purchase car, as they have to commute to access job opportunities and educational opportunities regardless of the state of our public transport system.

    Thus, by pricing out people who intend to own a car, through artificially rationalizing the number of COE offered, without offering a decent and reliable public transport, the COE may have repercussions on our society, particularly, social polarization.

  2. Those who could not afford the COE are marginalized by the society through having no access to a decent transport system.

    In contrast, those who can afford the COE now faces less competition since many capable competitors are priced out of the best jobs, educational institution, and with access to opportunities, they became even relatively well-off compared to those who could not afford to bid for the COE.

    Thus, while the COE may artificially suppress car usage through rationalizing the rights to own a car, it has not addressed the root cause of our urban transport problem.
    Instead, it serves as a buffer for those in power, particularly the upper class who are likely to support the ruling party through excluding the middle and lower class from the picture.

    Also, the COE may serve as a means for the authorities to profit from their failure to address our urban transport problem as the revenue from COE is inversely proportional to the authority’s ability to offer a decent public transport system.

  3. Please refer to these Straits Times report,with regards to
    our current state of public transport, particularly, our financial
    framework.Please refer to my comments.

    Will it lead to a moral hazard? (17 Dec 2012)

    No Smooth Ride for Bus Passengers (17 Dec 2012)

    Use COE money to subsidise bus drivers’ pay rise (17 Dec 2012)

    Fare increase not just to raise salaries of bus drivers: Lui Tuck Yew (13 Dec 2012)

    Singapore takes No. 2 spot for best taxi services in travel survey (14 Dec 2012)

    Avoid a bus fare policy of half-measures (07 Dec 2012).

    Please refer to these articles, and my comments. They are searchable with various search engines.

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