Well managed corporations usually address tough market conditions by implementing cost cutting measures such travel freeze, reducing new hires, trimming executive perks, etc, depending on the severity of the situation. Not so SBS Transit and and SMRT Corp - they simply ask the accommodating Gerard Ee (same fella tasked to "review" ministerial salaries) at the Public Transport Council to rubber stamp another hike in bus and train fares. EVP for trains Khoo Hean Seng is going for broke, "With uncontrollable cost increases due to rising fuel costs and manpower costs, we have applied for the maximum fare adjustment of 2.8 percent." It's uncontrollable by the commuters that's for sure, when the greedy buggers pay their CEO obscene salaries and tell you to take the next train if you don't like it.
SBS Transit even went on to enlighten us that they faced cost pressures "despite its efforts to raise productivity." Can management's abject failure to improve productivity, a nation wide goal, be justification to penalise the consumer? That Saw Phaik Hwa must have the easiest job in the world.
The albatross on every commuter's neck is the opaque formula that inputs inflation rate to adjust transportation fare, latter an item in the CPI basket of indices which defines inflation. Go figure. Maybe some kind whistle blower will leak us the formula, and we get to see if it's as flawed as the one used for calculating ministerial salaries.
Recently Brendan Wauters, president & CEO of Senoko Energy, said the new gas turbines which replace 3 decades-old oil-fired units at Woodlands are 2 per cent more efficient, and "reduces the fuel cost and allows to provide more competitively priced electricity for end users." Unfortunately, another opaque formula used by the EMA seems to index prices to current cost of oil, and Wauters' accomplishment will unlikely translate into lower energy cost for lesser mortals. Has someone forgotten about the 325 MMcfd of Natuna gas bought from Indonesia's Pertamina under a 22-year purchase agreement? Those long term contracts were supposed to hedge against the roller coaster ride of oil price fluctuations. Singapore's first deal to buy gas from Indonesia's West Natuna fields was signed in January 1999, worth some $8 billion for Indonesia. Surely that should have provided some relief to the relentless tariff hike.
An ex-PSA staffer told of how an international dredging company once ripped off the statutory board when they charged for the extensive reclamation work contracted. In that formula, which was not carefully vetted by the civil servants, the rate paid by PSA was indexed to the price of coal in Holland. Problem is, the fleet of dredgers run on oil, operating in Singapore waters. And we thought the best brains were in charge.
One thing's for sure, with the present Minister of Transportation installed, aptly name Tuck Yew!, Singaporeans can look forward to be over charged again.