CAR POPULATION (Measures to ensure manageable growth)

Mr Ng Kah Ting asked the Acting Minister for Communications (a) whether, as a result of the recent increases in road taxes, ARF and PARF as well as petrol pump prices, car growth will become more manageable; (b) what other measures his Ministry intends to take to ensure that there will be manageable growth in the car population, bearing in mind that the private car today is more of a basic necessity than a luxury; (c) will he also not consider removing the ARF altogether and retaining only the PARF, i.e., a new car may only be registered in exchange for an old one; and (d) will he also consider allowing new increases in the number of cars to be balloted for and made non-transferable.

Dr Yeo Ning Hong: The measures taken have begun to produce results. For the first 6 weeks since the increases on 17 October 1983, the average weekly increase was 340 cars compared to 494 for the first 10 months of this year - a reduction of 3O%. My Ministry will continue to monitor the situation and study other possible measures to ensure smooth traffic flow. But we must be careful about solutions which will severely distort the economy and result in the inefficient use of our limited land.

The long term answer for us must lie in the more efficient means of transportation like buses and the MRT.

The suggestion to remove ARF altogether and make car buyers scrap an old car whenever they buy a new car is a very attractive idea superficially. It is very effective and will put an immediate lid on the car population. However, there are severe consequences. The immediate outcome would be that second-hand car prices will increase dramatically overnight. When this happens, the cost will be beyond those who may need to own a car in future. Such an approach gives a windfall gain to existing car owners at the expense of the rest of the population and penalises our younger workers and professionals. These are some of the considerations we have to bear in mind before we introduce new measures.

The suggestion that we allow some increase in the car population through a ballot is not satisfactory. The ballot, which is really a lucky draw in disguise, will result in a windfall benefit for the lucky applicants and we will be swamped with tens of thousands of applicants. The allocation of cars in this manner would be unrelated to the optimum economic use of our roads.