WORLD CLASS LAND TRANSPORT SYSTEM (Motion)

Order read for Resumption of Debate on Question (18th January, 1996),

"That this House endorses the Paper Cmd 1 of 1996 on "A World Class Land Transport System" as the basis for developing an outstanding and affordable transport system for Singaporeans.". - [Minister for Communications].

Question again proposed.

Dr Wong Kwei Cheong (Kampong Glam GRC): Thank you, Mr Speaker, Sir, for giving me this opportunity to speak.

May I, first of all, congratulate the Land Transport Authority (LTA) for coming out with this very comprehensive report in spite of the fact that it has only been set up in September last year, and in three months, it was able to do this wonderful job. I am sure that under the management of LTA we can achieve our objective of having a world class transport system within the next 10-15 years. As my parliamentary colleagues yesterday have already covered a lot of the points, I would like just to cover a few points to complement what has been said yesterday.

First and foremost on improving the service in MRT stations. Those Members who have travelled in London, Tokyo, and use the Metro stations and MRT stations, will find it very convenient because at every station there is a time indicating when the next train will be coming. I believe in Singapore this is something that can be introduced to all the MRT stations as a first step for the LTA to improve their services.

The second point I want to bring up is the use of MRT stations for development purposes. In the Cairnhill Constituency, for example, we have three very good MRT stations at Dhoby Ghaut, Somerset and Orchard Road. Unfortunately, these MRT stations have not been developed. From what I understand, it is because of the stringent conditions laid down by the LTA when it comes to bidding for development purposes. For example, developers may be required to give warranties of up to 30 years that the MRT station will not be damaged. This kind of stringent conditions have discouraged many developers from coming to make their bids and develop these stations. May I suggest that the LTA take up this challenge of being a developer and develop these stations either on their own or in joint venture with one of our developers and set the example and show our developers how such stations can be developed in a manner that can ensure the safety of our trains.

The next point which I want to bring up is that the LTA in designing new lines, especially the North-East line, should make a proper study of the location of MRT stations. I have also discussed this with my residents in Cairnhill, especially my Residents' Committees at the Tekka Market, and they strongly suggest that the MRT stations should be located somewhere near Tekka Market for the simple reason that every weekend the Tekka Market has a big problem with the foreign workers and one way to solve this problem is to keep these foreign workers, if possible, in the air-conditioned comfort of the MRT station rather than around Tekka Market. I hope the LTA would take these into consideration when they are planning their new MRT stations along the North-East line.

Another point which I want to bring up is the bus service. At the moment, the bus commuters wait for long periods of time at certain bus stops. As in Tokyo, when we come out of the Narita Airport to take the airport bus, we always know exactly when the next bus is coming because there is always a clear time indication of the next bus going to which destination and I hope the LTA can use this as an example to have a clear time indicator at all the bus stops, especially the key bus stops along Orchard Road.

Finally, the LTA, with all its efficiency, could perhaps spend some time immediately to solve some of the transport problems that are causing a lot of concern to our residents, especially along Dorset Road. I have brought this up several times. There is only one bus service No. 131 serving a large area of Farrer Park. Of course, the question of profitability is always there, but I hope the LTA could address this problem and help our residents. Sometimes they have to wait up to an hour for the next bus, and would like to have a better bus service along this route.

Mr Lew Syn Pau (Tanglin): Mr Speaker, Sir, I commend the LTA for a comprehensive, integrated White Paper on our land transport system. It is an integration of existing stated policies and measures, a reconsideration of some old ideas and suggestions, and further development of new ideas in greater depth, such as the ERP system, the integration of bus interchanges with taxi stands and MRT stations, and the more intensive developments around such MRT stations. The newest proposal which will probably have the greatest impact on all of us is the new financing framework and it is on this section that I will focus the bulk of my attention.

Firstly, I support the concept of partnership in the financing policy of transport. The White Paper says that the Government provides the transport infrastructure, the commuters pay for the operating cost, while the operators extract efficiency dividends within the service standards and fare structure approved by the PTC. It is not very clear what is included under "transport infrastructure". The obvious items would be roads, MRT lines, tunnels, bus stops and taxi stands, and so on. In the White Paper on page 43, it is stated that the LTA will provide covered linkways and overhead pedestrian bridges between MRT stations and bus stops to the nearest building. This, I am sure, is good news for the Town Councils in HDB estates as most covered linkways are now built and paid for by Town Councils, or the CCCs with the support of the CIPC. My question is: what about the bus stops in private housing estates? Will linkways be built to connect them to the nearest common area?

I also agree with the proposed principles of financing. Here again, I have a few clarifications to seek. On page 63, it is stated that the PTC will approve fares based on a few principles, one of which is that the fare revision will be based on what PTC considers to be an acceptable rate of return to the public transport companies. I wonder how the PTC will be able to ascertain what this rate of return should be. Will the PTC make this public? What will they use? Return on assets or return on equity? What will be the rate of return? Is it 10% or 15%? Will these rates of return be different for different transport companies like taxi companies, bus companies or the MRT? Many transport operators, as we know today, are already public-listed and I am sure shareholders would be very interested to know.

Next, I agree that public transport projects must at least cover operating cost. However, this should be taken at the level of the whole entity, and not route by route, for instance. Without requiring some cross-subsidy between routes, bus companies would abandon loss-making routes to lesser populated outlying areas and private housing estates and compete only along the major corridors. Hence, although I support the policy of minimum cross-subsidy in general, in some instances, economic hurdle rates should not be the only criterion. Other considerations should be taken into account. As far as I can see, and I stand corrected on this, there are few transport policies that have evolved purely out of economic consideration - many include a wealth tax or wealth redistribution element. For example, in the COE policy, we categorise COEs and we allocate less COEs for the luxury cars so that the lower and middle income will end up paying less for the COEs for small cars. If we were to charge purely for car ownership or road usage, there should be only one type of COE and one price. The same thing for the ARF which is 150%. This is also partly a wealth tax as purchasers of big cars end up paying more taxes even though they use the same road space. The ALS and the ERP will be a pure usage tax, as long as we do not make bigger capacity cars pay more for using the roads. The point I am making here is that since most of our transport policies are not based on pure economics, is there any need to be puritanical in the formulation of other transport polices? Hence, in my view, the decision to build the North-East MRT line should not be based purely on economics.

Thirdly, I agree with the new sustainable policy on asset replacement, that is, for each generation to pay for the services and assets it consumes. With co-financing from the Government for the purchase of the second set of operating assets, fares can be kept lower for the commuters for a longer period of time. Here, again, this is an indirect decision of the Government to cross-subsidise MRT commuters because the Government revenue is really tax revenue, and the bulk of which, as we know, are paid by people who own cars and seldom use the MRT. Having said that, I am not suggesting that these higher income taxpayers begrudge those who enjoy the subsidy. On the contrary, the challenge for the Government would be to induce such car owners to leave their cars at home, or at/near MRT stations, and take the MRT to the city. The Government should seriously consider building multi-storey car parks at MRT stations, like the Newton Station, Buona Vista or Thomson/Novena stations and other suitable locations, to make it convenient for motorists to do so. For non-motorists living in private housing estates (and there are quite a few, for example, the wives, school-going children and aged parents who do not have cars), their main problem is how to get to the nearest MRT station or the bus stop without working up too much of a sweat under the heat, or getting drenched from the rain.

I have no easy immediate solution that is economically viable on its own to offer right now, but I would like to suggest that the LTA study this issue in greater detail. Perhaps, to begin with, the LTA could identify a central bus stop in every private housing estate to develop into a mini-hub and bicycle sheds could be constructed next to this bus stop, together with a taxi stand, to help provide some form of a seamless journey. Amenities like vending machines and public telephones should be installed to make waiting more comfortable. Proper waiting areas for cars could also be added for drivers to pick up their loved ones.

Finally, before I close, a few words on taxis. Taxis are at the high end of the public transport spectrum, and like private cars, would be the most severely hit by the electronic road pricing system. I am grateful to note that the Government will phase in the ERP charges for taxis gradually over several years. In the White Paper, it is not very clear how this will be done. But in my view, for the system to work well, we have to find a way to have the ERP charges transmitted to the taxi meters straightaway so that taxi commuters can pay for them at the end of their journeys without dispute with the taxi drivers. ERP charges should rightfully be paid by commuters and not by taxi drivers, as for the ALS right now. With ERP, taxis should cruise less and be encouraged to wait at stands. However, to make this more convenient, there should be more taxi stands and the stands should be larger. Today, most taxi stands, as you can see in the city, cannot accommodate more than three taxis. These stands should also be sheltered and covered linkways should be built to connect them to the nearest building. With about 14,000 to 15,000 taxis plying on the roads today, perhaps even bigger waiting areas or holding areas may have to be built in strategic areas of the island if empty cruising becomes too expensive with the ERP.

I am happy to note LTA's support for differential pricing of taxis to address the problem of supply-demand imbalance during peak hours, and also more flexibility for taxi operators to offer a variety of differentiated services to give commuters more choice according to their needs and pockets. In fact, I had suggested this several times before when I was with NTUC Comfort, but, unfortunately, I could not find support from the PTC then. I am glad the LTA understands the need for this now to meet the different needs of commuters.

Mr Speaker, Sir, I support the White Paper.

Dr Lee Tsao Yuan (Nominated Member): Mr Speaker, Sir, transportation in urban centres has become a global problem. Hence, much credit must go to the Government, and the Land Transport Authority in particular, for having this strategic mindset to think long term and to think big. Transportation infrastructure very properly belongs in the domain of the public sector, and the entrepreneurial approach adopted by the Government, as demonstrated by this White Paper, is precisely one of those key success factors which has contributed towards Singapore's economic success. Also, knowing the Government, the White Paper is not going to be all words and no action. I am confident that, if approved, this vision will be promptly and efficiently implemented.

My main comment about the White Paper is regarding financing. In this area, the White Paper leaves a number of questions unanswered. Before I raise these questions, it is useful to summarise four financing principles which have been used in the provision of public services by the Government.

First, we all know that there is no such thing as a free lunch. A price tag is put on almost everything in Singapore by the Government.

The second principle is: "you get what you pay for". Take hospitals, for example. If you want the comfort and privacy of an "A" class ward, well, you pay hotel prices.

The third principle, which applies to the provision of three public goods - health, education and housing - is that of progressive subsidisation. In health, the long-term subsidy targets are: 80% subsidy for "C" class wards; 65% for "B2"; 20% for "B1", and no subsidy for "A" class wards. This is to ensure that even the very low-income can have medical treatment, and that basic health care remains affordable for all. In education, the Government subsidises all development costs of schools and other educational institutions. It also subsidises operating costs to the tune of 98-100% for primary, secondary and junior colleges; 94% for the Institute of Technical Education; 83% for polytechnics; and 75% for universities. I would like to reiterate that this is for operating costs. Similarly for public housing. The Government subsidises about 30% of the total development cost of 3- and 4-room flats, and about 10% for 5-room and Executive flats. This is in order to ensure that HDB flats are affordable to the average income household. To reiterate, the third financing principle, which has been used by the Government, is that in health, education and housing, subsidies are provided in a progressive manner in order to maintain basic affordability of these public goods. While the Government eschews welfarism, it does subsidise the provision of certain public goods.

The fourth financing principle of the Government is that all Government revenues go into a consolidated revenue account.

How do these financing principles jibe with the financing principles laid out in the White Paper?

First, there is no such thing as a free lunch where public transport is concerned. Commuters pay for bus and MRT trips. This has always been the case, and has been well accepted.

Second, you do get what you pay for in public transport. Taxis and cars cost much more than the bus and the MRT. However, the question left unanswered by the White Paper is: will the vision of a world class transport system mean that transportation will become more costly for the ordinary user? How much more will the man-in-the-street have to pay for the comfortable, safe, speedy and seamless transport? Yes, fares have to be regularly revised to account for justifiable cost increases. But how much more? Is there going to be a cap to the percentage increase per year? The White Paper remains silent on these issues.

The question of how much more the public has to pay is inter-related with the third principle, that of Government subsidy. The White Paper has stated that the Government will subsidise capital costs plus asset replacement costs, over and above historical costs, and has re-defined operating expenditure to exclude this item.

The context of this is capital-intensive projects such as the MRT and light rail transport. But what about bus transport? Will the Government also subsidise the increase in asset replacement costs? I am fully aware that bus services are run by the private sector, so there appears to be no good reason for any Government subsidy. After all, one perception is why should the Government subsidise private corporations? However, the same argument which applies to rail transport can also apply to bus transport. Let me explain why. If bus fares have to cover operating costs, what fare increases will be in future depend on the definition of operating costs. Even though operating assets for bus transport are not as high a proportion of operating costs as for rail transport, fare increases can still be moderated for bus transport if the same financing principle is used for bus transport as for rail transport. Furthermore, the Public Transport Council can ensure that this Government subsidy is passed on directly to the user, and not result in higher profits for the bus operators.

There is in addition another argument for applying this principle to bus transport. Bus transport will continue to be the backbone of the public transportation system. There are three million bus trips per day compared to only 700,000 by the MRT. At present, commuters, especially those along less-populated corridors, have to suffer longer waiting times or longer bus journeys because operating these bus routes are not profitable, so the frequency of service can be cut down. Why not make bus transport not only world class but also world class and very affordable to the low-and average-income household? Why not moderate price increases for bus transport? If the Government can progressively subsidise health, education and housing, can the Government also not progressively subsidise all areas of public transport, including bus transport? After all, I think that there is a valid argument for saying that public transport is as equal a necessity as is housing. It does affect productivity in terms of time, as do education and health.

I turn next to cars, the "A" class of the transportation system in Singapore. The Government has set the target of 3% growth in the number of cars, and has devised the COE system as a means of allocation of these cars. With the introduction of Electronic Road Pricing, the cost of using road space will be spread between ownership and usage. My question here is, what is the scenario which lies ahead for car owners? There will be more cars. But will congestion worsen and the total cost of owning and using a car increase, which is the worst case scenario? Or will congestion improve, and the cost of owning and using a car decrease, the best case scenario? What will be the usage charges for the underground road system?

It is useful to examine the sums that are involved. In terms of capital costs: the North-East MRT line will cost about $5 billion; the Singapore Underground Road System is estimated to cost $4.8 billion; the LRT, up to $1 billion; expansion of the road network, $1.1 billion. All of these costs would be spread over a number of years. For example, the Underground Road System over 15 years; road network expansion, five years, and so on.

The gross revenue collected by the Registry of Vehicles in 1994 alone was $4.2 billion, of which the quota premium or COE collection comprised $1.9 billion. In 1993, gross revenue of the ROV was $3.4 billion, and COE collection, $1.3 billion. Between 1992 and 1994, gross ROV revenues amounted to $10 billion. Add another $3.5 billion for fiscal year 1995 - a very conservative estimate - and this makes a total of $13.5 billion in ROV revenue collections between 1992 and 1995. This alone can pay for the capital cost of the North-East MRT line, SURS, LRT and road expansion as well as cover part of operating costs. In light of these sums, the operating cost of, say, even the Singapore Underground Road System of $80 million a year is really not large at all. It is also not as if the Government budget is in deficit. Far from it. The budget surplus in fiscal year 1994 was $6 billion. The estimate for 1995 is $4.8 billion. If one were to add net capital receipts, the excess of receipts over outlays was $11.9 billion in 1994 and an estimated $9.3 billion in 1995.

I mentioned that the fourth principle of the Government is not to tie revenue to specific expenditure items. Many have asked why does the Government not use the COE collections to improve the transportation system. After all, COEs were not meant to be revenue-generating; they were meant to limit demand and as an allocation mechanism. My view is that the Government need not sacrifice this principle if it does not want to. The point is that revenues generated from transport taxes and fees alone could cover the capital costs plus a proportion of operating costs of these transport projects.

In conclusion, I am not suggesting that the Government subsidises everything. Nor am I suggesting that the Government spend every cent that it has in surplus. But I am suggesting that there are valid areas where Government subsidies are justified, particularly where they do not reduce the incentives to work hard and to save.

Unlike some other Members of this House, I beg to disagree that financing of asset replacement in addition to historical cost opens the floodgates for pressures to do so in other areas other than public transport. As I mentioned earlier, education, health and housing have, from the very beginning of the PAP Government, been treated differently.

To me, subsidy is not a dirty word. Making basic health, education and housing affordable is, and always has been, the social compact between this Government and the people. I am suggesting that, if the Government is asking that there be a social compact in the area of transportation, then, first, let the Government extend its subsidy to bus transport, the backbone of the public transportation system, and, second, let the Government spell out how much more the public has to pay.

With that, I support the motion.

Mr Chew Heng Ching (Eunos GRC): Mr Speaker, Sir, we are glad to have bold and astute leaders who could see beyond the finite limits and implement visions for the betterment of Singapore. And history has, time and again, credited our leaders with such tangible and intangible rewards of success as can be seen in the high quality of life Singaporeans are enjoying.

Sir, although a small island nation which we sometimes cannot even find ourselves in a global map, we pride ourselves as having scored many first. Our airport, our seaport and our living standards are among the best in the world. Our Area Licensing Scheme (ALS) is the first of its kind ever and has succeeded in ensuring a smoother traffic flow even at peak hours. Many countries are now studying our ALS to try to solve their traffic woes. Thanks to the vision of our leaders and thanks to our people who together have worked hand-in-hand to ensure that our economy continues to thrive and generate the income necessary to sustain and improve on its modern infrastructure.

Sir, the White Paper has promised Singaporeans yet another best, a world class land transportation system, that will not only be another envy to others but a long-term solution to road congestion which, if left unchecked, could erode our competitive edge. The formation of the Land Transport Authority by the Government, some months ago, to look into providing a comprehensive, convenient, reliable and affordable land transport system is indeed timely. And I am sure Singaporeans will once again rise to the occasion to meet this challenge and pledge their full support to ensure that the proposed land transport system will be another success which will further improve our quality of life.

Sir, I would like to briefly touch on the financing aspect of the proposed world class land transport system and to offer suggestions to improve the flow of public transport at the constituency level.

Sir, the cost for the construction, operation and asset replacement of this exciting land transportation system will run into billions of dollars. And this is big money. Many Singaporeans, including my grassroots leaders, who had read the White Paper found sentences like, "commuters will pay fares which cover operating costs including depreciation" and "the second set of operating asset will be financed by fare revenue covering only the historical cost of the first set of operating asset", a mouthful, if not quite confounding to them. Many of them are non-accountants. Many of them are just grassroots leaders and laymen. So they asked me point blank: What does all this mean? Will fares be increased in small amounts but more regularly? Will the funding come from current surplus and current tax revenue, or will it come from the reserves? They would like to know. Will future generations be made to pay for this system in the form of higher income tax and will GST be increased in the future? Some of our grassroots leaders are concerned and many are wary. Sir, this is understandable as nothing pinches a person's heart more than a tug of his purse-string. I would therefore be grateful if the Minister, in his reply afterwards, would clarify these misconceptions and doubts regarding where the funding for a world class transportation system will come from and, perhaps, also allay the fears that many may have about world class fares.

Sir, the proposed financing framework for a world class land transportation system implies that the Government will increase its subsidies for public transport services. I think this is a laudable move as it will help make such services more affordable. This move is also prudent as more and more of our public sector services will be privatised in the future. Assuming we continue to have economic growth, albeit moderate ones, the Government could well afford to increase its subsidies for such essential services, like public transportation, besides housing, health and education. Already budget surpluses have enabled the Government to step up HDB upgrading programmes, implement Edusave and various CPF and Medisave Top-up schemes. Transportation is certainly another area which deserves a share of the budget surplus cake. But, Sir, increasing Government's subsidy is not enough as the public transport operators must themselves ensure that they remain efficient and productive in order to keep fares low. I therefore propose that the LTA look into adopting a "carrot and stick" approach towards these public transport operators to ensure that they remain efficient and keep fares affordable.

Sir, continuing on the subject of costs, residents in my constituency, and they are mostly 3-roomers and 4-roomers, like all Singaporeans, aspire to own cars in the future. Many, however, will still have to depend on public transport to move around. Their priority, they told me, is affordability first, followed by convenience a close second, and, lastly, comfort in that order. For instance, they would still like to have a choice between cheaper, non-airconditioned bus ride and, say, the more expensive and comfortable BusPlus. It is no use having a world class transportation system if Singaporeans have to allocate the bulk of their salary to pay for this system at the expense of, say, education, health, food and lodging. In other words, Sir, uppermost in the minds of Singaporeans is affordability, not "world class" price when we implement this system. So would the LTA please bear this in mind.

Sir, on the question of convenience, I would like to propose that the Government consider having designated taxi stands in HDB estates. I say this because I notice more rampant taxi snatching in the constituency. By that, I mean one who stands closer to on-coming traffic ahead of another gets a taxi first. So it is not uncommon in the constituency to see taxi commuters trying to out-walk each other. Thus, Sir, until the day when some relatively affluent but ugly Singaporeans could imbibe gracious social manners, we should consider having taxi stands built in HDB estates so that priority would be accorded to a passenger first in the queue. Like queuing for a bus, we must instil orderliness in queuing for a taxi in our constituency.

Sir, on the question of providing a comfortable public transportation system, one way to augment this is to have more linkways connecting the blocks in HDB estates to bus stops. I know this subject has been brought up by other Members but I would also like to raise this because this is a feedback from the grassroots leaders and they have asked the LTA to consider funding the construction of linkways from HDB blocks to bus stops. Currently, the Town Council has to pay 10% for the construction of such linkways, with the remaining 90% being borne by the Government through the CIPC funds applied through the constituency CCC. In meeting this objective of a comfortable public transport system, it would be good if the Government could bear 100% of the costs of the construction of such linkways so that Town Councils would have more money left to fund other necessary amenities and improve the living environment in the constituency. Would the Minister please discuss this suggestion with the Minister for National Development?

Sir, whilst Singaporeans look forward eagerly to the implementation of this new transportation system, would it not be of immediate service to Singaporeans even as they are persuaded to travel more on the MRT and, subsequently, the Light Rail Transit (LRT) system and other forms of public transport, to have parts of our existing roads demarcated as cycling tracks linking MRT stations and bus interchanges to blocks within the constituency so that residents could cycle safely to these stations and have better control of their time? And a corollary, would it not be practical and a safe idea if motorcyclists and scooterists would have their own lanes, like bus lanes, on our highways? I urge the LTA to give serious thought to these ideas.

Sir, I also note in the White Paper that the proposed Light Rail Transit system will serve as feeders to the MRT network. The LRT will run through residential estates where there is sufficient ridership. Sir, Eunos GRC is a very big constituency indeed with a population of at least a quarter million people today. The MRT currently cuts through my neighbouring GRCs, like Bedok GRC and Tampines GRC. Except for the Pasir Ris sector, the other parts of Eunos GRC are a distance away from the existing MRT line. May I therefore propose to the Minister to plan the LRT system to cut through the other parts of Eunos GRC, such as Bedok Reservoir, Bedok North and Tampines North, so that my constituents in Eunos GRC will be adequately served in the future.

Finally, Sir, I wish to remind Singaporeans that a world class land transport system does not come by easy. It will only be realised if we continue to work hard, foster and uphold the importance of national unity and political stability, and generate economic growth. For without growth, we will not have the money to build this system.

Dr Ker Sin Tze (Aljunied GRC): ( In Mandarin): Mr Speaker, Sir, on 2nd January, 1996 the Government released the White Paper on "A World Class Land Transport System". The two points in the White Paper which are most innovative and outstanding are:

(1) Integrating land use and town planning to form an overall development plan, during the planning of the transport system;

(2) Proposing a new formula for financial costing arrangement, particularly in the MRT extension lines, to lighten the burden of commuters.

Let me first deal with the first point. All along, town planning in Singapore is centred on the development of satellite towns whereby the population and the industrial and commercial activities are decentralised to the city outskirts and suburban areas. These satellite towns are then linked up to the city area by the transport system. Although the transport system is planned in line with the needs of the development of the towns, they come under two different Ministries and there seems to be a lack of overall integrated planning, resulting in the potential of the surrounding areas of the MRT stations not being fully developed, and the residents and commuters are deprived of the convenience which they would have otherwise enjoyed.

The White Paper states that town planning and transport system planning must be closely integrated. This is a step in the right direction. At the same time, the Land Transport Authority recommends that the MRT station be the centre of development and the surrounding area be allowed to be used for high-density residential, industrial and commercial, and public institution development. The Land Transport Authority also proposes that the Authority itself be given the right to develop the land above and around the MRT stations for residential and industrial and commercial purposes. This will change the existing method of the MRT developing passively in line with the development of satellite towns. It can then actively link up the MRT stations with the surrounding areas to develop it into a town centre, bustling with activities. The positive and proactive approach of the Land Transport Authority is worthy of our support and commendation.

The other significant point in the White Paper is the new formula for cost-sharing among the Government, the LTA and the commuters for the capital cost of constructing the MRT extension lines, including the proposed Light Rail Transit system. The cost of construction and operation of the MRT is extremely high. If the entire cost is to be borne by the commuters, the fares will be exorbitant. For this reason, the White Paper recommends that the Government bear the infrastructure cost such as tunnelling, construction of MRT stations, and the cost for supply of the trains and other facilities. The commuters need to bear only the operational cost, including depreciation. For example, the construction and equipment cost of the North-East Line is estimated to be in the region of $5 billion, and it will be borne entirely by the Government. The fares to be paid by the commuters shall be sufficient to cover only the operating cost and future replacement of trains and equipment.

The LTA goes further to recommend that the commuters bear only the cost of the current generation of trains and equipment, but not for the future generation because future cost will certainly be higher. The shortfall will have to be paid for by the Government. I think this new formula of cost-sharing will lighten the burden of commuters and increase the feasibility of the new MRT line. This again is a proposal which warrants our support.

However, this cost-sharing formula can be further improved. In dealing with the underground road system, the White Paper points out that the cost of construction is about $4.8 billion which is not far from the $5 billion for the construction of the North-East Line. Because of the construction of an underground road system, the Government can allow an increase in the car population. As such, the increased revenue from road tax and COEs can be used to pay for the construction and operating cost of the underground road network. If we apply this same principle, the LTA can also build above or around the MRT stations and make more profits because of the premium. All these extra profits and revenue can also be used for the financing of operating new MRT lines. In this way, the burden on the commuters will be further lightened. I hope that the LTA will consider applying this principle to other public transport facilities, to ensure that the fares paid by the commuters are affordable.

As the Member for Aljunied GRC, I am somewhat disappointed that the White Paper has not recommended that the construction of the North-East Line be commenced immediately. The Government's reason for the delay is that the capital cost involved is too heavy. According to their estimates and forecast, the passenger load is inadequate to cover the operating cost in the initial years, even though the passenger number is large. This will result in losses on the part of the operator. The Government has now agreed to undertake the construction cost of $5 billion. However, the commuters will still have to bear the high operating cost for the North-East Line to ensure that the LTA will not suffer any losses. Even with the proposed new formula of cost-sharing, the fares to be charged for the North-East Line will still be high.

In order to lighten the burden of the commuters and to bring about earlier realisation of the North-East Line, I would suggest that the LTA be allowed to develop commercial, industrial and residential properties above and around the MRT stations, so that these areas will be turned into mini hubs. On the one hand, this will increase the passenger-load when more people are attracted to live and work there, thereby sharing in the operating cost of the North-East Line. On the other hand, because of the convenience of MRT, the properties around the stations will yield higher rentals and higher sale prices. All these extra premiums earned can be used to subsidise the operation cost of the MRT lines, so that it will not run into losses in the long-term. In this way, it will be possible to bring about the earlier realisation of the North-East Line and the people living there will be able to enjoy the benefits of the new modern system of mass rapid public transport.

Mr Speaker, Sir, I support the motion.

Mr Heng Chiang Meng (Cheng San GRC): Thank you, Sir, for the opportunity to speak on this motion.

The vision of a world class land transport system as painted by the White Paper cannot but excite all of us to what is in store for us in the future. I support the vision of the White Paper and the objectives that the Land Transport Authority wishes to achieve. They are indeed laudable goals.

Having said so, however, there are some missing areas which, if included, would make the White Paper more comprehensive and perhaps a little better. I would like to touch on some of these areas.

The triangular relationship between the commuters, ie, the people, the transport operators and the Government is equivalent to the concept of a 3-way partnership. To me, a partnership should be one of equality. Only then would such a partnership be enduring. Unfortunately, the partnership in the land transport enterprise is not one of equality, but one of inequality.

Sir, permit me to explain. If we look at the total expenditure spent on land transport, ie, expenditure such as the cost of building roads, the land costs, the prices of vehicles, including taxes, the operating costs and so forth, we can liken it as the total revenue to the system. This is quite obvious, as from a systems viewpoint, somebody's expenditure is another body's revenue. It is like saying that when I buy a bag of rice, what is my expenditure is the shopkeeper's revenue.

Sir, such revenue goes towards the various parties for the import cost of vehicles, the cost of materials to build the roads, manpower cost, cost incurred by transport operators, including their profits, the Government in transfer payments such as taxes and levies, etc. I do not have the means of calculating the magnitude of individual items. But from a gut feel, I am pretty sure that the lion's share of the revenue accrues to the Government in the form of COE premia and various types of taxes, levies and fees.

Sir, let me state here that there is nothing wrong with a government raising its revenues by way of taxes, levies and fees for its needs. However, when the reasons for levies and fees are for the purposes of control and management, then as much as possible of such revenues should be returned to the system. In other words, up to now, the Government has been taking a lot from the system and not putting back enough, ie, until now.

With the new financial framework in which the Government will finance the inflation of SMRT's operating assets, the Government has decided to put a bit more into the system. I have been advocating for such a step; in substance, if not in the manner which the Government has proposed. I thus very much support this proposal to ensure that MRT rides, in spite of the high levels of comfort and convenience, will remain affordable to the majority of Singapore's commuters.

The next obvious question thus would be: What about the affordability of the other modes of public transport? Already, SBS has called for the Government to finance the price inflation of its buses. Should the Government do so? Sir, I think not, at least not at this point; not because it is, in principle, wrong but because the bus operators do not need such help at present. But if one day the bus operators need to increase the convenience and comfort levels of bus travel to the point where the fares become unaffordable to the commuters, then LTA will have to do something. This could mean some form of financial help, because I shall not use that dirty word beginning with the letter "s". Sir, in such a case, a financial framework similar to that for the trains could be used.

Alternatively, the Government could reduce the taxes, duties, fees or levies paid by the bus operators. Such taxes are transfer payments to the Government and do not add any value to the improvement of the transport system. So, are these forms of transfer payments by the operators really necessary? If not needed for revenue purposes, surely the Government could abolish all these transfer payments and thus reduce the operating cost of the transport operators. Such a policy would definitely help to make public transport more affordable to the public.

Sir, am I asking too much? Let us look at what I am asking. All that I am asking is for the Government to take a look at its financial requirements, decide on the class of land transport it wants its citizens to have, whether world class, Singapore class, lousy class, bad class, good class, see how much the people can afford to pay and then act accordingly. Since it has stated that it wants a world class land transport system, ie, a land transport system including all modes of public transport, and that it wants such a system to be affordable to the people, then surely it must be prepared to do the necessary to make its own vision come true.

Would such a policy then mean abandoning its financial prudence? Sir, again I do not think so. The White Paper does not mention the details of how the inflation financing would be funded. I would therefore like to suggest that the Government set up a sinking fund for this purpose. For example, based on the estimated $5.3 billion needed to replace the projected price increase of assets for the existing line, the Government could easily put aside $265 million each year in a sinking fund. This would add up to $5.3 billion in 20 years' time, assuming no income is earned from these funds in the meantime. We know that this is not realistic. If we assume a 5% return on the funds put into the sinking fund, the amount needed would only be $160 million. At a compounded interest rate of 5%, this would add up to $5.3 billion in 20 years' time. This amount is much lesser than one-tenth of what is collected annually from COEs, ARF and the taxes on petrol.

Further, the Government cannot look at these expenditures in isolation. The increases in the value that better transport brings to the land around an MRT station are not small. The high prices paid by private developers in Government land tenders for land near MRT stations, whether in Choa Chua Kang or Woodlands, are testimony of this factor. Surely, the Government cannot say that they receive no financial benefit from the MRT system when the higher revenue received from these sales is there for all to see. Even if the land is privately owned, that means the Government cannot put the land up for sale, the Government still will get its due share in the form of higher property taxes. And mind you, Sir, property taxes are in perpetuity.

Coming back to the issue of the sinking fund, I would also like the Government to do the same for the funds put aside for depreciation by the SMRT. The rationale is simple. Depreciation is based on the historical costs of the assets. It is considered as expenses, affects the profits, but does not constitute a cash outflow. In other words, unlike other types of expenses, the money still remains in the company, and the company puts it to good use to earn more money, even if it meant only putting it in the bank to earn interest.

Sir, normally, the earnings from this money are part and parcel of a company's future profits and available for distribution to the shareholders. However, as the Government will be paying for the price increase of the operating assets of SMRT, then logically the earnings from the depreciation money should also go towards the payment of asset replacement. SMRT should thus be required to set up an asset replacement sinking fund where the earnings from this sinking fund accrue to the fund to be used for asset replacement, and not to its bottom line profits.

It would be better to have the depreciated money transferred to the sinking fund to be set up by the Government as mentioned earlier. Then, the total funds needed for asset replacement could be managed as one, and transparent to all. If this proposal is accepted, the amount of Government financing needed for asset inflation would be much lower.

Sir, I do apologise for taking up so much time on the financial aspect of the White Paper. However, I am sure that you will agree with me that this is probably the most important part of the White Paper. After all, the financial framework will determine the ultimate issue of how this White Paper would affect the lives of ordinary citizens. Convenience and comfort come at a price. Can the people afford this price? That is the question. To me, this is the essence of the White Paper, the litmus test of whether or not the vision contained in the White Paper is really for the people.

From the White Paper, it is now quite evident that the Government no longer considers the money collected from the COEs as a by-product of its traffic management policies, but as cold hard cash for its coffers. There is nothing wrong with this as long as the Government realises that there is a point beyond which people will refuse to be taxed. The fact that it has now agreed to finance asset inflation in the rail system shows that we may be approaching that point. I am glad that the Government will be putting back more into the system to encourage greater use of public transport. My next hope, Sir, is that with the huge revenue from this area, mainly voluntary taxes, mind you, the Government will now see it fit to further reduce the mandatory taxes on income.

The White Paper has stated that in trying to build a world class land transport system, nothing is too tiny to ignore. I agree. Individual transport-related measures may appear trivial but added up together, they can contribute much to improve the quality of our transportation. I am glad the White Paper devoted a whole chapter to such supporting measures.

I would have thought, however, that the most evident measure would be on how we can better utilise the current system of roads and rail. By this, I mean that these public assets built at great cost are only utilised slightly more than half of a 24-hour day. For the rest of the time, these assets are much under-utilised.

Surely, the Government can come up with measures to fully utilise these assets throughout the 24-hour day. Some of this type of measures could include staggering the school hours and office hours of the public sector, encouraging lesser travelling by having more work places and schools nearer the homes, encouraging greater use of tele-commuting or even allowing residential homes to double up as offices.

Tax incentives could be used to encourage night shift work, both for the employers as well as employees. Other assets, such as office buildings and factories would then also be better utilised. Tax incentives could also be used to encourage more to work from their homes, using computers and telecommunications. There are many more. I am very sure that if the Government were to ask Singaporeans, it would have more suggestions than required. There is no lack of ideas; only the will.

The amount of money needed to build more roads and train lines mentioned in the White Paper is enormous. Perhaps the Government need not spend so much if it is able to reduce the need to travel. I am sure such savings would be much more than the tax incentives given.

I welcome the clear policy statement that taxis are now part of the spectrum of public transport, albeit at its high end. Taxi commuters and taxi drivers and operators will benefit from a transparency of this policy. I hope that if the day comes when the earnings of taxi drivers are inadequate and the fares cannot be increased because they are not consistent with the public transport equation of cost versus comfort and convenience, the Government will reduce some of the taxes on taxi operators.

I must add also that I am most heartened with the stand taken by the LTA with respect to motor cars. With the measures to discourage double transfers still current and the stated willingness to implement the pay-as-you-bid method of tendering, if needed, the LTA has clearly shown that it wants to provide Singaporeans with the cheapest COEs possible, of course, within the constraints of the number of vehicle quotas available. More importantly, I believe that most car owners would be happy to see more of their voluntary tax payments go towards achieving a world class land transport system.

Finally, Sir, I would like to remind the Minister that there are still parts of Singapore not enjoying a Singapore-class system, let alone a world class system. We have heard many of my fellow colleagues saying the same thing. These parts are not covered by the MRT system. Bus services are still inadequate.

One such area is in my own constituency, the part of Hougang New Town in Cheng San GRC. The SBS may deny this. The PTC may be hoodwinked by the overflow of data provided by SBS to show the inadequacy, I mean the adequacy, of its services in the area. But, Sir, the residents there, my constituents, know the truth. The truth is that they are the forgotten, long suffering commuters not even able to enjoy the current quality of public transport services enjoyed by many in Singapore. If the PTC does not believe this, I would like them to compare the public transport services in Ang Mo Kio New Town with those of Hougang New Town. The two towns are adjacent to one another but the difference in the levels of services is like night and day.

With the publication of the White Paper, they look forward to the early building of the North-East line. They look forward to the type of bus services they can now only dream of. In the meanwhile, I plead with the Minister to provide them with a Singapore-class land transport system now. Show them that they may be forgotten but not forsaken.

With this plea, I support the Government's plan as proposed in the White Paper.

Mrs Yu-Foo Yee Shoon (Yuhua): ( In Mandarin): Mr Speaker, Sir, the Land Transport Authority (LTA) has presented a White Paper entitled "A World Class Land Transport System". I am very pleased to note that our people have reacted very positively towards the recommendations made in the White Paper.

On the whole, Singapore has been able to achieve excellent economic growth, for which public transport plays a very important role. Land transport has made considerable contribution to our economic growth. In reviewing our White Paper we have to consider the respective responsibilities of the Government, the transport operators and the people. What will be the role of the Government? What kind of revenue will be collected to pay for such transport? How do we ensure that the service standard is constantly improved? How do we ensure that the fares will remain affordable and, at the same time, ensure the operators of a reasonable rate of return? Under these general principles, let us examine the White Paper.

Our economy is a market economy. However, we should not be mesmerised by the principles of market economy because I do not agree with certain anxieties and fears expressed by some Members of Parliament that it would be wrong for the Government to subsidise the construction and operation of the MRT. We have to look at the surplus of the State, whether we can afford to pay for the subsidy. It would depend on our budget surpluses and our economic growth. If such subsidy and assistance can be linked to our surpluses, we believe that we will be able to achieve a balanced policy. So we need not be unduly worried by such subsidies. Of course, we would not be going on the social welfare path because we have seen the plight of France and other western countries.

Now, let me talk about the recommendations in the White Paper. The White Paper seems to place too much emphasis on the MRT and the Government's subsidy for MRT. There is no doubt that this is very important. However, we have also to look at the important link between our land transport system and the bus transport system. We have to be concerned about the challenges faced by the bus transport system. Many of the profitable bus routes have been replaced by MRT lines and shortened. In some cases, the bus service seems to have been relegated to that of a feeder service for the MRT. Many workers have reflected their views on the matter, and there seems to be a lack of choice for the commuters. Previously, they had to take only one bus, but now they have to change buses two or three times in order to get to their destination. Many people living in the rural areas have to take a bus from Jurong East to Boon Lay MRT station and then take a bus from there to the industrial estate. To those who stay near to the MRT station, of course, MRT is comfortable, fast, but for those who are living on the fringe, they have not experienced such excellent or fast service because bus operators have abolished routes which are not lucrative, in order to increase their profits. Therefore, they have cut down on these unlucrative routes or merged some of these routes to form a longer route. So now many workers have to spend longer time on travelling. They used to take 15 minutes, now they have to take half an hour to reach their destination.

For those who live in the West Coast to go to Buona Vista MRT station, they have to spend half an hour. This is certainly not conducive to the improvement of productivity of these workers, a factor which is of great concern to the companies who employ these workers. Workers are also worried that some unpopular routes will be scrapped by the bus operators. If all bus routes are devised according to market economy, then these routes will be abolished. Or do we have to ask them to pay double the amount of bus fares, in order to ensure "reasonable returns" for the bus operators? They are also worried that after such routes have been scrapped, the company may even raise the bus fares for the feeder service. According to the Land Transport Authority, there are an average of 3 million passenger-trips made on buses each day, and only 700,000 passenger-trips on MRT. This shows that many people are still relying on bus as their mode of public transport. Therefore, I would like to reiterate that, with the extension of MRT lines, many profitable bus routes have been replaced or taken over by MRT. How are we going to continue to provide for our people efficient bus services which are fast, comfortable and accessible?

The White Paper also mentions the possibility of more bus lanes for the buses to improve the regularity of the schedule of buses, particularly during the peak hours. I think this is a very important measure in order to discourage people from driving into the town. Therefore, we should have a special bus lane throughout the island during peak hours, so that buses can move speedily from one point to another without congestion. If we want to improve their services, we should also look into the problems of the bus workers. As far as I know, certain bus companies have as many as 400 vacancies for bus drivers and the average age of the existing bus drivers is above 45 years old. These people have to work under tremendous pressure. They do not even have enough time for lunch. Many are having gastric problem. They have to collect fares and make sure that no commuters litter on the bus. They have to work under very trying condition. They have to work over time. Therefore, I would like to know whether the Government would consider approving the employment of people from China, Indonesia to become drivers and to increase the quota for foreign workers in the bus service.

Another point I would like the Minister to look at is whether it is possible to review the profit of the bus operators and MRTC, because the bus operators feel that their main purpose is to bring people to the MRT stations. Therefore, should the profit be equitably allocated between the bus operators and MRTC? The Government also promises to assist MRT in its asset replacement. In order to do away with such discrimination, we should look into the feasibility of merging the bus and the MRT operations, so that there will be one operator for all the modes of public transport. Under such a situation, resources could be fully utilised. More important is how they are going to coordinate their routes in order to bring about a better public transport service for the people.

Some may fear that the proposal will create a monopoly in our public transport service. The Land Transport Authority could address this fear by putting in place regulatory measures to curb monopolistic abuses arising from the merger.

Another alternative will be for the Government to make sure that bus operators and the MRTC consult each other, look into their bus routes and the allocation of profits. With fair competition, they will be able to provide better public transport service for the people. The LTA should play a more important role. They should allow bus operators to have more flexibility. The LTA should ensure that when bus routes are adjusted, the interest of the commuters should be considered.

I support the motion. 2.07 pm

Dr Kanwaljit Soin (Nominated Member): Mr Speaker, Sir, the Government has unveiled its state-of-the-art plans for a land transport system for the next century. The vision is exciting and enticing. We will have the world's first ERP system, bus time tables on the Internet and satellite traffic management. Some of us can see all these in our mind's eye while the rest of us find the scenario of seamless journeys more difficult to imagine since we are confronted daily with crowded buses, long waits and bad traffic jams.

However, Sir, there is one concern that is in all our minds, and this is the financing framework for this massive venture. The partnership between Government, operators and commuters sounds great but not in the terms laid out in the White Paper.

However, before coming to this part, I would like to talk about the relationship of a good land transport system and the economy. Land transport is the life blood of the economy - it must function well for the economic well-being of Singapore.

A good public transport system will help to boost the productivity of everyone, especially the labour force. The convenient, comfortable, hassle-free and quicker trips to and from the workplace will decrease the stress of workers and save us more time to devote to work and family. This also applies to students and other segments of the population. In the White Paper it is stated that traffic jams on the PIE and Central Expressway cost $45 million a year in lost productivity. I wonder what the figure would be if we could calculate the total cost in lost productivity due to traffic jams on all other roads. A developed country with a shortage of labour cannot afford to have its workforce spend an inordinately long unproductive time on the road to get to work and be worn out on reaching the workplace. Efficiency has to be the name of the game. We, therefore, have no choice but to invest heavily in land transport but this is not a one-way traffic. There are both direct and indirect returns for this investment.

During the 15 to 20 years that it will take us to put our land transport system into place, there will be a big boost to industry, especially in construction. This will, in turn, boost the general economic growth of the country. And this is timely as some of the economic growth due to the manufacturing sector is slowing. When the plans for the land transport system are in full swing, it is estimated by some economists that the boost to the economic growth of the country will be by as much as 1 1/2 percent per annum. After the system is fully in place, the contribution to the economy should continue to be at least by half percent per annum. This increased economic growth during the building of the land transportation system and after its implementation will enlarge the financial pie for everyone and will also increase Government revenue.

Thus, a good land transport system will not only satisfy the transport needs and aspirations of our population but it will also increase economic growth and boost productivity. This is how we must look at this whole venture of a world class transport system - as an investment in our economic growth and productivity. It is therefore appropriate and economically logical for the Government to become a much bigger partner in the venture, as the end result will be a win-win situation. The economy will grow, Government revenues will increase, productivity will go up and people will have a better quality of life.

The financing arrangement suggested so far is that the Government builds all the infrastructure, the commuters pay for the capital cost of trains and the day-to-day operating costs and then a few years down the line, the Government will pay for the replacement cost of trains. So this is not factored into what the commuters have to pay now. This sounds equitable, but undoubtedly with such an arrangement, the cost of future public transport is bound to be higher than what the average worker pays now, which is already 14% of his or her disposable income. Any further increase in the fares will be a regressive step as it will affect the economically bottom 20% of the population more than the rest. Also, if we really wish to upgrade to a world class transport system, then the real bottom end choice of cheap transportation will not be available for the poor of our country. For a world class system, the general standard has to be high and no part can really be sub-standard. But our fares cannot be world class because a certain proportion of the workforce even finds the present fares a financial burden. Future fares have to be affordable to all sectors of the population. This is not such a bad thing as it will allow some redistribution of wealth.

The principle of re-distribution is the reason why we have embarked on the HDB upgrading programme, the Edusave programme for the top 25% of students from poorer families, and the Medisave Top-up scheme for the elderly. Implementation of fares that are affordable for even the bottom 20% should not therefore be considered as an act of charity but yet another means of re-distributing wealth. Good governance, Sir, does not just consist of creating wealth but also involves equitable and prudent re-distribution. In the case of the land transport system, there are added benefits of boosting economic growth for the whole country and increasing national productivity.

I would therefore like to ask the Government to reconsider its position on financing and pay also for the capital cost or the initial cost of trains besides the replacement cost. This new commitment should apply not only to MRT and LRT but also to the buses. The Government may consider this as asking for too much and liken it to a welfare subsidy or a handout, but I would like the Government to think of this arrangement as an investment in the economy and people of Singapore. An economist has stated, and it was reported in the Straits Times, that "there is the recognition that transport is not a pure consumption item, but is an investment in human capital, like education and health."

Unlike other subsidy schemes, major Government financing for transport, in the way that I am suggesting, will not take away the incentive for hard work or create a culture of dependency, as there is little likelihood of the transport system being abused for personal gain. People travel for necessity and not for the fun of it except in the initial novelty stage. For the year 1994/95, the Singapore Government spent 9% of GDP for financing operating expenditure and 4% of GDP for development expenditure. The remaining 10% or so of GDP that was collected by the Government as revenue was saved. Financing the capital and replacement costs of trains, buses and other transport equipment by the Government will bring the figure for development expenditure up a little and will lower the savings a bit. But the total amount spent by the Government will not exceed 16% or so of GDP. In comparison, governments in welfare states spend 40% to 60% of GDP. Thus, by advocating that our Government becomes a bigger partner in the land transport system, there is no need to sound alarm bells and get into a flap on the dire consequences of a welfare state. At 15% to 16% of GDP as Government expenditure, we are far, far away from the proverbial precipice or the slippery slope of welfare spending.

Sir, if spending $20 billion on the HDB upgrading programme without expecting much return in productivity is considered prudent financial management by the Government, then there can be no question that spending about the same amount on achieving a world class transport system is an even more worthwhile and prudent enterprise. Furthermore, the total amount of revenue collected from vehicular and road taxes, fees and fines was just short of $14 billion for the four years 1992 to 1995. Thus, the amount that will accrue from this vehicular related revenue for the 10 to 15 years that it will take us to complete the land transport system will be more than enough to pay for the total cost of our world class transport system. How can then there be any reluctance on the part of the Government or talk of subsidy in paying for the infrastructure and also for the capital and replacement costs of trains and buses? Sir, the Minister will have to concede to this economic logic.

Let me now come to one important omission in the White Paper. Amongst its many proposals, it seeks also to provide a seamless journey for commuters so that the hassle and transfer time involved in changing from one mode of transport to another is minimised. In this sense, the proposal appears to be user-friendly. Unfortunately, the extent of its user-friendliness is limited to the physically able Singaporeans.

By the time the last phase of our world class transport system has been put into place, nearly 15% of our population will be over the age of 60 years. Many of the elderly will continue to be fit and will have a sprightly step but many of them, and this will include some of us here, will not be so physically fit. We will have osteoarthritis of our knees and we will have strokes on one side of our bodies. We might even have Parkinsonism and some of us may be in the state of what is described in Hokkien as "boh lat". For the non-dialect speakers, that means "no strength". What is being done to address the transport needs of this large group of people, remembering that the retirement age by then will be at least 67 years, if not more? Besides this group of not so physically able aged, we have to consider the group of young people who are physically disabled.

We cannot pride ourselves on having attained a world class transport system unless we integrate the needs of our disadvantaged community, ie, the aged and the disabled. To do this, we must first change our mindset - learn to understand the difficulties that our disadvantaged friends face, and accept them as part of our commuting community who need an even more seamless and user-friendly journey than any one of us.

A Community Development Ministry survey indicated that one of the main reasons why more than half of the 4,000 disabled persons interviewed were unemployed was commuting difficulty. This survey has not even taken cognizance of elderly people who are disabled by age. If the LTA's promise of a world class transport system is to be meaningful, then public transport should be converted to enable the disabled and elderly to travel freely.

The Government has gone some way in instituting a mandatory code of Barrier Free Accessibility in Buildings, but let us go all the way so that the less physically able in our society are not immobilized by our uncaring attitude which will eventually translate into economic shortsightness as the aged and disabled will find it difficult to go to work and contribute to the economy and will become dependent on the young and able.

Another consideration in the integration of land transport and urban planning is the locality of good and popular schools. Independent schools, autonomous schools and other popular schools should be evenly distributed geographically so that travelling time for students is shortened and traffic congestion is lessened. Our town councils can initiate a partnership between schools in their area and some bus operators so that a "bus pool" can be formed to ferry students living in the same area but studying in different nearby schools. This will rationalize bus trips and bus routes.

Sir, it is quite obvious that the LTA alone cannot achieve the vision of a world class transport system in a holistic sense unless it has the expertise and input of other agencies, such as the Ministry of Trade and Industry, Ministry of Community Development, Ministry of Education and Ministry of the Environment, just to name a few. I would, therefore, like to suggest that the LTA work with an inter-ministerial committee to realise our vision of an integrated and meaningful transportation system that is not only world class but is geared to the needs and aspirations of the people of Singapore.

At this point, Sir, I would like to raise one specific matter in the area of land transport and this concerns the multi-million dollars paid up by PWD to private contractors in a dispute involving the construction of a section of the Central Expressway. Even after this major pay-off, I understand from reports in the media that the Central Expressway tunnel continues to leak and PWD has hired consultants to carry out a $1.3 million study into the cause of the leak. Presumably, after the cause has been established, further expenditure will have to be incurred to remedy the defect.

Would the Minister be good enough to give an explanation into this matter and would it be possible to minimise the occurrence of similar incidents in the realisation of our multi-billion dollar world class land transport system? Would it be feasible to have some sort of an insurance policy for such occurrences? If so, did we take out such a policy for the Central Expressway?

Before ending, Sir, I would like to ask the Minister to give us more detailed figures for the cost and maintenance of different parts of the land transport system. How much is this going to cost to the commuters in more precise monetary terms? How and when are different stages of the system going to be phased? How will the ERP system affect cars from Malaysia? Will motorcycles be subject to ERP? Are there any immediate plans to alleviate congestions at the causeway for vehicles going to and from Malaysia? These trips are made not only for leisure but for the purpose of work and affect the productivity of the workforce in Singapore. Will we have to wait for the second causeway or are there any interim plans?

Sir, the LTA has spelt out a general vision but there are many unanswered questions. These constitute the nuts and bolts of the system and the Minister will have to provide many answers before informed decisions on the land transport system in Singapore can be made. However, I am in support of the general vision as outlined in the White Paper.

Mr Lau Ping Sum (Ang Mo Kio GRC): ( In Mandarin): Mr Speaker, Sir, I support the White Paper on A World Class Land Transport System. Two weeks ago, BBC News reported on the introduction of the White Paper. In the programme, a staff member of BBC asked its correspondent in Singapore for the reason for the White Paper as Singapore already had a relatively good traffic system. The correspondent explained that the Singapore Government had been well-known for its thorough approach and long term view and alluded to the fact that it could implement long-term plans of 20 years, or even longer, because of its political stability. We know that some measures may not be popular in the short term, eg, the ERP during the initial stages of which some people would not be happy. Some 20 years ago, when we first started the CBD system, there were a lot of people who opposed the system. But we can see clearly now that without the CBD, road congestion in Singapore today would be much more serious. One thing is for sure, ie, the White Paper is introduced not for short-term political benefits, but to ensure that the land transport system in Singapore will cater to the needs of the people in their work, study and leisure activities. Most importantly, we have to plan ahead, and not wait for the situation to deteriorate. We can see what has happened to cities like Taipei and Bangkok. The government officials and the general public there are immobilised by a sense of helplessness as they realise that the traffic conditions are so bad that an effective solution may never be found.

With regard to the MRT North-East line, we know that before the MRT system was given the go-ahead, the American consultants had asserted that it was not necessary to have such a system in Singapore, as an "all-bus" system would meet our needs adequately. Most Singaporeans today will agree that this view was clearly lop-sided, because it did not take into account, besides road congestion, the need for pollution-free air and high productivity and the optimum use of land. Similarly, the one-time capital investment required should not be the sole criterion for deciding whether or not to build the North-East line.

The Singapore Bus Services Pte Ltd is a successful company and this fact has been mentioned with evident pride several times in the White Paper. But it appears that the company is somewhat complacent. MPs and residents of various constituencies often express their unhappiness over the revision of bus routes by the bus operators for greater revenue. The residents reflect their views to the bus operators but to no avail, as profit maximisation is their overriding concern. Many residents feel that their views have been brushed aside. Of course, we cannot expect to have buses plying the streets and serving every block in an estate or to have a bus stop in front of every block. But the bus operators should not be guided by revenue considerations alone in route planning and revision.

Another recommendation in the White Paper is that road use should be charged according to usage. But the White Paper does not mention an appropriate ratio for cost sharing between usage and vehicle ownership. I hope that the Minister will enlighten us on this matter.

With the implementation of the ERP, every motorist in Singapore will have to install a smart card in his vehicle, so that an appropriate amount could be deducted each time he passes a check-point. As in every new technology, there are bound to be some technical problems in its initial stages of implementation. I would like to know whether the Land Transport Authority has any foolproof system to record that on a certain day, at a certain time, when a car passes through a certain location, a specified amount has been deducted from the smart card. In the event of a dispute, is there any way to ensure that the complaint could be dealt with in a satisfactory manner?

Yesterday, we heard some Members saying that because of roadworks, the free flow of traffic was affected. It was suggested that some form of charges be levied on the relevant parties responsible for these roadworks. I think this is something that we need to look into very carefully. If we levy a charge for roadworks and if the levy is too low, it would not have the desired effect. The parties responsible for the carrying out of roadworks are the statutory boards, and a levy of a few thousand dollars would hardly have any deterrent effect. On the other hand, if the levy is high, we can expect that the cost would be transferred to the users or the general public. The levy scheme may not be effective. Some 20 years ago, Members in the House had raised similar issues concerning the lack of co-ordination of roadworks among the various parties concerned. The Government then set up a committee to review and oversee the planning of roadworks. I hope that the Minister in charge would look into this matter again, particularly when the LRT system, the MRT North-East line and the underground road network are being constructed and road digging will certainly be more extensive and protracted.

Mr Chin Harn Tong (Aljunied GRC): Mr Speaker, Sir, I rise to comment on the White Paper on "A World Class Land Transport System" in Singapore. It is a policy paper with an inspiring and breath-taking vision. Needless to say, comprehensive and in-depth studies have gone into shaping this vision of the kind of quality land transport system Singapore can hope to have in the years to come.

However, what I am interested in is how this vision will be translated into our land transport policy. Or more importantly, how the proposed land transport system in the White Paper will affect Singaporeans in their pockets.

The first two paragraphs in the chapter on "Financing Framework" at page 58 of the White Paper are rather illuminating. It would appear the uproar some time back over the probability of commuters having to pay more to travel on the proposed North-East line has been much ado about nothing.

While commuters pay directly towards the cost of operating the MRT, all Singaporeans, including the commuters, as taxpayers, ultimately and indirectly pay the remaining cost of constructing as well as operating the MRT. I do not know how the discussion on the proposed North-East line was hijacked into a debate on whether or not commuters residing in the north-east corridor should pay more for the privilege of riding on the MRT than the other MRT commuters.

Every new line or extension of the present MRT system is meant to serve all MRT commuters. If it is made relatively dearer to use the new line or extension, then the forecast of fewer commuters using the new line or extension becomes self-fulfilling. The whole purpose of having the MRT is to induce as many Singaporeans as possible to use the MRT as a system.

As the White Paper shows, a discussion of the cost of the MRT system should be logically focused on how to share the burden between the commuters as such and all taxpayers. With GST now a regular feature of our tax system, taxpayers must mean practically all Singaporeans. The question of one group of commuters being treated less favourably than others should not have arisen.

Sir, I have no quarrel with the proposal in the White Paper on the funding of the MRT. The commuters pay for operational cost and replacement cost of operational assets and the Government picking up the tab on behalf of all taxpayers the construction cost and historical inflation cost.

There should be no question of different rates of fares for different lines or sections of the MRT. Bus companies in Singapore apply the same fare structure to all their bus routes. These bus companies are not allowed to charge higher fares for routes with fewer passengers or routes with newer buses, even though these routes give lower profit margin. Otherwise, the situation would have been as ridiculous and absurd as in a country with a galloping inflation by the minute, where one diner has to pay double what another pays for a similar meal at the same restaurant, merely because the former has been served a few minutes later through no fault of his.

Scheduled bus services are one system of public transport. The companies which provide these services have to operate less profitable or unprofitable routes without extra cost to the bus commuters, so long as the companies' overall operation is profitable.

Similarly, MRT fares should be priced on the overall viability of the MRT system and not differentiated according to the viability of individual line or section. MRT commuters patronising a less viable line or section have to wait longer for trains, just as bus commuters using less profitable routes have to wait longer for buses. But these commuters should not have to pay dearer fares for less convenient services.

The MRT, together with the proposed LRT, is the land transport system that is most suitable and most expensive for a compact urban area like Singapore. The Government has accepted that the overall cost of the capital-intensive MRT cannot be entirely downloaded on the commuters without making MRT fares exorbitantly expensive for the commuters.

Perhaps the Minister may wish to consider a similar subsidy, but on a reduced scale, for the bus companies. Scheduled bus services, as a complement and as an alternative to the MRT, are the next most suitable form of land transport system in Singapore. If the bus companies do not have to worry about the inflation component when replacing buses, the lower operational cost will help to stabilise bus fares over a longer period for bus commuters.

Companies offering scheduled bus services now do not pay COE, ALS and RPS. When the ERP comes into operation, the White Paper assures that these companies will have their taxes adjusted to ensure their combined payment of taxes and ERP charges will not exceed what they pay in taxes before the introduction of ERP. Taxi owners will not enjoy similar adjustment and private cars, needless to say, will bear the full brunt of the ERP.

Sir, it is clear from the White Paper that the Government accepts that the scheduled bus services are a desirable land transport system but seems reluctant to extend to it public funding on the same basis as the MRT. This reluctance is understandable when viewed in relation to the Government's refusal to subsidise commercial activities. However, while the bus companies are private sector companies, the Government has also indicated an intention of privatising the operator of the MRT.

As the White Paper has shown, it would take many years and much capital for Singapore's MRT system to be as extensive and comprehensive as the corresponding systems in London, Paris and Tokyo, if Singapore so desires. Until such time as our MRT system can adequately serve the needs of Singapore, I think it is reasonable to expect the Government to do more to help make our system of scheduled bus services more attractive to Singaporeans

On the whole, the Government has come out with a White Paper setting out a world class transport system, which I wholeheartedly endorse and support.

Mr Speaker: Order. I suspend the Sitting and will take the Chair again at 3.10 pm.

Sitting accordingly suspended at 2.48 pm until 3.10 pm. Sitting resumed at 3.10 pm