Speech by Minister Khaw Boon Wan at the Ministry of Transport’s Committee of Supply Debate 2018

Staying Competitive

1.     Our excellent connections to the world provide huge advantages for our businesses, create good jobs for Singaporeans and raise our quality of life. They make Singapore a global city and a vibrant economic hub.

2.     The role played by Changi Airport and PSA is well understood. But remember these are not permanent strengths. As the Chinese saying goes, “一山还有一山高”: there is always a taller mountain elsewhere. Many airports and seaports in the region are working hard to replace us. Changi Airport and PSA are working even harder to make sure we are not easily replaceable. MOT is fully behind them, together with other government agencies.

3.     That is why we are expanding Changi Airport, even though we have just opened Terminal 4. This is not just about building another terminal building in Changi. We are actually building a second airport, complete with a third runway, an extensive underground network of tunnels, and a mega terminal to serve up to 50 million passengers per year in the first phase of development. By adjoining the current airport, it will almost double our overall airport capacity. More importantly, we can synergise both airports to make the entire Changi an unbeatable air hub.

4.     Likewise, the capacity of our seaport at Tuas will be double our current container throughput. But more than physical size, the new seaport will leverage on the latest technology, and help create new innovative solutions. As the operator of the new seaport, this will set PSA apart from its rivals. It will help make PSA’s customers even more efficient and cost-effective in their operations.

5.     While the external connectivity dimensions of Changi Airport and the seaport are obvious, the role played by land transport is also crucial. No point being able to fly or sail into Singapore,and then to be stuck on the road in traffic jams. This is a common phenomenon in many other cities around the world. Singapore must never be like that.

Public Transport as the Preferred Choice

6.     The key is to ensure our land transport matches the standard of Changi and PSA. Our approach is to make public transport the preferred mode of transport within Singapore. This is continuing work in progress. As Mr Sitoh Yih Pin put it, there will be growing pains, but I am confident we will get there. Our target is to have 75% of all peak hour journeys made on public transport by 2030. We are on track to achieve this target. To answer Mr Ang Hin Kee’s question, the peak hour public transport mode share last year was 67%: with bus at 34%, rail at 28%, and taxi & private hire car at 5%. With the introduction and growing popularity of Personal Mobility Devices (PMDs), we can be increasingly confident.

7.     We are clear that for public transport to be the preferred mode, it must be extensive, affordable, reliable and seamless.

(a)     An Extensive Public Transport Network

8.     First: an extensive public transport network. A well-connected and resilient rail network forms the backbone. 8 in 10 households will live within a ten-minute walk of a train station by 2030. That is why we are expanding our rail network to 360 kilometres. We will also increase the number of stations to 270. This will put our rail network density ahead of Tokyo and New York City today. This is hard work, patient work over many years and several Transport Ministers. When we fully opened the Downtown Line last year, we took a giant step forward.

9.     The next giant step will be the opening of the Thomson-East Coast Line. The project is on schedule. We have also started planning the Jurong Region Line and Cross Island Line. These new MRT lines will help to catalyse the development of the Jurong Lake District and Punggol Digital District and transform them to enable an exciting car-lite lifestyle for many Singaporeans.

10.    Besides the MRT, we have also enhanced bus services significantly, as noted by Mr Melvin Yong. Through the $1.1 billion Bus Service Enhancement Programme (BSEP), we have added 1,000 new buses to our fleet and introduced 80 new routes. Through the Bus Contracting Model, we have raised service standards by injecting additional capacity for more than 100 services. To support the expansion, 4 new depots as well as 7 interchanges and terminals have been built or upgraded over the past five years. We have also incorporated an incentive-disincentive framework in the bus contracts. For the first service year, the operators have already earned incentives of about 1.5% of their total service fees. This is nearly $20 million of incentive payments. The more they improve their services to commuters, the more incentives they stand to gain. This way, it aligns their corporate objectives with ours. Together, these measures have contributed to greater bus connectivity, less crowded rides and shorter waiting time for commuters. Commuters have felt the difference. It showed up in the Public Transport Customer Satisfaction Survey. I see this as a vote of confidence by commuters for the BSEP and the new Bus Contracting Model. 

(b)     Affordable Public Transport Fares

11.    Second: an affordable public transport service. Our transport fares are affordable. To measure affordability, we track the percentage of income that lower income Singaporeans spend on public transport. In other words, out of your monthly salary, how much do you spend on public transport? It is low, below 2%. So if you earn $1,000, less than $20 are spent on public transport. While transport fares must be affordable, we must be careful that they are not priced too cheaply, as maintaining a high quality transport system requires resources. Cheap fares are popular, but they are just not sustainable.

12.    The story of the New York City subway is instructive. There was a recent New York Times article, which was reproduced in our local media. It chronicled the woes of the New York City subway. It was once an engineering marvel; it is now a broken system with many safety issues. They have estimated that over US$100 billion is needed just to fix the subway’s most pressing needs.

13.    The investments we are making to improve the transport system are huge. MOT’s budget is now the second biggest amongst Ministries, after MINDEF, and ahead of MOH, MND and MOE. Miss Cheng Li Hui has observed an alarming spike in public transport subsidies. She is right. And we should all be alarmed. She is in business. She knows that rising cost against a declining revenue have only one outcome – disaster. What are the facts? Over the past 5 years, improvements to public transport services have increased operating costs by about 60%. One major contributing factor is the huge increase in network capacity as we opened new lines and added more buses and trains. This huge cost increase has been borne by the Government. Namely, taxpayers. Against such rising cost, fares have gone down by 2% over the same period. So 60% rise, but fares reduced by 2%. And that’s the past 5 years.

14.    What about the future? Over the next 5 years, we will provide subsidies of about $5 billion for public bus services and $4 billion to renew our rail operating assets. That’s not all. Another $20 billion will be invested in infrastructure to further expand the public transport network. The government will continue to subsidise public transport to keep fares affordable. However, every dollar spent on transport is a dollar less for other expenditure – like schools, healthcare and security. The Public Transport Council (PTC) is currently reviewing the fare formula, and I agree with Miss Cheng Li Hui that the current formula is inadequate. It can be improved to better track total costs. I am confident that PTC can work out a fair and sustainable arrangement. Please support the PTC when they make their recommendations.

15.    Meanwhile, we need to be prudent about where and when to inject new services, especially in low ridership areas, so as to not overburden taxpayers. I hear Mr Zaqy Mohamad’s call on behalf of Mayor Low Yen Ling for better rail connectivity in Bukit Gombak. Mayor Low is a good MP. She is reflecting her residents’ demands. I have to be a good Transport Minister. I have to balance the needs of all Singaporeans in a fair manner. We are committed to opening Hume MRT station eventually. But, the exact timing of this will depend on the pace of developments and ridership growth in the area. I seek Mayor Low’s patience and understanding. 

(c)     Reliable Public Transport 

16.    Third: a reliable public transport system. We do not need the story of the New York City subway to remind us of the importance of reliability. SMRT had its own bad experience of past neglect and hence its fair share of reliability problems in recent years. Correcting these problems is a multi-year effort. But we will get there. We just need time. I asked for 5 years when I took over this portfolio two and a half years ago. So I am at the mid-point.

17.    Mr Melvin Yong asked for an update. We are making good progress. I have set yearly targets. My target is for the MRT network to achieve an MKBF of 400,000 train-km by the end of this year, 600,000 train-km by the end of next year and 1 million train-km by 2020. These are not soft, easy targets. They are very difficult targets to achieve, and that is why very few metros in the world have achieved them. After a painful year in 2017, the new signalling system in the North-South Line has finally stabilised. I am pleased to report that the MKBF of the MRT network, for this year so far, that means the first two months of this year, January and February, has already exceeded next year’s target of 600,000 train-km. In fact, the North-South Line should cross its 150^th consecutive day of no disruption today. This is the good news. The bad news is that we will soon start testing the new signalling system on the East-West Line with passengers. We have been testing it without passengers, that means at midnight. But now we will soon be testing with passengers on board. I’ll be spending many days and nights briefing the MPs along this stretch of the East-West Line. Explain to them what re-signalling is all about, why do we need to re-signal, why it is good for Singapore and the commuters, and what to expect especially the unpleasant experience of the North-South Line. Do expect glitches and delays, so please bear with us.

18.    Extended engineering hours have been very useful to our engineering team. They allow us to speed up the renewal of ageing assets, as well as install noise barriers around the island. For residents living next to MRT tracks, this is a welcome development. My residents as well as residents of Er Dr Lee Bee Wah.

19.    Extended engineering hours have also allowed us to step up preventive maintenance and repairs. To answer Miss Cheng Li Hui’s question, we require our train operators to fulfil stringent Maintenance Performance Standards (MPS). If they fail to comply we will impose regulatory action and financial penalties. More importantly, I think after several years of interacting with them, my sense is that our two rail operators themselves have internalised the importance of maintenance and they have accepted the responsibility to regain public confidence in our MRT system. I am optimistic they will not fail us. They are ramping up the number of maintenance staff. Over the past five years, our maintenance workforce has grown by over 1,500 staff – a 50% increase, with plans to further increase this by more than 600 over the next three years.

20.    I thank commuters for allowing us to close earlier and open later: ECLO (Early Closure, Late Opening). To answer Mr Melvin Yong’s question, ECLO will continue, especially for the old lines where we have to juggle limited engineering time between maintenance and the renewal of ageing systems.

21.    We have learnt to manage such planned closures with an extensive shuttle bus arrangement so that affected commuters have convenient travel options. During the recent planned closures along the entire East-West Line, we mobilised 350 buses and 700 bus captains to support the shuttle services. I thank all our transport partners and LTA for their commitment to this effort. It was Team Singapore at its best.

22.    Many readily adjusted their work schedules to accommodate the additional works. Many made personal sacrifices. During one Sunday closure, this was in December, along the North-South and East-West Lines, many members of SMRT’s track circuit replacement team were unable to attend the wedding of their teammate,  Mohammed Idris bin Zakaria. The team managed to send him a photo and a message from the worksite, which read: “Hi Idris, we are working at Jurong due to ECLO, hot sun & rain are big challenges here, in fact it is going to rain, but we know today is your big day, we all just want to say, Happy Marriage”. And there are many such examples.

23.    We are determined to make our system among the best in the world. It can be done. Until all the ageing assets are fully replaced and upgraded, we may still encounter some delays or disruptions. But we are doing our best to eliminate such risks and should they happen, to minimise inconvenience to commuters.

24.    To accelerate the renewal of the ageing assets, we will reinforce our bus network to provide some back-up capacity. We will be deploying 450 buses to bolster capacity along existing bus routes which support critical stretches of the rail network undergoing renewal. These are new buses. They were ordered to meet growing ridership demand and to replace our ageing bus fleet. We are opportunistically bringing forward their purchase and deployment to strengthen the resilience of our public transport network in the interim.

25.    Like Mr Melvin Yong, we too are concerned about staff fatigue. Planned closures are generally over the weekends, when bus services are thinner, so we have been able to tap on the existing pool of bus captains for these shuttle services. To manage driver fatigue, bus captains are rostered to ensure that they have sufficient rest. We will continue to work closely with the bus operators and NTWU, the workers’ union, to ensure that such shuttle services are sustainable, and that we maintain strong morale amongst our bus captains.

26.    Besides our oldest MRT Lines, enhanced maintenance and renewals are also underway for all the other MRT and LRT lines, which are at different stages of their lives. The Bukit Panjang LRT, in particular, is reaching the end of its useful life. After evaluating all possible options, LTA has decided to work with the original equipment supplier, Bombardier, to renew the entire network. We will also try out a new service support arrangement whereby SMRT will engage Bombardier through a long-term maintenance contract for spares, for training and for technical expertise. Bukit Panjang residents can look forward to more reliable rides in due course.

(d)     A Seamless Public Transport Experience

27.    Fourth, a seamless public transport experience. Commuter perception of public transport is often shaped by their first and last-mile experience. Is it convenient? Is it pleasant? Is it safe? We are helping pedestrians by providing more covered walkways to transport nodes. Shared bicycles and PMDs have also provided commuters with a new option for shorter journeys. However, dis-amenities – specifically indiscriminate parking and reckless behaviour – are a growing irritation. I remember Mr Sitoh’s reservations on e-bikes and PMDs when the Act was debated in this house last year This year, I noticed out of the 33 cuts for MOT this year, 14, that was a high percentage, were on shared bicycles and PMDs. Yesterday evening, I heard all your passionate piece from the MPs who spoke and so many spoke, including Ms Foo Mee Har despite her loss of voice and let me share you a little secret. I heard this from my wife too. Not every night but every often. Everytime when she drives around our estate we see this yellow rainbow coloured bicycles parked, blocking the pathways. Believe me, I had an earful. Clearly this is a hot topic among many people on the ground! SMS Dr Lam Pin Min will address this topic in full later.

28.    I heard Mr Pritam Singh’s call to significantly tweak the COE system to favour families with young children and low-income motorcyclists.  The COE is a sound market-based mechanism to allocate limited vehicle supply. Favouring one specific group would inevitably disadvantage others. Far more correct is to keep the COE system pure, and formulate separate specific policies to encourage couples to have babies, and to help low-income Singaporeans.  Meanwhile, we are committed to making public transport the preferred mode for all Singaporeans. This applies not just for new families, but also for the elderly and persons with disabilities. SMS Dr Lam will also elaborate on this later on.

29.    We also facilitate the introduction of car-sharing services such as BlueSG, and welcome the growth of private hire car services. They have provided commuters with more on-demand and point-to-point alternatives to owning a car. We will make car-lite Singapore a reality. But the point-to-point industry is still consolidating. How it consolidates can have serious implications on contestability and the welfare of commuters and drivers. In other words, will the industry remain open and contestable. Today is not a bad outcome. We have choices between Grab and Uber. That’s why the service levels improve. What if the market consolidate and we end up with only one player or a very huge dominant player. I am quite sure the pricing will change drastically overnight, both for taxi drivers as well for commuters. So we have as regulators, we will have to anticipate such possible outcome and try to pre-empt. Second Minister Ng Chee Meng will discuss this very important issue later. 

Harnessing Technology

30.    Finally, we are harnessing technology to transform land transport. Last month, we launched the Land Transport Industry Transformation Map (ITM). Emerging technologies are unsettling, but the opportunities to transform land transport for the better are compelling.

31.    The ITM will help the industry and workers move up the value chain, and serve commuters in new and better ways. Mr Melvin Yong and Mr Ang Hin Kee spoke about Autonomous Vehicles (AVs). AVs have the potential to transform transport, reinvent transport. We are working with some of the best in the world and in Singapore to tap this exciting technology, which is still developing. We are keenly watching where this technology will take us next, and the benefits that it will bring to commuters. It is too early to say how widely adopted AV technology will be by 2030, but the progress of AV trials overseas and in Singapore is very encouraging. Waymo of Google has tested their AVs on public roads in US without a safety driver. This is what we called level 4/5 of driverless vehicles. It intends to launch a commercial AV ride-sharing service later this year. Here in Singapore, we expanded our AV test-bed at one-north to about 70km. As we gain experience and expertise, we will expand trials to other precincts and also pilot the use of other vehicles, like AV bus, AV shuttle services in Punggol, Tengah and Jurong.

32.    Mr Melvin Yong asked if we have the necessary infrastructure and legislative framework. We are not yet fully ready, in fact no cities are, but the AV trials have given us insights into the gaps which we will fill. We have amended the Road Traffic Act to facilitate our AV efforts, and we will make further amendments if necessary. We have also launched a Request for Information to seek inputs from industry and other experts. In fact, this week’s Economist magazine had a special report on AVs, several pages on this developing technology, worth a quick flip through, spells out the possibilities in the exciting world of transport. In fact, Singapore was mentioned in the article as an example for pro-innovation regulation. It is so easy to snuff out regulations. If you regulate too tightly, too early, nothing will happen. If you maintain a light touch for too long, as happen in the bike-sharing situation, then you have dis-amenities. Reminded me of what Mencius (孟子, mengzi) said 2,500 years ago: The art of cook of frying a small fish, too much fire, you burn the fish. It’s carcinogenic, you may get cancer; too little fire, the fish remains uncooked, you may get a stomachache.

33.    Although it is difficult to predict the timing of widespread AV adoption, the potential for such technologies to disrupt the livelihoods of transport workers is undeniable. I therefore agree with Mr Melvin Yong and Mr Ang Hin Kee that we should help our workers adapt early.

34.    The Government is working closely with unions and the transport operators to up-skill and re-skill and to transition some of them to adjacent vocations. This is being done through our institutes of higher learning, as well as through the Singapore Bus Academy and Singapore Rail Academy. We will also work with government agencies, industry champions, and service providers to identify other areas of employment growth outside land transport for the affected workers to transition to.

35.    LTA, SkillsFuture Singapore, our public transport operators and NTWU are jointly developing the Skills Framework for Public Transport and we will launch this very soon in May. It will provide our transport workers with a clearer picture of what skills they should develop as well as the programmes available if they want to upgrade. As we expect to create 8,000 new jobs in the public bus and rail sectors by 2030, we will also enhance talent management and engagement efforts for the sector to attract a pipeline of skilled workers and retain more in-service staff. 

Conclusion 

36.    Mr Chairman, the future transport scene is truly exciting. We are lucky to be living in Singapore at this time. Just the Autonomous Vehicle technology alone plus sharing economy and improvements in mobile telephony, we already combine to make on-demand point-to-point transport service a reality. When these comes about, who needs to own a car? No need to. When you want to go anywhere, using your mobile phone, just call up. Likely it won’t be a car, it will be a driverless pod. Why should a car look like a car? In fact once you have driverless cars, there is no need for steering wheel, there is no need for brakes and pedals. The car does not need to look like a car. Dubai right now is doing a trial of some of these autonomous pods, which don’t look like cars at all. They can reconfigure very easily to take one passenger or two passengers if you want greater intimacy or if you have a family of five children. It can be configured like Hollywood’s Transformers. Most exciting. These will have huge impact on city planning. The roads and carparks will be freed up. Another very important positive impact is the significant drop in casualties and road accidents because a well-programmed robot is always safer than human beings. Much of the problems or accidents are due to human beings. It will change our quality of life. Do flip through The Economist special report this week. To have a glimpse of this brave new world. Is it a dream or a nightmare? Hard to say. You can never guarantee how the future will be like. But various articles in The Economist special report have a good advice: it is in our hands to shape this futureto make sure that it is not a nightmare, it will be a dream, provided that our policies remains pro-innovation, pro-market and also very important, right-pricing of limited resources. The quality of life of our children will definitely be better than ours. Of this, I am confident.

37.    Thank you.