PUBLIC BUS SERVICE IN SINGAPORE : PROBLEMS AND POLICY ISSUES

Abstract

Public bus services are very important to many Singaporeans. The structure of this industry is that of a duopoly since the services are provided by two main operators: SBS Bus Service Pte Ltd (SBS) and TransIsland Bus Service Ltd (Tibs). The duopoly is regulated by the Public Transport Council (PTC) with regard to fares and routes. Public bus services are provided by the public sector in some countries but are under private provision in others. The optimum level of government intervention has always been an issue. Some believe that regulation is required to prevent duplication of routes and excess competition while others believe that competition provides a spur to the operators to cut cost and enhance efficiency. Some countries privatize bus operations to relieve the strain on the government's budget which has been the case for Britain. It is difficult to make generalizations about which regime is optimum. Privatization may be more efficient in some countries but not in others. It depends on the market demand, the kind of management the operators adopt among others. Success of privatization of bus industry is also ambiguous and controversial since many a time, it involves some losers and gainers. Effective competition and/or contestability of the market are important elements to successful privatization ( or deregulation). There is scope for deregulation of public bus service in Singapore. In terms of structural deregulation, competitive tendering offers a more feasible choice among others considered. Nonetheless, logistic problems and uncertainties do exist. Pilot projects may be enacted to test the effects of such deregulation on a small scale. Deregulation of the varieties of bus services offered is proposed to provide more product differentiation to commuters. This subtle form of deregulation may benefit both users and producers alike.