School bus fares to rise in 2023; operators say hike needed to cover higher costs

The_King · December 3, 2022

SINGAPORE – Architect Tan Tze Wei, 37, will be paying $15 more a month for her daughter’s school-bus ride from January – 10 per cent more than the current fare.

She said the hike from $150 to $165 for a one-way 2km trip is probably inevitable, mirroring the trend of higher prices across many industries.

Steadfast Transport, the company ferrying her daughter, is among the school bus operators raising their charges. It said the $15 fare adjustment is under a new two-year contract with the school that starts in 2023.

The Singapore School & Private Hire Bus Owners’ Association (SSPHBOA) said it does not track the rates its members negotiate with schools, noting that there is a competitive tender system. However, it expects the newer contracts to be priced higher to account for growing operating costs.

In August, the Ministry of Education (MOE) said operators with existing contracts will be allowed to make a one-time fare increase of up to 7 per cent from January 2023 to help sustain their operations, as fuel and manpower costs have climbed.

To help parents cope, MOE has revised the income eligibility criteria to cover more families and give more support to students under its Financial Assistance Scheme from January 2023.

The SSPHBOA said it sought the concession from MOE to help its members tackle the escalating costs. Typically, fares are revised only after a contract ends.

Mr Phillip Peh, president of SSPHBOA and general manager of Tong Tar Transport Services, said the 7 per cent hike does not fully cover the cost increases for bus operators. Tong Tar has more than 10 school bus contracts in 2023.

Besides coping with higher fuel and manpower expenses, Mr Peh said bus operators are likely to have to bear the 1 percentage point increase in the goods and services tax (GST) from January 2023, since the industry practice is to absorb the tax in school bus fares.

Revolving Transport, which has a contract with Cantonment Primary in Tanjong Pagar from 2022 to end-2023, said it will be raising fares by the full 7 per cent as allowed by MOE. Its spokesman did not give further details.

The MOE has a website called Information Notice Board for School Bus Services (IBSB) for schools to call for tenders. The website publishes details of school bus operators and the fare caps for each primary school.

Longlim, which has more than 60 buses and contracts with seven schools, requested to raise fares by “around 7 per cent” for existing contracts.

For a fresh contract like the one it won in September from Zhonghua Primary School in Serangoon, the company said it factored in rising costs when submitting its bid. There are four companies supplying bus services to the school.

Parents said Longlim’s rates are between $30 and $40 higher than those charged by the previous vendor. Based on the rates published on IBSB, the new fares range from $132 per month for one-way trips within a 2km distance to $242 for two-way trips of up to 6km.

Apart from rising fuel bills – diesel prices, for example, have shot up from over $1 a litre to more than $3 in the past 12 months – the cost of engaging subcontractors to take up jobs has surged, said bus companies.

Some said that with drivers in short supply, they have had to tap bus operators with some excess capacity between other contract jobs. For ad-hoc demands, which can be due to drivers suddenly taking ill or if a bus breaks down, subcontractors can ask for as much as $180 or even $200 a trip – significantly more than the average rate of around $80 a trip that a bus company gets for the job.

Parents who have to pay more say they do not have other options.

Mr Terence Teh, 42, a general manager at a furniture retailer, pays $140 a month for his four-year-old daughter’s ride home from a kindergarten.

He said: “Even if the bus operator raises fares, we also bo pian (Hokkien for “no choice”), how else can she come home?”