Impact of Zero Car Growth Policy on COE Prices
Ministry of TransportSpeakers
Summary
This question concerns the impact of reducing the vehicle growth rate for Categories A, B, and D to 0% on COE prices and transport infrastructure. Mr Saktiandi Supaat inquired about transport inflation, public transport readiness, and potential mitigating measures for car-dependent segments like families or persons with disabilities. Senior Minister of State for Transport Dr Lam Pin Min stated that COE prices are not expected to rise significantly as quotas are primarily determined by vehicle deregistrations. He highlighted extensive investments in the rail network and bus services to reduce car reliance while noting that foreign vehicles are managed via Vehicle Entry Permits. Senior Minister of State for Transport Dr Lam Pin Min maintained that the current quota system remains the most appropriate allocation method for vehicle ownership in land-scarce Singapore.
Transcript
8 Mr Saktiandi Supaat asked the Minister for Transport in light of the policy to cut car growth to zero by February 2018 (a) whether the Ministry has considered the impact of this policy on COE prices; (b) how will this impact transport inflation; (c) whether the public transport system and commuting infrastructure are ready to take on more passenger load; (d) whether zero growth will be imposed on non-Singapore registered cars on our roads; and (e) whether mitigating policies will be explored to mitigate the impact on segments of the population who still need cars as a mode of transportation.
The Senior Minister of State for Transport (Dr Lam Pin Min) (for the Minister for Transport): Mr Speaker, Sir, we will lower the Vehicle Growth Rate (VGR) for Certificates of Entitlement (COE) Categories A, B and D from the current 0.25% per annum to 0% with effect from February 2018. We do not expect this to affect the COE quota and, therefore, COE prices significantly, as the COE quota is largely determined by the number of vehicle deregistrations.
We have invested heavily to build up our public transport system and will continue to do so. In the last five years, we have expanded our rail network by almost 30% to 230 kilometres. By 2030, eight in 10 households will be within a 10-minute walk to a train station. We have also expanded the fleet size for the existing Mass Rapid Transit (MRT) lines by close to 50%. Through the Bus Service Enhancement Programme and subsequently the Bus Contracting Model, we would have added 80 new bus routes and 1,000 new buses by the end of this year. There will be less need to own a car.
We manage the number of foreign-registered vehicles via the Vehicle Entry Permit (VEP), which equalises the cost of owning and using a foreign-registered vehicle in Singapore, with that of owning and using a Singapore-registered vehicle.
Mr Speaker: Mr Saktiandi Supaat.
Mr Saktiandi Supaat (Bishan-Toa Payoh): Mr Speaker, I would like to thank the Senior Minister of State for answering the question. I have one follow-up question with regard to my last question about mitigating policies in the scenario where, if COE prices actually do rise over the next few years or following the policy introduction, will the Ministry of Transport (MOT) look into considering potentially introducing COE subsidies or rebates, for example, for families or citizens with disability in the future, for example, alleviating some of cost increases as a result of the COE increase?
Dr Lam Pin Min: I would like to thank the Member for the supplementary question. Indeed, it is a pertinent question that is in the minds of many.
In land-scarce Singapore, unfortunately, we do not have the luxury of letting everyone own a car. It is also very difficult for the Government to consider alternative methods of prioritising COEs to favour a certain selected group. While our current vehicle quota system is not a perfect solution, it is still the most appropriate at this point in time to allocate a limited and non-basic resource, such as vehicle ownership.
The Government is very mindful of the aspiration and wishes of Singaporeans to enjoy a high degree of mobility. Like what I have said in my reply, we will continue to invest heavily to improve our public transport system – more rail lines and bus routes – and also trying innovative models of transportation, such as private hire car services. Hopefully, this will help reduce the need to own a car.
Mr Speaker: Dr Lim Wee Kiak.
Dr Lim Wee Kiak (Sembawang): Mr Speaker, I would like to ask the Senior Minister of State, for COE ownership, how many of the car owners now actually own more than one car? Will MOT consider leveraging an extra certain percentage if you buy a second COE under your own name?
Dr Lam Pin Min: I would like to thank the Member for the supplementary question. With regard to the question on how many families own more than one car, I do not have the figures with me right now at this point in time but I think this question has been answered in a past Parliamentary Question and I would be able to provide the answer subsequently to the Member.