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Thread: Smrt Profit 150 Millions

  1. #21

    Default Re: Smrt Profit 150 Millions

    Quote Originally Posted by paradigm View Post
    maybe the best way is WE pay them to OPERATE the system.

    ie, operating cost aside, company WILL GET $100m profit depending on operating standards met ... then company will hv incentive to provide the best level of training etc ... keeping operating / maintenance cost low can be one of the standards set to obtain the optimal amt of maintenance.
    that's another way of doing it - akin to government regulation.

    then you have 2 possible negative outcomes:

    the first is not unlike the nhs of britain, which no matter how many people tell you is ok, is still horrible. the nonchalence of some of the doctors here far extend the boundaries of what you might get in a polyclinic in singapore. at least back home they worry that they might kill you. so basically, service standards drop, and costs are kept low by: not replacing buses, reducing the number of routes, reducing the number of drivers.

    either that or like i had mentioned - no incentive to keep costs down. now the government is taking responsibility for us - why do we care? the taxpayers can worry about that. wastage is rampant, and you end up with the same, just that taxes will have to increase in order to accomodate the petitions to the government to increase their operating costs.

    note that i am not saying that the only possible outcome is a negative one. i'm just saying that while we could see it as an easy solution, things are never as easy as that.

    by the way, i am not sure how public transport = no profits. can anyone educate me on that mentality?
    you don't see teachers arguing for ministry of education that it is a loss-making organisation, do we?
    Last edited by night86mare; 6th May 2008 at 06:17 PM.

  2. #22

    Default Re: Smrt Profit 150 Millions

    1.Figures in isolation are misleading. It's like saying someone just strike toto 1 million dollars. But suppose he has gambling debt of 2m dollars. That still makes him worse off than most of us, doesn't it?

    So a profit of 150m means nothing in isolation, until you compare the amount that was invested to earn 150m.

    That's why analysts look at roi, roe, etc.

    2. Profit is the past, price increases are the future. Just because they made 150m last year does not mean they will make more this year. Any fare increase is based on projections of the future, and is completely unrelated to the past.

    Hard for the average man in the street to accept, I agree.

    3. How much fares are depends on how much roe or roi the govt allows them, and also by what standards of comfort, safety and frequency the govt has set for them. Our govt has opted to mandate 'world class' stds, so obviously the prices got to go up too.

    I wish we commuters had a choice though. If the govt were to allow a non world class operator, we would have different choices at different prices. And just like how budget airlines give full service airlines a run for their money, I think a low cost rail operator could be a real alternative, esp for the really poor people.

  3. #23
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    Default Re: Smrt Profit 150 Millions

    Quote Originally Posted by ninelives View Post
    the increment of fare doesnt justify the service smrt provided. come on man, i need to wait 10 mins for a train in the morning( around 10 am/weekday), can you image the crowd?? also, on a certain website , based on survey, singapore got the worst transportation system (amongst urban countries).
    Whether 10 minutes is a long time to wait is subjective. I think there is a very high, sometimes unrealistic expectation of our Singapore public transport system. Of course, if the train ride is only 20mins, 10mins would be a long time.

    Quote Originally Posted by night86mare View Post
    that's another way of doing it - akin to government regulation.

    then you have 2 possible negative outcomes:

    the first is not unlike the nhs of britain, which no matter how many people tell you is ok, is still horrible. the nonchalence of some of the doctors here far extend the boundaries of what you might get in a polyclinic in singapore. at least back home they worry that they might kill you. so basically, service standards drop, and costs are kept low by: not replacing buses, reducing the number of routes, reducing the number of drivers.

    either that or like i had mentioned - no incentive to keep costs down. now the government is taking responsibility for us - why do we care? the taxpayers can worry about that. wastage is rampant, and you end up with the same, just that taxes will have to increase in order to accomodate the petitions to the government to increase their operating costs.

    note that i am not saying that the only possible outcome is a negative one. i'm just saying that while we could see it as an easy solution, things are never as easy as that.

    by the way, i am not sure how public transport = no profits. can anyone educate me on that mentality?
    you don't see teachers arguing for ministry of education that it is a loss-making organisation, do we?
    I can empathise with you on the NHS, as I am also here in the UK (Guildford actually). We even have to make appointment to bring our baby girl to see the doctor!) But its a different culture and treatment regimes.

    Govt owned or privatised. It really depends on the people running the organisation/company. You can have a efficiently runned govt organisation or a private company. There is no conclusion that privatisation is actually better in terms of efficiency or effectiveness. Certainly, it depends on the objectives, culture, race, social-political and economic context. In certain context, govt regulated organisations might be more effective than a private runned organisation doing the same thing.

    For public goods operated by a privatised industry, you would certainly need govt regulations to ensure that the public interest is taken care of. Even with govt regulations, the responsibility still lies with the companies though. the government really works as a check on the private organisation.

    People assumed that just because it is a public organisation, there shouldn't be any profit. Any organisation, even governments, need to make profit to survive and grow. Who would work for free?
    "Photography is an austere and blazing poetry of the real" -Ansel Adams

  4. #24
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    Default Re: Smrt Profit 150 Millions

    Quote Originally Posted by waileong View Post
    I wish we commuters had a choice though. If the govt were to allow a non world class operator, we would have different choices at different prices. And just like how budget airlines give full service airlines a run for their money, I think a low cost rail operator could be a real alternative, esp for the really poor people.
    And who would pay to put in the rail infrastructure in a land scarced country like ours?

    Sometimes having duplicate infrastructure might not be the best thing. Its costly to put in the infrastructure, more costly to maintained it.

    You could consider alternative transportation instead, or moving closer to where you usually go to...
    "Photography is an austere and blazing poetry of the real" -Ansel Adams

  5. #25

    Default Re: Smrt Profit 150 Millions

    If you don't tender it out, how would you know no one wants to play?

    The point is that prices are dictated by what standards the govt sets. If you lower the standards, prices can fall.

    Bus services is another area where it would be nice to have cheap alternatives. No need for brand spanking new and fully aircon buses, many would be willing to take cheap non aircon minibuses.

    Quote Originally Posted by blive View Post
    And who would pay to put in the rail infrastructure in a land scarced country like ours?

    Sometimes having duplicate infrastructure might not be the best thing. Its costly to put in the infrastructure, more costly to maintained it.

    You could consider alternative transportation instead, or moving closer to where you usually go to...

  6. #26

    Default Re: Smrt Profit 150 Millions

    Quote Originally Posted by waileong View Post
    I wish we commuters had a choice though. If the govt were to allow a non world class operator, we would have different choices at different prices. And just like how budget airlines give full service airlines a run for their money, I think a low cost rail operator could be a real alternative, esp for the really poor people.
    rail is a bit hard to do, the profit margins are much lower undoubtedly compared to that of budget airlines - though sometimes i really HAVE TO WONDER how ryanair here in europe makes profits with free fares (one only needs to pay airport tax) for a 2 hour flight, etc.

    is it asking for a choice for the sake of a choice? let's base it on europe, which i think, most singaporeans who express unhappiness with tend towards, unlike america, where amazingly personal responsibility is higher. i think europe is a soft touch region that all economics professors speak of in whispered words and baited breath, it's an utopian idea gone horribly wrong, and it can only suffer in the long run.

    but that aside, there ARE low cost alternatives for railway services - say from venice to milan you could take something which costs half the price and takes twice the time. BUT - correct me if i'm wrong, the metro is another story altogether.

  7. #27

    Default Re: Smrt Profit 150 Millions

    Quote Originally Posted by waileong View Post
    If you don't tender it out, how would you know no one wants to play?

    The point is that prices are dictated by what standards the govt sets. If you lower the standards, prices can fall.

    Bus services is another area where it would be nice to have cheap alternatives. No need for brand spanking new and fully aircon buses, many would be willing to take cheap non aircon minibuses.
    1) true enough, but the thing is.. all the infrastructure is there.

    how would you feel if the singapore government spent billions of taxpayer's monies to build up a nice mrt track, and handed it over to an individual operator to earn, well, profits all over again?

    well, they could sell it, but who's going to want to step into those hot shoes? i can't think of many people who'd want to take over smrt, even if they had the money.

    2) well, i would certainly more than welcome non-aircon buses with cheap fares. and then, there we go again, there will be unhappy people who complain that they are willing to pay for air-con but don't have air-con. you can't please everyone, especially in public transportation.

  8. #28

    Default Re: Smrt Profit 150 Millions

    Quote Originally Posted by blive View Post
    I can empathise with you on the NHS, as I am also here in the UK (Guildford actually). We even have to make appointment to bring our baby girl to see the doctor!) But its a different culture and treatment regimes.

    Govt owned or privatised. It really depends on the people running the organisation/company. You can have a efficiently runned govt organisation or a private company. There is no conclusion that privatisation is actually better in terms of efficiency or effectiveness. Certainly, it depends on the objectives, culture, race, social-political and economic context. In certain context, govt regulated organisations might be more effective than a private runned organisation doing the same thing.

    For public goods operated by a privatised industry, you would certainly need govt regulations to ensure that the public interest is taken care of. Even with govt regulations, the responsibility still lies with the companies though. the government really works as a check on the private organisation.

    People assumed that just because it is a public organisation, there shouldn't be any profit. Any organisation, even governments, need to make profit to survive and grow. Who would work for free?
    aha, hey there. i don't like to compare singapore to london, because well, they're two very different places. but i have to say that the tube is the train from hell. well there are loads of people here who i suspect will appear sooner or later to make noise about how the nhs is excelling and all that, but that's blatant nonsense from my personal experience - 5 singaporeans went to see the doctor, all were sent home being told to gargle saltwater, and 1 eventually checked himself into a hospital for pneumonia. whee. ok but enough of that.

    yes, that is correct. essentially there are arguments (economic ones) that perfect competition is always the best case scenario FOR THE CONSUMER, note, but it does not make any mention of either being best for society. a few case studies would easily prove that there is no one-size solution for every provision of good because there are so many other factors involved in deciding "what is best for all".

    well.. there is the misunderstanding that all government operations involve a big accounting table, which by the end of the year, should sum to zero, in the best case.

    then if negative, make big noise.

    if positive, must divide equally amongst everyone and pay back, hee hee hee. talk about blatant meritocracy.

  9. #29

    Default Re: Smrt Profit 150 Millions

    1. Who said anything about the govt building more tracks? These days public infrastructure projects is all about BOT.

    2. I am talking about having alternatives, so people can choose. Not for the entire SBS fleet to become non-aircon.

    Think it can't work? Well, Hong Kong has small non-aircon privately operated minibuses running alongside the big aircon double deckers. So people have a choice.



    Quote Originally Posted by night86mare View Post
    1) true enough, but the thing is.. all the infrastructure is there.

    how would you feel if the singapore government spent billions of taxpayer's monies to build up a nice mrt track, and handed it over to an individual operator to earn, well, profits all over again?

    well, they could sell it, but who's going to want to step into those hot shoes? i can't think of many people who'd want to take over smrt, even if they had the money.

    2) well, i would certainly more than welcome non-aircon buses with cheap fares. and then, there we go again, there will be unhappy people who complain that they are willing to pay for air-con but don't have air-con. you can't please everyone, especially in public transportation.
    Last edited by waileong; 6th May 2008 at 09:28 PM.

  10. #30
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    Default Re: Smrt Profit 150 Millions

    Take a look at the case of the NZ railway. Govt owns the tracks but allowed to privatise but now the govt is taking it back from operator Toll Rail (renationalising) simply because under private hands, even though it was profitable, there was little reinvestment into the track system.

    Making a profit albeit a healthy one isn't wrong per se but justifications for fare increase must be tempered by service improvements or expansion of services. Failure to meet the stringent service standards must be quantified in monetary terms. In this regard, the Public Transport Council is far too lax in allowing fare hikes and far too lenient in imposing strict service standards on the operators. I guess Singapore is one of the few places worldwide where transport operators get a free rein to make profits almost from day one.

  11. #31
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    Default Re: Smrt Profit 150 Millions

    so how does this profit benefit the commuters?

  12. #32

    Default Re: Smrt Profit 150 Millions

    Quote Originally Posted by JillValentine View Post
    so how does this profit benefit the commuters?
    they will build more and powerful speakers in station. the operator will shout

    "THE TRAIN AT THE MIDDLE PLATFORM IS NOT FOR SERVICE" * 10 times, damn irritating !

  13. #33

    Default Re: Smrt Profit 150 Millions

    Before it goes in circles again... I wonder how much profit is considered...too little? too much? Juz enuf?
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  14. #34

    Default Re: Smrt Profit 150 Millions

    Quote Originally Posted by JillValentine View Post
    so how does this profit benefit the commuters?

    After reading whole lots of crap economics theories, i can't stop laughing when I saw this question.

    I think they will spend more to develop "state of the art" fare collection system for the commuters to travel honestly.
    They just complain they were cheated off $9 million by commuters.

  15. #35

    Default Re: Smrt Profit 150 Millions

    Quote Originally Posted by ninelives View Post
    they will build more and powerful speakers in station. the operator will shout

    "THE TRAIN AT THE MIDDLE PLATFORM IS NOT FOR SERVICE" * 10 times, damn irritating !
    Hahahaha.... The "tu..tu..tu door's closing" is 80 decibel. In industrial standard must wear ear plug liao.

  16. #36

    Default Re: Smrt Profit 150 Millions

    Quote Originally Posted by CYRN View Post
    Before it goes in circles again... I wonder how much profit is considered...too little? too much? Juz enuf?
    Just remember this: $600,000 is peanut.

  17. #37

    Default Re: Smrt Profit 150 Millions

    Quote Originally Posted by waileong View Post
    1. Who said anything about the govt building more tracks? These days public infrastructure projects is all about BOT.

    2. I am talking about having alternatives, so people can choose. Not for the entire SBS fleet to become non-aircon.

    Think it can't work? Well, Hong Kong has small non-aircon privately operated minibuses running alongside the big aircon double deckers. So people have a choice.
    I have to agree with you, people should be given alternatives and choices.
    Even Dr M knows this rule.
    When he built tolls along the N-S Highways, he virtually left the old routes untouched. "If you think I charged too expensive you can always take the old scenic routes, it's free; he said".

    In Singapore, we employ the Ring Fencing. No way can you run, No where you can hide.

  18. #38
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    Default Re: Smrt Profit 150 Millions

    Maybe you forgot in this business they have to replace the rolling stock. So making a big profit is a must. To put things in perspective, I recall reading that in the US, they pay some of their CEOs of big companies >US$100 Million a year. (stock options not counted yet)

    That's just to pay 1 person.

  19. #39

    Default Re: Smrt Profit 150 Millions

    Quote Originally Posted by ricohflex View Post
    Maybe you forgot in this business they have to replace the rolling stock. So making a big profit is a must. To put things in perspective, I recall reading that in the US, they pay some of their CEOs of big companies >US$100 Million a year. (stock options not counted yet)

    That's just to pay 1 person.
    The reported profit should have included the capital expenditure already, right?

  20. #40

    Default Re: Smrt Profit 150 Millions

    Quote Originally Posted by creampuff View Post
    Take a look at the case of the NZ railway. Govt owns the tracks but allowed to privatise but now the govt is taking it back from operator Toll Rail (renationalising) simply because under private hands, even though it was profitable, there was little reinvestment into the track system.

    Making a profit albeit a healthy one isn't wrong per se but justifications for fare increase must be tempered by service improvements or expansion of services. Failure to meet the stringent service standards must be quantified in monetary terms. In this regard, the Public Transport Council is far too lax in allowing fare hikes and far too lenient in imposing strict service standards on the operators. I guess Singapore is one of the few places worldwide where transport operators get a free rein to make profits almost from day one.
    yes, that's a viable solution; and much fairer statements made here than the emotive rants posted here.

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