Budget 2015: Transport spending expected to soar

Budget 2015: Transport spending expected to soar

Transport-related expenditure is expected to rise by more than 80 per cent, or $4.8 billion, this year mainly on the back of major infrastructural projects.

These include preparatory works for the new Changi Airport Terminal 5 and Tuas Port, additions to the MRT network such as the Tuas West Extension and the Thomson-East Coast Line, and the purchase of new public buses.

The increase is also owing to a foreseeable rise in operating expenditure in FY2015 to $792.92 million - up by almost 30 per cent.

According to the latest Revenue and Expenditure Estimates, which was presented to Parliament yesterday, about 92 per cent of the operating expenditure will be for the Land Transport Authority's (LTA) management fee "to support the higher maintenance costs for roads and road-related infrastructure".

The LTA's established headcount is expected to rise to 5,815 - up from 5,080 in FY2013.

For the remaining operating expenditure of $63.76 million, a portion will be set aside to fund two public transport concession schemes for lower-wage workers and persons with disabilities and new off-peak monthly travel passes, while the remainder will be used to meet the running costs of Ministry of Transport headquarters and the Public Transport Council.

In total, the expenditure of the transport ministry is projected to be $10.85 billion - up from $6.01 billion last year.

The biggest ticket item in the expenditure report is the MRT Downtown Line, which costs $20.69 billion. This is 70 per cent higher than the original estimate of $12 billion.

Senior Minister of State for Transport Josephine Teo said the cost spiral was mainly due to prices soaring for raw materials such as concrete and steel. She said the addition of one more station, as well as the provision of more entrances and underground links to the line also contributed to the cost increase.

Mrs Teo said that in total, about $14 billion has been devoted to the public transport system over the past five years.

"Another $26 billion has been committed for the next five," she said. "This works out to close to $4 billion per year over 10 years."

The bulk of the spending is for rail infrastructure projects.

Other items include bus infrastructure and operations, commuter concessions, and travel demand management initiatives.

Government Parliamentary Committee for Transport chairman Cedric Foo said the expenditure was necessary to make Singapore more liveable and attractive to investors.

It is also necessary if the aim is to promote public transport, he added.

"To do so when the economy is not overheated is also wise," he said.

christan@sph.com.sg


This article was first published on Feb 24, 2015.
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