Friday 24 August 2012

London Cab - New Life with Grant

About 9 months ago, I wrote on the flight of wheelchair bound commuters and added my feeble voice to ask this Government to do something for this disadvantaged group of commuters ((Link).

Today, I read the best news of the year. This Government is finally giving a grant of $3.1 millions to SMRT to run a fleet of 30 new London cabs. I hope LKY is not pissed-off.

Now, I would like to add my 2 cents worth of comments on some aspects of the grant and what changes could be implemented to enhance the scheme and benefit all stakeholders fairly.

I feel that MCYS should have invited not only taxi operators to apply for the grant but also non-profit charitable welfare organizations like The Handicaps Welfare Association, which presently runs a fleet of vans that serve people with physical disabilities.

HWA is a member of the National Council of Social Service but is not funded by the Community Chest. It has been raising funds on its own to finance the various programs and activities, like running the van services, for the benefit of its members. These are the people who desperately needs help from the Government to support their non-profit activities, not Government linked companies like SMRT or Comfort.

If Welfare Associations have extensive experience in running public transport services for wheelchair bounded and handicapped people, they should at least be considered for the scheme, if not given priority. I wonder why they were not invited.

Granted that SMRT is running the London cab business now and has existing manpower and equipments for smooth management of the new fleet of 30 London Cabs, they are primarily a profit oriented company At the end of the day, they must make a profit for running this business and therefore, the fare they charged the handicapped commuters will surely be "business rate". Unlike SMRT, Welfare Associations can charge a lower "charitable rate", without the profit consideration.

Apart from meeting the transport needs of the wheelchair and handicapped people, the fare must be reasonably priced or discounted for this disadvantage group of people in our society.

Let me explain in my layman way.

Presently, SMRT charge $45 per transfer (point A to point B) or S$45.00 per hour (min. 2 consecutive hours disposal). These charges take into consideration the capital cost of about $1.5 million of the current 15 London cabs that had to be recovered in 5 years, plus operation cum maintenance cost and profit factor.

With the award of $3.1 million grant for 30 new London cabs, SMRT does not have to factor in the recovery of capital into their fare anymore, though profit is still an important consideration. Therefore, with the recovery of capital out of the picture, SMRT could charge a lower fare than the $45 per trip. On the other hand, if an experienced Welfare Association gets the same grant, they could charge an even a lower fare than SMRT because the profit factor was never a consideration.

Now, writing from a taxi driver's perspective and experience, I would say that the $45 per trip charge and an advance booking fee of $18 for a London cab for wheelchair passenger is extremely high. Though a trip in a Mercedes Benz limousine costs the same, the capital cost of a London cab is much lower than a Mercedes Benz cab. Why charge the same fare for riding a donkey and a horse?

In the past, running the business of London cabs was not viable because investment in a London cab was high, plus wheelchair passengers were few and drivers were scarce. This in turn limits the size of the fleet and necessitate a corresponding high fare.

Since the new grants does not have to be repaid, SMRT is basically given 30 FREE London cab to run. Now, SMRT have no excuse for not begin able to make it a viable business because no investment in new cab is required. LTA could  help by waiving the COE for these 30 London cabs specifically.

With regard to lack of drivers and wheelchair passengers, maybe a slight adjustment in SMRT pricing policies and system might help to solve this problem,

Firstly, set the rental of London cab for taxi driver at about $80 a day (current $120+ per day). This would certainly attract many taxi drivers but mandate that drivers must compulsorily ferry all assigned wheelchair passengers. Allocate the London cabs only to drivers who live within 5 kilometers of a clusters of wheelchair passengers. This would ensure efficiency and "productivity".

With a yield of  almost $900,000 ($80 x 30 x 365) a year from rental of the 30 London cab, SMRT has the economic of scale to earn a decent profit. So, what's the problem in setting a $80 rental rate?. 

Secondly, reduce the fare to about $30 per trip or based on metered fare like a normal cab but without surcharge for wheelchair passengers. The reduced fare would attract more wheelchair passengers to SMRT and more importantly, help the disadvantage people in their transportation cost. The lower fare will not affect the taxi driver's income. He could still earn a decent income of about $2,500 per month per shift, because of low taxi rental.

Now, let me recap the "tweaks" I propose. Firstly, reduce the fare charged for using London cabs by wheelchair bounded passengers and secondly, reduce the rental of these cabs. With some help from LTA, stakeholders would benefit more from the grant, if MCYS compels SMRT to implement these "reduced" pricing policies. I don't foresee any difficulties in getting it done because these people are siblings with a common patriarch and it's within their control.

In retrospect, you may say that when SMRT intends to phrase out the London cabs, I appealed to the Government to help them to reinstate the services. Now that the Government had done that, you want them to intervene to set the fare and other matters.

Aren't you asking for a pound of charity now that you got an ounce? Yes, yes. precisely. Grants are awards in the form of money given to a person or organization that does not have to be repaid and they are tax payers money. Therefore, as a concerned citizen, I've the right to say how the money should be better spent. If no grant is involved, I wouldn't broach on it.

Meanwhile, with the $3.1 million grant, SMRT will rejuvenate the London cab service and users can expect greater convenience and service. Also, the new cabs can be booked two days in advance instead of at least three days at present. Though these are minor improvements, the most important thing is the London cabs are back in service.

For the first time, I felt gratified that this anti-welfare Government is slowly changing it's direction from an uncaring and dispassionate path towards one that is more caring of it's citizen and putting Singaporeans' welfare at the heart of their policies. This is the right thing to do and is in the right direction.

Keep it up as more help is needed in many other areas in Singapore. Cheers!.

I hope my readers will add a comment in support of my proposals to reduce the fare for the wheelchair bounded passengers using the London cabs. After a period of time, I will consolidate and submit your 'support" together with this post to MCYS, SMRT and LTA to mull on this matter. I'll post their response, if any, here. Thank you!


gm . 绿效精神 said...

It will be great to see further cut following your recommendations, but likely to be tough to interfere the booking charge/ transfer charge/ rental fee/ ... for high-cost wheelchair taxis by SMRT. The ultimate call towards community spirit will still depend on CSR of profit-oriented organization for the convenience of handicaps.

The long-term solution will be to expand the services of reasonable cost wheelchair mini buses by HWA (or other charitable organization). The low-cost wheelchair accessible public buses can complement these shortages during off-peak period, bearing some inconvenience here and there.

Diary of a Singaorean Cabby said...

Hi, gm,

Thanks for your comments.

Ultimately, implementation of any public recommendations solely depend on the will of the authorities. It's totally within their power and control. It's a question of whether they want to do it or not for the benefit of the affected group without jeopardizing the interest and inconvenience of the majority.

I hope my other readers will have something to say as well.

Eddy - Fellow Cabby said...

Any Help from the Gov and benefiting the community big and small is worth supporting!

Diary of a Singaorean Cabby said...

Hi, Eddy,

Sry for late response to your comment. Thks. Yes, any help form the Govt. to the affected group is much appreciated. The question is what is the percentage of the affected group in comparison to the percentage of voters in a G.E. That's the bottom line.

Govardhan Avvaru said...

Great post and I agree with all that you said here and hope sure you will find a solution,
Regards, cabs in hyderabad

Aussie Den said...

Definitely charging too much compared to other options. Hopefully they will listen to your logic James.
I'm coming to visit in July and it would cost me $150 for 3 seperate trips?
It's a lot cheaper on the buses providing I can work the routes out :)

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