atans1

Posts Tagged ‘Public Transport’

SMRT: only now meh?

In Infrastructure on 04/03/2014 at 4:55 am

I’ve only recovered from this piece of news on SMRT: on 16th Feb it was reported that “Singapore’s two train operators will adopt a “predict and prevent” approach to their maintenance regimes from now on.

‘Transport Minister Lui Tuck Yew said … this new approach will see operators actively monitoring the condition of the rail system to prevent breakdowns and delays.”* Seems they were using a find and fix” approach. Easiest way to “find” problems is sit back, drink kopi and wait for news of train delays, breakdowns?

Maybe taz why a CEO who is a scholar and ex-SAF chief is needed, not a Ferrari-driving FT retailer? Horses for courses?

Anyway now that SMRT is adopting state-of-the-art, cutting edge management techniques, time to buy stock? Stock set a new 52-week low during yesterday’s trading session when it touched 1.02. 36.7% down from a 52 weeks ago. That it yields 1.95% is a reflection that the price has collapsed.

DBS wrote this in 2012: SMRT has a dividend payout policy of at least 60% of net profit. In fact, in the past few years, it has paid over 70%, hence providing a reasonable yield.

ComfortDelGro, on the other hand, has paid only 50%of earnings as dividends. – See more at: http://sbr.com.sg/transport-logistics/markets-investing/smrt%E2%80%99s-dividends-risky-in-2012-dbs#sthash.k1ywpunr.dpuf

(Comfort yields 3.63%)

Surely after GE (next yr after August,  is my prediction), fares will be increased? Time to buy and wait now that mgt is better?

60% dividend policy. SMRT has a dividend payout policy of at least 60% of net profit. In fact, in the past few years, it has paid over 70%, hence providing a reasonable yield.
ComfortDelGro, on the other hand, has paid only 50%of earnings as dividends. – See more at: http://sbr.com.sg/transport-logistics/markets-investing/smrt%E2%80%99s-dividends-risky-in-2012-dbs#sthash.k1ywpunr.dpuf
60% dividend policy. SMRT has a dividend payout policy of at least 60% of net profit. In fact, in the past few years, it has paid over 70%, hence providing a reasonable yield.
ComfortDelGro, on the other hand, has paid only 50%of earnings as dividends. – See more at: http://sbr.com.sg/transport-logistics/markets-investing/smrt%E2%80%99s-dividends-risky-in-2012-dbs#sthash.k1ywpunr.dpuf

But then think again as NOL is run by another general and scholar and NOL recently lost serious money. Here’s analysis from last yr after an earlier set of results http://atans1.wordpress.com/2013/11/19/scholar-cant-repair-nol-maersk-steams-ahead/

——-

*Mr Lui was responding to questions from Members of Parliament on the reliability of train services, in the wake of several disruptions last month, including a delay on the North-South Line that affected some 19,000 peak-hour commuters.

So far, operators SMRT and SBS Transit have been using the “find and fix” approach to correct existing issues with their rail systems.

Mr Lui said he had called up SMRT’s senior management to convey his concerns after the recent spate of incidents.

He said: “They take it seriously, and as the CEO told me himself… the team was actually very disappointed themselves with the series of incidents, as well as with how the staff on the ground had handled it.”

SMRT will be reviewing its contingency plans on a station-by-station basis to better support its ground staff, rather than rely on a generic plan that covers stretches of the network.

Mr Lui said: “SMRT’s management has already committed to review its contingency plans on a station-by-station basis, and refine its command and control structure in times of disruption to better support ground staff.”

Both SMRT and SBS Transit have also switched to a “predict and prevent” strategy for their maintenance regimes.

For instance, some trains on the North-South and East-West lines are already equipped to collect real-time data and detect problems as they run.

Several MPs had asked why train disruptions continue despite efforts in recent years to improve the train services.

Mr Lui said: “Service disruptions do happen from time to time, especially as our rail network further expands and ages, and as we run more and more train trips.

“But in the case of the January incidents, SMRT could have done much better in service recovery, especially to provide timely information to affected commuters.”

Both train operators, however, have put in hard work to improve train reliability since 2011, Mr Lui added.

Government estimates showed that SMRT has increased its yearly repair and maintenance expenses by over 65 per cent from S$38.3 million in 2011 to S$64.6 million last year.

Both train operators have also hired more engineers and expanded their maintenance teams.

The Land Transport Authority is also upgrading the rail infrastructure.

The North-South, East-West lines’ third rail system will undergo a full, system-wide change-out this year, Mr Lui said, and the North-East Line’s overhead power system will also be improved with new corrosion-resistant materials to minimise cracking in its components.

In a separate statement, SMRT said it takes responsibility for the recent incidents, and will leave no stone unturned to improve the reliability of its train services. (CNA report)

SMRT: Update

In Infrastructure on 06/02/2014 at 4:38 am

.There could be a rights issue coming to shore up its finances. But to call it, it must be pretty sure of profits for dividends somewhere down the line. Massive train price increase after 2015 GE?  Don’t see PAP losing power or even losing a two-thirds majority. Or even PritamS becoming a cabinet minister in a PAP, WP coalition govt.

But remember the CEO is an ex-SAF chief, juz like in that dog with fleas, NOL :http://atans1.wordpress.com/2013/11/19/scholar-cant-repair-nol-maersk-steams-ahead/

Good article on SMRT by someone whom I don’t usually think highly of: http://www.baldingsworld.com/2014/01/29/why-is-smrt-raising-fares/

This video has been making the rounds on Facebook: During a 45 train delay, SMRT begs passengers on board repeatedly for a pair of scissors

Taz why PTC raised fares. After paying Kwek and his SAF buddies, got no $ for proper tool box? LOL

Gd reports

– SBS (ComfortDelgro)  benefits more than SMRT from price hike

http://sbr.com.sg/transport-logistics/news/chart-day-these-charts-show-how-transport-firms-will-be-impacted-fare-hike

– Sports Hub to make $ for SMRT

http://sbr.com.sg/transport-logistics/news/singapore-sports-hub-could-turn-around-souring-smrt-profits

 

Another reason why SMRT sucks

In Infrastructure on 27/01/2014 at 4:27 am

Last Monday, I made one of my irregular trips on the MRT. I entered Eunos Stn in the late morning and one of the escaltors was closed “for maintenance”. I returned home via another route partly to avoid walking down the stairs on the return journey

Last Friday, I again took the MRT from Eunos Stn. Guess what? The escalator was still closed for “for maintenance”. When I made the return trip (wanted to eat at a great but expensive Malay food stall at Eunos Hawkers’ centre: stall always asking why I don’t eat more regularly and I explain to them I don’t use the MRT that often), several hours later, the escalator was still not working.

Err how to expect train services not to be disrupted (five already this yr according to TRE*) if cannot even repair or service escalator within five days? But to be fair, maybe engineers too busy repairing tracks etc to bother about escalator. Got to prioritise everything, according to jnr tpt minister Jos Teo.

I will have to again use the MRT from Eunos this Wednesday and then the following Monday (yah lot of travelling these few weeks: pushing my luck leh), and I’ll keep readers informed.

Meanwhile, avoid the stock. It’s going to take huge fare rises to make it a gd dividend yielding stock again because it needs to spend more, a lot more to get (and then keep) the trains running on time. With an election likely in 2015, these fare increases are unlikely http://atans1.wordpress.com/2013/12/13/why-a-2015-ge-is-now-more-probable/

Meanwhile, I wish MRT users a disruption free day, though the odds are rising against this probability.

Thinking about it, SMRT may have closed one of the Eunos escalators to save money as per this story about the London MRT (tube) system.

Green Park is one of the busiest tube stations in London. It has three escalators to the station concourse from the Piccadilly line, which serves not just London commuters but international businessmen and tourists travelling to and from Heathrow. Yet routinely one is closed at peak times.

The reason? According to station staff Green Park has been set energy targets and this is the way that it is meeting them.

So, in order to meet this energy-saving goal, the London Underground is prepared to cause unnecessary delays to passengers, even though time-saving for passengers is always a crucial element in any evaluation of a transport project. It is also prepared to create potential dangers to public safety as bunching occurs while people wait for the only up escalator that is operating. And as that happens another escalator stands idle, with the big investment that has been made in it in effect written off.

What folly. Whether or not this is intended by the top brass at Transport for London is unclear. But this is what happens when stupid objectives are set and managers are either pressured into meeting them come what may or follow them without paying heed to their primary responsibility, which in the case of a tube station is to convey passengers as swiftly and as safely as possible to and from the trains. (http://www.economist.com/blogs/blighty/2014/01/trouble-targets)

Hmm, thinking about it, the setting of stupid objectives, and why the absence of the profit-motive when providing public services (like transport) is not a gd idea, may be the subject of posts after the CNY hols. Must try to stop writing about ang moh tua kee Bernice Wong and her masculine, not sheltered, babyed & childish (so unlike local boyars) hubbie, Anton Casey.

*Or is it four http://www.tremeritus.com/2014/01/26/smrt-5th-smrt-breakdown-not-a-breakdown/ (Updated one hour after first publication)

A PAP MP on the need to lose dignity to get $50 vouchers

In Political governance on 20/01/2014 at 5:00 am

Last year, the Fare Review Mechanism Committee (FRMC), among other things, proposed that public transport operators be required to contribute to the Public Transport Fund to help needy households when fares are adjusted, as a way of “sharing” their gains with commuters, it said. This could range from 20% t to 50% of the expected increase in fare revenue, depending on profitability, Presumably it would then issue vouchers for distribution to the needy poor.

I was reminded of  the proposal when I read, The thing is, the G talks about public transport vouchers again. Now if I remember correctly, hundreds of vouchers in the past hadn’t even been taken up…Either people really don’t need them – or there wasn’t a good plan to get them to the needy. Perhaps, that should be fixed first. http://berthahenson.wordpress.com/2014/

The proposed fund in turn reminded me that one Charles Chong in the  early noughtie said the needy should be made to lose their dignity to get $50 help vouchers.

This is what I posted in 2011

I hear Charles Chong will speak in parliament tomorrow. Doubtless he will talk about helping the needy*. It’s the in- thing in the PAP to want to help the needy. (This is of progress of sorts. Only recently, Lily Neo was berated and sneered at by VivianB for asking for more help for the poor. When that happened, I tot of Oliver Twist asking for more food and being beaten for his pains.)

But I would like to ask Charles Chong, “Must a needy S’porean still lose his dignity for a $30 voucher?”.

Let me explain the background by winding the watch back some years.

In the early noughties, when S’pore was in a recession or recovering from one, one Charles Chong said, “We shouldn’t…be telling everyone that there’s this help available. It’s quite a process to go through to get the vouchers. A person with dignity won’t do it unless he’s in genuine trouble.” Charles Chong was explaining his (and some other PAP MPs’) reluctance to distribute free electricity vouchers on the ground that giving these to the needy would create a culture of dependence.

After reading this remark, I began to have serious problems with the attitude of the governing party. (Previously I had been indifferent to the PAP, even though before 1991, I was a “LKY is almost always right” and “LKY has his heart in the right place” person.)

This remark of Charles Chong also prompted a writer to MediaCorp’s freesheet to ask,”Can a Singaporean no longer lend a hand … without being accused of encouraging a crutch mentality? Aren’t we allowed to feel compassion for another? …cannot use for any other purpose except to pay your utility bill. There is no need to make people beg for that.”

I don’t recall the government or Charles Chong responding to this letter …

(http://atans1.wordpress.com/2011/10/20/question-for-charles-chong/)

Will Kee Cui tell us that the PAP govt repudiate such an attitude today? Will Charles Chong say “It was an honest mistake?”.

For the record, Charles Chong is my MP. As readers will know, I’ve always voted WP all my life. But even if JJ stands for the WP, I’m likely to be on hols next GE. Charles Chong and the WP makes me want to puke**. My wish i9s that the SDP stands in Joo Chiat in place of WP, with JJ as its candidate. Yah, I typival S’porean: want cake and eat it too, all of it.

Let’s not be fooled into believing that the PM, cabinet ministers,  and PAP and WP MPs and  get out of bed in the morning to help the working poor. I would exempt Lily Neo and Halimah Yaacob and possibly Kee Chui from the last sentence.

Maybe, anti-PAP paper activists including readers of TOC and TRE should remind Charles Chong and voters that he said,“We shouldn’t…be telling everyone that there’s this help available. It’s quite a process to go through to get the vouchers. A person with dignity won’t do it unless he’s in genuine trouble.”

If this turned me against the PAP’s policies, it might turn others too. Or remind wavering anti-PAP S’poreans why they are right not to trust the PAP.

—-

*He did. speak of helping the needy. Funnily he didn’t say that they should be made to crawl on their knees to get help. But then he only won by 300 votes in GE2011, and the PAP only got 60% of the popular vote.

**In its election manifesto WP called for public tpt nationalisation, something Low reaffirmed after the Punggol East victory. Now, “The WP believes that public transport should be provided as a public good and not for profit” And if we help it be a kingmaker in the next GE. will it play us out and support the PAP, Hard Truths and all? Remember PritamS’s comments on coalition with the PAP juz after the voters of Aljunied gave WP a gd majority. He slapped us in the face, not the PAP, driver. Low only slapped Singh’s wrist.

Tpt minister looks after shareholders, the poor and the disabled?

In Infrastructure, Public Administration on 15/01/2014 at 4:27 am

What about other disadvantaged S’poreans?

The Public Transport Council (PTC) will release its decision on raising fare adjustments for public transport tomorrow and a reasonable person would conclude that fares will go up based on what Minister for Transport Lui Tuck Yew wrote  on a Facebook post on Monday.

“I told (PTC chairman Gerard Ee) that the government was ready with our package for the low-income workers and persons with disabilities and that we would like to announce this together on Thursday. These two concession schemes will be fully funded by the government,” wrote Mr Lui, stressing that the schemes would make transport fares much more affordable for both groups.

Isn’t he telling the PTO, pls feel free to help out the tpt companies (and their shareholders*) because the govt (us tax-payers, including said poor and disabled: remember that they too pay GST) will absorb the increases for said groups.

Mr Lui also said that the discount under the scheme for low-income workers would lower their fares to around the same levels as 10-15 years ago, depending on the journey. Meanwhile, the discount for those with disabilities will be “even more significant”.

Hey what about retirees and those who never got pay rises?

BTW, the WP’s silence on nationalisation is deafening, even though WP Low told us last yr that WP still believes in it. I have my doubts  http://atans1.wordpress.com/2012/12/14/wp-changes-mind-on-nationalising-smrt-sbs/

Backgrounder: In December, transport operators SBS Transit (SBST) and SMRT applied to the PTC to raise bus and rail fares this year, with SBS – Singapore’s biggest bus operator – citing cost pressures.

—–

*Some shareholders do get a free lunch:despite claims by scholar and ex-general running SMRT that its biz model is broken:

Using back-of-the envelope calculations and figures in annual reports, since it was listed SMRT (over a decade ago) has paid S$562.79m in dividends to Temasek, and ComfortDelgro has paid the S’pore Labour Foundation (a statutory board affiliated to the NTUC) dividends of  S$150.46m*since 2003 (Comfort and Delgro merged in 2003, and SLF had a stake in Comfort). The amount that ended up with the government was S$713.25m, with SMRT contributing 79%. But ComfortDelgro is likely be the main beneficiary of the S$1.1bn bus plan**, given that, at present, SBS Transit (a listed co 75% owned by ComfortDelgro) provides most of the buses. Taz an example of how messed up things are.

The funds’ flows also show that the government is putting back all the dividends it received from these two companies and then adding 35% more. So it’s wrong to say that the SMRT and ComfortDelgro are getting free lunches. At most the government is subsidising their lunches by 35%.

The government should get credit for ploughing its share of the “loot” (as the proponents of nationalisation would put it and MPs Puthu, PAP, and PritamS, WP, might put it), but it doesn’t. Taz how messed up are.

(Incidentally, one could reasonably argue that the other shareholders — and the minority shareholders of SBS Transit, remember ComfortDelgro owns around 75% – are getting a free lunch while the government returns its share of the dividends. But let’s nt get into that today.)

http://atans1.wordpress.com/2012/03/02/oh-what-a-tangled-web-we-weave-mrt-comfortdelgro-and-the-government/

Small wonder that foreigners snapped up ComfortDelgro at gd discount last year though tapering caused some wobbles http://atans1.wordpress.com/2013/06/17/when-raising-fares-sbs-smrt-govt-dont-have-this-problem/. Now above price bot. in.

.

When S’pore has 8m people and counting

In Infrastructure on 04/01/2014 at 4:58 am

An unofficial map of how the MRT system will look like when fully developed

http://transitmaps.tumblr.com/post/68121163229/singapore-bernie-ng

 

Waz the “right” kind of gotong royong?

In Economy, Infrastructure, Internet, Political governance, Public Administration on 18/10/2013 at 5:00 am

Update on 22 23 October 2013: Minister explains use of Criminal Law Temporary Provision Act (http://au.sports.yahoo.com/football/news/article/-/19491410/football-match-fixing-witnesses-fear-reprisals/) on footie fixers.

I recently came across “gotong royong” the American way, or community spirit the capitalist way: in American- speak, the “sharing economy”.

Technology is revolutionising the way Americans catch a cab with a ride now just a click away through mobile phone apps like like Uber, Lyft, Sidecar, Instantcab and Flywheel.

Many of these services are part of the so-called “sharing economy” in which car owners offer to drive strangers in exchange for a “donation”.

http://www.bbc.co.uk/news/magazine-24393348

But is this the “right” gotong royong that the PAPpies say they want here?

Bet you the Hard Truths that premise the PAP’s governing methods will prevent S’pore from ever going down this route, even though this seems one of several viable solutions (several are needed)  to our public tpt and private car problems  Remember, NTUC is via the Labour Foundation, the controlling shareholder of ComfortDelgro, the owner of the biggest taxi fleet here, and Temasek’s SMRT has a big taxi fleet too. The former runs most of the buses, while the latter runs most of the trains too. And it might impact the revenue from CoEs.

Seriously, the problem here is that “gotong royong” is contrary to the PAP’s Hard Truth that it is fount of everything. Gotong royong is not compatible with a top-down approach, where there is always a “right” way of doing things.

In “gotong royong”, as in the “sharing economy”, things happen because the rabble plebs mob community, society, consumer is the driving force, not a benign meritocratic elite. The people realise that there is a problem, issue, and are free (within some, not many, constraints) to work out a solution*. They don’t bitch while waiting for the governing elite to solve the problem, feeling entitled that because said elite is well-paid, they must solve the problem, resolve the issue.

I consider the following to be gotong royong in action, but doubt the PAP ministers urging us to “gotong royong” would agree:

– TOC’s and TRE’s continued existence;

– the various fund raisings for various legal cases where the govt is the defendant;

– the public funding of the deposits of Alex Tan and friends, and the independent team at Tanjong Pagar GRC;

– Nicole Seah raising money for her team’s election expenses;

– the free food and drinks at Gilbert Goh’s Hong Lim Green functions;

– Function 8;

– CHC members who willingly pay the legal fees of church members being prosecuted for false accounting etc;

– pastor Khong’s gang funding a legal suit;

– those who lend sound eqpt and technical help at various Hong Lim Green parties

– the kay pohs trying to help FTs avoid being hung for drug trafficking**;

– those gathering to help the family of Dinesh Raman get justice and closure**;

– Maruah**;

– the volunteers who help FT manual workers;

– the LGBT community; and

the dedicated band of enthusiasts who have been trying to draw attention to the cemetery’s [Bukit Brown's] value. They have succeeded in having it included on the biennial watchlist of the World Monument Fund (WMF), of heritage sites around the world that are in danger.

All these examples and more show that the gotong royong spirit is alive and well. They juz don’t fit the PAP’s narrative, especially the bit that the PA’s and PAP’s grass-root activists are the only selfless, dedicated volunteers. And that in cyberspace, their activists are no match for the the injuns, outlaws and other inhabitants of cowboy towns.

*In the US, there is no hegemonic elite to enforce the top down approach, and stifle innovation or stifle dissent or force recantations from members of the elite turned heretical.

**How come no help Dan Tan? Because he drive 7 series, got properties and China babe? And he not violent, middle class or FT?

SMRT: Rights issue coming?

In Infrastructure on 08/10/2013 at 5:54 am

Reading the u/m, I can’t shake the feeling that a rights issue is coming: the capex and running costs seem to call for it. Given that the share price has fallen from the 1.40ish level (at the end of July), to the present level of 1.29, it  might be interesting to buy if one expects a rights issue is in the offing. A rights issue will signal that Temasek expects dividend levels to be maintained at current levels, or slightly reduced, not slashed drastically. It took the results of 1Q 2013- 2014 to bring the shares to below the 1.34 level, a level brokers had been targeting since January.

Let you know if I buy after I buy. BTW, still not bot ComfortDelgro http://atans1.wordpress.com/2013/06/17/when-raising-fares-sbs-smrt-govt-dont-have-this-problem/. Share price recovered 10% while I was thinking about it (blame QE reprieve). Shares are now near the price that institutions took a placement off the S’pore Labour Foundation.

CREDIT ratings agency Standard & Poor’s (S&P) has lowered its outlook on SMRT Corp from “stable” to “negative” over concerns about its financial position, particularly its cash flow.

S&P said [on 27th September 2013] that the transport operator’s operating expenses are higher than expected. It also pointed to high capital spending over the 12 months to June, while noting the uncertainty over government financial support such as funding for the firm.

http://www.cpf.gov.sg/imsavvy/infohub_article.asp?readid={435478142-19258-9361788629}

“… the lack of timely government support could delay a recovery in SMRT’s key financial metrics.”

SMRT’s “moderate” financial risk profile is weakening, S&P added.

It said it expects the group’s bottom line will be hit by increased operating expenses such as wages and repair and maintenance costs, without the offsetting factor of higher fares.

S&P added that SMRT’s capital expenditure will likely remain high at about $600 million.

It noted that the group’s capital spending will likely ease in 2015 as it implements a new rail financing framework. This, in turn, will ease its debt situation.

“Nevertheless, we base this on a positive and timely outcome for the ongoing discussions between the company and the Government.”

S&P said SMRT’s business risk profile remains “excellent”, backed by its dominance in Singapore’s rail sector.

Its passenger numbers have grown steadily over the past two years despite breakdowns in December 2011.

The agency predicts that passenger numbers will continue to rise as the economic environment improves and it retains its dominant position here.

S&P continues to believe that the likelihood of “extraordinary government support” for SMRT Corp is “extremely high”.

It said: “This is based on the company’s critical role as a provider of essential public transport service in Singapore, and its very strong link with its majority owner, the Government, through Temasek Holdings, which owns 54.2 per cent of SMRT.”

TRE to blame?

In Humour on 25/09/2013 at 5:21 am

The appointment of SMRT’s security chief as its new PR chief* reminded me that In a letter dated 3 September 2013, a TRE reader sent in a complaint about some PRC FTs at a MRT station

They were eating foods such as Biscuits, Cakes, Lychees, Bananas and Apples, taken out from several boxes and plastic bags. The lychees peeled skins were littered on the concrete bench/seat. They were also shouting loudly in a distinct China’s Chinese accent. I also observed that they were loitering; not boarding any trains travelling towards Joo Koon or Woodlands MRT. They were literally having a picnic.

I did not stop them to minimise the possibility of myself getting hurt, as I have read several reports of China nationals attacking Singaporean Police officers. e.g. (source: TR Emeritus)

He complained to the SMRT staff but didn’t know the outcome as he had to catch his train and TRE wrote: Editor’s note: A letter has been sent to SMRT for comments on why the foreigners were not fined on the spot.

Maybe the SMRT person too read TRE’s reports of aggressive PRC behaviour and decided he too didn’t want to get beaten up, juz like the letter writer? There was an incident also reported by TRE about a PRC PR shop assistant who beat up a SMRT officer because the officer had stopped her son for trying to avoid paying.

So maybe TRE should be more careful in highlighting PRCs aggressive behaviour towards S’poreans to avoid unnecessarily frightening S’poreans.

Wonder if SMRT ever replied to TRE?

*Let’s hope this ex-cop improves on this

http://atans1.wordpress.com/2013/07/29/smrt-another-breakdown/

http://atans1.wordpress.com/2012/11/16/smrt-is-in-the-biz-of-transporting-people/

http://atans1.wordpress.com/2011/12/18/smrt-svp-is-great-believer-in-shareholder-value/

“Cheaper” to build F1 track

In Humour, Infrastructure on 08/09/2013 at 6:21 am

Netizens in July were making comments about a SMRT river training for F1 following a tragic accident when a bus alleged to be speeding overturned. The driver (apparently an FT PRC) claims the brakes didn’t work. http://www.tremeritus.com/2013/07/24/smrt-bus-crash-at-dairy-farm-road-actual-video-of-crash/. Nothing further has emerged.

For us lesser mortals, when F1 comes to town, those of us who have to work, have the inconvenience of blocked roads and altered bus routes. And the shops at Suntec have to deal with falling biz. All this so that S’pore doesn’t have to build a proper F1 track. Guess we now know why only Monaco, Montreal and S’pore have street races: peanuts compared to the number on permanent circuits. The public are inconvenienced, and the public cannot be upset even in countries where the people can’t vote for the govt ruling them. BTW, in Montreal, the street race ain’t in the heart of the city, and in Monaco, people commute by helicopters and boats too (at least the rich do).

It’s not as though there is a huge savings gap. In fact it’s more expensive to stage a street race, even without taking account of the economic losses.

However, the annual running costs of a street race are greater than those of one on a permanent circuit: temporary grandstands need to be built and the roads need to be upgraded to F1’s high safety standards. The biggest single expense for the operators is staffing (c£10m), followed by rental of grandstands (c£8m) and construction of safety barriers and fencing (c£5m). 

In total, the annual operating cost of an F1 street race is in the region of £36m. Then comes the hosting fee, which is paid to the F1 rights holder. The average hosting fee came to £17m in 2011 but the sting in the tail of the contracts is that the price accelerates by as much as 10 per cent every year. Most new F1 race contracts are for ten years, so by the end of the agreement the annual fee comes to around £40m thanks to the escalator clause in the contract. That means that over the ten-year duration the bill for hosting fees totals an estimated £272m (see below) with the cost of running the races coming to £360m. That makes a total over ten years of more than £600m.

With annual running costs that are far lower than those for a street race, the total cost of building a Grand Prix circuit and hosting an F1 race over a ten-year period comes in at around £560m. But promoters need to dig deep to fund that initial track construction… http://www.babusinesslife.com/Ideas/Features/The-cost-of-hosting-a-Formula-1-Grand-Prix.html … how much the key elements of a brand new Grand Prix circuit are likely to cost… [£164m]

So the difference is spending S$80m more over 10 yrs to “save” on the cost of building a permanent track. Of course, I ‘m assuming the cost of the circuit land is zero or nominal. But this being S’pore where giving away the land for public housing would be “raiding the reserves” (Mah Bow Tan), this is a non-starter. Anyway the usual suspects would shout “corruption” even if the govt was willing to lease land at a nominal price.

So, the end result is that the “little people” who have to commute by way of public transport, get screwed, So waz new?

(Related post: http://atans1.wordpress.com/2012/10/01/f1-sharing-the-1bn-in-value-add-with-the-losers/)

But let’s look on the bright side like Brian Cohen in the Life of Brian. Suffering a lingering, painful death by cruxification, Brian’s spirits were lifted by others crucified along with him, who sang “Always Look on the Bright Side of Life”.

Hopefully SMRT and SBS are tapping F1 to make our tpt system more reliable and efficient. In the UK, train and bus companies have started working with the Williams Formula One team to help improve their service.

The companies are buying advice and equipment to make their vehicles more reliable, something every passenger in the land will be grateful for.

http://www.bbc.co.uk/news/business-23132335

At the moment, SMRT’s only links with F1 is that the previous CEO drove a Ferrari, and is alleged to have had a Mercedes super car. Maybe when Desond Kwek and his ex-SAF mgrs want to buy super cars with their mega-bonuses, Williams could call them to see if something win-win can be arranged for them, Williams and SMRT? Free sex is no longer an option after recent corruption court cases.

SMRT might be interested in this: talking train window ads

http://www.bbc.co.uk/news/technology-23167112

I mean its CEO is claiming that its business model is not sustainable i.e. he can’t raise fares to cover the costs of salaries and maintenance. Cut dividends leh? As at end February 2012, SMRT has paid SMRT paid S$562.79m in dividends to Temasek since its listing.

(Another way of raising $http://atans1.wordpress.com/2012/08/13/how-smrt-can-spend-more-on-maintenance-while-contd-paying-gd-dividends/)

Finally, great video that shows guy driving round Manhattan at speeds that breaks the law. http://www.theguardian.com/world/video/2013/sep/06/manhattan-island-24-minutes-video. Driver records 24-minute fastest lap around Manhattan

SMRT: Another breakdown!

In Infrastructure on 29/07/2013 at 10:49 am

Fortunately it’s not the trains, or the buses. It’s minor. Shares are marginally off today, so market doesn’t worry about this latest dyfunctionality

Still even think about investing in it because the continuing dysfunctionality  is not reassuring, inspite of having as CEO, a scholar and ex SAF head, who was brought in to get the trains (and buses) to run on time again. Still not running. There have been several train delays, the most publicised of which was in April when a crack on the northbound track between Somerset and Orchard stations slowed trains to a crawl. Then a speeding bus (driven by FT PRC driver training for F1) crashed overturned.There were injuries and a death. And then there was S’pore’s first strike (legal or otherwise) in decades.

All this on the watch of a scholar and general? Err what would have happened on the watch of a non-scholar, sales char bor FT? Actually, we know: overcrowded trains, poor working conditions for FT drivers, contempt for commuters.

Back to the latest failure: SMRT’s Vice President for Corporate Marketing and Communications, Ms Kalai Natarajan, has quit after only 5 months. She was among several senior management staff (mostly ex-SAF officers, but not her) brought in by the new CEO Lt Gen (NS) Desmond Kuek after he took over in Oct last year. She was hired in Feb this year, taking over from Mr Goh Chee Kong, who left last year. Mr Goh is the guy who insinuated, “Better you die, than damage SMRT property.” OK, I exaggerate, but not by much. He was ex-SAFer. (Her quitting shows the gd for the FT, where “T” stands for “Talent”, running Temasek’s public communications. I once blogged that he had turned down the SMRT post.)

During her short tenure, more than five in her communication team of about 10 people resigned.

According to ST, her departure is unusual because she is not required to serve notice. She told ST that she is leaving SMRT today (Monday). She confirmed that she will not be serving notice. Usually the notice period for senior management is three months. Seems she hasn’t another job waiting for her.

A HR expert speculated in ST report that there may be a “cultural misfit” if senior management staff “are not on the same wavelength”. Let’s watch to see if the Hongkie that was brought in to run train operations, quits.

If he does, then commuters should be worried, very worried, that experienced professionals have left, leaving only ex-SAFers, not experienced in running public transport operations or public communications.

Related posts: http://atans1.wordpress.com/2013/05/05/smrt-can-still-wait/ Interesting that it is still trading way above its “Sell” target price.

http://atans1.wordpress.com/2012/11/27/for-they-have-sown-the-wind-and-they-shall-reap-the-whirlwind/

When raising fares, SBS, SMRT & Govt don’t have this problem

In Infrastructure on 17/06/2013 at 5:33 am

SBS and SMRT are grumbling loudly that their present biz model (after delivering golden rivers of dividends for Temasek and the S’pore Labour Foundation) doesn’t work. SLF even sold 8% of SBS’s parent at a huge discount to the market price. Great move as this was done before market meltdown. (BTW, at current price, tempted to buy into ComfortDelgro. It closed last Friday at 1.755, up 3% from Thursday. The co’s fundamentals havenot changed since institutions bought SLF’s stake at 1.94. It is likely that when they bot from SLF, they would have been given assurances of the fundamentals at that price.)

And govt has been pouring our money ($1.1bn and counting) at the public the transport system. And the Wankers’ Party remains quiet* about its Manifesto call to nationalise the public transport system.

If the PAP govt weren’t concerned that it would lose votes if fares were raised without a marked improvement in service standards, fares would have gone up by now to keep the dividends flowing. Screwing the public (by making the public pay-and-pay) is the PAP way pre the 2011 GE and PE.

Anyway, SMRT, ComfortDelgro and the govt should be grateful that this doesn’t happen here when faresw are raised: Protests against bus and underground fare rises in the Brazilian city of Sao Paulo have turned violent.

Police fired rubber-coated bullets and tear gas, and detained more than 200 people. Police say they seized petrol bombs, knives and drugs.

Violence has also been reported at protests in Rio de Janeiro.

Prices for a single ticket in Sao Paulo were raised on 2 June from 3 reals ($1.40, £0.90) to 3.20 reals ($1.50, £0.96).

http://www.bbc.co.uk/news/world-latin-america-22899748

For that, they have to thank people like this TRE reader

My Middle name is AhLong:

We need to organise a movement similar to BERSEH of Malaysia now to demand clean election. We need to ensure a proper way to secure and account for the ballot boxes en-route to the counting station …We must demand at the counting station, after all ballot boxes are accounted for and examined, all the ballot tickets should mixed into a single bunch and count from there. In this way, the sly election department will not be able to get the data for gerrymandering in the next election.

Finally, to have a level of playing field, election department should NOT be under PMO!

If he is serious, he should be trying to organise shumething, instead of juz bitching anon. His use of the word “We” is simply a way of saying “You”.He juz wants to let out hot air, like VivianB, Auntie and her favourite Singh, the M’sian gals from S’pore Writers, and the Nairs, Gopalan and Rajan. He doesn’t want to do the hard slog, like Low, Ah Huat, Ah Lian, the NSP’s Dynamic Duo, the Ravis (M and P) and Team SDP. If you’re wondering why Siow is not on the list, he’s away in the US until year-end. And no, he is not attending the CIA’s regime change course.

*To be fair, Low mentions it in passing, now and then.

LTA, SMRT: Learn from NY & Dubai pls

In Infrastructure on 04/06/2013 at 5:48 pm

“Sponsorship is already used on metro systems across the word in places like Madrid, Dubai and New York,” says a Tory party report, and it suggests “Sponsorship deals to rename London Underground lines and stations should be considered as a way to fund a freeze in fares, Tory politicians have said.”

A report by the Conservative Party on the London Assembly said if £136m was raised in sponsorship it could freeze fares for a year.And it claimed £204m would cap rises at inflation for the next three years.

http://www.bbc.co.uk/news/uk-england-london-22745677

“Transport for London (TfL) said the cost of of changing maps and signs made a deal of that kind unfeasible”, and bet you that LTA and SMRT would give the same excuse.

But here’s shumething that SMRT cannot say, “Every penny of this and our other revenue goes towards keeping fares as low as possible”,. because as a listco, controlled by Temasek, it got to pay dividends.

SMRT: Dump

In Infrastructure on 31/01/2013 at 5:15 am

Brokers had forecast cost increases in staff, repair and maintenance costs, but not the 29.1% in maintenance & repair; and the 18.2% in staffing costs (all those new recruits from SAF?*) reported this quarter.

Brokers are putting a target price of around 1.34, a big drop.

But maybe there is the usually Biz School approved front-loading of costs, expenses whenever there is a new CEO. For yield buyers like me, the next Q’s numbers are awaited.

——

*http://atans1.wordpress.com/2013/01/21/smrt-noticed/

 

 

 

More FTs on way, a lot MORE!: DBS

In Economy, Infrastructure, Political economy on 22/01/2013 at 6:29 am

OK, OK, I exaggerate: only 8% more of population if S’poreans don’t start breeding like rabbits.

DBS Vickers expects an upcoming white paper on Singapore’s population to raise its population target to 7 million from 6.5 million, which will benefit construction, land transport, property and healthcare companies. http://www.reuters.com/article/2013/01/18/markets-singapore-stocksnews-population-idUSL4N0AN3GR20130118

SMRT is not on the “buy” list. It too has concerns about SMRT, like me and many others.

SMRT: Noticed?

In Infrastructure on 21/01/2013 at 5:45 am

I had planned to blog on the new appointments http://www.sammyboy.com/showthread.php?138562-8-New-hires-to-get-SMRT-on-track-4-from-military but forgot until today. Old age.

Noticed that SMRT has created seven new posts? Looks like Kuekie wants to spend, spend, spend on expanding management.He must think SMRT like SAF, money not an issue.

Taz two reasons to avoid the stock. The only reason to buy is to capture the gains from increased fares. But I’m not sure if fares would be allowed to rise this year, let alone this side of next GE: unless there is a marked improvement in service.

And speaking about service, on Boxing Day, for the first time ever, I couldn’t board a train because it was full: I didn’t have the right to board a crowded train, it was too crowded. It was at noon at Bishan. Note, I avoid using MRT and buses during rush hrs. And on Boxing Day and 31st Dec, there were problems when I used the NE Line.

SMRT: Buying target price

In Infrastructure on 20/12/2012 at 7:03 am

OSK DMG has a target price of $1.60 (6% above current price) and a Neutral call. I’ll monitor price to see if it falls to below or near that level. And then evaluate it to see if worth buying for dividend yield. The CEO’s talk of getting rid of FT drivers’ supervisors, could if carried out herald a change of culture.

BTW broker has a  Nneutral” call on the sector, with preference for ComfortDelGro (S$1.72 BUY TP S$1.85) for its cheaper valuations and overseas growth potential.

WP changes mind on nationalising SMRT & SBS

In Political governance on 14/12/2012 at 6:08 am

This blog at regular intervals reminds readers that the Wankers’ Workers’ Party had been silent on public transport nationalisation, despite it being in the Wayangs’ party’s 2011 manifesto and despite Gerald Giam advocating it in ST in July 2011 (here, here); and despite the seeming failure of the govt’s public tpt policy (I mean does the pumping in of S$1.1bn show that the “for-profit” policy working?)

Finally WP and GG have broken their silence: “If PTOs are unable to do so because of their obligations to shareholders, public transport should be taken out of private hands and run by a not-for-profit corporation which focuses on providing efficient and quality public transport, instead of generating shareholder returns.”

Err this was what is written in Manifesto: “Instead of public transport being provided by profit-oriented companies, all public transport including the MRT & public buses servicing major routes should be brought under a National Transport Corporation, a public body, to ensure a smooth integration of the overall national transport network and to avoid unnecessary duplication of services and overheads incurred by multiple operators.”

Spot the difference? The Manifesto call was unconditional. Now the operative word is “IF”.

Second time WP changing its mind on a Manifesto call. The first was on the benchmarking of ministers’ salaries. Like this change, one GG was behind that one too. Maybe Eric Tan (remember him?*) was right to rubbisg GG.

If the Manifesto is juz toilet paper, pls tell us WP. And tell us which first-world opposition party treats its manifesto with such contempt?

Related post

http://atans1.wordpress.com/2012/11/23/why-wp-mps-are-not-first-world-parlimentarians/

*GG called him his Si-Fu. Si-Fu lost NCMP seat to GG. Si-Fu had been promised NCMP seat before GE 2011, if East Coast team was entitled to one.

SMRT is in the biz of transporting people

In Infrastructure on 16/11/2012 at 6:31 am

TRE republished this and improved on it by adding part of  the newspaper report that annoyed me.

Here are some great comments posted on TRE about the “unprecedented offer”

TheFortyPercent:

The SMRT’s attitude is typical of the legacy left behind by LKY. If SMRT makes a generous compensation, people will throw themselves on to the MRT rails. If we have too generous welfare benefits, people will laze around and not work. If we have good health benefits, people will fall sick, get cancer and not take care of their health. If we don’t pay our civil servants and ministers the highest salaries, they become corrupt. If we don’t have the ISA, people will become militant. If we don’t have a meritocratic law of the jungle system, every Singaporean will become lazy and indolent. If we don’t bring the thousands and thousands of foreigners, Singapore will collapse and your mothers, wives and sisters will become maids. And the list goes on….. It just shows how much confidence LKY and the PAP has in its citizens! No other country in the world in all history has its leaders, as Singapore has, condemned, spoken derisively and rubbished its own citizens. This is the wonderful legacy that LKY has bequeathed to all Singaporeans! His money of course goes to his family and the ten generations of descendants after him.

One Eye Dragon In Your Pants:

Wow, so that’s what SMRT thinks of us. Money grubbing opportunists who would do anything (even getting our limbs amputated!) to get some compensation. Yeah, in their eyes, we are all lesser mortals who deserve nothing. Have they looked at themselves in the mirror lately? If only public transportation isn’t monopolized by SMRT & SBS, I would outright boycott their services.

Truth:

It is shameful that SMRT has such bad social grace to say such words of the public , implying the young Thai girl has a motive to lose her legs to get some money. Are we in some foreign lands where people sell their body organs to get some money ? Then why the need to say such unkind words of your commuters, to the effect that they would intrude on the SMRT tracks and implying try some antics to get some donation.

Lousy public relation, presenting a inhumane image of SMRT. These words are really mean and uncalled for.

Thought those infamous word ” opportunity to make money ” sent to the taxis after the breakdown of the trains last December was bad enough, and now these words. The SMRT never learn, or with a new PR people, has still not got its acts together again.

By the way, why is the PaaPa government making the common folks pay for upgrading and repairs bill $1.1 billion for the SMRT ? The Board of directors( past since 2002 )each receiving $200,000 annually and the chairman $500,000 should contribute their fees to the repair bills if they have some conscience. They failed in their duties as directors, and yet keep this money for private enjoyment . Shame on them, especially on Mr Chew Choon Seng, now chairman of SGX, who was the chairman of the board in 2002 that appointed a wrong unsuitable person to be CEO. They got away scot free, enjoying their director fees privately, but now the taxpayers have to bear with the cost of the repair , through no fault of theirs.

Today had reported that the ang moh FT I tot had joined SMRT had still not joined, and is unlikely to do so: Smart “Talent”. When you have a PR person, unapologetically, saying that $15,000 was an “unprecedented” offer to a girl who lost her legs; and that non-payment policy is to deter people from deliberately losing their limbs or lives  to get money from SMRT, it shows the kind of culture ( “choose not to board crowded trains” and “trains can be packed more” and “opportunity to make money” and “never ever damage SMRT property even if you are suffocating in a train that has stopped, and there is no electricity and you are left in the dark”) he would have to defend about if he signed on. Maybe the previous PR boss, an ex-army colonel, should reapply for his job?

He fits the culture to a “T”, blaming the bad English of the staff for them not communicating with the public. He was the person who also said that SMRT should never ever be damaged. Wonder why did he “move on” if he fitted the culture to a “T”. Goh Chee Kong approved comments like this.

Finally, we get to the title of this post:  SMRT is repositioning itself as an engineering company. I’ve commented on why this may be a bad idea: engineering companies tend to gold plate operations.

SMRT should think of itself as a “Mass Rapid Transit” biz: moving crowds of people quickly, in reasonable comfort and efficiently at low cost. Be like AirAsia, EasyJet or Ryanair, the best low cost airlines: decent customer service at lowish prices. And handicapped and elderly people: take a taxi if you are not happy with the service. Don’t bitch too much. Ryanair tells them in no uncertain terms, not to use it. It tells them there are alternatives.

 

SMRT: $15,000 not enough

In Infrastructure on 07/11/2012 at 7:26 am

Talk of bad PR.

When I read that the Thai gal sued SMRT, I didn’t think much of her case. I tot that she should have accepted reasonable compensation and moved on.

But when I read that SMRT says that its $15,000 offer was “unprecedented”, I tot what a dumb, mean company.

I don’t know waz a fair amount would be taking into account her injuries and that it isn’t SMRT’s fault. But $15,000 is not it. Its legal costs would easily exceed $100,000.

I had been looking to buy shares in SMRT, but I’ll give it a miss for the time being. Want to see if mgt changes are working.

Anyway, hopefully the FT brought in to replace an ex-SAF officer will do something to change SMRT’s bad record in public communications. The SAF officer said once “Better you die, than damage SMRT property”.  Ya I exaggerate, but that was the message he gave when a commuter smashed a glass panel to let air into a train stuck in a tunnel.

How SMRT can spend more on maintenance while cont’d paying gd dividends

In Infrastructure on 13/08/2012 at 6:55 pm

Find sponsors for MRT stations Dubai style.

The station at Changi Int’l Airport can be renamed after Changi Airport, or SIA or any airline wanting publicity. Raffles City can be renamed after Robinsons or Westin. Raffles Place can be named after a bank sponsor while Temasek can sponsor Dhoby Gaut.

While new CEO as an ex-SAF chief and senior civil servant (also a scholar) should ensure that the trains run on time (in the early 20th century in the US, retired generals were in demand to run railwa s because the army like the railways were complex organisations), he might not be gd for profits. As I explained here, SMRT is now seeing itself as an engineering co, not a transport co, but problem is that engineers tend to gold-plate their operations.

Reason WP quietly ditched its public tpt nationalisation call?

In Infrastructure, Political governance on 09/07/2012 at 7:01 am

(“Trying to serve residents better, WP ditches manifesto call nationalise public tpt?”)

My WP “Morocco Mole”* (the sidekick of  “Secret Squirrel” in the carton series: bit like Yaw to Low) tells me that at July’s parly seating, GG will again keep quiet on the above issue in the debate after the ministerial statement on the major disruption in the MRT system. Tells me no other WP MP will raise the issue of public tpt nationalisation, as this is GG’s responsibility.

He asked, “Why so cock, when the Commission of Inquiry’s findings  that SMRT was skimping on maintenance can be used to support WP’s election manifesto call to nationalise public transport? Also shows WP can think better than PAP.”

I referred him to this ST report, where it was reported that MPs are lobbying LTA  for better bus services in their wards: all because the $1.1 bn subsidy.

I told him since WP has appointed Ah Huat (remember him?) to co-ordinate its efforts for more buses to serve Hougang and Aljunied, it would be most awkward for him (and WP) to beg LTA, and SMRT and SBS to improve services in WP areas if the WP is publicly proposing to destroy their staffs’ rice bowls. It would have no leg to stand on.

His response, “Tan kuku. Even if Sylvia, Glenda and Angela (remember her?) perform [expletive deleted] on the LTA, SBS and SMRT male managers, and Show Mao [expletive deleted] the female managers, think that they will improve services in WP areas? Why WP so cock?” 

He has a point. SIGH (Victor Hugo: “A traitor always pays for his betrayal in the end.”)

Related post: http://atans1.wordpress.com/2012/05/28/hougang-only-up-to-a-point-lucky/

—-

*Moley is a WP cadre but not on the Central Executive Council,. He is ex-Barisan. He early last week told me that the WP had tabled only one question abt public transport (abt the release of the COI report). He is right. Which makes WP’s silence on this issue more deafening. Look at the topics raised: what the public wants raised for the most.

Demonising cabbies again?

In Uncategorized on 08/06/2012 at 5:35 am

(Or “How to get more taxis on the road, increasing rentals, and still screw the consumer”)

Last Saturday, MediaCorp’s freesheet carried an article that screamed

Taxis could become harder to flag down

More may obtain a taxi licence to rent cabs for personal use instead of plying the roads

It went on: more people could possibly be getting taxi licences for the wrong reasons – as suggested by Transport Minister Lui Tuck Yew in a press interview … Noting how, with the exception of those owned by ComfortDelGro, taxis are hired out mostly to cabbies who drive a single shift per day, Mr Lui said the authorities “need to be even more vigilant about this … because now driving a taxi can, with high COE prices, become a substitute for owning a car”.

Right, it’s the fault of cabbies gaming the system that we can’t get a cab. Not the fault of ComfortDelgro, the govt, or SMRT.

In mid April, there was a ST report that taxi drivers’ take-home income have gone up by as much as 30% since the increase in taxi fares at the end of last year. “ComfortDelGro, the biggest operator here with about 15,600 taxis, said average net income per cab per day has risen by 12 per cent to $210.93 … up from $188.69 in November, excludes costs drivers have to bear, such as rental and diesel.”

In the run-up to the fare increase late last year, our nation-building, constructive media were full of stories of the plight of cabbies. And when fares were increased, there were stories of drops in income as people stopped taking cabs. Poor cabbies. The media also reported extensively that the fleet owners were NOT increasing their taxi rentals. The benefits of the  increase were all going to the cabbies.

So I was surprised (in February or early March) to read in the same said media that S’pore had plenty of  taxis (about 27,000 of them) but that taxis were under-utilised because some work on one shift with one operator per taxi who “once they earn enough would call it a day”.

In April, we were told that they are doing well: to to 30% increase in take-home pay. So will there be shortages again as more of those taxis with one operator are AWOL because the operators call it a day after they earn enough? Now we are again reminded that many cabs are only operated by one person a day, and worse: that increasingly cabbies are gaming the system by using the taxi as a car, not as a cab. Juz earn enough to pay rental, then use taxi as car, for what we are not told. Transport gds? Visit clients? Or rent to senior members of Home Team or other scholars to have sex in in return for favours?

A shortage that will be solved when the fleet owners increase their charges so that the cabbies have to work longer hours again?

In other words, are we “being conditioned” for operating costs (not fares) for cabbies to go up to increase the supply of available taxis.

Then we will read stories in the media that taxi drivers are suffering, and that fares have to rise. And we shouldn’t complain if we are compassionate.

The cycle of spin goes on. Bit like the cycle of life.

Instead of inceasing rentals to increase supply, why not insist that each taxi must have mutiple operators working in shifts? Incentives, disincentives could be introduced to force cabbies into sharing? Afraid of too many cabs on the road, forcing down rentals because cabbies are leaving the industry?

.

SMRT: “Cowboys” were right

In Corporate governance, Infrastructure on 14/05/2012 at 8:52 am

Since the trains started breaking down towards the end of last yr, bloggers and posters (not I) have been attacking SMRT for putting profits before safety, and disregarding the engineers’ advice (though without having a clue abt the said advice). Yacoob’s exemplar for the new media, the constructive, nation-building media were deafening in their silence on this national issue. I was silent because I was trying to figure out if I shld go buy some SMRT shares.

Well, based on the comments by the chairman, Koh Yong Gua, reported by ST and ST’s headline on an inside page, the inhabitants of cowboy towns were correct. (Explain that Yacoob and DPM Teo.)

“SMRT to refocus on its engineers” read the headline. This implied that SMRT had lost its focus on engineers somewhere along the line, assuming it once had such a focus.

Mr Koh said that “SMRT will be repositioned an engineering company”, begging the question “What was its earlier positioning?”. Retailer, property developer, financial engineer, or cash cow for Temasek? Since SMRT was listed in 2000, Temasek has received $694.3m in dividends (I’ve including the dividend declared recently).

The promotion of Mr Khoo Hean Siang in March 2011 to COO was meant to show the importance of engineers, he said. The previous COO who was “removed” was not a technical person. Wonder what was he? Ex-SAF officer or financial man? With the CEO a retailer, it surprises me that until 2011, the COO was not a technical man. And that board meetings did not include a very senior engineer in attendance.

Actually, I think Mr Koh still hasn’t got it. SMRT is not an engineering company. It is a company whose main business is moving large numbers of people around S’pore safely, and in reasonable comfort (most of the time). By focusing on engineers and positioning SMRT as an engineering company, he could be laying the seeds for a serious problem somewhere along the track. Investors in the West have found that companies dominated by engineers tend to goldplate processes and systems. Siemens, Rolls-Royce, Westinghouse, Boeing, Airbus and even GE, had to be run by non-engineers before shareholders benefitted.  

Commuters may say so what? So long as it is safer and doesn’t breakdown, power to the engineers. The problem is that goldplating is expensive, and eventually someone has to pay. This is likely to be the commuter (via fare increases) or his avatar or alter ego the taxpayer.

I was planning to buy into a rights issue when one is annced, as I expect. But given the positioning as an “engineering company” and its “refocus on its engineers”, I think I’ll give the stock a miss for the time being. But never ever bet against Temasek when it comes to a local company.

Related post:

http://atans1.wordpress.com/2012/05/06/smrt-quiet-re-nationalisation/

SMRT mgt failures: What does it say abt SAF?

In Infrastructure on 11/05/2012 at 10:19 am

“The experts questioned having the bus bridging services ply a route mirroring the entire train line as this may not be the most effective way to move people. They suggested that the bus bridging services should ferry commuters to one to three stations, or to the next working station.”

Huh? Having been lucky enough not to kanna caught in one of these disruptions (my 87-yr old mum on her only second MRT outing was at a station when a disruption occured), I’m surprised to learn that this wasn’t done or that it isn’t now SOP?

Given that it is a well-known fact, I believe, that retired SAF officers are given senior jobs at SMRT (presumably because they have the experience of managing large and complex organisations), I’m surprised that foreign experts recommended the following “fairly common sense and not rocket science” command and control procedures:

http://www.todayonline.com/Singapore/EDC120510-0000079/Foreign-experts-give-tips-at-SMRT-inquiry

http://www.channelnewsasia.com/stories/singaporelocalnews/view/1200227/1/.html

We need genuine Talents to help us run our public transport systems, not ex-SAF officers, M’sian PRs or PRC bus drivers that we have been getting. And no “ang moh tua kee” attitude when getting Talents please. Hongkies, Japs, Taiwanese and Koreans who speak Inglish should be considered. No PRCs because China’s MRT systems are very new.

As to our defence, are we spending money foolishly on hardware, when what we need are a few good men? The government should be worried. It’s not us “lesser” citizens are at risk. It’s the FTs and rich S’poreans who need protection. An Indonesian pirate chief after reading of SMRT’s failures despite employing retired SAF colonels, may be tempted to raid Sentosa Cove, plunder it and kidnap people.

DPM Teo & GG (or WP): gentle reminders for next week

In Humour, Political governance on 08/05/2012 at 7:23 pm

DPM Teo has been busy in April, what with opening a temporary carpark in Hougang, praising Desmond Choo (assumed PAP candidate there), talking abt the dangers of the internet, and pushing onto us the task of integrating FTs onto us, despite many of us wanting first-world FTs, not the garbage we’ve been getting in ever increasing truck loads, I’d tot I’d remind him of shumething he said in March concerning violent, ang moh FTs.

In March,  in parliament to a question from “Kate Spade” (the real people’s princess, not that NSP, TJS groupie gal who was from RP and who is looking to move on from NSP, not her boy friend: I mean tin looks ordinary, Nicole has star quality), he told us very upset S’poreans that Home Team was conducting an internal investigation on why two violent ang moh FTS who beat up two S’poreans badly in 2010 were allowed to post “peanuts” in bail; and why the police investigation took so long? They took the opportunity to cock a snook at S’pore by moving on.

He said the investigation would be completed in April, and implied that we would told the conclusions.

As it’s now May and parly sits next week, he should be abt to tell us abt the conclusions. And if the investigation has yet to be concluded, why not?

Tot he might need reminding as he seems to be trying hard to join Tharman, Sailor Lui, $8 Khaw and PM, as a teller of jokes in bad taste.

And I hope Gerald Giam (the apprentice who overthrew his si-fu Eric Tan) remembers that the WP called for the nationalisation of the bus and MRT systems in its 2011 GE manifesto, and that he wrote this on nationalising the public tpt system in July 2011.

If neither he nor any other WP MP raises this issue in parly next week, or explains why the WP has changed its mind of nationalisation (despite the apparent failure of the government’s model and the voters’ disgust with the government on this issue), the WP should have the decency to take down the manifesto from the WP website. First, the WP changed its benchmark that the WP wanted ministerial salaries to be referenced to, and now this. Said manifesto isn’t worth the paper it is written on even before the WP comes into power.  In first-world democracies, manifesto promises are ditched after the party wins power, not before: another WP first? Other firsts https://www.facebook.com/#!/photo.php?fbid=449379458422514&set=at.281804541846674.87911.280285461998582.555162557&type=1&theater

WP: No longer believes in public tpt nationalisation

In Political governance on 08/04/2012 at 6:59 pm

This week, one of the topics to be debated in parliament will be the public transport system especially the government’s plans to inject $1.1bn into the bus system.

In its 2011 General Election Manifesto the WP wrote: Instead of public transport being provided by profit-oriented companies, all public transport including the MRT & public buses servicing major routes should be brought under a National Transport Corporation, a public body, to ensure a smooth integration of the overall national transport network and to avoid unnecessary duplication of services and overheads incurred by multiple operators.

In simple English, the WP manifesto called for the nationalisation of the MRT and bus systems.

But, I’ve been reliably told, that the WP will not be calling for the nationalisation of the public transport system in the debate on public transport this week. It will keep silent on its manifesto call.

If my source (a WP member in gd standing) is correct, and I hope he is wrong, one can only wonder if the WP has forgotten its manifesto call on the nationalisation of public transport (see somewhere here) or changed its mind on public transport nationalisation? And then one can wonder why the forgetfulness or change, when the facts and public mood seem to favour nationalisation.

Granted, at the time, there was very little mainstream (to be expected) or new media (more surprising this) attention, and very little public interest (not surprising, given the lack of awareness on this call) on this issue. But things are different now.

There have been several major failures of the MRT system, resulting in chaos, and public anger.

With $1.1bn of tax-payers’ money going into the bus system (two-thirds or 67% of it, $733m, going into ComfortDelgro where the state has a shareholding that is “peanuts”*), there are many voices wondering why private shareholders should benefit from a public good?

Example: Since housing and transport are both necessities of life, and public transport is the only choice of the lower-income group, it is not unjustifiable to commit resources to keep the cost of public transport low … government spending on public transport is a form of income redistribution …

The key concern in the S$1.1-billion package to purchase and operate buses is not that it subsidises public transport per se but whether public funds could benefit a small group of shareholders, to whom bus companies are ultimately accountable.

This is what the Government will need to account to taxpayers.

Even BT, part of the nation-building, constructive media had this to say, The public transport model has come under scrutiny ever since a $1.1 billion package was announced by the government to supplement the existing privately run bus fleet with 550 buses.

How has the government responded?

The minister responsible for throwing $1.1bn at the problem can only parrot repeat what his predecessors used to say, Our current model leaves the operations of trains and buses to commercial entities as we believe the long term public interest is best served this way. The profit incentive drives the operators towards higher efficiency and productivity, which keeps costs as low as possible . . . Otherwise, if the system is inefficiently run, the public will ultimately pay for the higher operating costs, either through higher fares, or greater government subsidies.

He should be asked in parliament this week why despite the “higher efficency and productivity” (“which keeps costs as low as possible”) of the private companies, commuters keep paying more and more while getting worse and worse service, so much so that the government has to subsidise the companies to improve bus service quality.  The minister’s The profit incentive drives the operators towards higher efficiency and productivity, which keeps costs as low as possible, can and should be challenged.

So the WP has plenty of ammunition to rubbish the government’s public transport policy And remind the government and the voters that it called for nationalisation last year. But it seems it will not call for nationalisation.

Parliament is the best place to debate the issue and the WP should not let this opportunity be missed especially as it called for nationalisation in its election manifesto. If it does not raise this issue, S’poreans must hope that PAP newbie FT MP, Puthucheary (“No NS for me”) will raise the issue. He had suggested in the last session of parliament that nationalisation might be a gd option.

There should be a more selfish, self-serving reason for the WP to use this opportunity to call for nationalisation.  If  the WP doesn’t believe in its own manifesto or keeps quiet when it changes its mind on a manifesto issue, why should, we, the voters believe in the WP?

The PAP pointed out earlier this year (rightly) that the WP’s benchmark for ministers’ salaries had changed from the poor (in said manifesto) to a civil service senior grade (Gerald Giam in parliament). The WP could not rebut the PAP charge.

The voters who voted for the WP believed its call for the need of a co-driver, to keep the PAP honest and competent. If voters cannot believe in the PAP and the WP, what should the voters do? Vote SDP?

The WP might want to be reminded that in countries with first-world parliaments, the election manifesto is a very important document, not something to be chucked away after a general election. If the WP does not call for nationalisation of the public transport system in parliament this week, it should remove the link on the front page of its website to its manifesto.

*Using back-of-the envelope calculations and figures in annual reports, since it was listed SMRT (over a decade ago) has paid $562.79m in dividends to Temasek (which owns 74%), and ComfortDelgro has paid the S’pore Labour Foundation (a statutory board affiliated to the NTUC which has 12%) dividends of roughly $150.46m since 2003 (Comfort and Delgro merged in 2003, and SLF had a stake in Comfort). The amount that ended up with the government was $713.25m, with SMRT contributing 79%. But ComfortDelgro is the main beneficiary of the $1.1bn bus plan, given that, at present, SBS Transit (a listed co 75% owned by ComfortDelgro) provides most of the buses. ComfortDelgro is getting $733m or 67% of the $1.1bn package.

Related rant

http://atans1.wordpress.com/2012/03/09/wp-does-do-original-thinking-pap/

 

WP does do Original Thinking PAP

In Political governance on 09/03/2012 at 7:42 am

(Or “Trumpets pls for WP” or “WP way ahead of PAP and S’poreans”)

So the PAPpies are accusing WP MPs of plagarising. The implication is that WP don’t do original thinking. Well it is clear from the responses of the “victims” that the PAP are peeing on the wrong tree. Wicked, mean tot: are the two Nairs advising their fellow PAPpies to use this tactic? Seems the kind of thing lawyers love to do: go negative on obscure technicalities. It also seems similar in nature to the Nair’s recent antics; antics that backfired badly on the Nairs, and on the PM in one instance. So the PAPpies should take care.

Seriously, the WP had an original idea that was way ahead of public sentiment in its 2011 General Election Manifesto. Instead of public transport being provided by profit-oriented companies, all public transport including the MRT & public buses servicing major routes should be brought under a National Transport Corporation, a public body, to ensure a smooth integration of the overall national transport network and to avoid unnecessary duplication of services and overheads incurred by multiple operators.

In simple English, the WP Manifesto called for the nationalisation of the MRT and bus systems.

At the time, there was very little mainstream (to be expected) or new media (more surprising this) attention, and very little public interest on this issue. But things are different now.

With $1.1bn of tax-payers’ money going into the bus system (two-thirds or 67% of it, $733m, going into ComfortDelgro where the state has a shareholding that is “peanuts”*), there are many voices wondering why private shareholders should benefit from a public good? Example: Since housing and transport are both necessities of life, and public transport is the only choice of the lower-income group, it is not unjustifiable to commit resources to keep the cost of public transport low … government spending on public transport is a form of income redistribution …

The key concern in the S$1.1-billion package to purchase and operate buses is not that it subsidises public transport per se but whether public funds could benefit a small group of shareholders, to whom bus companies are ultimately accountable.

This is what the Government will need to account to taxpayers.

Even BT, part of the nation-building, constructive media had this to say yesterday, The public transport model has come under scrutiny ever since a $1.1 billion package was announced by the government to supplement the existing privately run bus fleet with 550 buses.

But the minister responsible for the splurge can only parrot his predecessors, Our current model leaves the operations of trains and buses to commercial entities as we believe the long term public interest is best served this way. The profit incentive drives the operators towards higher efficiency and productivity, which keeps costs as low as possible . . . Otherwise, if the system is inefficiently run, the public will ultimately pay for the higher operating costs, either through higher fares, or greater government subsidies.

The WP should now be asking why despite the “higher efficency and productivity” (“which keeps costs as low as possible”) of the private companies, bus commuters keep paying more and more while getting worse and worse service, so much so that the government has to subsidise the companies to improve bus service quality. It should also remind the government and the voters that it called for nationalisation last year.

I’m sure the WP will soon rebut the minister’s The profit incentive drives the operators towards higher efficiency and productivity, which keeps costs as low as possible. But why is the WP so modest about getting it “right”? 

Being modest and understated are to me, great traits, in people. I hate show-offs and boasters. But being modest is not for a political party that aspires to form the government some day. Worse, there is the danger that the PAPpies persuade voters that the WP doesn’t believe its own manifesto, so why should they (the voters) believe the WP? It pointed out earlier this year (rightly) that the WP’s benchmark for ministers’ salaries had changed from the poor (in said manifesto) to a civil service senior grade (Gerald Giam in parliament).

If this silence persists, one can only wonder if the WP has forgotten its manifesto call on the nationalisation of public transport (see somewhere here) or changed its mind on public transport nationalisation? And then one can wonder why the forgetfulness or change, when the facts and public mood seem to favour nationalisation?

*Using back-of-the envelope calculations and figures in annual reports, since it was listed SMRT (over a decade ago) has paid $562.79m in dividends to Temasek (which owns 74%), and ComfortDelgro has paid the S’pore Labour Foundation (a statutory board affiliated to the NTUC which has 12%) dividends of roughly $150.46m since 2003 (Comfort and Delgro merged in 2003, and SLF had a stake in Comfort). The amount that ended up with the government was $713.25m, with SMRT contributing 79%. But ComfortDelgro is the main beneficiary of the $1.1bn bus plan, given that, at present, SBS Transit (a listed co 75% owned by ComfortDelgro) provides most of the buses. ComfortDelgro is getting $733m or 67% of the $1.1bn package.

Oh what a tangled web we weave: MRT, ComfortDelgro and the Government

In Infrastructure on 02/03/2012 at 5:58 am

According to the Christian doctrine of the trinity, there is only one God but God is three persons: the Father, the Son ( Jesus Christ) and the Holy Spirit. But each person is God, whole and entire.

Well our public transport system is some sort of trinity: the government*, ComfortDelgro and SMRT. Except while they are legally separate entities, in practice there is a kind of blending. This makes the Christian doctrine of the trinity easy to understand by comparison.

I’ll use the flow of funds between the companies and the government to illustrate an example of S’pore’s unique trinity at work. Using back-of-the envelope calculations and figures in annual reports, since it was listed SMRT (over a decade ago) has paid S$562.79m in dividends to Temasek, and ComfortDelgro has paid the S’pore Labour Foundation (a statutory board affiliated to the NTUC) dividends of  S$150.46m*since 2003 (Comfort and Delgro merged in 2003, and SLF had a stake in Comfort). The amount that ended up with the government was S$713.25m, with SMRT contributing 79%. But ComfortDelgro is likely be the main beneficiary of the S$1.1bn bus plan**, given that, at present, SBS Transit (a listed co 75% owned by ComfortDelgro) provides most of the buses. Taz an example of how messed up things are.

The funds’ flows also show that the government is putting back all the dividends it received from these two companies and then adding 35% more. So it’s wrong to say that the SMRT and ComfortDelgro are getting free lunches. At most the government is subsidising their lunches by 35%.

The government should get credit for ploughing its share of the “loot” (as the proponents of nationalisation would put it and MPs Puthu, PAP, and PritamS, WP, might put it), but it doesn’t. Taz how messed up are.

(Incidentally, one could reasonably argue that the other shareholders — and the minority shareholders of SBS Transit, remember ComfortDelgro owns around 75% — are getting a free lunch while the government returns its share of the dividends. But let’s not get into that today.)

What a mess. Even the government implicitly accepts that the present “rojak” system of organising the public transport here is not something that it would have introduced, if it had been prescient:

– it is is now planning to publicly funding the bus fleets of Comfort Delgro and SMRT with S$1.1bn; and

– in 2009, the then transport minister, a private sector PAP “catch” (“retired’ after the 2011 general election when the WP almost won the GRC he was helming) that joined the government was trying to fix the system while not admitting that the system was broken even then. (Thank Alex Au’s write-up on this for reminding us what that minister said in 2009.)

So it is no surprise that the the WP’s call in its 2011 general election manifesto to nationalise the public transport system**** is getting a lot of support (the nationalisation, not the WP’s call) from netizens. There may be merit in a nationalised public transport system: instead of being run for shareholders who are only interested in profits, and dividends, the system is run for the benefit of commuters. One of these days, I may run through the arguments. But don’t hold your breath. I think the debate is sterile as it all depends on one’s assumptions and definitions.

Sorry, back to the “rojak” system:  in the short-term, there is a problem of overcrowded buses. And this problem needs fixing. Nationalising the system ain’t as easy as passing a law. Shareholders have to be compensated and this requires valuations to be made, and agreed upon, or adjudicated. And it ain’t as though the shareholders are FTs. As mentioned earlier:

– Temasek owns 54% of SMRT; and

– The S’pore Labour Foundation, a statutory board linked to the NTUC, holds 12% of Comfort Delgro. SLF is Delgro’s single largest shareholder.

(Incidentally these stakes especially Temasek’s controlling stake shows how absurd the system is. S’pore has public transport private monopolies that are partially owned and controlled by the government. And the government regulates the fares and the routes. And as mentioned earlier, the government’s share of the dividends are now ploughed back and added to, but not appreciated by the public.)

Meantime, who is to run the system, and fund the fleet expansion? Public has to wait while these issues are sorted out? It’s OK for those critics who don’t use public transport that often, especially those who have one car per family person. But most S’poreans are not that fortunate.

To me, the government spending on the buses is a pragmatic quick fix both for the public and itself. The commuting public (self included when forced to travel during peak periods, admittedly a rare occurrence) gets less annoyed with the government, while the government is seen as publicly responding positively on a matter of public unhappiness.

As to the concern that the system is being fixed to bring more FTs in, let’s reserve judgement on that. Too early to even speculate. To even speculate, shows the level of mistrust that some people have of this government. I’m not one of them.

So while longer term, nationalisisation may be the best way to run a public transport system, it ain’t a short-term fix. The short-term fix is what the government is doing, throw money at the problem.

Critics should focus on whether the fix is the most cost-effective means of solving an immediate problem, not focus on a possible long-term solution. They should be making a case (not juz asking) for ComfortDelgro and SMRT to make massive rights issues to fund bus fleet expansion. Or asking for detailed details on what taxpayers get in return? Or how to ensure that the other shareholders don’t get a free lunch because of the S$1.1bn package.

Plenty of things to do to keep the government on its toes.

BTW, the full quote in the title is:

Oh what a tangled web we weave,
When first we practise to deceive!

——-

*I’ve simplified: there is a universe within the government — including the Land Transport Authority, the Ministry of Transport, the committee that fixes train and bus fares, the S’pore Labour Foundation, the Minister of Finance (owner of Temasek), the Singapore Civil Defence Force and the police force.

**Dodgy this calculation as I’ve used a dodgy, lazy assumption, but near enough for all but CFAers, or investment analysts, or myself when analysing an investment)

***The government has allocated S$1.1bn to the purchase of 800 new buses, 550 of which will be paid for by the government (that is, through public funds), with the remaining 250 paid for by the PTOs. The S$1.1bn is also to fund running costs over the next 10 years. More on the use of the money, and an assurance that the operators will not benefit because it is a subsidy for us commuters. [Last sentence is an update on @ March 2012 at 9.00am]

****Unless the WP has quietly ditched this too like its benchmarking of ministers’ pay to the poor. I am not being mean or nasty. In January 2012, Gerald Giam had to be reminded in a private conversation where I was present that nationalisation was in the party manifesto for the 2011 general election. GG seems to have difficulty remembering things. He had some problems in parliament during the ministers’ salaries debate.

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