What will happen to the differed quantum of 15.6%?
At every Fare Review Exercise, the PTC takes many factors into account before deciding on the final fare adjustment quantum. These include the deferred fare quantum from the previous exercise, if any, the fare formula output for that year, the economic situation at that point in time, the financial sustainability of the public transport system, and the affordability of public transport fares for commuters.
In general, we should try not to defer fare increases by more than a year, because the reality is that costs have risen, and the bigger the gap between cost and fares, the harder it is for the public transport system to be financially sustainable over the long term. But in these last two years, we have seen very strong price increases, even price spikes. Energy is the most apparent, more than 100% in 2021, and more than 60% in 2022. There have also been strong inflation and wage pressures. So, the PTC has been taking a balanced approach – allowing some cost increases to pass through, but not all such that it becomes unbearable.
In the same way, PTC will have to decide how much of the deferred fare amount to implement in subsequent years. These deferred increases are reflective of actual cost increases that the public transport system has already experienced.
Can’t find what you’re looking for?