SMRT

[chialc]

Hi Clement,
Although SMRT suggest to change to cost+plus model, no luck, the FMRC still recommend to stick with cost-minus.

The devils is in the details.

As I had yet studies in details, I gives you the benefits of doubt that cost-minus model will not encourage spending.

Thanks for point this out.

[CityFarmer]

I fail to understand how they are actually private enterprises. To say they are social enterprises with a private enterprise structure would be more acceptable

That is other way of saying "private enterprises in disguise as social enterprises." May be my English fail me this round.

[specuvestor]

^^ Very different... root and means are very different things

[CityFarmer]

Hi Clement,
Although SMRT suggest to change to cost+plus model, no luck, the FMRC still recommend to stick with cost-minus.

The devils is in the details.

As I had yet studies in details, I gives you the benefits of doubt that cost-minus model will not encourage spending.

Thanks for point this out.

The FMRC report is not conflicting with the cost-plus model, IMO.

I haven't read the report yet, only base on summaries from news reports. I doubt the report has recommendations that rule out cost-plus model implementation.

[CityFarmer]

^^ Very different... root and means are very different things

Er... OK you are right.

[Clement]

Hi Clement,
Although SMRT suggest to change to cost+plus model, no luck, the FMRC still recommend to stick with cost-minus.

The devils is in the details.

As I had yet studies in details, I gives you the benefits of doubt that cost-minus model will not encourage spending.

Thanks for point this out.

The FMRC report is not conflicting with the cost-plus model, IMO.

I haven't read the report yet, only base on summaries from news reports. I doubt the report has recommendations that rule out cost-plus model implementation.

I think it depends on what we mean by cost plus model. The model smrt is eyeing for it's bus services is one where it gets paid a fixed amount for providing bus services, with bus fares going to the government. In this case, the fares themselves use the cost minus model. To my knowledge, there is no such proposal in the works for train services.

[chialc]

City and Clement,
Both models are described inside yesterday report.
Recommendation is also pen out clearly.

[ForeverAlone]

how come CD rally but SMRT like no reaction to this good news???

[ForeverAlone]

ok both CD and smrt up, seems +ve for both of them ^^

[chialc88]

Hi Clement,
Although SMRT suggest to change to cost+plus model, no luck, the FMRC still recommend to stick with cost-minus.

The devils is in the details.

As I had yet studies in details, I gives you the benefits of doubt that cost-minus model will not encourage spending.

Thanks for point this out.

[Extract from FRMC report on SMRT request to use "cost-plus" ]
From the PTOs, both SMRT and SBST would prefer the fare adjustment formula to be based on a “cost plus” formulation rather than the current “cost minus”.

[Extract from FRMC report on recommending continue to use current "cost-minus" formula" ]
The Committee looked at the current method of calculating productivity, as well as the sharing of productivity gains between the PTOs and the commuters. An equal sharing of productivity gains would incentivise the operators to continue looking for ways to improve productivity, while sharing these gains with the commuters. By fixing the productivity extraction for a number of years, this provides certainty for the PTOs.
Thus, the Committee recommends maintaining the existing method of calculating productivity and sharing of productivity gains equally.

One way for the operators to cut their costs is to be more productive. We should incentivise them to be productive, and when
they do achieve productivity gains, we want the gains to be shared
with commuters. This is why we keep the productivity extraction in
the fare formula.

Current cost-minus formula:
[Image: proposed_fare_formula.jpg?itok=s7iIro-b]

enjoy...