Foreign players take on local bus routes

Two foreign bus operators started services this year, dismantling a three-decade duopoly held by SBS Transit and SMRT Buses. Anglo-Australian Tower Transit took over 26 bus services under the Bulim package in May and June, while British-based Go-Ahead began running 24 bus routes in Pasir Ris and Punggol in September.

They are the first operators employed under the bus contracting model, which subjects operators to stricter reliability standards and doles out performance incentives or fines depending on whether benchmarks are met.

Tower Transit clinched the Bulim bus package with a bid of $556 million for five years in May last year, while Go-Ahead won the second Government bus contract for $498 million in November last year. Their entries are key steps in the restructuring of Singapore's bus industry to raise service standards.

In May, Tower Transit raised its starting pay for bus drivers to $1,930 a month, an increase of 3.5 percent. The other operators followed suit - SBS Transit raised its starting pay to $1,950 in June, Go-Ahead did likewise in July, while SMRT Buses also increased the starting pay for its bus drivers to $1,950 in August. Tower Transit has also hired new bus drivers from non-driving backgrounds, and redeployed some to other positions that better suit their skills and qualities.

However, it was not entirely smooth-sailing for Go-Ahead, which found itself hit by an unexpected spate of resignations just two weeks after it began operations, due to an unpopular practice of having drivers undertake more than one route per shift. The firm had to borrow bus drivers from incumbents SBS Transit and SMRT Buses as a stop-gap measure.

With the Land Transport Authority due to award a tender for the third Government bus contract in Seletar next year, the public bus industry could see yet another new operator as five of the nine bids received were from new players.