From Third World to First The Singapore Story pdfdrive com

Fighting Traffic Congestion
By 1975 traffic jams at peak hours were unbearable. I had read a paper
proposing that, to reduce congestion, we charge a fee for cars entering the
central business district (CBD) at peak hours. I asked our officials to examine
this idea. They found it feasible. They proposed gantries with notices to warn all
motorists entering the Area Licensing System (ALS), which covered the CBD at
a restricted time, to display a licence on their windscreen. I had the plan
discussed publicly in the media for several months. We refined the proposals, for
example allowing cars with four passengers to go through without a licence and
settling for a charge of S$3 per day, less if bought on a monthly basis. The plan
eased rush hour traffic jams and was well received.
I knew this was but a temporary respite. Incomes were rising and the number
of cars registered yearly was rising exponentially. I believed the answer was to
limit the growth of the car population to the rate the roads could take without
massive traffic jams. No matter how many underground passes, flyovers and
expressways we built, the car population would increase to clog them all up. I
proposed that a new car owner had to bid for a certificate to purchase and put the
car on the road. The number of certificates available each year would depend on
road capacity. We calculated that the roads then could accommodate a 3 per cent
annual increase of vehicles. The minister for communications took a bill for this
to a parliamentary select committee to hear all representations. We settled on a
scheme whereby a person had to bid for a certificate of entitlement (COE) to use
a new car for 10 years.
It proved effective in limiting the yearly vehicle increase to 3 per cent. Bids
for COEs started low but soon rose to astronomical heights. In 1994 it exceeded
S$100,000 for a car of over 2,000 cc; this was in addition to other heavy import
taxes. COEs became unpopular and endless letters to the newspapers by would-
be car owners argued that the bids were being manipulated by car dealers and
speculators. Responding to public requests, the government prohibited car
dealers from bidding for COEs in their own names for transfer to their customers
and also made the certificates non-transferable. These changes made no
difference. When the economy boomed and the stock market rose, so did COE
bids, and vice versa, as when Singapore suffered in the economic crisis of 1997–
98.
By trial and error, I learnt that if I wanted to get an important proposal
accepted at all levels, I should first float my ideas with my ministers, who would
then discuss them with the permanent secretaries and officials. After I got their

---

reactions, I would have the proposal discussed among those who had to make it
work. If, like the transport system, it concerned large numbers of people, I would
then get the issue into the media for public discussion. Hence, before we decided
on an underground mass rapid transit (MRT), we had a public debate for a year
on the merits of an MRT as against an all-bus system using dedicated roads. We
also had American consultants advise us on the two options. They convinced us
that an all-bus system would not provide as satisfactory a solution, because in
wet weather the buses would slow down and clog up the system. This would not
happen with trains.
The MRT did not reduce the demand to own cars which increased every year
although we slowed it down with COEs and the ALS. In 1998 we introduced
electronic road pricing (ERP). Every vehicle now has a “smart card” at its
windscreen, and the correct toll is automatically deducted every time it passes
under gantries sited at strategic points in the city. The toll amount varies with the
stretch of road used and the time of day. Technology has made it possible to
fine-tune the ERP system and extend it to all roads that have become congested.
Since the amount a person pays the government now depends upon how much
he uses the roads, the optimum number of cars can be owned with the minimum
of congestion.

---