Friday, October 17, 2008

It takes two

The price of oil has plummeted, in concert with the banks and investment houses going broke in the US and Europe. Singapore is now in a recession, yet the price of services in Singapore is still going up, or at least, not going down any time soon.

Electricity has gone up a whopping 20%. Transport costs, particularly taxi services, refuse to go down. A surcharge of 30 cents was slapped on taxi fares some time ago when the price of oil was going north at US$130/barrel. The price of oil is now US$70-$80 a barrel, and we learn that in spite of this, fuel oil is sold at a premium in Singapore for daa daa daa dee dee dee reasons...

Which of us common folks can understand ther pricing mechanism, anyway? The pump price for diesel is $1.53/litre now and the taxi company, in collusion, refuses to take away the surcharge, saying that it will be removed once the price of diesel falls to $1.19 - the December 07 level. So much for competition. Even cars running on gas pretend that they are on diesel.

What if the price of diesel falls to $1.20 and no lower? Then the surcharge will be a permanent charge, and you have the new model of increasing taxi prices. No need to agonise over prices increases in future since all you have to tell the PTC is that the increase is temporary. Well, how temporary is temporary? While commuters quibble over 2 cent increases, or even 10 cents increases that bus companies impose, we have the taxi companies getting away with 30 cent increases (well, ok, the taxi companies also run the public bus services and vice versa).

Well, there are two ways to skin a cat (my apologies to cat-lovers). Either we wait for the pump price of diesel to fall to that magical number, or we force the removal of the surcharge by with-holding our business. Commuters should just vote with their feet, literally, and take less taxis.

And it seem to be happening. Last Sunday, there was a long queue of taxis in front of my place. Usually, you'd have to wait at least 10 minutes to board one, if you are fortunate. Otherwise it would be 20 minutes. On that occasion, I spied a woman with a clipboard writing away while glancing at the taxi queue. No, I don't mean the people queueing for the taxi, I mean the taxi queueing for customers. The last time this happened was during the bad times, economically, that SARs brought. It was a breeze when you'd want to take a taxi then, because they are all lining up for you. When the good times return soon after, commuters were at the selective mercy of taxi drivers again, though not entirely due to the fault of the taxi companies.

I don't know what that woman's purpose was. Usually it is either to report back that there is not enough taxi's at a particular spot or the frequency is good/bad so that something can be done about it. This time around, there probably wasn't any concern for the commuter. It appears that the taxi drivers are more concerned. Well, it was only last Sunday. I would like to see if this happens again. If it does, then it would confirm that people's pockets are truly in sync with the reported recession that Singapore has slippped into.

Image source: Author: Cheryl Rankin