In a move aimed at ensuring the continued provision of essential school bus services, the Ministry of Education (MOE) has announced an adjustment to the pricing cap for existing school bus contracts. Effective from January 2024, school bus operators will be permitted to increase fares under existing contracts by up to 13%.
This decision comes as a response to rising operational costs that have been pressuring school bus operators, thus safeguarding the stability of school transportation services.
According to Ministry of Education (MOE) the pricing cap for school bus fares was last revised in January 2023, with a 7% increase. However, with ongoing cost challenges faced by school bus operators, a further adjustment has been deemed necessary for the year 2024.
The new pricing cap adjustment of up to 13% will offer incumbent operators – those currently serving schools – the flexibility to raise fares up to the revised cap, if required. This strategic step aims to ensure the consistent availability of school bus services for students who depend on them, MOE added.
By mitigating the risk of potential disruptions, these adjustments play a vital role in maintaining the convenience and accessibility of school transportation for families.
Starting from September 2023, bus operators will communicate any changes to parents and guardians regarding revised fares. This early notification will enable families to factor in these adjustments while planning their child’s transportation arrangements for the upcoming school year.
Notably, primary school students benefiting from the MOE Financial Assistance Scheme will continue to receive substantial support, as school bus subsidies covering 65% of their monthly fares will persist.
This increase from the previous 60% subsidy level, implemented in January 2023, reflects the government’s commitment to ensuring affordability for families from various economic backgrounds. Moreover, families requiring additional assistance are encouraged to approach their respective schools for school-based support.
In August 2022, the Ministry had initially announced the allowance for pricing caps to increase by up to 7% as of January 2023. This proactive step acknowledged the significance of enabling fare adjustments for school bus operators who had committed to fixed fares for a predetermined duration when the contracts were initially awarded. Recognizing the potential implications of a stagnant fare structure on the viability of operations, this move aimed to forestall the risk of operators having to cease their services due to financial strain.
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