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Off-peak car schemes need fine-tuning

It is heartening to read that more people are using public transport. What would be ideal is if people can own cars to serve their ad hoc needs, but use public transport for their daily commute.

It is heartening to read that more people are using public transport. What would be ideal is if people can own cars to serve their ad hoc needs, but use public transport for their daily commute.

Every day that a car is off the road is beneficial to everyone. It is, therefore, surprising that the Off-Peak Car (OPC) Scheme and the Revised Off-Peak Car (ROPC) scheme — which is for cars that are registered on or after Jan 25, 2010 — are not appealing enough to draw more takers.

The rebate of up to S$17,000 for the Quota Premium for a Certificate of Entitlement (COE) and the Additional Registration Fee, plus a reduction in road tax of S$500, work out to savings of about S$2,200 a year, or about S$42 a week.

This means that a regular car user is paying only S$42 more to use their cars any time they like, compared with an ROPC user who cannot drive on weekdays from 7am to 7pm.

Moreover, an ROPC owner has to pay S$20 each time he uses the car during restricted hours. An off-peak car driven for more than two weekdays would cost more to drive than a regular car.

It is no wonder that the scheme is unattractive, while other car owners continue to feel incentivised to maximise their investment by driving as often as possible.

The OPC scheme should be fine-tuned. Perhaps, usage charges during restricted hours should be capped, such as that it does not exceed the cost of driving a non-ROPC scheme car.

The rebates and usage costs could also be adjusted so even as more people sign up for the scheme, they are incentivised to use the car as little as possible.

Off-peak car drivers still pay COE premiums and increasing the take-up rate of the scheme also does drive up the overall vehicle population given the COE quotas. In fact, it is desirable to make every car an off-peak car by default.

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