If you haven’t lived out of Singapore, you probably can’t appreciate how efficient our public bus transport system is, complete with a comfortable air-conditioned fleet. Peter Chan takes us back to the early 1970s, to the last days of the Singapore Traction Company, the major public bus company before it was liquidated in 1973.

On Dec 16 1971, STC was placed under receivership and as a consequence, 407 of its fleet of buses were sold to the other 3 bus companies. In FY’71, STC recorded a $9 million loss which first began in FY’65 with a small loss of $0.764 million. From 1965 to 1971, the only thing consistent of STC was its losses; each year became far worse than the previous year. In fact the company could have collapsed even earlier in 1967 but it was not in the shareholders’ interest to opt for voluntary liquidation.

December 6 was “Black Monday” for STC shareholders too. The counter was suspended on the Singapore Stock Exchange until its liquidation in 1973, by which time STC shares became zero value. I heard stories of many disgruntled shareholders who burnt their share certificates and laid the blame at almost everybody; the government, stock exchange and STC management.

After STC, we did not live long with the 3 Chinese bus companies because Singapore Bus Services (fore-runner of SBSTransit) was created in 1973 and culminating two years later with the “Restricted Zone” scheme. So I safely conclude that Adam Smith’s concept of the “invisible hand” cannot work in Singapore.

Read Peter’s two-parter on Good Morning Yesterday here and here.

Tags: Singapore Public Transport, Singapore Traction Company