By Yeo Ghim Lay

SINGAPORE'S competition watchdog is against a recent proposal by school bus operators to charge parents more to cover rising diesel prices.

The Competition Commission of Singapore (CCS) said in a statement on Friday that it has met the 900-member Singapore School Transport Association (SSTA) and advised it to 'take appropriate remedial action'.

Three weeks ago, the SSTA announced a proposed hike of $10 to $15 more a month on school bus fares. The association said it was a guideline for members and not mandatory.

The CCS, however, said this is not right.

'Price recommendations or guidelines tend to restrict independent pricing decisions. The circulation of such recommended prices by a trade association, even if it is non-binding, is likely to prompt industry players to cluster their prices around, if not exactly matching, the recommend prices,' it said.

This will not be helpful to free competition, it added.

The commission said it will continue to monitor the situation and will start investigations if it suspects that prices are being co-ordinated among school bus operators.

In light of the commission's stand, school bus operators are holding off the fare hike, which was to have come into effect on Friday.

The association is now in talks with the Consumers Association of Singapore, which is helping to facilitate a meeting between the association and relevant Government agencies.

'We're hoping that the authorities will consider giving us a diesel rebate, because fuel prices are really putting a squeeze on smaller bus operators,' said Mr Wong.

A check with school bus operators on Friday found that most had not raised their fares, mostly out of fear that schools or parents will complain.