Free public transport?

DavidB · Posted: Mon Mar 06, 2006 11:46 am

There have been a few media article about it. The concept is good, but I think it's being sold the wrong way. The headline "cost" of $340 million is misleading, and the idea of a $100-200 levy on all households to "pay" for it is completely unnecessary. Some thoughts.

Ticketing

Free public transport does not require ticket machines or validators. This would represent a saving in maintenance and consumables on the current system. On buses, removing the need to collect fares and validate tickets when boarding significantly reduces dwell times, thus improving overall journey times. It also allows passengers to board and alight by any door. There is also an improvement in security of bus drivers who do not need to handle cash.

It also saves the estimated $494 million cost of rolling out smart cards[1].

Employment and administration

Free public transport results in increased patronage. One detactor in The Age claimed it would only increase public transport usage about 1%, and the proponents suggested 30%. In Hasselt, public transport usage went up 800% in 18 months. This means you need more drivers and some customer service and security staff.

Removing the requirement to collect and enforce fares results in a saving in administration of the whole public transport system. However the overall increase in the number of operational staff results in a net increase in employment by the operator. Cities with free public transport see this as a benefit as it creates employment.

Savings in infrastructure

International experience is that significant increases in public transport usage leads to an overall saving in the transport budget as a whole through savings in road maintenance and a decreased requirement for new or expanded roads. This results in an overall saving in the total "cost" of the transport system in a city or region as a proportion of total wealth[2].

Reduced congestion

International experiences is that significant increased use of public transport results in decreased congestion and improved journey times for those who by choice or necessity continues to use cars. It also speeds up urban freight. The Industry Commission found that road congestion is a growing problem and such congestion lessens the efficiency of urban freight and commercial distribution, and improving the efficiency of urban freight is "crucial to the international competitiveness of Australia’s trade and commerce" [3].

Environmental benefits

The Industry Commission[4] also found that the use of motor vehicles during peak times is "associated with a range of adverse environmental and social effects which are of increasing and justifiable concern to the community."

There are obvious environmental benefits from a significantly greater number of commuters using public transport, including air quality and noise. The benefit is even greater in the suburbs if additional buses run on cleaner fuels such as compressed natural gas, biodiesel, ethanol, hydrogen or fuel cells.

The economic costs of pollution in Australia are unclear, but there is anecdotal evidence of the benefits of a significant modal transport shift. In Europe, cities with low cost or free public transport have experienced a slowing of deterioration of historic buildings from reduced pollution, resulting in savings in the cost of preservation and restoration.

Health benefits

The Industry Commission[5] found that the cost of transport systems "are not confined to the costs of building and maintaining the transport infrastructure and operating the transport systems which us it." In particular, the Commission noted that "they also include the economic costs of road accidents."

International experience is that increased use of public transport results in a lower incidence of asthma and other respiratory problems resulting from decreased air pollution, with resultant savings to the health system.

There is also a general improvement in the health and fitness of the overall population as a result of bus commuters walking a short distance at each end of their journey.

A major benefit is the reduction in road accidents. The experience in Hasselt was that the number of road accidents and more importantly the number of road fatalities decreased about 80% following the introduction of free public transport. This resulted in significant savings to the health system and emergency services. The savings to the health budget alone more than offset the cost of providing free public transport.

Commercial opportunities

Increase public transport usage results in more exposure for advertising space. This can be a source of revenue for the transport operator. For bus and tram stops, it can be a significant incentive for private organisations to build and maintain new shelters at no cost to the operator.

The increase in ridership also creates commercial opportunities at railway stations, major tram stations and major bus interchanges/stops, both from vending machines and retail outlets. International experience is that increased pedestrianism over short distances around major transport nodes leads to increased sales[6], and improved shop occupation and rents. In Europe the scale of growth of retail sales at transport nodes was completely unexpected. Some interesting examples being a large increase (in some cases doubling) of the number of street cafes around transport nodes and significant increases in the sale of the city’s major daily newspaper.

Business and growth

International experience is that free public transport will attract population and new business to a city and region. In the case of Hasselt, the city was able to attract over 100 new businesses in the first year. These new businesses had no trouble in recruiting staff as the presence of free public transport was a significant incentive to attract potential staff to move to the city[7].

Household expenditure on fuel and other car-related expenses is significantly reduced, noting that much of the cost of fuel does not stay within the city or region. Higher disposable incomes as a result of these savings tend to stimulate the local economy as a higher proportion of household spending remains within the city or region. Cities with increased public transit usage have greater wealth (gross regional product per capita) than cities with heavy car use and percentage of wealth spent on commuting[8].

Productivity

International experience is that commuters who use a frequent, efficient and low cost public transport system arrive at work more relaxed, resulting in increased productivity, reduced stress and reduced absenteeism[9]. This effect is even more significant where public transport is very low cost or free. The experience in Hasselt was that the improved productivity of the workforce was a major factor in attracting new business to the city[10].

Tourism and international recognition

International experience is that free public transport can be a significant driver for tourism. In several European cities, tourist numbers increased around 30% after the introduction of free public transport. Free public transport could be a significant factor in attracting visitors to major events such as Floriade, and at least partially offset rising fuel costs which can be a disincentive to visit.

Disadvantages

Initial outlay: Initial capital outlay to increase the size of the transport fleet to meet increased demand.

Cleaning: International experience is that there tends to be an increase in the amount of rubbish at major transport nodes. This can be mitigated by provision of additional rubbish and recycling bins, more frequent emptying of bins and more frequent cleaning. For bus and tram stops, the cost can be reduced if stops are built and maintained by private organisations as described above.

Employment: In some international cases, there was an initial downturn in the taxi industry and minor job losses in motor vehicle service industries, mainly at petrol stations. However this was offset by immediate growth in other areas. In the medium term (3+ years) there was overall growth in the taxi industry as a result of increased tourism and new business attracted to the city, and overall growth in employment in the city.

[1] The Age, 18/8/2005
[2] Newman et al, Indicators of Transport Efficiency in 37 Global Cities, Report to the World Bank, 1998. ISBN 0869055577.
[3] Urban Transport[i], Industry Commission Report No. 37, 15 February 1995. ISBN 0644333006.
[4] Ibid.
[5] Ibid.
[6] ‘Quality streets’, [i]Transport and Environment Studies, May 1989, pp5-21.
[7] Hasselt had actually been experiencing a slight decline in population prior to the introduction of public transport. The population of the city has since been growing at 25 times the rate it was previously falling.
[8] Newman et al, ob. cit.
[9] S. Beder, Towards Sustainable Land Transport, CDRom, NZ Institute of Highway Technology, November 2004.
[10] Steve Stevaert, Mayor of Hasselt. Interview with CNN, 14/7/1998.

Riccardo · Posted: Mon Mar 06, 2006 11:54 am

There is still the distributional argument, more so here than in Europe.

If PT is provided on current patterns, people in existing suburbs with good PT access 'capitalised' into their property values, will disproportionately benefit from that, a transfer from the poor to the rich.

I stayed in Kirribilli in Sydney, just down the road from John and Janet. I loved catching the First Fleet class boats into the Quay, a wonderful relaxing way of getting around. But it struck me that the users of this boat are some of the wealthiest people in Australia, and while it isn't cheap, you must be able to slug these guys for a bit more and make the service truly profitable.

In employment terms, it also disproportionately benefits the professional workers who work in CBDs for large multinational companies, either their lower and middle ranks who actually USE the PT to get to work, or their upper ranks who drive to work, but in roads that are faster than what they would be without PT. The traddies and trash who live in the outer burbs get less such benenfit.

But my final argument is the 'you look after what you own' or even the biblical view that where a man's money is, there is his heart. Maybe you could argue that 'free' public transport will therefore be 'owned' by all, not just the 10% who use it. But equally you might find that 'nobody' owns it and it will be even more unloved than it is now.

If you need to get in touch, drop a comment at the Transport Textbook or on my blog.

Somebody in the WWW · Posted: Mon Mar 06, 2006 3:03 pm

Dumb idea. Can you imagine how many druggies there would be? What we need is improved public transport. NOT Free P/T. Making it free is like saying "We give up - the system is so smeggy that there is no point working on it anymore. Its free now".

"The trains at Pennant Hills run roughly every half hour. Nobody in their right mind uses a service that shoddy. That so many do just proves how many dumb and/or desperate people there are in Sydney." - MrPC

mjja · Posted: Mon Mar 06, 2006 5:27 pm

I have to agree with Somebody. The price now is so much lower than any alternative (apart from cycling or walking, which involve expending lots of energy and therefore are basically only available to a few) that people look down on PT users as the poorer cousin. If it's free the effect will be increased.

DavidB hinted at this with the disadvantage of littering. I think the two stem from the same problem - people don't appreciate what's free.

Although David's advantages (no ticketing equipment = less cost; no enforcement = less admin staff; the rest are basically the advantages of increased PT usage) are valid, I would be very cautious about the hidden problems with such an option.

Afterthought: DavidB's mention of advertising makes me appreciate the low patronage of PT. I'd rather look at "To use this space call Shane at JCDecaux" than dumb ads.

Happy Gunzelling and remember, "Go by rail!"

Michael Angelico
President, Smart Passengers Inc
(My opinions are my own unless specifically stated.)

EvanC · Posted: Mon Mar 06, 2006 5:41 pm

The Met · Posted: Mon Mar 06, 2006 6:15 pm

Personally speaking, i'll agree with Somebody in the WWW:

DavidB · Posted: Mon Mar 06, 2006 6:31 pm

mjja · Posted: Mon Mar 06, 2006 7:41 pm

David you keep saying international experience. I realise it's all we have to go on, but I would say that it has limited usefulness. Without knowing them all, I would doubt that any of them were (before becoming free) comparable to Melbourne in the areas of:
* stigma - the feeling in the general community that cars are cool and PT is not. That will limit the uptake of PT usage even if it does become free.
* vandalism, fare evasion, littering, and disregard for other rules eg smoking and drinking on board trains - these are symptoms of an attitude that says PT is where the dregs of humanity gather so it doesn't matter what I do to it. These will only be increased if it becomes free.
* level of service - even with a tripling of the bus fleet (as you mentioned above) it would be difficult to provide a world class service. In fact I think it would hardly be more than is warranted at today's levels of patronage.
* price of petrol - as Hubert was fond of saying, petrol in Australia is too cheap.
* individualism - Australia is very indiviualistic compared with Europe. My guess is that it's because of the population density, we don't live all on top of each other so we are more likely to keep ourselves to ourselves than mix socially with people we happen to be thrown together with. Australians don't like to go to work in the company of 100 strangers.
* drive for convenience - Australians are more likely to value their own convenience above things like environmental considerations which don't affect them directly. As evidence of this look at the complete flop that has been the push to get people to recycle instead of chucking everything in landfill.
* Last but not least, the attitude of our government. If they saw these examples and thought "Here's a GREAT way to save money" they'd do just that - make it free but not do the upgrades and continue to build freeways.

Let me stress, I'm not sold on the idea that making PT free will be a failure, even though I have a philosophical aversion to things being doled out to us by the government. I'm just pointing out that we shouldn't necessarily take overseas examples and assume that Melbourne will be the same.

[/soapbox]

Happy Gunzelling and remember, "Go by rail!"

Michael Angelico
President, Smart Passengers Inc
(My opinions are my own unless specifically stated.)

EvanC · Posted: Mon Mar 06, 2006 7:48 pm

I agree with Mjja - Melbourne is pretty much unique. That's one of the reasons we have a lot of problems, I've read.

Riccardo · Posted: Mon Mar 06, 2006 8:02 pm

PalmerEldritch · Posted: Mon Mar 06, 2006 8:10 pm

Riccardo · Posted: Mon Mar 06, 2006 8:21 pm

I suspect he also regretted that being a 'no-win' portfolio, he didn't make some bold move to disconnect PT from being a political issue. Maybe he hoped privatisation would do this.

Anyone who has studied labour economics knows the "Company Town" theory, that unions are only as powerful as the management they face. This was the real reason why Hillside/Bayside was split. Unfortunately the union stayed powerful because the government was still ultimately responsible for paying, adn that reality gave the union the power it needed.

Back to the social engineering, definitely a free or low cost system would have promoted consolidation, as the benefits of good PT got further 'capitalised' into land values, people would huddle closer to the city.

But I would rather go the other way, strong revenue flows from road and rail sources going into rail construction, making metro-style services possible in the inner and middle suburbs and better commuter services in the outer areas.

This is the broad-brush problem in Australia. Not rail v road, but not enough of either. Starved of funding from all sources including taxation and user fees.

If you need to get in touch, drop a comment at the Transport Textbook or on my blog.

themikanic · Posted: Tue Mar 07, 2006 11:07 am

Gwiwer · Posted: Tue Mar 07, 2006 12:27 pm

In brief - I don't approve of a free-for-all on public transport although I do whole heartedly approve of any initiative which makes it more accessible and attractive to potential users.

There needs to be a small element of user-pays if only to deter the otherwise open invitation to the less salubrious members of our society who could use trains, trams and buses as mobile shooting galleries, works of "art", restaurants / pubs and lavatories.

Without ticketing there is only the behavioural element to enforcement, which might be insufficient deterrent and difficult to police.

An 800% patronage increase would bring Melbourne's PT to a standstill in moments; parts of the network are already at capacity with nothing spare to add more services. "Demand management" is a business tool which seeks to reduce the demand on the system (or at least mitigate the peaks) by pricing. This function would be lost if the system were to be free for all.

CEO Penhayle Bay Railway. Ferroequinologist. BA Hons (Honourable Bachelor of Aquatarts

)
The wise yet mysterious Sir Gwiwer Greybeard

Riccardo · Posted: Tue Mar 07, 2006 3:03 pm