Sunday, April 29, 2012

Public transport fare increases in South East Queensland have been a complete failure

Back in 2009/10 Translink introduced it's new "fare structure" and with it the 15% a year increases in public transport fares. The stated reason, by both then Transport minister Rachel Nolan and Translink was to reduce the percentage of each fare that was subsidised by the government.

From the 09/10 Translink annual report section on fares:
(The new fare structure) "introduces a series of staged fare increases to ensure the long-term sustainability of South East Queensland’s public transport system. These fare increases will enable TransLink to continue to rollout services to meet growing demand, whilst gradually reducing state subsidies to a more sustainable level... TransLink aims to reduce the total subsidy requirement from 75 per cent to 70 per cent of the total cost of delivering public transport services, over a five year period."
Now you might have predicted that 15% a year fare rises would impact negatively on public transport patronage, and that the combination of less passenger growth and more services would outweigh any extra money coming from increased fares. And you'd have been right. Since 2009 the percentage subsidy paid by the government has actually increased to 77%. So not only is the government subsidising a larger percentage of each journey, the dollar amount of subsidy per journey has also increased. Although the entire 5 years period has not yet passed, I think it is already safe to call this policy a complete failure.

Looking at the actual patronage numbers (by comparing the 09/10 Translink report with the latest numbers) it also looks like the strong yearly increases in passengers seen between 2003/04 and 2008/09 have ground to a halt despite new and extra services. With customer satisfaction around affordability also taking a dive, it's not unreasonably to think it is the fare increases that have caused patronage numbers to flat-line.

So what about the future?
The Labour govt who introduced the fare increases is now gone, but it doesn't seem that the new LNP govt have fully learnt the lesson either. Although they have pledged to halve the fare increases, they are still planning yearly fare increases of 7.5% over the next few years. The last three years have shown that big fare increases don't work and don't save money for the government. Instead the state government (and transport minister Scott Emerson) should limit fare increases to CPI and focus on increasing passenger numbers.

HT to BrizCommuter for pointing me towards the latest passenger numbers and for their useful public transport blog.

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