Fares discussion welcome, but better service is still the main game

Fare gates

The Public Transport Users Association has welcomed the conversation on public transport fare reform sparked by the release of a new Infrastructure Victoria report “Fair Move: Better Public Transport Fares for Melbourne“.

But PTUA President Dr Tony Morton said many of the proposed measures, like off-peak discounting, would only work properly in the context of improved service frequency and span, particularly in Melbourne’s suburbs. “Off-peak discount fares make a lot of sense,” he said, “particularly in a ‘COVID normal’ world where we need people who can to avoid travelling at peak times to reduce crowding. It’s a fair substitute for ad-hoc measures like the Free Tram Zone that advantage a lucky few without much of a clear policy rationale.”

“The obverse of this is that outside peak times, you often have to wait 20 or 30 minutes for a train, and you can easily be waiting an hour or more for a bus. It’s the poor standard of service, not the lack of a price signal, that’s keeping people away from public transport at these times.”

Multimodal is king

Dr Morton noted Infrastructure Victoria had, in response to feedback from the PTUA and others on its earlier “Good Move” report, moved away from proposals that would have undermined the multimodal nature of the system. “It’s an important principle of our system, as with most of the world’s best, that you don’t charge people extra simply because they need two different modes of public transport to complete their trip rather than just one,” he said. “The Fair Move report accepts this and is improved as a result.”

Despite this, Infrastructure Victoria continues to emphasise the idea of charging different fares for different modes of public transport, a notion that ultimately works against the objectives of the transport system.

“Thanks to decades of hands-off planning, Melbourne has a train system (plus a few express buses that act like trains) heavily oriented toward central-city commuting in peak hour, a well-used but geographically limited tram system, and a residualised bus system that caters to small populations in the suburbs who don’t travel long distances and are prepared to work around infrequent services,” Dr Morton said. “Infrastructure Victoria has looked at this largely-accidental outcome and formed the view that as the train users tend to have higher incomes and bus users lower incomes, charging more for a train and less for a bus is the best way to promote social equity.”

“The problem is that using this kind of statistical profiling as the basis for policy easily leads to unconscious discrimination. Train users have higher incomes on average, but this masks the fact a lot of lower-income people use trains too, including in peak hour. And it’s those lower-income people who are less likely to be able to adjust their work hours and take advantage of discounted off-peak train fares.”

“What the disparity between trains and buses actually reveals is the absence of high-income people from buses, rather than an absence of low-income people from trains. You don’t see this as much in cities like Vienna or Toronto where public transport caters to a higher proportion of the population.”

“Likewise, you can’t expect Infrastructure Victoria’s modelling to have picked this up, because the models are – out of necessity – based on where Melbourne has been, not on where we ultimately want to be as a city.”

Dr Morton pointed out that the mode of transport for a given journey from A to B is determined by long-term network planning and not within the control of individual travellers. “If you’re in Fawkner on the Upfield line and going south to access jobs and services closer to the city, then you’re going to be on a train, even though it only runs every 20 minutes in peak hour and there’s no plan on the horizon to improve that,” he said. “Go further south and there’s a parallel train and tram line for historical reasons, but they’ve evolved complementary roles: the tram is used for local shopping and the train to go to the city. Differential fares might see a lot more people crowd onto that Sydney Road tram, but it’s really hard to see what social purpose that would fulfil.”

“Through all this we also have to remember, the one choice individual travellers can most easily control is whether to use public transport at all or to get in the car. That’s a function of the quality of public transport service available, much more than finer details of fare calculations.”

“Seamless networks with multimodal fares – where what you pay depends on time and place, but not the technicalities of how the system gets you from origin to destination, because that’s the system’s business not yours – have become established as world’s best practice over decades,” Dr Morton said. “By and large, the cities charging different prices for different travel modes are those like Sydney still dealing with the legacy of uncoordinated operators each with their own idiosyncratic fare system. The de facto global standard is the one regional transport authority – ‘Verkehrsverbund’ as the Germans call it – with a single fare scale.”

Myki Pass still valuable

The PTUA agreed with Infrastructure Victoria that replacing the weekly Myki pass with a weekly fare cap, as originally proposed for Myki a decade ago, could make more sense in a post-COVID world where people might only travel any distance from home on 3 or 4 days each week. But monthly and longer Myki passes should stay, as they play a valuable strategic role.

“Abolishing Myki Passes does nothing but alienate public transport’s most loyal customers,” said Dr Morton. “It’s also an important tool to encourage mode shift in a world where the average motorist spends as much on annual registration, insurance and servicing as on petrol or tolls. They’re going to be particularly sensitive to travel options that involve a substantial incremental cost per trip. A Pass is a convenient ‘set and forget’ option that also incentivises the use of public transport for non-work travel – all the more critical in a post-COVID world.”

Independent price setting requires expertise

Ultimately the design of a public transport fare system is a delicate balancing act involving diverse objectives. It needs to be simple for passengers to understand and for authorities to enforce. It must be legible enough that passengers can readily anticipate the cost of their journey. It needs to provide a sustainable revenue source to maintain and expand services, while providing a competitive alternative to private car travel. It should be broadly reflective of the cost of providing the service, but must also be equitable – providing targeted concessions to those of limited means but otherwise charging similar amounts for recognisably similar journeys.

“Designing a fare system and setting fares is a highly complex exercise, with no unique right answer,” Dr Morton said. “It is part of the strategic planning of the entire public transport system and needs to be undertaken by those with appropriate subject-matter expertise.”

The Infrastructure Victoria report includes a recommendation for decisions on fares to be in the hands of an independent authority, modelled on IPART in New South Wales or the Essential Services Commission in Victoria. “The idea may have some merit, but we also need to learn the lessons from NSW,” Dr Morton says. “In that state, the kind of multimodal approach to fares common in other parts of Australia and worldwide has been actively resisted by an ‘independent’ regulator with little relevant expertise in transport planning.”

“The PTUA would be more supportive of these decisions being given to an independent planning agency staffed by experts – such as PTV was intended to be a decade ago.”