21/07/2011 - 00:00

Public transport model a long-term loser

21/07/2011 - 00:00

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The way our public transport network is run is unsustainable.

IS the state government’s $4 billion public transport plan the start of a slow motion crash?

If we think relatively simple things like indoor sports stadiums can blow out into expensive disasters, then wait for what happens when a light rail connection has to wend its way through established suburbs.

But it’s not just the capital cost of these projects; it is the operational cost, which means there is an ongoing and never-ending drain on the public purse increasing exponentially as more services make this form of transport ever more popular.

Don’t get me wrong, I am actually a fan of public transport and believe it is an important part of any sophisticated community. I have even been an exclusive user of public transport for certain periods of my life, so I’m not welded to the steering wheel of private vehicle dominance.

Nevertheless, I question the commitment made by the state government – a conservative government – while at the same time ruling out a proper debate on the mechanisms required to pay for building and operating these expensive systems.

The government has made a rod for its own back by making this announcement, including where such transport might lie, without having made real progress on reducing the cost of current public transport, which would significantly help it make the business case for further investment in services.

Just as the cost of the newly announced stadium will blow out and the waterfront development will drag on, all of us will be continually reminded of the recently released maps and asking ‘where’s my light rail link?’ just as the residents of Ellenbrook have been doing.

Every year, the government will look at the huge expenditure and baulk, until an election comes up and piecemeal elements of that map will be promised to win over marginal seats. As much as I admire a long-term blueprint to avoid the sort of silly election promises made in NSW, there is still plenty of scope for a politically desperate government to pork barrel. And that might not just be at the state level.

But even if the plan progressed in an efficient and non-political manner, it will be expensive unless someone can think of an alternative way of funding it – because every time a passenger gets on a bus or train, three quarters of the cost of that ride is borne by the whole state, which includes the vast majority of people who don’t use public transport as their primary mode of getting about.

Recently, I made the point that trains and buses recoup about a quarter of their running costs. That is a scary number when you realise how many people use public-subsidised transport. Just as a reminder, the Public Transport Authority’s annual report for 2009-10 showed expenditure at Transperth, which is mainly metropolitan buses and trains, was $691.2 million (or $499.1 million if capital charges were excluded), while fare revenue was $141.7 million. Of the 132 million boardings, about 79 million were paid for, suggesting it costs less than $2 per journey for those who actually pay for the service.

So we are losing around $550 million a year (about half a football stadium, but that’s another questionable public expense) on this system, and rising.

My suggestion a few weeks back was to start recouping some of this by charging more money. Just reducing the subsidy, not ending it, would be a start to make sure that new public transport projects might ultimately not be expensive nooses around the necks of governments of the future.

Again, as I stated the other week, I am not ignoring the cost of road infrastructure (bring on toll roads) and the concern about CO2 emissions, I am just discounting them to focus on the real and rising cost of public transport.

Clearly, public transport is well priced because it is very popular.

But I’d be certain that almost every adult commuter who uses public transport still owns a car, which they’d use at the weekend or to make special trips that are not feasible on a bus or train.

At an average purchase price of $30,000, that’s a lot of capital invested in a vehicle that sits around the garage most of the time when people are public transport users.

Even if they have an old bomb it still probably means thousands of dollars they have invested in an occasionally used convenience.

This includes people who like to lecture those who rely exclusively on cars but typically have their private capital tied up in a vehicle of their own while they expect the whole community to share the burden of their regular public transport usage.

And the worst thing about the cost of a car is how quickly its value diminishes. Public transport is not like that. Once the rail, roads, bridges and stations are constructed, if well maintained, it should take decades to depreciate certain elements while some parts, like rail reserves, simply escalate in value as population rises.

It’s a pity the capital invested in those cars can’t be harnessed to pay for our public transport system.

Perhaps that would ultimately happen if public transport was more widely available, something that can only happen if there is more (or preferably total) cost recovery.

Full cost recovery need not be a starting point but a goal. For instance, subsidisation might make sense to encourage people to commit to public transport – in where they choose to live, how they choose to live and what jobs they take – but once those patterns are established why should the cost be carried by others?

I am not necessarily talking about everybody here. I am particularly focusing on those who use public transport for commuting to regular, well-paid jobs. They are making a choice and part of that is expecting other people to pay for them. Dare I suggest means testing? We use this to cut people out of all manner of other public services, why not public transport?

You might think I’m dreaming, but there are a lot of changes we could make to public transport to make it flexible. If taxi fares in Perth resembled those of Singapore, for instance, a lot of people would find using cabs a lot more affordable as an alternative when traditional public transport was unavailable.

Some alternative thinking is required in this field, otherwise we’ll forever stare at pretty lines on maps, and politicians will regret ever mentioning promises of expanding our public transport system.

• mark.pownall@wabn.com.au

 

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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