A rather interesting discussion has emerged in the comments thread on my recent post “Speeding Up Public Transport” over whether there is an argument out there for making public transport free. This came about due to a comment by “Chris N“, questioning whether all the fuss, expense and delays caused by having a ticketing system were actually worth it. Here’s the point he made:
What would be the effect of a fare/ticket free system? Forget about charging on urban routes and go fare-free within the Auckland City…Benefits include:
– shorter boarding/alighting times;
– tighter travelling times;
– less/no ticketing infrastructure to maintain;
– no need to costly integrated ticketing development and maintenance/compliance;
– no inspectors;
– simplify the jobs of drivers, station staff;
– simplify the experience of users, parents, children;
– make the PT system totally accessible to visitors, tourists, new migrants;
– PT options become the primarily considered ones for trip planning (vs car only).If enough additional people started using PT services, could/would the savings in other areas of city expenditure exceed the lost income…?
It’s an interesting point actually. Collecting fares is a really big hassle, requiring either expensive modern ticketing systems (like we’re supposedly getting here in Auckland) or crap systems like we have at the moment. Paying as you board a bus really slows things down and one really can wonder whether it might be more effective to simply can the whole process altogether.
However, if you look internationally there are actually very few major cities that have free public transport. And there are some good reasons for this. Firstly, it would actually be pretty damn expensive. During the 2008/09 year, around $150 million of subsidies were spent on public transport in Auckland, covering about 56% of the cost of running the public transport system. This means that around $120 million of fares were collected. While you would save some money in terms of more efficient operations and less staff being required, I reckon you would probably still find that you need around $100 million extra per year to cover making public transport free.
Now I’m fine with that. Take it out of the motorway budget and nobody would even notice I reckon. However, that’s not going to be your only additional cost. If public transport was to be made free, then chances are that your main areas of patronage growth would be amongst peak time commuters – which is fine in terms of congestion easing benefits, but not so great in terms of finding new buses, trains, bus lanes, railway tracks and so forth to shift all these people along. Alternatively, you might just find that those who already use public transport will continue to use it – just more often. The point is that it’s quite likely your existing infrastructure will become fairly overloaded, particularly during peak hour, and because you’re spending all your money on making public transport free, it’s somewhat unlikely you’re going to have much left over on expanding the capacity of your system.
Ultimately, I don’t know whether it is cost that really puts more people off using public transport. It would seem to me as though speed, reliability and “whether it goes where you want to go” are more important factors here. In which case, doesn’t it make more sense to put that $100 million or so per year into improving the system, rather than on free fares?
Regular commenter Nick R made the following excellent points in the original discussion:
1) The council would have to come up with an extra $150 million a year (or whatever the farebox take is) just to maintain the same level of service, let along have funds to improve the system. This would have to come straight out of rates as the council would have no other suitable funding source.
2) The cost of public transport is something of a barrier for some people, but it certainly isn’t the number one reason people don’t use it. In comparison to other transport options most PT is quite cheap overall. Any funding should naturally address the main problems first (things like improving frequencies and actually being able to take people where they want to go in a reasonable time).
3) Having no price would create unrestricted consumption of public transport. One question to ask is do we really want to just get as many people onto PT as possible, or is the real goal to meet peoples travel needs most appropriately. One school of thought suggests the first step should be to eliminate travel where possible, not to encourage it. One side effect could be that people start taking a lot more individual trips than they need to, which has implications for resource and energy use. Also related to this are similar problems of having no barrier at all to public transport access, the most common one is that vagrants and other non-travellers start using buses and trains as a place to shelter, live, beg, urinate etc.
I agree that increasing public transport patronage is the means to the ends, rather than the ends itself. What we’re really aiming for is a more sustainable, environmentally friendly and economically efficient transport system that helps create a better city. As I have explained before, increasing public transport patronage by improving the system will help achieve these benefits, but it is not necessarily the ultimate goal in and of itself.
This is not to say that we shouldn’t think about changing the way we structure fares. For example, I am a big fan of the idea of reducing fares during off-peak periods – to help ‘spread the load’ on the public transport system and make it operate more efficiently. It just seems very wasteful to have a whole pile of buses and trains that are only needed for a very few hours of each day. If we halved fares for travel between 9am and 3pm, after 7pm and on weekends, compensated for by a rise in peak-time fares, then I very much imagine we would ‘spread the load’ on the system a lot more, and we might find that we’re able to handle many more passengers in our system without needing to dramatically expand the infrastructure, or buy more trains and buses. Ensuring that there were decent frequencies operating during ‘shoulder-peak’ periods would also help in this respect, as I do wonder whether people who could use public transport outside peak hours actually choose to travel during peak time because the service levels are better.
All up though, I must say that I’m not a supporter of free public transport – although I certainly see where its proponents are coming from (and to be fair to Chris N, he was only just suggesting it as an idea). I suspect that far more people are likely to “switch” to public transport from driving if the system operated better, rather than if they got a free ride on a very overcrowded and old bus each day.
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I think a good question is: At what oil price is free PT a good idea..?
Unless our public transport is powered by electric vehicles, that will be an interesting question to answer from a financial feasibility issue. Operating a diesel-based public transport system will get pretty expensive if diesel was $2.50+ a litre.
I read a report a few years ago by the Toronto City Council which stated that when oil prices where 2 – 3 times higher than they were (2005ish) they should change to trolley buses for purely economic reasons…
Thanks for reconsidering the merits of free public transport.
But let’s have a look at some of the old myths you raise.
Your scenario of “a free ride on a very crowded and old bus each day” has never been part of the proposal advocated by proponents of free public transport.
Fare-free transit presupposes that the public transport system would be efficient, totally integrated, frequent and of a very high standard – using comfortable, modern low-emission vehicles. Such a new network would require at least three times the number of buses we now have in Auckland, plus a decent electrified rail service & support infra-structure for starters. Good user-friendly amenities for cyclists and pedestrians would also be a vital component.
It took the Belgium city of Hasselt several years to get it’s bus services up to a quality standard before they introduced zero-fares twelve years ago – and now everybody gets about the city easily, with no traffic congestion – which had been a serious problem previously.
Your tired old cliche about ‘vagrants’ would be easily overcome by engaging public transport ‘ambassadors’ to assist passengers and deter anti-social behaviour… again, as they do effectively in Hasselt. And there would be no incentive for assaults on drivers as there would be no cashbox to rob and no disputes over fares! The driver will be free to do his/her job – get everyone to their destinations safely.
[Chris N outlines other benefits very well… have another look at what he says.]
Yes, of course it will cost alot of money. But introducing fare-free, quality public transport would cost a fraction of the billions currently wasted on extremely expensive motorways that we all know will be clogged up again in no time – and, to make matters worse, now this government is allowing up to 5000 extra-super-rigs to churn up the roads and increase the road toll even more – and guess who’s going to get the bill for all of this mayhem? …not to mention the extravagant cost of these proposed new flash ticketing systems for the current inefficient, worn-out bus & rail system.
Supporters of the status quo and car dependency never seem to factor in the appalling costs of the carnage on the roads – another 10 people perished over Easter weekend, and another several dozen mangled bodies ended up in hospital. Then there’s the phenomenal rising health costs and human suffering due to pollution problems – much of which comes from the abundance of cars clogging our roads each day. There is also the issue of increased costs & waste of precious fuel.
No – we should see decent public transport as an important, free & easily accessible public service, with funding shared by all for the common good, like many other public services – not as some sort of burden.
It’s time to make major changes to get people out of cars and to let us get about the city in a civilised & sensible manner. Traffic chaos is literally killing hundreds of people and making city life unsustainable & miserable.
Much of our public transport is already subsidized by taxes and road user charges – why not up-grade it properly and cover the costs collectively? In Hasselt the residents rates decreased after free buses were introduced and the city flourished. Auckland too could lead the way as truly ‘world class, clean, green, pleasant city’ and a fine example for others. I’m sure that the resulting increased numbers of tourists would be happy to contribute to the cost of their ‘carbon-footprint’ by paying a special vistors’ levy to help with the nation’s transport costs too.
If your readers wish to follow up on these issues, there are dozens of free public transport blogsites around the world, and everyone is welcome to check out our New Zealand site at: farefreenz.blogspot.com
Email address: farefreenz@clear.net.nz
For rational mobility,
Roger Fowler
Editor
Fare-FreeNZ
I certainly believe PT is a public good and could be provided as such similiar to hospitals and schools etc… Changing the public mindset is the important step and until enough minds are changed I don’t think it is feasible for now…
I looked up Hasselt in Wikipedia and followed a few links and found that lots of cities have fare free transport. I’d never heard of it… It’s an interesting idea.
All of the places listed have populations smaller than Auckland. All are less than 100k. Most are less than 20k. I’m not sure if city size makes a difference or not. A larger city must have a bigger and more complicated network than a town of, say, 50k people. But on the other hand, a smaller city has a much smaller rating base than a larger one.
If the figures listed in this post are correct, public transport spending (excluding airline flights in to and out of the city) in Auckland is around $270m each year ($120m fares and $150m subsidy). But what if use increases 13 times, like it did in Hasselt? That’s $3.5 billion worth of rates required each year. Eeeek! That feels like an an extreme case, but I could easily imagine a tripling of use for around $1 billion a year. Is an extra $2k a year per household in rates feasible? That’s going to hurt people on fixed incomes, like beneficiaries and pensioners. People would obviously get free transport, but pensioners have that already. And I suspect most people would maintain a car anyway, so they’re still paying the fixed cost component of ownership (maintenance, insurance, registration, etc).
Thinking further about this… Inner city dwellers who walk to work would end up with large rates bills and little benefit, while people who commute in to the CBD from Papakura and similar far flung places would have the same rates bills but enormous benefits. Does this provide a disincentive for people to live in the inner city, and encourage them to live in outer suburbs? If so, that is incenting the exact opposite of the sustainable behaviour we’d like to encourage.
This sort of thing wouldn’t be a factor in a smaller town where no one lives very far from the CBD. Such as Hasselt. But Auckland has got to be the best part of 70km from one side to the other. Are students living and studying in the CBD going to be subsidising wealthy people commuting in to the city from lifestyle blocks in Rodney?
Roger, you make some good points but they all seem to based upon the benefits of good public transport in general, not the specific benefits of being fare free. The only thing directly related to being fare free is the savings on installing the new ticketing system, and presumably labour costs involved in not collecting cash.
You propose three times the number of buses in Auckland (!) and note Hasselt spent several years improving its public transport before going fare free. Sounds fantastic but would these things not have similar benefits anyway? Your arguments seem to be basically about improving public transport drastically, and you are assuming that going fare free would either make this improvement directly or cause it to occur.
I would argue that spending the $150-$270 million a year it would cost to forgo farebox revenue (anyone confirm exactly how much is collected each year?), on new buses/trains, drivers and staff, running new routes, designing timetables to interconnect etc might have a greater outcome than simply making the existing system free to use.
Fascinating what happens when one tosses out some ideas!
Following up on Roger’s thoughts, it is indeed sensible to see a city much more organically than we currently do. Our current mindset is one of fenced off accounting cost/income centres and responsibility demarcation with several players involved in PT funding/provision.
BUT:: if we viewed, say, Auckland, as an organism, then it makes no sense to fund the arteries one way but the “collective good” services in them another. It would be analogous to having a body with arteries provided but no blood because it’s not economically viable to go there… or providing the arteries then filling them full of slow-moving fat!
Viewing the roads/rails/whatever +plus+ the buses/trains/whatever as integral components of the same thing (city transport/life blood) would potentially rid us of many of the disruptive -predominantly financial but also psychological- barriers to integrated provision, yes?
Put another way:
What is $1bill as a percentage of the economic activity of Auckland? Is that worth paying so that for eg: goods can move between port and business in a timely fashion?
What is the benefit to the happiness/well-being of the city if we reduce the numbers of deaths and injuries and stress (direct+indirect) by reducing the need for car-centred transport choices?
What is the value of the positive perceptions locals and visitors would have of the City – what downstream benefits would there be (Chinese business partners may start to recommend Auckland to their colleagues because it’s an easy city to get around…? International conference/events organisers put Auckland higher up the hosting cities consideration list due to its reputation of an easy-to-use QPTN?)
obi does however have a good point about the unintended consequence of potentially subsidising a few people to make unsustainable lifestyle residence choices… again I say BUT:: viewing the city as an organism would solve some of those mind-set issues as land-use planning decisions would be made holistically with transport accessibility and density/intensity as core considerations… (or is that only in the utopia we all dream of?)
On the cited list for cities providing free PT, I see Rotherham and Sheffield get on the list simply by providing a free inner CBD shuttle service. Christchurch does the same with the Free Shuttle, and to a lesser extent (less stops) so does Auckland with the City Circuit, yet they’re not on the list.
Perth has a CBD free fare zone and combined with a electrified rail system with feeder buses are getting excellent results… That is where I think we can start (free fare zone in the CBD) and grow from there as bus services increase…
Obi makes a good point that free PT could work against efforts to create a more compact city.
For example I pay quite a lot of rent to live where I am, but it makes sense as I am just a 1 stage bus trip to town and my partner can walk to work.
If we were to shift to somewhere where we both had to catch 3 stage rides to work our rent would need to be considerably lower to compensate, which is an incentive to live centrally.
How much does it actually cost us to collect tickets, the cost of PT services is unlikely to change by that much by making them free.
I think that having a free system is a nice to have in the future but first we need to get our system developed enough to cope with the demand. There is probably at least $10 bil worth of development needed first and some of the projects will take close to 10 years to complete, even if we start them all now. I would rather pay what we do now and get a decent system than have the existing system free and unable to cope with the demand.
Another option would be to leave fares at roughly today’s levels for the next 20 -30 years, as inflation continues PT would become comparatively cheaper and cheaper which would in itself generate demand over time.
I think that the argument should not go about “free” PT because “nothing is free”
The real argument for all those places where fare-free PT has been applied is the alternative funding mechanism… I look at it this way … at the moment, roads are “fare free” for me because I don’t have to pay to get on them but I do pay for them through alternative mechanisms.
It was a very good opportunity lost when the “regional fuel tax” was dumped. In 2005 the fuel cost for passenger transport was around $3billion (nationally) … not insignificant!
Any system that is under priced suffers from induced demand. Just as underpricing of roads leads to traffic congestion as people live further and further from where they work and shop the same will happen at a metro level with free public transport. And just as that induced demand soaks up any capacity enhancements to roads the same process of induced demand will result in any capacity enhancements to PT leading to no reduction in crowding and congestion for passengers.
Hell I think pubs with free beer would be a great idea too. But you just know they are going to be way too crowded and have all sorts of unintended consequences (health etc).
Free public transport is a nice idea but it potentially is just a move from car to public transport based sprawl. And while PT is generally more energy efficient than private cars it still uses a lot of energy.
So if we really want to be sustainable we need the right price signals on driving and PT and get more people living close to where they work and shop and walking and cycling.
Maybe if free transport was limited to local travel within a local zone it could work. Arguably that is How small centers such as Hasselt (pop 70,000) make it work. To get anywhere beyond Hasselt you still have to pay limiting the potential induced demand to short local trips.
Following LX’s comments, what about making PT free within identified residential/school/social/work zones (like ‘suburbs’ maybe) – and inter-suburb travel is what attracts an incremental fare based on the number of suburbs traversed. Given rail’s acknowledged longer passenger trips a rail zone might be longer than a bus zone (6 bus suburbs traversed might equal 2 train zones)? That would probably encourage people to generally live closer to where they need to work/school/shop.
However, this would mean maintaining and integrating fare collection infrastructures with all the attendant processing, security and staffing issues. There really is no simple solution, is there – but there must be better solutions than what is in place right now… right?
Chris N, there’s always a balance to be found about making the ticketing system fair, simple and economically efficient. We certainly haven’t found the balance at the moment, but hopefully once we finally get around to having an integrated ticketing system, we will be able to get things right….
… though I must say I am a bit worried that it might be some time before we actually revolutionise the fare system. Which seems silly to do the technology bit before the policy bit.
Why not get rid of the age discrimination in the Super Gold Card system and make post-9am PT free for everybody. The Government pays, not the local authority.
@ Jarbury – I agree about the sprawl thing. I decided not to look for a house in Glen Eden for exactly the same reason. It would cost so much to commute that the lower price of housing wasn’t worth it…