I wrote the article below in January 2013. We are still waiting for a new fare structure (June 2014). Fare affordability has reached the lowest levels ever ( 31 May 2014: SEQ: Fare affordability crisis worsens ), patronage has stalled. The article below was submitted to the transport authorities January 2013.

They cannot say they were not warned that the fare system for public transport in south-east Queensland was off the rails.

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January 2013

Why we need a fare review

We note that the recently published Six month action plan (1) makes the following point: Announce new fare structure for public transport in South East Queensland. This is a welcome development, so it would appear that is now recognised the present TransLink Five Year Fare strategy has not been successful

A fare review of the SEQ TransLink network is needed for two main reasons, falling revenue and stalling patronage. As is shown in the most recent publicly available TransLink Tracker, patronage peaked at 181.8M trips annually in the 09/10 financial year. Prior to this patronage had been growing quite impressively, but more importantly for funding improved services, prior to the peak when patronage was still growing, the government subsidy per trip fluctuated around the $4.75-$5.00 mark. Since patronage has begun to decline this subsidy has blown out to $6.72 per trip as reported in the latest TransLink Tracker. At the same time, the dollar amount contributed by the passenger has increased from around $1.50 to $2.08. This clearly shows that the fare increases are not having their intended effect of decreasing the amount of subsidy per trip as while they are increasing the fare paid by passengers, they are driving more away through the prohibitive costs.

As this method of decreasing the subsidy has failed, it leaves only two options to decrease the subsidy per trip: drastically reducing services, or reducing fares to get more people on services. Reducing services is a flawed notion in many cases as services are quite well used and any reduction in service would only further reduce patronage, although reviews to find efficiencies (such as the current SEQ Bus Network Review) are useful for reducing duplication in the network. The key to ongoing patronage growth and (more importantly for the public transport budget) and reducing the subsidy per trip is to review the current fares to reduce the cost to individual passengers. In this way more people will find travel affordable and will take more trips.

Why has the current fare scheme failed?

The current fare scheme has failed because while fares have gone up dramatically over recent years, around 70% in real terms since 2010, the average income of Queensland has not. While the 9 then free scheme has done something towards increasing patronage in overall trips, paid trips has fallen and this then has an opposite impact on the subsidy per trip, leaving a net decrease in the number of trips for which passengers contributed towards the cost of running the service. This is most likely because the 9 then free scheme was attractive for those who might already be commuting by PT most days of the week, it isn't attractive at all for those who might only be using the network on occasion, which is where most growth in patronage would be coming from (because those who already use it 3-5 days a week have little capacity to use it more frequently).

Revised fare structure

A revised fare structure should address the fare box leakage as a result of the 9 and then free structure, provide a lower base fare cost and drive out of peak patronage. Additionally the fact that not all Health Care Card holders in Queensland are given public transport concession fares needs to be addressed. Some form of family/group ticketing should be introduced to encourage people back to public transport. The present two paid journey cap, then free for Seniors and some DVA pensioners needs a review. This scheme is inequitable to those Seniors/Pensioners who don't have access to high frequency public transport services and makes their initial journey costs very expensive.

Reference:

1. http://www.thepremier.qld.gov.au/plans-and-progress/plans/assets/6-month-action-plan-jan-jun-13.pdf page 6




Additional information

2013 Australian Fare Comparison http://brizcommuter.blogspot.com.au/2013/01/2013-australian-fare-comparison.html

2013 World Fare Comparison - Part 1 http://brizcommuter.blogspot.com.au/2012/12/2013-world-fare-comparison-part-1.html

2013 World Fare Comparison - Part 2 http://brizcommuter.blogspot.com.au/2012/12/2013-world-fare-comparison-part-2.html

2013 World Fare Comparison - Part 3 http://brizcommuter.blogspot.com.au/2012/12/2013-world-fare-comparison-part-3.html

2013 World Fare Comparison - Conclusion and Recommendations http://brizcommuter.blogspot.com.au/2013/01/2013-world-fare-comparison-conclusion.html

Get Smart - smart card daily and weekly options http://brizcommuter.blogspot.com.au/2013/01/get-smart-smart-card-daily-and-weekly.html

Car vs Train costs in SE Queensland http://brizcommuter.blogspot.com.au/2013/01/car-vs-train-in-se-queensland.html

Evaluating Public Transit Benefits and Costs Best Practices Guidebook 10 December 2012 http://www.vtpi.org/tranben.pdf

Australian Consumer Price Index http://www.natrem.com.au/inflation/index.html

RAIL PATRONAGE MANAGEMENT – effectiveness in practice, and new theoretical frames http://intranet.imet.gr/Portals/0/UsefulDocuments/documents/01584.pdf

MANAGING PEAK DEMAND FOR PASSENGER RAIL: A LITERATURE REVIEW http://www.atrf.info/papers/2009/2009_Hale_Charles.pdf

PRACTICE REVIEWS IN PEAK PERIOD RAIL NETWORK MANAGEMENT: http://intranet.imet.gr/Portals/0/UsefulDocuments/documents/01585.pdf

PRACTICE REVIEWS IN PEAK PERIOD RAIL NETWORK MANAGEMENT: SYDNEY & SAN FRANCISCO BAY AREA http://espace.library.uq.edu.au/eserv/UQ:195976/ATRF09_Hale_Charles_peak_practice_review.pdf

Modelling the Ability of Fare Incentives to Spread AM Peak Passenger Loads May 2012For Infrastructure NSW By DOUGLAS Economics http://www.infrastructure.nsw.gov.au/media/16691/douglas_economics_insw_modelling_fares.pdf

Robert Dow

27 January 2013