Free fares and the relative merits thereof

[ozbob]

Maybe it is time to consider the pros and cons of fare free public transport.

Public transport is a community service and is subsidised.  So is health, education and many things.

Fare free public transport means the costly ticketing and enforcement is not needed.  Security is still required but overall there would be significant cost savings. 

Public transport can be funded from general tax revenue or further subsidised by additional rate levies and so forth.  Congestion charges can also be directed to fund public transport.

The article below appeared in 2007.  It is an interesting perspective.

From Sydney Morning Herald click here!

A free ride is just the ticket

Linton Besser and Sunanda Creagh
August 16, 2007

TWO-THIRDS of Australians want free travel on buses, trains and ferries, funded from Federal Government surpluses, a nationwide survey says.

In a Galaxy poll commissioned by the Greens, 66 per cent of taxpayers said they were prepared to shoulder the tax burden to participate in a trial period of free public transport - though the shortfall in fare revenue from ferries, trains and buses in Sydney alone would be at least $1.07 billion.

Modelled on similar experiments overseas, the trial would entice large numbers of motorists over to public transport and significantly ease the congestion choking each capital city, the Greens say.

Only 26 per cent were opposed to running such a trial.

"If the Federal Government can contribute hospital funding in northern Tasmania and plebiscites on council amalgamations in Queensland, they can fund free buses and trains in Sydney," the Greens' Kerry Nettle said.

"The Greens are calling on the Government to set up large-scale free public transport trials."

Senator Nettle said the research provided a clear mandate to experiment with new public transport policy: "If we are serious about tackling climate change we need to encourage public transport use ? [and] in the longer term, looking to make trains, buses and ferries free."

But Sydneysiders appear far more wedded to their cars than those in other capital cities. The research, conducted at the end of July, showed 78 per cent of those in Melbourne were in favour of such a trial, but only 59 per cent in Sydney felt the same way - the fewest of all capital cities.

In the Netherlands, free travel was offered for 12 months on buses servicing a priority route between Leiden and The Hague in January 2004, costing taxpayers $1.6 million.

According to a review of this experiment, and others, published in European Transport last year, the result was a big surge in patronage.

"Bus use on the free bus routes increased from 1000 to 3000 passengers a day," it found.

"From these new passengers, 45 per cent made the [journey] formerly by car."

But the report also found that the quality of the transport offered affected patronage as much as the price, and that free fares did not necessarily achieve the expected environmental benefits. The costs would also likely rise steeply as demand surged and as resources were diverted to public transport.

The Galaxy research took in 996 people, with almost 300 in NSW and the ACT, 279 in Victoria, and several hundred across Queensland, South Australia and Western Australia.

A coalition of public transport activists will today launch a report, titled Moving Australians Sustainably, calling for more Commonwealth funding of trains, buses, bike paths and tax rebates for people with yearly travel passes.

The report Moving Australians Sustainably can be found here --> http://www.ptua.org.au/federal/

[Cazza]

New thread split from https://railbotforum.org/mbs/index.php?topic=12863.msg196515#msg196515

I certainly noticed loading and unloading times have approved with pax not needing touch on / off.

Who needs all door boarding now?? Free fares everyday:pr

But in all honesty, public transport fares should be payed for as a tax. That way, everyone has to pay it and people can just hop on and hop off any mode of transport as they go, with no fare evasion either. There would be a set limit that everyone has to pay (obviously seniors would pay less). Plus, it would encourage people to use PT anyway because they are already paying for it. People hate paying for things we don't use, that's how cheap we are becoming.

But this is a serious idea that could be worked on and improved and hopefully incorporated into our silly political world

[Gazza]

It wouldn't work because transport would be over demanded but undersupplied.

[Cazza]

It wouldn't work because transport would be over demanded but undersupplied.

With the current state of the network, yes. BUT, with a better bus network with feeder services to trains and ferries and a reliable and frequent train network, I do believe that the usage of public transport will rise. As I said, because people are having to pay for transport as a part of their tax, they would be more inclined to use it.

[SurfRail]

I pay for hospitals and public schools with my tax but I've never used either.

By making PT free all you are doing is throwing away $400m per year in revenue that you have to find elsewhere.  There's no reason you can't increase taxation (at least in the SEQ service area) and keep the fare system in place. 

Petrol taxes would help - in NZ they pay $2/L for unleaded and nobody seems to be rioting about it.  Even a modest charge of $0.10/L would work wonders.  There are silly constitutional issues of course.

[Cazza]

By making PT free all you are doing is throwing away $400m per year in revenue that you have to find elsewhere.  There's no reason you can't increase taxation (at least in the SEQ service area) and keep the fare system in place. 

I'm not making PT free, I am making people pay for it as a tax (e.g. like the way people pay for water, electricity etc. etc. etc.). People would pay for PT as a part of their rates that they pay to their local council. It would be a set amount (say around $150-$200 per month- the average commute from Caboolture [zone 3] to the City [zone 1] if you travelled 10 journeys per week during peak, would cost you $59.60 or $238.40 per month).

The reason for making PT a 'tax' so to speak is so that vehicles can be quickly loaded and unloaded through all doors AND to stop fare evasion. Just this afternoon, I was on the 3:38pm Brookside-bound route 362 and 6 kids out of about 40 just walked straight on the bus without paying or anything.

Yes, there are flaws and faults that would have to be fixed but as a whole, the idea is could be successful.

[James]

There are many reasons for charging people a fare to use public transport, one of which is demand management.

Thanks to human psychology, the moment anything becomes "free" leads to people going nuts and undertaking economically useless trips because the only cost is their time. In the other case, 'free' PT does not necessarily cause PT to take all the load, as the generalised cost of driving to your destination may still be lower than using PT once you factor in waiting time, walks to/from the bus stop and so forth.

Also, you'd see a revolt. PT's mode share is 10%, meaning 9 in 10 trips served don't use either buses, trains, trams or ferries. Some people do not use PT at all, or are served by appalling PT, and you're suggesting we hike their rates by thousands of dollars per annum?

It simply won't work. Car mentality is permanently ingrained on "new western" society (e.g. America, NZ, societies with low density housing and major cities spaced far apart), this won't change in our lifetime.

The reason for making PT a 'tax' so to speak is so that vehicles can be quickly loaded and unloaded through all doors AND to stop fare evasion. Just this afternoon, I was on the 3:38pm Brookside-bound route 362 and 6 kids out of about 40 just walked straight on the bus without paying or anything.

This is where the No Child Left Behind policy needs to be modified, and more SNOs need to be brought on to the network.

(May I suggest that this recent line of discussion may warrant a break-off thread).

[OzGamer]

Perhaps an option would be to make public transport cost dependent on the supply, so it might be free to get on an empty bus at 7:00PM on Sunday evening, but a full fare would be required at 7:30AM on Monday morning.

The marginal cost of an extra user at off peak times is essentially zero, whereas the marginal cost of another peak commuter is very high, as the peak usage determines things like how many buses and trains you need to procure in total.

In terms of the delay of services through fare collection, things like off-board fare collection as is proposed for the Metro should be looked at more. A better smartcard system should allow this to happen at major stops even on regular streets. For example, bus stations like Indooroopilly, Chermside, or Carindale could all have off-board touching on and off, as could major stops on arteries like Mains and Gympie Roads.

[Gazza]

So you're saying make it like water and electricity bills.

But its not like you generally get unlimited electricity and water for a set monthly fee?

I don't see the advantage in switching away from the current model.

If its free, then how do you deal with the influx of GC commuters who can live a long way from work at low cost.

If there is a lot of kids exploiting the no child Left behind policy, it would be cheaper to hire SNOs then to throw your arms up and make it free.

[#Metro]

https://www.originenergy.com.au/for-home/campaign/origin-predictable-plan.html

Predictable Plan has changed the way you pay for energy

You'll pay the same amount for your electricity or natural gas for 12 months - no price hikes or nasty surprises. Our Fair Use Policy applies.

Buffet Electricity Plans do exist. However, buffet electricity AND being free does not.

As others have pointed out, it is possible to offer free travel. Whether that would be desirable during peak hour when adding

one addition service comes at extreme expense (i.e. track expansion required) is debateable.

[James]

You could try a supply and demand model, but how easy would that be to understand? We already have it to an extent with peak and off-peak fares.
If someone is faced with a different fare every time they use PT, they will probably be less inclined to use it as they will never know how much it will cost. Free PT at low demand hours could also attract "undesirables" as well, discouraging people from using PT late at night.

[aldonius]

(This is intended as a sandbox thread; discussions elsewhere can get pointed here.)

Free fares have become much more popular around the world in the last few years, mostly within smaller jurisdictions where collection/enforcement costs were relatively large.


A very interesting article I saw today suggests that Toronto could make its transit free for the astonishingly low sum of $1/day extra in property tax. Those figures are of course subject to dispute.

https://www.blogto.com/city/2020/02/cost-toronto-homeowner-ttc-free/


So another purpose for this thread is "if SEQ did make fares free in general, or perhaps free off-peak, what would it cost and is there any good way to pay for that?


The third question that interests me is "would making PT free be an effective strategy in making a more sustainable city?"

[Gazza]

Free fares would only benefit people in areas that already have a usable good quality transit service.
The Toronto example is interesting...If they could theoretically get through that property tax increase they urgently need to do stuff like build relief lines for the subway.

[James]

There was an interesting YouTube video published online recently about this very topic:



The reason PT has been made free in Luxembourg is due to a lot of people driving in from neighbouring countries. The point is made in the video that the service is so bad, people may not use it even if it is free, as there is almost no guarantee you will get to your destination anywhere close to on time.

Returning to Brisbane, even if farebox recovery is only at 20%, that's still a fair amount of money the government is receiving that they can invest in services. If it costs as little as $1 a week to make fares free, imagine the level of improvement that could be made if that money was invested in decent service instead.

IMHO, the reason "free fares" is taking off all over SEQ is for a few reasons:
1. Fares are already very expensive, particularly for cheap trips, and no passes are available.
2. The network is poor, but the cost of expansions is expensive and would require network reform to be cost neutral - something no side or level of politics is very interested in.
3. Politics running transport planning in Queensland.

Combine the three, and you have a situation ripe for saying "let's make all public transport free!" without really considering the consequences or the opportunity costs caused by the introduction of this policy.

[ozbob]

... IMHO, the reason "free fares" is taking off all over SEQ is for a few reasons:
1. Fares are already very expensive, particularly for cheap trips, and no passes are available.
2. The network is poor, but the cost of expansions is expensive and would require network reform to be cost neutral - something no side or level of politics is very interested in.
3. Politics running transport planning in Queensland.

Combine the three, and you have a situation ripe for saying "let's make all public transport free!" without really considering the consequences or the opportunity costs caused by the introduction of this policy.

Very well expressed James.  Spot on ... 

Until we get a single authority with the means and the will to improve and act equitably for all,

the present mess of festering failure will continue ...

[ozbob]

https://twitter.com/ozbob13/status/1233789659999719424

[verbatim9]

BBC News---->  Free transport in Luxembourg, but what's the cost?

It has had months of hype and now finally Luxembourg's free public transport has begun.

With a population of only 614,000, it may be one of Europe's smallest countries and the idea is not unprecedented.

But the "free mobility" drive has captured the imagination. Buses, trams and trains are now free to ride on and you don't need a ticket.

One aim is to ease traffic congestion but critics see it as a PR stunt.

"The government wants Luxembourg to become a laboratory for mobility," says Mobility Minister François Bausch, who points to the grand duchy's fast-rising population, with a rise of 40% in 20 years.

Some 200,000 workers - almost half of Luxembourg's workforce - commute from Belgium, France and Germany, attracted by high salaries and a wealthy economy.

The big day is being heralded on Saturday with concerts at four train stations and numerous other events.

Markus Hesse, professor of urban studies at the University of Luxembourg, says the "bling bling" they have organised is the wrong solution to a complex problem.

One question is whether free public transport will really be free.

What is the cost?

Travelling on transport will be free for residents and visitors alike, except for first-class train passengers.

The price of the project will be the €41m (£35m; $44m) in lost ticket fares, but that will be shouldered by the taxpayer. "Of course, just because I call it free transport doesn't mean nobody pays," said Mr Bausch, who is part of Luxembourg's green party, déi Gréng.

The total cost of running the service is more than €500m so the government sees the lost fare revenue as relatively small. Transport staff will not lose their jobs, they will merely spend less time checking tickets.

It was not exactly pricey before 29 February. A fare cost €2, and double for a day pass. Many workers have their annual travel pass subsidised in Luxembourg, so few people spend much on transport anyway.

Why do it?

The government has several reasons:

It talks of a social measure that will hit higher taxpayers more than others

It wants to get cars off the road - as Luxembourg has more cars per 1,000 people than anywhere else in the EU

It aims to have 20% more passengers on public transport within five years

It will alert Luxembourgers to their country's environmental problems

It wants to invest in the transport network to cope with an already big increase in passengers

What's not to like?

Luxembourg has a terrible traffic problem. Major roads are snarled up in the rush-hour, buses are old-fashioned and the rail system is notorious for its delays.

Diesel and petrol costs are cheap in Luxembourg, compared with its neighbours, so not only do many commuters from neighbouring countries drive to work. but "fuel tourists" cross the border to fill their tanks.

The free public transport will not really deal with the car problem, according to Prof Hesse, because Luxembourg has "high salaries and low petrol prices so people buy cars".

Many of those commuting from neighbouring countries live in areas without decent public transport so he believes they will continue to drive. Luxembourgers who currently cycle may now get off their bikes to enjoy the free travel too.

He also believes the government has picked the wrong moment.

Luxembourg's tram system has been up and running since December 2017 and the network is still being built

The new tram network is being expanded, and money is going into the trains and bus system, but it will take time, he argues.

"They're investing so much that while the total system is being overhauled the delays are actually increasing, because they are working on tracks trying to fix it."

Will Luxembourg's infrastructure improve?

One of the key aims is to make public transport better, with a promise of almost €4bn on trains between 2018 and 2027.

The government estimates that the number of transport users will rise by 20% in the next five years and that the expansion of the tram network and buses will be able to deal with that.

Luxembourg spends more of its economic output on transport that most other European countries, with a reported €600 a year per person.

Critics complain the scheme will not tackle the lack of housing, which has forced thousands of Luxembourgers to emigrate beyond the country's borders while keeping their jobs.

Who else does free transport?

Estonia's capital, Tallinn, introduced free public transport in 2013 but only for residents. It has not ruled out extending the scheme to non-residents but does not want to pay the extra €20m it would cost.

The northern French city of Dunkirk (population: 200,000) also introduced free travel in 2018 and hailed a dramatic increase in bus passengers. It was such a success that it caught the eye of Paris Mayor Anne Hidalgo. As part of a mayoral campaign pledge she wants to introduce free travel for under 18s. She has previously mooted the idea of free transport for all Parisians, but that would work out at around €500 per household, which is widely seen as too expensive.

[ozbob]

https://x.com/theprojecttv/status/1792483644172276088

[#Metro]

The claim is made the free PT would ease cost of living pressures.

The two largest costs of living, taking about ~ 50% of a workers income are:

1. Government taxes (usually 25%+)
2. Housing costs (rent/mortgage repayments)(usually another 25-30%)

It's movement on those two dials that would bring living costs down.

[OzGamer]

Taxes are a lower proportion than that for people on low incomes. Tax reductions really do not help people who need it the most.

Housing is, of course, a huge cost for people on low incomes and proportionally less for higher incomes.

Public transport fares are not as significant as those, but they are something the government has simple and direct control of.

I would propose not removing fares altogether but removing them for children and all full time students as well as for over 65 or anyone on any sort of pension or other government support. That would be a cost effective way of helping people who need it the most.

[#Metro]

Better to just increase Newstart payments and rent assistance.

[Gazza]

Yeah this. If you want to help low income earners, increase welfare rather than expensive to administer means tested systems.

[#Metro]

Green Team have free PT. Blue Team have free car parking. At the end of the day, these are all political inducements / gimmicks and should be all treated the same way.

If they genuinely want to know the answer, run a test under controlled conditions like the Chilean free travel pass study. Compare it against the effectiveness of frequency upgrades like BUZ.

In NSW they are now paying motorists to drive with toll relief from suburbs that have metro stations with trains every few minutes. This is where this sort of gimmick approach leads.

Best not to start down this road in the first place.

[Jonno]

I just want public transport to get the same subsidy level as driving,

[SurfRail]

I wouldn't have a problem with a fare cut in the next few years.  Definitely not fare free but I am not convinced fares are set at an optimum level right now - there would easily be people who are deterred from using public transport on that basis alone where there is already good quality service.

The 2010s strategy of aggressively hiking fares was abominably stupid and achieved nothing good.  The consolidation of fare zones from 23 to 8 has really only gone a little way to fixing that - especially when combined with the lack of simple capping that exists elsewhere in the country.

A single myki fare in Melbourne might be far more than a one zone go card fare for comparable distance, but that only becomes relevant to very occasional users.

[ozbob]

Daniel Bowen: Free fares: two charts

https://danielbowen.com/2024/05/26/free-fares-two-charts/