Article: Lessons noted, Connex pitches for second chance

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Lessons noted, Connex pitches for second chance

Lessons noted, Connex pitches for second chance

    * Reid Sexton
    * April 5, 2009

Jonathan Metcalfe

The rail operator says it has the right experience to run the city's trains.

CONNEX admits it could have done more to cope with Melbourne's record surge in rail patronage and the resulting passenger frustration, but it wants another chance to run the network for at least the next eight years.

As Connex fights to renew its contract before the Government's mid-year decision on who will run Melbourne's rail system, chairman Jonathan Metcalfe conceded that the organisation had made mistakes.

This Tuesday is the deadline for bids from short-listed candidates Connex, fellow French transport company Keolis, and Hong Kong metro operators MTR.

Each bid is expected to contain management procedures, new ideas and costings for Melbourne's ailing system, but potential operators are banned by the State Government from discussing them.

In the decade since Connex took over part of the network, it had boosted services but had been hampered by problems such as new trains that performed poorly, Mr Metcalfe said.

He said the decision by fellow operators National Express to abandon their contract in 2002, leaving Connex to run the entire network, had caused difficulties by forcing two systems to merge.

But the biggest problem, he said, was record patronage growth on a network neglected for decades by state governments.

New timetables had led to more than 350 new weekly services in the past year and were pushing the network's capacity to its limits.

And the passenger boom ? from about 134 million annual trips in 2003 to 212 million in 2008 ? had created problems.

"We've had more than our fair share of issues and difficulties," Mr Metcalfe said. "(But) have we made mistakes? Yes, we have. Of course we could have done more and we should have done more, but the sheer scale of (patronage growth) has been greater than anywhere in Australia or probably anywhere else in the world."

In 2003, a State Government report forecast patronage would top 200 million by 2006-07, with that figure eventually being reached a year later.

Despite the prediction, Connex added just over 300 new services to the strained network from 2004-07, a growth of only 3 per cent compared with a passenger surge of 32 per cent in the same time. During that period, the Government bought only five new six-car trains, which critics say indicates the under-investment that has marked the network for decades.

This year, industrial disputes, hot weather and crumbling infrastructure led to some of the worst punctuality and cancellation rates in the network's history.

Passengers have endured worsening conditions.

Mr Metcalfe admitted that until recently Connex had not always treated them well enough. He said more could have been done to provide cleaner trains and more information to passengers, particularly during disruptions.

Connex had tackled the problem by recently introducing new measures, including hiring more station staff and equipping them with better equipment to track trains.

The winning bidder will take over in December and oversee a system expected to deal with a further 36 million annual trips by 2011 and receive close to $10 billion if the State Government keeps its promise.

Melbourne needed a rail operator that understood the network's complexities and limitations, Mr Metcalfe said. He understood commuter frustration with the current limitations but said that experience would help with the planning to avoid it in future.

"We have developed an intimate, detailed knowledge of this network. We are at a period where there needs to be continuity. I think we can argue that because of our experience we have the capabilities."

Public Transport Users Association president Daniel Bowen said Connex had worked hard for two years to improve the system. But he said the network would probably run better if it had worked that hard since arriving in Melbourne in 1999.

RMIT transport academic Paul Mees, an opponent of privatisation, said the network's poor performance meant Connex would be made a scapegoat by Transport Minister Lynne Kosky. "Simply getting rid of them and replacing them with another private carpetbagger won't make any difference."

A spokesman for Ms Kosky said the Government would keep trying to improve the system.

The short list for our next train operator.

MASS TRANSIT RAILWAY

Hong Kong-based operator that runs the province's 10-line metro system, light rail and bus.

WORLDWIDE: Owns half the franchise to operate London Overground. Has projects in mainland China and is building a metro line in Beijing.

SIZE: The Hong Kong metro carries about 3.6 million people each weekday. MTR employed 14,134 people in 2008.

RECORD: In 2008, MTR recorded average punctuality rates of 99.9%. The worst lines recorded 99.6%. Cancellation rates averaged 0.01%.

CONSORTIUM: Includes Australian train maintenance company UGL Rail and engineers John Holland.

OWNERSHIP: Listed on the Hong Kong stock exchange. Hong Kong Special Administrative Region Government has a controlling interest.

INTERESTING FACT: If MTR wins, Melbourne's trains will be operated by a company whose controlling shareholder is the Hong Kong Government, the head of which is appointed by and answers to the People's Republic of China.
KEOLIS

France's largest private sector transport company.

WORLDWIDE: Operates trains, trams and buses in Europe and Canada and, through part-owner SNCF, most trains in France.

SIZE: Employs 38,000 people worldwide. Claims to carry 1.8 billion passengers annually.

RECORD: UK regional services average 90% punctuality. In France, SNCF had punctuality rates of 88.3% on its Parisian suburban network in 2008.

CONSORTIUM: Partners with engineers Downer EDI.

OWNERSHIP: AXA Private Equity and the Caisse depot et placement du Quebec (52%, joint participation), SNCF (45.5%), and key Keolis managers (2.5%).

WHAT ELSE THEY DO: Primarily transport.

INTERESTING FACT: Then French president Jacques Chirac declared in 2006 that no SNCF train in France would run on fossil fuel by 2026.
VEOLIA ENVIRONNEMENT SA

Paris-based multinational with interests in water, waste management, energy and transport services.

WORLDWIDE: Has commuter operations in Boston and Los Angeles and regional rail in Germany. Runs buses around Australia and Melbourne's rail service under the Connex brand.

SIZE: Transport division has 82,000 employees in 27 countries; 2.7 billion passenger trips a year.

RECORD: More than one in 10 Melbourne trains delayed since January. Customer satisfaction: 59%. Australian bus services on time 99% of time.

CONSORTIUM: Train manufacturer Bombardier. Engineers Thiess pulled out earlier this year.

OWNERSHIP: Listed on New York Stock Exchange and pan-European stock exchange Euronext.

WHAT ELSE THEY DO: Now world's largest non-government water supplier.