Fare Review for TransLink South-East Queensland now! - Petition

[Gazza]

Quick clarification of what Simon an I mean.

The per trip subsidy is just the Translink service budget divided by the number of trips taken on the network in a set period (year? quarter?) The fares collected over the same period are then applied to that to work out how much of the running costs they are covering.

Its not a fixed number, because the calculation depends on total patronage in the end. Remember that the original intent behind the fare hikes was a target to reduce the average per trip subsidy from 75% to 70%, but because patronage dropped they failed to achieve this (See the trackers)

I stress that the per trip subsidy is not a "ka-ching, ka-ching" type thing that happens everyone time someone sets foot on a bus/train/ferry. (Eg every time I touch on on a bus its not magically costing the govt a set $6 in subsidy there and then)
If that were the case it would mean that a fully loaded bus would have more subsidy than one with a single person on it.

Point is, operators are paid based on services run/service km, not based upon patronage.

All the services running at present have already been paid for, it doesn't make a real difference at all in running costs if they are full or empty.

So for the free trips being taken, we are missing out on the fares, but its not costing us any more in terms of running costs/subsidy.

Simon is correct.

[ozbob]

That would be the case if the paid journeys were maintained but they are not.

There is a decrease of 150,000 per week in the paid journeys.  This is a real cost, and as TransLink themselves report each trip costs $6.72 the free trips that displaced the paid journeys still cost the same (probably more in a sense) in the subsidy as the paid journeys, but also the additional loss of the nominal fares. 

[Gazza]

Loss of revenue ... which in turn is increasing the subsidy.

Yes but 'subsidy' is a measurement metric of how the system is performing financially.
You don't use the subsidy percentage in reverse to calculate what something is costing.

[ozbob]

But it does have  cost.  If there were a million trips per week you are saying it doesn't have a cost?

The subsidy is of course an average figure.  To argue that the free trips don't cost in terms of subsidy as paid journeys is not correct. They do of course.  And it has already been reflected in the falling fare box ratio.

A paid trip or a free trip still has same nominal subsidy.  The only difference is the paid journey also has a fare component.  As the free trip numbers increase the fare component is further diluted and the subsidy for each trip actually increases.

[Gazza]

That would be the case if the paid journeys were maintained but they are not.

There is a decrease of 150,000 per week in the paid journeys.  This is a real cost, and as TransLink themselves report each trip costs $6.72 the free trips that displaced the paid journeys still cost the same (probably more in a sense) in the subsidy as the paid journeys, but also the additional loss of the nominal fares.

$6.72 is just the figure you get when you combine all of TL+Operator out of pocket running costs and divide out by the number of pax.

"Subsidy" is just a fancy way of saying "running costs that didn't end up being covered by fares".

The actual hard running costs of services is fixed (Well, it increases year by year with inflation, but you get what i mean)

When they budgeted for this program, they would have budgeted solely for the fares being foregone. There's no need for them to account for anything else because its already accounted for under other parts of the budget, and because the activity of passengers paying or not isn't going to influence how much a bus costs per hour to run, or how much money QR needs to maintain tracks etc etc.

The magic $6.72 was always an out of pocket cost for government regardless.
It was never being covered, even if the passenger was paying full fare!

How is it an additional cost of the program making it go over budget? Its not.

[ozbob]

I understand what you are saying.  But a trip, whether free or not does cost.  They might budget for just the presumed fare loss (under estimate because the free fares would be biased to high zone fare loss as well) but in reality the real or actual cost is both subsidy and fare loss. 

[Gazza]

If there were a million trips per week you are saying it doesn't have a cost?

Only in terms of lost fares, but not in terms of the money needed to allocate to QR, BT, Surfside, Veolia etc to run services.

If there were a million trips free per week you'd lose $2,080,000  from the fares (Average fare is $2.08) but nothing else.

All that would happen is that TL would have $2,080,000 less to cover the money they already gave to operators to run the services.

[Gazza]

But a trip, whether free or not does cost.

Of course! But Mr Emmerson has no need to worry because the cost of actually providing the trips already has been paid for.

[somebody]

But it does have  cost.  If there were a million trips per week you are saying it doesn't have a cost?

Only in the senses of the (a) the additional service-km required and (b) additional time for boarding/alighting.  The latter point isn't really worth talking about.

The fact remains that a lot of the peak buses in Brisbane run around with loadings which would see service reductions in Sydney, and quickly.  Trains aren't generally overcrowded either.  There is heaps of slack within the system for additional patronage, and I'm not sure where you are coming from.

[Gazza]

but in reality the real or actual cost is both subsidy and fare loss.

But the 'subsidy' would have to be paid out regardless of wether people are travelling or not, or else we wouldn't have buses or trains in the first place!

Face it, the only two figures that matter are:

-Amount collected from fares.
-Amount paid to operators to run services.

The subsidy is just the thing in the middle that gets calculated after the fact.
Subsidy figures cant be calculated without those two critical numbers above you realise?

The additional service-km required

I doubt we've had to run extra services as a result of the policy though lol?

[ozbob]

If you like then a budgeted cost and the real cost.

Just assume all trips are free, present costs and numbers.  The real cost then of each trip would then be equivalent of $6.72 + $2.80 = $9.52 

Semantics maybe, but it confirms the base premise.  Free trips cost.

[Gazza]

Semantics maybe, but it confirms the base premise.  Free trips cost.

Who cares though? How is it blowing the budget of the election promise?

The trains are still gonna run every 15 minutes to Darra, empty or full right?

[ozbob]

Semantics maybe, but it confirms the base premise.  Free trips cost.

Who cares though? How is it blowing the budget of the election promise?

The trains are gonna run every 15 minutes to Darra, empty or full right?

Probably is as the fare box is going down.  The whole point is to try to get a better fares in place.  If they stick with the 9 and free, highly probable then they should take steps to cap it.  People will still get a good deal after 9 paid journeys, but the outright rorting will be brought under control.  Perhaps then they can correctly price the smaller zones, get zone inconsistencies sorted, and look at other initiatives.

[Gazza]

Probably is as the fare box is going down.

$9,000,000+$7,000,000 was allocated to it for a total of $16,000,000.
So at an average fare paid of $2.08 , it has the capacity to give out 7,692,307 freebies per year, or 147,928 per week.

Until we tip that point then that's all the program is costing...$16 mil worth of the government paying fares for us.

[somebody]

We'll have a better idea when/if the Tracker for the Sep Qtr is released.

[Gazza]

Indeed.

But Bob I still don't get why you'd attribute the running costs of the services free trippers are using to the actual cost of the program? The services are scheduled to run regardless.

The other night I saw the penultimate outbound 468 go past with nobody on it.
Does zero passengers mean zero subsidy or something? LOL.

[ozbob]

Outlier ... 

Free trips were running around 200,000 per week July to September this year according to the Minister.

Already negative, and don't forget the free trips are probably biased to higher zone freebies as well.

[ozbob]

You might argue that free trips don't appear add to additional costs.  But a point is reached where they do.

Translink state clearly that each trip is subsidised x dollars (that presumably includes paid and free trips btw).  You cannot then logically state that each free trip doesn't cost.  To properly cost the free trip program the effective subsidy and foregone fares should be used, not just the forgone fares.  We can argue this forever, but as I showed earlier if 100 % of the trips was free they clearly cost.  They cost nominally whether 1% or 100%. 

[Gazza]

Already negative, and don't forget the free trips are probably biased to higher zone freebies as well.

Consider though that there aren't that many high zone travellers anyway.
I think we do need to watch how many people end up using it in the end, but I don't reckon its going to be a massive amount over what they were predicting....Maybe an extra $5 mil needed?

You might argue that free trips don't appear add to additional costs.  But a point is reached where they do.

Only when they need to start running extra services to cope with free trippers...Maybe if city loop buses got overloaded with people doing lunch trips :?

Translink state clearly that each trip is subsidised x dollars

Which is an average over a set time period, not tied to individual trip makers.
Like I've said a few times now, if they way you are thinking about it was true, a bus with 10 people would need 10 times the subsidy (10x$6.72) as one with 1 person on it (10x$6.72) , and a bus with zero passengers needs no subsidy (0x$6.72) . Which is clearly wrong.'

To properly cost the free trip program the effective subsidy and foregone fares should be used, not just the forgone fares.

And if you want to account that way, thats cool, but to be correct, at the same time you'd subtract the subsidisation provided to 'free' passengers out of the column dealing with the subsidy provided to 'paying' passengers.

But in the end, what's the point? Why sweat over it? It's still the same net impact on the state budget.

The only impact of this program on the state budget is the $16 Mil (Or $20 mil or whatever if it ends up being too popular)
That's it, nothing extra, case closed.

[ozbob]

They are average figures.  It does cost and will continue to climb as more people work out how to maximise the free after nine.

A paid journey costs the same as a free journey in terms of subsidy - forgone fare notwithstanding.  That is the reality.

[Gazza]

You cannot then logically state that each free trip doesn't cost.

Actually, I can.

Each time a free passenger boards, you would have the cost in terms of foregone fares.

But there is no on the spot cost of actually conveying the extra passenger turning up. It's not a taxi.

Why? Because the operator already received a lump sum to make services available. The bus or train costs per hour to run, not per passenger.

TL has missed out on a bit of extra money to cover costs of that service through providing it 'fare free', but they aren't facing extra costs in service provision, pre fare revenue.

[Gazza]

t does cost and will continue to climb as more people work out how to maximise the free after nine.

Ok then, give me some examples of the additional costs operators will be faced with due to more free passengers jumping board.

[ozbob]

t does cost and will continue to climb as more people work out how to maximise the free after nine.

Ok then, give me some examples of the additional costs operators will be faced with due to more free passengers jumping board.

Because it is displacing paid trips with free trips.  A point you have missed out on.

A trip costs in the broad sense whether it is free or paid.  Transporting a passenger who has paid or not has the same subsidy or operational cost on average, the free passenger more because of the foregone fare. 

A bus with 20 fare paying passengers has the same operational cost (plus fare loss) as a bus with 20 free trip passengers  if you like.

[somebody]

I think you've just disproved your argument.

[ozbob]

I think you've just disproved your argument.

No I haven't, I have just explained it so it is very clear.

[Gazza]

Because it is displacing paid trips with free trips.  A point you have missed out on.

And all that is is forgone fare revenue. The thing the election promise accounted for, nothing else!
Why inflate it to make it sound worse?

Its not pushing the budget for fuel, drivers, cleaners, maintenance etc any higher than it used to be, which are the main components of the subsidy.

[Gazza]

The only thing this policy will do is require an extra $16-20 million per year, depending on the number of free trips taken in the end.
It will push and pull the subsidy percentage a bit, but that doesn't have an outward impact in itself on other things, its just a measurement.

But the out of pocket cost to Qld taxpayers is $16-20 million of this policy compared to what it was like when we didn't have it.

Nothing more, cant argue otherwhise.

[ozbob]

Leaving aside the semantics, what concerns me is the fact that this is being touted as the solution to affordability, in conjunction with a 7.5% fare increase.

Whilst this leakage is going on what chance is there to get the fares correctly repositioned in terms of price?  Probably none.  So I expect we will see the free trip count progressively climb.  People will work out how easy it is to do  three journeys on the way to work, and three on the way home using a couple of go cards. Main and backup.  Any with half a brain should be able to get themselves on free travel by Tuesday if they really plan it out well.  Is this really a good thing? 

[Gazza]

This means that actual paid public transport trips is reduced by 150,000 per week.  This is a significant fare box leakage.  The real cost of this is approximately [$6.72 (subsidy) plus forgone average fare $2] by 150,000 per week = $1.3M dollars per week.  Which is equivalent to $65 million per year!  This around 7 times the budgeted cost.

Lets assume the program will be closer to $20 mil in free fares given out, not $16 Mil.

Point is, you said right there $65 million would be the true cost, which gives the impression the government has to scratch around for another $45 million it didn't have to previously.

Which is false.

[ozbob]

Read what I said, I said the real cost will be $65M.  And that is pretty close to the mark in proper accounting practice.

I have not been challenged by Government or TransLink either on this point, because it is the real cost.

[somebody]

I've read it, and I reject it.

[ozbob]

I've read it, and I reject it.

Good for you!  I don't ...

[Gazza]

Read what I said, I said the real cost will be $65M.  And that is pretty close to the mark in proper accounting practice.

I have not been challenged by Government or TransLink either on this point, because it is the real cost.

Even if its the real costs, its not really consequential.

The Govt wont have to scratch together whopping extra $65 mil,
It'll only be perhaps $20 mil or so.

[ozbob]

Yes, I accept that.  It will be reflected in the subsidy etc. Be interesting to see if they continue to release the free trip numbers ....  but as time progresses it will become more of a drain ...  money that could be used for a more balanced fare price regime for a start.

[ozbob]

From The Senior January 2013 page 14 Letter to the editor

We can't always travel off peak

[somebody]

Maybe they should go to NSW it is so good then.

[ozbob]

Sent to all outlets:

8th January 2013

Fare Review for TransLink South-East Queensland now! Petition

Greetings,

Our petition, Fare Review for TransLink South-East Queensland now!  http://www.gopetition.com/petitions/fare-review-for-translink-south-east-queensland-now.html
Continues to gain hundreds of signatures.

Anyone who seriously thinks there is not a major issue with the TransLink 5 year fare strategy is on another planet.

Time to act in the best interests  of the economy, and for the community, and initiate a proper fare review.

Best wishes
Robert

Robert Dow
Administration
admin@backontrack.org
RAIL Back On Track http://backontrack.org

[ozbob]

Sent to all outlets:

10th January 2013

Re: Fare Review for TransLink South-East Queensland now!  Petition

Greetings,

It is clear to everyone except, at least publicly, Ministerial advisers and staff that the TransLink Five Year Fare Strategy is off the rails folks.

If you doubt that, peruse these articles and blog comments:

Brisbane transport a zonal offence http://www.brisbanetimes.com.au/queensland/brisbane-transport-a-zonal-offence-20130109-2ch07.html

How do we fix public transport in Brisbane?  http://www.brisbanetimes.com.au/queensland/how-do-we-fix-public-transport-in-brisbane-20130108-2cey5.html

It is time to sort it.  Forcing people off public transport is a disastrous outcome.

Best wishes,
Robert

Robert Dow
Administration
admin@backontrack.org
RAIL Back On Track http://backontrack.org

Sent to all outlets:

8th January 2013

Fare Review for TransLink South-East Queensland now! Petition

Greetings,

Our petition, Fare Review for TransLink South-East Queensland now!  http://www.gopetition.com/petitions/fare-review-for-translink-south-east-queensland-now.html
Continues to gain hundreds of signatures.

Anyone who seriously thinks there is not a major issue with the TransLink 5 year fare strategy is on another planet.

Time to act in the best interests  of the economy, and for the community, and initiate a proper fare review.

Best wishes
Robert

Robert Dow
Administration
admin@backontrack.org
RAIL Back On Track http://backontrack.org

[ozbob]

Sent to all outlets:

11th January 2013

Re: Fare Review for TransLink South-East Queensland now!  Petition

Greetings,

Our petition calling for a fare review is receiving more strong support.

Our petition, Fare Review for TransLink South-East Queensland now!  http://www.gopetition.com/petitions/fare-review-for-translink-south-east-queensland-now.html

More compelling evidence why it is needed.

Public transport suffering from investment in roads: report

Read more: http://www.brisbanetimes.com.au/queensland/public-transport-suffering-from-investment-in-roads-report-20130110-2cj8x.html

Best wishes
Robert

Robert Dow
Administration
admin@backontrack.org
RAIL Back On Track http://backontrack.org

Sent to all outlets:

10th January 2013

Re: Fare Review for TransLink South-East Queensland now!  Petition

Greetings,

It is clear to everyone except, at least publicly, Ministerial advisers and staff that the TransLink Five Year Fare Strategy is off the rails folks.

If you doubt that, peruse these articles and blog comments:

Brisbane transport a zonal offence http://www.brisbanetimes.com.au/queensland/brisbane-transport-a-zonal-offence-20130109-2ch07.html

How do we fix public transport in Brisbane?  http://www.brisbanetimes.com.au/queensland/how-do-we-fix-public-transport-in-brisbane-20130108-2cey5.html

It is time to sort it.  Forcing people off public transport is a disastrous outcome.

Best wishes,
Robert

Robert Dow
Administration
admin@backontrack.org
RAIL Back On Track http://backontrack.org

Sent to all outlets:

8th January 2013

Fare Review for TransLink South-East Queensland now! Petition

Greetings,

Our petition, Fare Review for TransLink South-East Queensland now!  http://www.gopetition.com/petitions/fare-review-for-translink-south-east-queensland-now.html
Continues to gain hundreds of signatures.

Anyone who seriously thinks there is not a major issue with the TransLink 5 year fare strategy is on another planet.

Time to act in the best interests  of the economy, and for the community, and initiate a proper fare review.

Best wishes
Robert

Robert Dow
Administration
admin@backontrack.org
RAIL Back On Track http://backontrack.org

[ozbob]

1000 barrier looms ...