With public transport free today, it looks like some are taking advantage — there seemed to be more Seniors on the train this morning, enjoying a free trip into the city (even though it’s only $3.40 normally).
But overall the train wasn’t markedly more crowded than usual, and it’s not like everyone abandoned their cars for the day.
Many simply don’t have PT that is anywhere near time-competitive with driving, even if it’s free.
So what’s the real cost of today’s Fare Free Friday (making up for, as one wag put it, No Trains Tuesday)?
The Minister said it would be “something upwards of $1 million”. I think it’s closer to two million.
How much is fare revenue?
Fare revenue formulas have changed now, and I haven’t dug around to get more recent exact figures, but the old formula from last year is a quick easy way of checking it. The old formula was a 40/40/20 split; 40% to Connex, 40% to Yarra Trams, and 20% to the government to pay for buses.
Page 7 of Track Record 40 (July-Sep 2009, the last full quarter before the new contracts came in) shows a farebox payment of $60.95m to Connex for the quarter ending Sep-09, that being their 40% share.
That makes total metropolitan revenue for the quarter about $152.4 million, or about $609 million per year. (One could use the exact payments made to them during 2009, but there’s a steady upward trend as patronage increases, so it’s probably fairer to use the last quarter figure x 4.)
Page 8 also shows the V/Line fare revenue, which is $18.19m for the quarter (again, it’s trending upwards), or about $73 million for a year, making total metropolitan+V/Line revenue about $682 million.
So how much is free travel costing today?
Divide that by 364 days per year (because Christmas Day is always free) and you get $1.87 million — and that assumes that weekday revenue is the same as weekend, which it isn’t.
How about we assume that weekday revenue is 50% higher than weekend (though it’s probably much higher). Taking into account ten public holidays, that would make it $2.09 million for a weekday, and $1.39 million for a weekend day.
One could theorise about how many people will inadvertently touch-on or validate and end up paying, and how many weekly/monthly/yearly and V/Line ticketholders will be claiming their free day’s travel.
And one could also theorise that Authorised Officers (who check tickets) may not be rostered-on, or may take the day off, since they would have nothing to do — though in fact a large number of them help with general customer service at big events like tonight’s football (another reason more revenue will be lost today than the average day) and planned disruptions for improvement works.
Some people may have moved their trips/outings/errands from another day to today, adding to the lost revenue.
All in all I think it’s not unrealistic to say it’s probably around $2 million in cost to run PT free today.
Could the money be spent better? I have no doubt people will claim their compensation, and some will enjoy travelling free today. And politically, the government had to eat humble pie. But I wonder if that $2 million might have been better spent on maintenance or upgrades, or planning to make the network more resilient to be able to isolate faults better in the future.
(Heck, a few more free days would pay for a station at Southland.)
Another thing: the free PT debate
The above figure of $682 million per year is the shortfall you’d need to make up if you made public transport free all the time. Less costs of Authorised Officers (inspectors) and running the ticket system ($135 million per year for the next ten years, and theoretically about $50 million after that). Let’s say about $500 million per year in funding you’d have to find to make the system free.
And as illustrated by the picture above, plenty of people would still drive — even into the CBD, because they don’t have good enough services to use, at any price.
- PTUA: Myth: Making public transport free will encourage use
- Weekly/Monthly/Yearly and V/Line ticketholders: Claim your compensation