guest post: peter brown on the decline of u.k. privatization of transit

Peter Brown is a lifelong UK transit enthusiast (and an HT reader from the earliest days).   He is a member of the Light Rail Transit Association (LRTA), and a former volunteer tram driver at Seaton Tramway, Devon, England.

Twenty six years after the Thatcher government deregulated local bus services in the UK (outside London and Northern Ireland), the calls for some form of re-regulation persist.  

The latest issue is the stated ambition of the Tyne and Wear Passenger Transport Executive (PTE), which today calls itself 'Nexus,' to restore government control of planning and management for the bus system in the Newcastle-upon-Tyne/Gateshead/Sunderland conurbation.  This is significant because for a few years in the 1980s this authority operated the UK's only example of an integrated transport system on a par with European best practise — a system that was destroyed by the Thatcher government.

Img_10384In the early 1980s, the Tyne and Wear PTE directly operated a large bus system which was formed by the takeover of the former municipal fleets of Newcastle, Gateshead, and Sunderland, and also built and operated the LRT system (The Metro).  During the short life of this integrated system it was possible to travel between any two points on a single ticket by bus, local train, Metro, and ferry services. The bus system was redesigned to feed into the metro at purpose built interchanges for journeys into central Newcastle, thus reducing bus movements across the heavily congested Tyne bridges.  
Unfortunately the Thatcher Government deregulation of bus services destroyed this integrated network.  Deregulation swept away a regulated system that had existed in the UK since the 1930s. It meant that bus companies (referred to as ‘Operators’ in the UK) had to self financing through the fare box. Blanket subsidies and any form of network co-ordination (or what Americans would call "integrated network planning") were terminated.  In short, it became illegal to think of transit as a public resource, integrated with the city, and managed for greatest possible efficiency and usefulness.

Instead, the ideal became competition.  Bus operators could operate "commercial" (non-subsidised) networks anywhere, and the role of local government became to purchase subsidized services wherever more service was desired.  Integrated transit features that many cities take for granted — including citywide fare systems, lines that aim to connect with one another, and rational management of limited resources, became effectively impossible.  
Yet if the goal was competition, the system failed.  As in most of the UK today, there is very little direct on-the-road competition between the three bus companies in Tyne and Wear.  Instead, each company has settled into a "territory" in which the lack of competition is the key to profitability.  Passenger journeys starting in one operator's territory that finish in another's require the passenger to change buses and pay twice. Nexus is no longer happy about this and wants to take over the commercial networks and purchase operations from the bus companies – this is known as a 'Quality Contract' and there is new (as yet unused) legislation to do this. 

In short a Quality Contract would involve the suspension of deregulation within a specified area and the imposition of a tendered system whereby the transport authority would specify the network, fares, frequencies etc. As urban bus operation outside London is a profitable activity (nationally approximately 90% of bus mileage requires no direct revenue support) the proponents of Quality Contracts believe that massive subsidies would not be required.  
In order to bring about a Quality Contract several conditions must be satisfied, with an independent board to adjudicate. The promoters would have to prove that the new system would:

  • have a positive impact on the use of bus services
  • will be of benefit to users of bus services by improving quality
  • will contribute to the implementation of the local transport policies
  • achieve all the above in an economic, efficient and effective manner.

 All the above leave lots of room for argument against them, and since the commercial operators would in effect have their businesses sequestrated without compensation it is likely they will use the legal process in full, including the European Court of Human Rights.
The alternative approach for a local transport authority to increase its influence in the provision of bus services is the 'Statutory Quality Partnership' as demonstrated in Oxford last year using powers from the 2008 Transport Act. 
The 2008 Act expands the terms of the previous voluntary Quality Partnership model to allow a LTA [Local Transport Authority — the tier of local government responsible for transport] to specify requirements as to frequencies, timings or maximum fares as part of the standard of service to be provided under a scheme, in addition to quality standards. But it also provides important safeguards to ensure that unrealistic conditions are not imposed on operators, and that their legitimate right to a fair commercial rate of return on their investment is not undermined. The process by which an operator can object to particular standards included in a scheme relating to frequencies, timings or maximum fares, is an important feature of this. But at the same time it places a responsibility on them to justify the grounds for their objection, thus minimising the scope for vexatious or frivolous objections.

In the context of Oxford, where such a scheme was implemented last year, there is no history of municipal bus operation. This could account for the partnership approach being more acceptable to that LTA.

Photo: Simon Billis 

new york ferries: the first smartphone payment system for transit?

Ny waterway

That's what I'm being told about the new fare system at the Hudson River ferry operator New York Waterway.  You can now buy a ticket using your smartphone and then use the phone itself to present the ticket to the fare reader, similar to the "digital boarding passes" already used by airlines.  No paper required.  Expect this to spread in high-end commuter markets.

It would be great to see this spread in urban bus transit, where boarding times are still a dominant problem, but that will rely a very easy-to-use app and compatibility with smartcard media now under development.  My guess is that we'll get a ubiquitous commercial smartcard-creditcard first, which will do the same job.

Photo: Hoboken Condos

information request: fare revenue impact of free transfers

We're looking for case studies in which:

  • A transit agency that had been charging for transfers (changing from one transit vehicle to another) eliminated that charge.
  • No other major changes happened at the same time.
  • A result could be measured in fare revenue, and also ridership.

If anyone's familiar with cases, or with studies of this issue, please let me know.  Thanks!

frequent-rider discounts to decongest the peak?

Just in from the Aspen Ideas Festival, via Alexis Madrigal at the Atlantic.  Stanford Electrical Engineering and Computer Science Professor Balaji Prabhakar thinks he has the solution to peak overcrowding.

The frequent commuter program has two goals. One is to increase people's loyalty to the public transport system. We want people to be disloyal to their cars, to cheat on their cars. And the second major goal is to decongest the peak time trains and buses. The problem is that it is unpleasant to take a trip during the peak time. If we could achieve both goals with the frequent commuter project, it would be great.

The nice thing about this project is that it is going to do exactly what the airline miles do. You take a 10 kilometer trip, you get 10 credits. And Singapore can measure the kilometers. But if you make that same trip in the off-peak time, you'll get 30 credits. This creates new bonding between you and the system. People don't think of the indignity of taking a three-stop trip on their preferred airline versus a direct cheaper flight sometimes. In fact, they see the angle as, "I'm earning more miles."

Does anyone with regular experience in transit think this is a good idea?  If so, I'd like to hear.  My first reaction:

This sounds like a very very complicated way to do discounts for off-peak riders, and to reward very regular riders.  The fact is, the transit industry already has a system for rewarding frequent riders; it's called a monthly or annual pass.

A simpler solution to the peak overcrowding problem is to provide discounts for off-peak trips, as Seattle, for example, has done for decades.  This costs very little to administer and has the desired effect much more directly. 

When the need for sheer service is so urgent, why would a transit agency take on the massive administrative cost of a frequent-rider program, when the same money could go into driving buses and trains instead? 

I'm sure transit professionals will appreciate the interest from the "big ideas" people.  But from Madrigal's summary, this idea sounds like a fun metaphor inappropriately applied, suggesting the lack of any technical understanding of the transit capacity problem.

But I'm curious what others think …

Connection Fare Penalties: Why They Happen

Is it fair to have to pay more if your trip requires a transfer or connection?  I’ve argued that it isn’t, but I also have an appreciation of the difficulty of eliminating these penalties.  So when complaining about a fare penalty, try to understand the situation from the transit agency’s point of view.  Not because they’re right and you’re wrong, but because you many need to help them solve the problem that it presents for themContinue Reading →

The Peril of Low Base Fares

Are transit fares in Los Angeles cheaper than in San Francisco?  That’s the impression you’ll get from a direct comparison of the base adult cash fare.  The travel blog Price of Travel just compared the base fares of 80 major tourist cities around the world and noted that, while San Francisco Muni’s base fare is $2.00, that of the Los Angeles County MTA is $1.50. Continue Reading →

The Horrors of “Transferring” in 1974, and a Happier Future

Connections, or transfers as North Americans depressingly call them, are the foundation of a simple, frequent transit network that’s there whenever you need it.  I laid out the basic argument here, but in brief, a transit system that tries to run direct service from everywhere else (so that nobody has to make a connection) ends up as a confusing tangle of hundreds of overlapping lines, few of which are frequent enough to rely on or simple enough to remember.  Continue Reading →

Guangzhou Abandons Free-Fare Experiment

Guangzhou, the southern Chinese megacity that is to host the 2010 Asian Games this month, has abandoned a plan to offer free public transit while the Games are on.

The plan was to ban half of all of the city’s private cars from the road each day (using an “even-odd rule,” a scheme by which certain license plates can be used only on certain days), and also to ban traffic unrelated to the Games from certain roads.  In return, public transit would be free during the Games.  Continue Reading →

Guest Post: Aaron Renn on Universal Fare Media

(Aaron Renn, who writes The Urbanophile, is an opinion-leading urban affairs analyst, consultant, and speaker, based in the US Midwest.)

When I’m at home, I ride bus and rail transit about equally.  But when I travel to a new city, I travel on rail systems frequently, but almost never use the bus.  Why?

For me, while I know how transit systems generally work, the specifics of fares and fare media are different from place to place. I know that if I show up at a rail station there is likely to be a station house where I can look at maps, read about fares and rules, and use nice machines with step by step instructions for purchasing tickets or other fare media.  Continue Reading →