Wellington public transport users face a 3% increase in their fares this year and the capital’s council is fretting about how it’s going to deal with mounting public transport costs. at a time too many people have been put off using the present trains.
It’s proposing a 2.2% increase in rates for the next year but a report to the council meeting on the rates issue has revealed a shock over the cost of its contract with Tranz Metro for the suburban train service.
The report revealed that
- The latest budget estimates from Tranz Metro show increased costs of $2.4 million. Greater Wellington’s share (the regional council) is $963,000.
- The council has to make up the difference to the operator between fare revenue and actual costs.
- Patronage on trains continues to drop because people are put off by the unreliable service, compounded by the work on getting the service ready for the new electric trains
- The council said further work “is to be undertaken to agree a budget with Tranz Metro.”
- The cost of maintaining rail rolling stock is forecast to increase because of increases in the fleet size with the arrival of the new Matangi EMUs in 2010/11, and the maintenance requirements of those trains.
- For budget purposes, a 3% public transport fare revenue increase has been forecast during the next financial year.
- The council has said it will be in serious trouble if passengers don’t return to the trains
A drop in Wellington passengers has deepened the problem
Council chair Fran Wilde says that the council still plans to deliver those major public transport improvements, as well as better flood protection to affected communities, “but we have tightened up spending in other areas and focused on being as efficient as possible.
“If contracted or committed spending associated with the new Matangi trains, real time public transport information and additional flood protection was removed, Greater Wellington would be proposing a rates decrease of 2.4% for the 2010/11 year, such being the extent of cost management throughout the organisation. Transport upgrades and flood protection will continue to have a significant impact on our budget in the next few years.
“We will need to see how we can manage the 9.4% rates increase projected for the 2011/12 year, again without being able to change the contracts in place for major capital items.”
Ms Wilde says unexpected risks in the coming year which could affect all this included “ movements in oil prices and interest rates and rail track access charges and infrastructure costs.
And we’ll see more and more councils wrestling with the problem of funding public transport, thanks to the new Government farebox recovery plan. That’s the revenue collected from public transport passengers. A farebox recovery ratio measures the contribution fares make to the cost of providing public transport services, and is typically expressed as a percentage. This as government money shifts to building more motorways.
We should see an announcement any day about the details of Auckland’s bus and train fare increases.
FAREBOX RECOVERY PLAN; Earlier concern
Farebox – The Trojan Horse
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8 Responses to “Commuters, Ratepayers Hit In Wellington’s PT Cost Crisis”
Auckland, NEW ZEALAND
am annoyed as this is seems a bit one sided as anyone catching the train on a daily basis can tell you… its no surprise costs are way up because the tranz metro service is being forced to buy thousands of bus services while all these rail track upgrades are done for new trains and tranz metro is also being forced to run its old trains into the ground rather than upgrade them while we all wait for fancy untested new trains to turn up!!
everytime work is done on the track, something goes wrong, and they are ALWAYS working on the track. its no wonder we’re are opting to use our cars…
what council needs to do is renegotiate the contract with the tranz metro service and give the railway more control over its own destiny and incentives to take charge and deliver, it seems like their hands are tied at the moment
@Cierat Good points
I think once the new trains come online a lot of these problems will go away.
@rtc Absolutely. Wellington, like Auckland is going through pain but when it comes out the other end, it will be fantastic. Those new trains, and other infrastructure changes.
I enjoy riding the trains in the capital.
I think once all the work is done and there are no longer regular bus replacements and disruptions passenger numbers will climb again.
So, has anyone asked themselves the obvious question?
Why doesn’t the GWRC own & run Wellington trains, instead of guaranteeing a profit to Tranz Metro?
How bizarre that any company should be allowed to make (publicly subsidised) profits on a natural monopoly, and if they stuff up and lose money, the ratepayers and patrons have to pay more to help the company break even.
Another failed corporate PT model.
And surely the rail upgrade contracts include penalty provisions for contractors messing it up all the time (as Cierat indicates)? So the contractors cover all the costs of their mistakes. Right?
When the new trains is in service and running smoothly. that’ll attract more people than what they just lost.
WTG Tranz Metro, have bought a car and am sticking to it, its actually cheaper for me to travel by car than train and I actually get there on time and in a shorter timeframe. Where is the incentive to use public transport.