More on the bus saga…

Posted on November 9, 2010 by

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I found this editorial on the Press website today. Certainly one of the more sensible pieces on this issue in the media:

OPINION: Anyone who travels on buses in Christchurch will know that whenever a route is transferred from one service provider to another there can be hiccups.

If a flurry of complaints from bus passengers is anything by which to judge, the transfer last week of several routes from the Christchurch City Council-owned Red Bus company to the rival Leopard Coachlines has been more than usually difficult.

But this does not necessarily mean the system by which routes are tendered is flawed, or that the problems with the new provider should be anything other than temporary.

In fact, Leopard appears to have been hit by an unfortunate and unforeseeable set of adverse circumstances. Certainly, this episode cannot be exploited, as some politicians might be inclined to do, as an argument for shifting responsibility for administering public bus services from Environment Canterbury to the city council.

Red Bus lost six routes to other operators in the latest round of tenders conducted by ECan (before Government-appointed commissioners took over). Three rival companies – Leopard, Christchurch Bus Services and Ritchies Transport – won the five-year contracts, presumably by persuading ECan they could provide as good or better services at a lower price.

The requirement that services be retendered regularly is, of course, a way of ensuring that ratepayers and taxpayers are getting the best value for the large sum of their money that is spent on them. Nowhere in the world does public transport pay for itself from passenger revenues, and bus services in Canterbury are no exception. Passenger fares provide only about half the cost of running the system. In the absence, therefore, of the free market to provide discipline to the business, tenders are the next best system. In this case, there is nothing to suggest that the tender process was anything other than fair. That is borne out by the fact that Red Bus made no complaint about it, although it suffered a stiff blow to its business and had to lay off a substantial number of staff.

There is a twist in the latest round in that the successful tenderer against Red Bus for three of its routes was Leopard. Twice in the past decade, the two companies have attempted to merge. The proposals have been rejected by the Commerce Commission because they would have substantially lessened competition.

It is unfortunate Leopard has had to begin its service on the new routes it has won with some buses that are less modern than the latest models its predecessor used.

// According to its chief executive, Brent Early, the company placed a large order for new ones, but its supplier, DesignLine, facing difficulties of its own, has not been able to complete the order. Red Bus, according to Early, declined to negotiate the short-term hire of its surplus vehicles at market rates to Leopard.

Red Bus must know its own business, but whether this is the most appropriate way for a city council-owned operator to work is debatable.

These problems, however, cannot be allowed to become long-term excuses. ECan must ensure they are overcome as quickly as possible. ECan is committed to promoting efficient, user-friendly public transport and patronage has been growing. This growth must not be blighted by anything second-rate or shoddy in the service.

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Posted in: Buses, Christchurch