PTOM, the LTP, and ECans “new network”

Posted on April 4, 2012 by

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The other day Cabinet approved the new framework for urban bus and ferry services, otherwise known as the Public Transport Operating Model (PTOM). The changes are a result of a review of the Public Transport Mangement Act 2008 (PTM), which was introduced by the Labour Government prior to the 2008 election. Many aspects of the PTM have been kept, and overall it isn’t too detrimental. Fundamentally, the PTOM will change the field thus:

The introduction of PTOM represents a fundamental shift in the delivery of urban bus and ferry services. Under PTOM public transport services, that form part of the region’s urban public transport network, will be grouped together into units and provided under contract with the regional council to enable stronger network co-ordination and a basis for joint investment. This replaces the existing practice of operators being able to register single timetabled services on a route as commercial, and regional councils having to ‘contract around’ these services with subsidised services — a practice that led to poor tender outcomes and network development.

The PTOM also aims to improve value for money and increase the commercial viability of services (i.e, make services more efficient and reduce reliance on subsidies to cover costs) . The situation around single-timetables services applies more to Auckland and Wellington than Christchurch:

Current situation

14. At the moment, public transport services are delivered through a mixture of commercial and contracted services. It is up to operators to identify what services they wish to provide on a commercial basis (ie without public subsidy). A commercial service can be a single timetabled service running from one point to another (for example the 10.48 am from Smithville to the city). Regional councils then determine what other services are necessary to the urban public transport network. These services are then ‘contracted around’ the commercial services to fill service gaps.

 15. The practice of registering single timetabled services as commercial has hampered regional councils’ ability to provide an integrated public transport network and achieve network efficiencies, as these services are not under contract with the regional council and do not have to conform to service standards or fare standards. The presence of commercial registrations has also arguably contributed to poor tender outcomes (on average just over one bid per tender in Auckland and Wellington) and higher prices than in regions where competition is more robust. This has led to increased tensions between regional councils and operators.

Only Auckland and Wellington have generally used commercial registrations to register single-timetabled services rather than all the timetabled services on a route. Only 3 percent of single timetabled services in Christchurch were registered as commercial and these services were all on a few routes and covered all the timetabled services on those routes. This was due to Environment Canterbury’s decision to not accept commercial registrations for anything less than all the timetabled services on a route, something I feel helped create a much more cohesive public transport network than either the two northern cities (for example, Christchurch already has integrated ticketing). As we now know, the two commercial routes operated by Redbus were dropped earlier this year, the 29 (Airport) becoming a contracted route, and the 10 (Airport-Cashmere) being covered by amendments to other bus routes.

Canterbury/Christchurch is, of course, on of the three big metropolitan areas, and the recent earthquake situation adds a whole other dimension to the public transport equation. On progress in the three big regions, the Cabinet paper said this about Canterbury:

ECAN is in the process of implementing some aspects of PTOM as appropriate for post-earthquake circumstances. It is expecting to directly negotiate new contracts with incumbent operators, rather than going out to tender, given the significant changes to the network that are likely now and over the next 5 years. The council will use price benchmarking to assist with the negotiations. It is focussed on using a partnership approach and on growing commerciality. New contract agreements, the concept of a unit, collaborative planning, and a league table will be introduced.

So what does it all mean for Christchurch? Well, expect some big changes to the network to be announced during 2012. In fact, this is what ECan have said about upcoming changes to the Metro bus network in the draft 2012-22 Long Term Plan (LTP):

In the 2012/13 financial year we aim to introduce a new network of services that will make more effective use of resources whilst also better meeting postearthquake travel patterns and returning fare revenue to sustainable levels.

It is clear ECan are looking at shaping the bus network into a system that is both more efficient and effective. We have discussed on here many a time how to do that, by organising the network into a tiered system (here and here). For example, why have lightly patronised bus routes running through the CBD and right across the city? Leave that to the major, or “core”, bus routes with local routes feeding into that core, and frequent, network at suburban hubs. Suddenly, you bring more people into the catchment of fast, reliable (thanks to bus priority concentrated on major bus routes) and frequent public transport services, instead of wasting resources trying to connect everyone directly to a bus route that goes to the city.

I think that approach is going to be the one ECan moves toward. The trick will be to move more people with less, and when you consider the nature of some of the bus routes around the city I think there is plenty of scope to do that. Bus routes like the 15 (Bishopdale – Cashmere), which meander right across the city are a waste of resources. Something along the lines of what Wellington is proposing to do with their bus routes is probably more where Christchurch should be heading.

The focus on commercialisation and better value for money is not too bad all up, and probably sounds a lot worse than it is. I actually think it will facilitate a more effective network. Some public transport services, those that are fully commercial, will be exempt from PTOM in what is in effect a compromise with operators. This shouldn’t have much of an effect on Christchurch given the different nature of the bus system to Auckland and Wellington, and the events over the last year. The only issue I can foresee is there may be a struggle to land the 50 percent farebox recovery ratio, particularly the hit the Metro system has taken recently. However, it seems targeted rates and NZTA funding will help in the meantime to ensure the viability of the network as it attempts to “catch-up”. It is too easy to look at ECans tentative proposals for a “new network” as some type of ‘cut’ situation. I don’t think that will be the case at all. It is important to remember that ECan are determined to get patronage back up to pre-quake levels, and even surpass them, as a high priority, and they are confident they can do that while moving toward a network that is more cost-effective.

You can check out the PTOM Cabinet paper and associated information here.

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Posted in: Buses, Funding